Ubisoft games - poster children for piracy?

[dps]

Nowadays, the consoles are the high-powered machines, outperforming all but the $1,000+ gaming rig PCs.

That's nonsense. It might have been true when they originally launched but the consoles tech is about 6 years old.

And if the piracy rates are any indication there is indeed a large market share of people who can both play these games and the desire to do so.

Well, yeah.  If a game is pirated a lot, that indicates that there are a lot of people who want to play the game but who aren't willing to pay the cash price for it.  Common sense should tell us that some of those people aren't willing (or not able) to pay for the game at all and aren't going to get it if they can't pirate it, but also that some of the would pay for it if it were more difficult/costly to pirate.  So of course there's not going to be a 1:1 correspondence between pirated copies and lost sales, but there's going to be some correlation.  And I have major doubts that anyone knows what that ratio is (and in fact, I rather suspect that the ratio varies a great deal from game to game--actually, I'd be very surprised if that wasn't the case).

[Razgovory]

Even if we use an absurdly low number like Berkut suggested it still adds up to a major loss.  I don't think profit margins in that industry are so great that they can shave off several million dollars easily.  Some bigger releases can, but most probably can't.  40% in sales could easily mean the difference between a profit and a loss.

[Berkut]

The thing is that the more piracy becomes easier, the lower the bar to piracy becomes (obviously).

Lets say at some given level of difficulty, 100,000 people will pirate some game. Of those 100,000 people, the ones who would pay for the game in some fashion might be some constant, lets say it is y lost revenue due to people who would pay some portion of the purchase price if they could not pirate it.

Some people would pay full price, some some portion of the full price, some very little. But if you average them all out over those 100k people, you get some number. For arguments sake, lets assume that y=$1.00 for our example. If the bar for piracy was so high that it was effectively impossible, then we would see an additional $100,000 in revenue for our product from increased sales/recovered costs, etc.

I submit that if you lower the bar such that the set of people able to pirate becomes 200,000, then the value of y declines. In fact, I would bet that as the bar for piracy becomes lower and lower, the value of y declines as well - the additional thieves who become pirates when the bar lowers enough are generally people who are LESS likely to actually pay for the game.

Obviously the total dollars lost still goes up anyway.

However, as the number of people pirating a title rises, I bet the overall sales for that title rises as well - because what drives relative piracy rates is almost certainly relative desirability rate (assuming ease of piracy is constant across titles, of course). Therefore, the cost of piracy expressed as a fraction of realized sales likely declines as total sales and piracy rates increase.

Which is why our example of Crysis is so telling - even though it was pirated at an incredible rate, it still made a lot of money, because all those additional pirates are more and more likely to be people who were not willing to pay much at all for the game anyway.

I think this is all pretty well understood by game developers. Which is why they are willing to use DRM to raise the difficulty bar - because it means that less people who are willing to pay will pirate. They have to balance that with pissing off their regular customers though. And THAT is why they have a vested interest in over-stating the financial problem as much as possible. The greater perception of "woe is us, we are not going to be able to develop PC games anymore because of the nasty pirates!" that exists among the paying customers, the more they will tolerate invasive DRM that raises the difficulty bar, and justifies the developers efforts to reduce piracy.


But the idea that there is a fixed revenue per additional pirate is almost certainly false - the 5th million people pirating Crysis do not represent the same amount of potential loss as the first million people.

[Barrister]

However, as the number of people pirating a title rises, I bet the overall sales for that title rises as well - because what drives relative piracy rates is almost certainly relative desirability rate (assuming ease of piracy is constant across titles, of course). Therefore, the cost of piracy expressed as a fraction of realized sales likely declines as total sales and piracy rates increase.

And I would bet the opposite - that as piracy increases, number of sales decrease.

[frunk]

I think Berkut is right in this.  Just about every non-MMO game gets pirated.  The rate at which non-popular low selling games is pirated is way lower than popular large selling games.

The same goes for movies, music, everything else.  The popular acts and movies (the ones that make more money) get pirated more frequently.

In all of these cases the marginal cost of the producer to make another copy is pennies compared to the price they sell it at.  Most of the cost of production is in paying for development of the original product not the duplicates.  The same reason why it is easy to pirate is also the reason it is easy to distribute widely.  It's also why movies, music and games have been pushing towards bigger and bigger blockbusters in sales.  It's better for them to have fewer big selling titles than many, individually expensive ones.

It's also why they so jealously protect their copyright.  It's way cheaper to sell a dvd for a movie that was made years ago than to go out and make a new movie.

[Berkut]

However, as the number of people pirating a title rises, I bet the overall sales for that title rises as well - because what drives relative piracy rates is almost certainly relative desirability rate (assuming ease of piracy is constant across titles, of course). Therefore, the cost of piracy expressed as a fraction of realized sales likely declines as total sales and piracy rates increase.

And I would bet the opposite - that as piracy increases, number of sales decrease.

There are numerous examples that disprove this - the most popular games in sales are the most pirated as well.

Which makes perfect sense. The more people want a game, the more will buy it and the more that will pirate it.

[Razgovory]

Actually this is why example of Crysis is so useless (or relying entirely on one datum point as Berkut has done).  Profit on a game means reaching a certain threshold.  The threshold is met by total games sold, not a percentage pirated.  So if Crysis sold enough for the threshold but was pirated it a trillion times it still makes a profit.  However, piracy still represents some percentage of sales lost.  If we use Berkut's number of 1/50 that makes 40% loss of profit for Crysis. If Crysis is making two dollars for every dollar spent on but loses 40% due to Piracy then it still successful.  For another game that only barely meets profit say for every dollar they spend they make dollar and ten cents then that 40 % loss is enough to kill it.

[Razgovory]

However, as the number of people pirating a title rises, I bet the overall sales for that title rises as well - because what drives relative piracy rates is almost certainly relative desirability rate (assuming ease of piracy is constant across titles, of course). Therefore, the cost of piracy expressed as a fraction of realized sales likely declines as total sales and piracy rates increase.

And I would bet the opposite - that as piracy increases, number of sales decrease.

There are numerous examples that disprove this - the most popular games in sales are the most pirated as well.

Which makes perfect sense. The more people want a game, the more will buy it and the more that will pirate it.

The problem is you are looking at it backwards.  As desirability goes up people getting the game goes up.  Piracy is not a function of games sold or vice versa.  You could presumably have a game that sold no copies, but was pirated millions of times and equally have a game that sold millions and had no games pirated.  While those are somewhat extreme, you can easily have situation where there is a massive imbalance in sales and piracy.  Take for instance a game that is cracked before it was released.  The only way you can get the game is to pirate it (or wait till it's released in your area).  This happens sometimes.  They call it "zero-day" piracy.  It's devastating on game sales.  On the other side piracy of cartridge games from the 1980's was probably much lower then games today.  Most people didn't know how to do it, and without the internet find out how to modify the machine and get the code it was much, much harder to pirate.  You may have several million copies of Mario 2 sold  but only have a miniscule number pirated.  Probably millions more sold then say Crysis, but far, far fewer then copies pirated.

[Shade]

https://www.google.com/landing/takeaction/ Not sure if you guys have heard about this it seemed to fit this this post.

[HisMajestyBOB]

Nowadays, the consoles are the high-powered machines, outperforming all but the $1,000+ gaming rig PCs.

That's nonsense. It might have been true when they originally launched but the consoles tech is about 6 years old.

But it's still one configuration for a market of millions.
To develop for a PC, you need to develop for a range of OS (Windows XP, Vista, and 7 at the least), video cards, drivers, and other hardware and configurations. That's more expensive and more difficult than developing for consoles.

[Grey Fox]

Nowadays, the consoles are the high-powered machines, outperforming all but the $1,000+ gaming rig PCs.

That's nonsense. It might have been true when they originally launched but the consoles tech is about 6 years old.

But it's still one configuration for a market of millions.
To develop for a PC, you need to develop for a range of OS (Windows XP, Vista, and 7 at the least), video cards, drivers, and other hardware and configurations. That's more expensive and more difficult than developing for consoles.

It might be one configuration but there is alot of certification to go thru. Especially with Microsoft.

It's easier to make PC games. How many indie devs make consoles games vs PC games outthere?

[Razgovory]

I dunno.  I know that indie games like Bastion came out for Xbox live before the PC.

[grumbler]

It's easier to make PC games. How many indie devs make consoles games vs PC games outthere?

Indie devs don't have access to the monopolistic distribution systems for consoles.  That may be more responsible that "ease to make games" for the indies' focus on the PC.

[Grey Fox]

It's easier to make PC games. How many indie devs make consoles games vs PC games outthere?

Indie devs don't have access to the monopolistic distribution systems for consoles.  That may be more responsible that "ease to make games" for the indies' focus on the PC.

Yes. Microsoft tried to loosen their grip with Xbox Live Arcade but like a drug addict, it's hard to let go.

[Syt]

http://www.rockpapershotgun.com/2012/02/02/legitimate-ubisoft-games-wont-work-tues/

With Ubisoft's recent announcement that Rayman: Origin's splendid arrival on PC will have the barest DRM for the download version (a single activation – a pointless waste of everyone's time still, of course) and the retail version having none at all (although Ubi have yet to get back to me over whether it will work without the disc in the drive), it makes you wonder if the company is beginning to see the light. With other recent games having only required a single activation, there does seem to be a movement away from their moronic 'always on' system. A system that's proving its idiocy next week, when Ubisoft take their servers down for an indefinite period, meaning any games using it will cease working.

As if a sampler for what would happen should Ubi ever go south, Eurogamer reports that HAWX 2, Might & Magic: Heroes 6, The Settlers 7, and any other Ubi games infected with the malware will simply not run on your PC. We're not talking about the multiplayer, or downtime for an online game here. We mean, the single-player versions of the game played locally on your own PC.

Great, eh?! What a brilliant thing for everyone involved. Those with pirated version can carry on enjoying the games throughout, and those who paid money for them will receive an error message. Woo-hoo! Put it on a PowerPoint slide and present it to your shareholders as another victory!

This all happens on Tuesday 7th, when the servers are all moving house. But Ubi haven't said how long it will take, and for how long non-pirated versions of their games won't work.

However, for those missing out, you could spend the downtime repeatedly punching yourself in the groin, while throwing money out of the window.