DRM is stupid. It is always stupid. It kills the used game marketplace more than digital downloads. Additionally, the idea that DRM is NECESSARY for the gaming industry to counteract is laughable.
Look at the music industry. Pirating music is just about as easy as making a Facebook status. So long as there's a YouTube video of a song that I want, I can just go to http://www.youtube-mp3.org and get an HD copy of that song for free without having to pay a dime*. But, guess what: the music industry is still a booming, multi-billion dollar industry. iTunes is still very much a super successful thing, and it can coexist with services like Pandora and Spotify. Piracy is much more prevalent in the music industry, and yet it manages to be extremely lucrative. Guess what again: the music industry doesn't put DRM on their music. Sure, there've been lawsuits here and there but it seems they've stopped caring as much as they used to.
So, given that, what reason is there to have DRM in video games?
*for ass-covering purposes, don't actually do that; it's illegal
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Well the music industry only gets 34% of its revenue from digital publication, and CD sales are dying. They then get fueled by music videos, advertising, promotions, concerts/appearances, etc. Video games only have publication as a significant source of revenue. As well, it takes so much more money to produce a video game than an album that it isn't even comparable. The livelihoods of everyone in the games industry is tied up in their extremely expensive product making its money back and a profit only through distribution. It's understandable that they're going to want to fight tooth and nail for every penny by making sure that absolutely everyone who plays the game has paid for the license to play it. It just also sucks and is going to ruin the industry with enough time.
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Edited by Seggi: 3/20/2013 7:15:13 AM[quote]It kills the used game marketplace more than digital downloads. [/quote] So? The used game marketplace can be really damaging for the video game industry. Also, the last time I checked, iTunes actually does use DRM.
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Not really. The developers get all their money pretty much from the first few weeks the game is out. After that is when used sales start to happen but it really doesn't hurt them that much. If it did hurt them then they wouldn't be in business because the used game industry was a lot bigger before now.
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[quote]Not really. The developers get all their money pretty much from the first few weeks the game is out. After that is when used sales start to happen but it really doesn't hurt them that much.[/quote] That's really only the case for the kind of big-budget games that dominate the market. If it's a modestly budgeted game, especially if its core focus is single-player, used games sales can just kill it. Big retailers often don't even order in new copies for those kinds of games after their initial order because they can rely on the preowned turnover. The way the used game market works now forces publishers away from games with modest budgets, a single player focus and little or no pre-existing brand recognition or loyalty. And what do you think you get when publishers are reluctant to green-light anything but big budget multiplayer sequels? [quote]If it did hurt them then they wouldn't be in business because the used game industry was a lot bigger before now.[/quote] I don't think that follows.
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Edited by CrazzySnipe55: 3/20/2013 10:41:24 AMe: How is it damaging? They're not taking away money from the developers. They purchased that content. They can now do with it whatever the hell they damn-well please. The developer got their 60 bucks. If the game was obtained illegally in the first place however, therein lies the problem, but that (IMO) doesn't seem to be nearly as prevalent as "I no longer find this game I bought fun, I'm turning it in." I can convert any iTunes song into an MP3 file using iTunes itself, through methods that were intended to let you do exactly that, as well as put any song from any source into my iTunes, and then onto my iPhone. If it's DRM, it's DRM they let you work around, making it effectively not DRM at all.
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Edited by Seggi: 3/20/2013 1:32:23 PMIt's damaging because it reduces publisher revenue from games, especially ones that get big turnovers in the preowned market. That effectively means the entire game development process is much riskier, causing a contractionary effect on the video game market, and one that disproportionately affects singleplayer games and new IPs at that. Of course buying used games doesn't make anybody a criminal, but that doesn't mean the prevalence of used games and the way publishers are so significantly cut out of any profit from them doesn't have a negative effect on the industry.
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Why hello there false dichotomy, long time no see.
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Edited by Seggi: 3/21/2013 2:35:01 AMIf you're trying to imply that I'm claiming that every used game purchase is a lost sale for the publisher, you're wrong.
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Then what are you implying?
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Nothing. I meant exactly what I said: the used game market has a negative effect on publisher revenue from games. That doesn't mean that every person who purchases a preowned game would've bought the new title if the preowned weren't available, but there's a possibility they would have. That possibility amounts to a loss of revenue. For example, let's say that 100 preowned games are sold of a particular title, and the probability that somebody buying a preowned game would buy new if it were their only option is about 50% - that means the publisher is missing out on 50% of the revenue they would get from 100 units - equivalent to 50 new games. Obviously there's more to take into account than that, and I have no idea what that exact number would be, but you see my point, I'm sure.
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You're assuming that the people who buy used games have enough money to buy the same game at full price.
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No, I'm assuming that some of them do.
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[quote]It's damaging because it reduces publisher revenue from games[/quote]No it's not. That's not their revenue. Their revenue comes from the initial sale, and that's all the revenue the deserve. A bike manufacturer is not entitled to the money gotten by someone who sells their old bike in a yard sale, just as a game manufacturer is not entitled to the money from a used game sale. [quote]Of course buying used games doesn't make anybody a criminal, but that doesn't mean the prevalence of used games and the way publishers are so significantly cut out of any profit from them doesn't have a negative effect on the industry.[/quote] There is no profit made on used games.
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Edited by Seggi: 3/21/2013 2:36:07 AM[quote]No it's not. That's not their revenue. Their revenue comes from the initial sale, and that's all the revenue the deserve. A bike manufacturer is not entitled to the money gotten by someone who sells their old bike in a yard sale, just as a game manufacturer is not entitled to the money from a used game sale. [/quote]The big difference there is that when you purchase a game, relatively little of your money goes towards the physical thing you're buying - a significant portion of it goes toward repaying the money it took to develop and market the game, instead (as well as retailer margins, depending on where you buy it). So when somebody makes a bike, they might pay for the design or the branding, but mostly they're paying for the physical components of the bike and the way they've been constructed and assembled - and all (or very near all) of that cost can just be passed on to the person buying it. When somebody makes a video game, on the other hand, it's a hugely expensive process that requires many, many consumers to make it profitable. If they don't get as many consumers as they expect, they can't just make fewer copies next time like you can for physical goods - they just stop making those games. Maybe that means the developer gets shut down, or maybe it means the publisher no longer greenlights similar games. Either way, that's not a good thing for the industry. And, no, I wasn't saying that the publisher is 'entitled' to the money from used game sales, I'm saying that the used game market as it currently exists damages the industry. [quote]There is no profit made on used games.[/quote]I'm aware.
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Edited by CrazzySnipe55: 3/21/2013 4:25:54 AM[quote]a significant portion of it goes toward repaying the money it took to develop and market the game, instead (as well as retailer margins, depending on where you buy it).[/quote]Correct. And if you can't manage to get that all back plus profit with 60 dollars per purchase, you made a bad game, or it was marketed poorly. Therefore, they are not losing revenue from used game sales, people are just taking less of an economic loss on a game than they originally did. They now spent 30-40 bucks on that game instead of 60. [quote]And, no, I wasn't saying that the publisher is 'entitled' to the money from used game sales, I'm saying that the used game market as it currently exists damages the industry.[/quote]No it doesn't. Again, if a game company suffers because they can't turn a significant profit without extra (undeserved) revenue from used game sales, that company either failed at marketing that game or they made a bad game. This is not the fault of second-hand sales. e:[quote]I'm aware.[/quote]But... you said profit.
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What I'm saying is that the video game market is worse off for the existence of the preowned games market as it currently exists. All of the distinctions you're making are semantic, and miss the point of my posts.
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So your point is that if game developers got money from used game sales, they would have more money? Profound.
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And yet it took you so long to grasp it...
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Considering your point was basically that money is, in fact, money, I don't know why it was worth discussing at such a length if you didn't actually have an opinion to assert.
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Edited by lonepaul2441: 3/20/2013 7:35:59 AMUsed game sales can be used to the advantage of publishers and developers. What is it that steam says? "You need to give the paying customer a better offer than the pirates" and steam does massive sales which gives us cheap top quality BRAND NEW AAA Titles that work 100% fine. If the prices of games went down to used game prices £25-£30 then more people will buy the game and even though the profit margin goes up the boost in sales will compensate for that. Most games these days are releasing games at full price £40 and then a few months later cutting the price of new copies in half. That's the way to do it.
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Edited by Seggi: 3/20/2013 7:39:11 AM[quote]If the prices of games went down to used game prices £25-£30 then more people will buy the game and even though the profit margin goes up the boost in sales will compensate for that.[/quote] That assumption just doesn't hold up in every circumstance. A lot of the time (particularly at launch), the increased sales will [i]not[/i] compensate wholly for the decreased profit the publisher receives on each unit. If it did, they would sell games at that price at launch, because it would simply be better business.
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The more they increase the price the smaller pool of potential customers becomes, some games now are releasing multiplayer and singleplayer separately so the game is actually cheaper. Making things cheaper is the most effective way to fight piracy even if it won't kill it. We have DLC always coming out to boost revenue and the more people playing your game the more that buy the DLC meaning you get more money. It all balances out.
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Edited by Seggi: 3/20/2013 8:31:36 AMLook, dude, these are people whose entire jobs are to make as much money as they possibly can for the business they work for. They've got people in there who've spent six years or more studying these things; you might know more about video games themselves than a lot of the people who work there do, but you do [i]not[/i] know more about the market or about microeconomics. If there was such a simple solution that 'all balances out', they'd do it in a heartbeat.
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Recording Video and Music will kill the Music and Movie industries, guess how many people it took to come to that conclusion with all the data in the world at their disposal? I don't see the 2 industries anywhere near faltering, only being overtaken by the gaming industry. The Gaming industry is young and it needs to work it's self out but piracy is not as big of a problem as they want you to believe, trust me on that. Every other industry that has claimed otherwise have the been wrong every single time, why would gaming be any different? I'm looking for a job in the industry so piracy would effect me just as much as the guys already developing the games.
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Edited by Seggi: 3/20/2013 8:54:22 AMYou're not even responding to my posts any more. You're just ignoring what I say and making points against things I never argued.