Tuesday, August 05, 2008

My piracy is bigger than yours

I nearly forgot about that one. Sometimes, I create a new file, give it a name, relative to a given topic which I might expand upon or not, and sometimes they get complete enough to make it to the blog.
This one was seeded after reading an article at Gamasutra, wherein Cevat Yerli was interviewed and took the chance to provide his own figures about piracy. It had me tempted to lay down a quick commentary about piracy, and jump in to point a finger at those who use this industry’s leech token as a convenient excuse for their games doing poorly on the PC, although I plainly acknowledge the problem this platform encounters in this particular domain.
Then this rather vague and shapeless bag of bytes sunk deep into my folder hierarchy.

Until then. It’s back, and it’s not happy at all.
Two recent events had me fingers trippy. One being Capcom wagging the skull flag for their concrete solid explanation behind Devil May Cry 4’s poor sales, the other being Michael Fitch dropping the hammer in a last spasm of courage and honour to reveal how Iron Lore Entertainment was mercilessly slain. These two extra sources of information had me pull that article-embryo out of the jar and grow it some lungs, a stomach and a tongue, since I’ve found some stuff to feed it.

A Crysis

The first article starts with Yerli blaming lower than expected sales because of a piracy ratio of 1 copy sold for 20 acquired illegally. The point here is not to dismiss the existence of a virulent piracy plague, but to understand that piracy is not the sole vector of failure or semi-failure here.

First, Yerli recognizes that Crysis did sell well. Not super well, but well, or good as he puts it. However you can understand that a slight fraction of the piracy lore means a great deal of cash to Crytek.

Secondly, and that’s where he hit the crux of the problem, is that while the article was titled “Crysis Developer Puts Piracy Ratio At 1:20”, we learn about marketing mistakes which would be swiftly ignored by many, but which in my opinion are all the more important here.

These mistakes, which I think did have a greater toll on sales than generally thought, were two fold.

  1. Improper information regarding the game’s minimum system requirements, which for a game like Crysis, almost an engine with some game in it, meant much more than for any other game. Crysis was Crytek’s booth. I am not saying they’re not going to sell their engine because of these bumps in their plans, since people know more than well what it does (and that’s the second part I address), but a misshaped listing of power requirements strikes me as an awkward fault, one I wouldn’t expect from those who made a business creating a top of the art engine.

  2. Badly timed announcements, pre-releases and schedules. Basically, they poked their own balloon, dented the hype by showing too much of the game and too early, and then letting delays flatten the cake, so when it came out, people were bit blasé.

When you’re dealing with games which cost so much on production and marketing, it’s understandable that such errors could hamper the success of the product. Negligible? I don’t think so.
Of course, it’s easier said than done, and they can’t be held as the unique reasons behind the unsatisfying sales numbers.

Devil May Cry, Capcom Surely Whines

This news had a lot of people chuckling in front of their screen, cause here we have a perfect example of men in charge crying at wolf and, as such, literally trivializing the issue of piracy to explain the poor results they read on their statistic sheets.

Short story shorter, Capcom’s Svensson used the official forums as his soapbox to let his pain reach out, for Devil May Cry 4’s sales on the PC suck terribly.

Let’s consider the very simple problem we have at hand.
Have you played Devil May Cry 3 or 4 anytime soon?
Well, check Gametrailers or Youtube if you wonder what these games are about.

The essential idea everybody would agree on is that this beat’em all is a typical arcade game, fitting perfectly for the living room style of fun. So what kind of gaming machine people put in their living rooms?
Consoles (if you say a PC, you go out, NOW!).

Basically, they try to shoehorn a game within a hardcore PC niche, while it’s part of a genre which has always been tailored for consoles, little sisters of the legendary coin up machines.
Piracy has possibly played some role there, but pushing such a game on a machine where it literally feels out of place is bad thinking. It would be folly to expect such a game do well on the PC.

On this topic, it would be interesting to consider the sales of Final Fantasy VII, released in ‘98 for Windows (‘97 for the Playstation). The context was different, but piracy already existed.

CSI: Maynard

At the Quarter to Three forums, Michael Fitch (THQ) put down a legitimate rant about the danger of piracy, the issues of developing on the PC, the retarded people in the world (we all did at some point) and how all this dooms the PC, and apparently put a bullet into ILE’s head.
A good read, and I’m not even done with that 20 pages long thread yet.
I couldn’t agree more on the flood of ridiculous pro-piracy arguments you can read on the internet, it’s literally baffling. Yes, that’s part of the world wide idiocy he points out.
On the other hand, if people were wealthier…

OK, let’s pretend I didn’t say that.
It’s rather obvious that those who keep their time grabbing illegal versions are rarely going to pay for a game, unless you put a cop behind them. That’s also one of the arguments used frequently, and mixed to the rest, looses its factualness.
The real problem is that it’s becoming easier to acquire pirated versions, as well as more and more people are becoming aware of this particular fact and the existence of download channels.

So we return to square one, where people meet and wonder how they could grab the consumers’ attention and love.
One pseudo solution that often comes back is to make quality games, offer a better content and extra stuff to those who bought the game. Notice how pro-piracy people diverted from this theme by saying that since many games are not properly finished or whatever, they shouldn’t pay for it, notably because they don’t consider that the game meets all the content quality requirements they’ve been waiting from it.
So you know, instead of, well, not buying it because apparently they hate it so much, they believe they’ve hit an arrangement by pirating it. Of course, how obvious!

I won’t epilogue on the idiots who think they help companies by playing illegal copies. They don’t. It’s a myth they love to sustain. Good for them.
But I’ll surely continue on the topic of the quality of the gaming experience to point out what I consider a mistake, using a tool which leaves to be desired.

ILE used a specific (third party) library which contained a rather blunt anti-piracy system, checking out if your version was a legal one or not. If not, the game would crash at the first quest, bringing you back to desktop.
Plus another security, if not more.
The problem: people unaware of the mechanism behind this event thought it was a bug. The fact that only owners of an illegal version would suffer this coded crash is just a bit of irony for you, since this game was bad mouthed as buggy like hell by people who didn’t pay for it anyway. It seems this bashing somehow made its way up to certain reviews.
The damage was done, and Iron Lore Entertainment studio is down. But careful here, there’s not necessarily a correlation. I know absolutely nothing about the game’s quality either.

Still, the decision was disastrous, and the protection design stupid in a way.
You could always say that the library was limited, they had to deal with it and all that jazz, but you surely know that a single message explaining to the player that if the game crashes, it’s because of the security system, would have circumvented the backslash due to sheer ignorance.
Also, why not consider the eventuality of a another background program monitoring the running, and popping a message if it detects the game crashing precisely for the reason you know?

Oh but see, some think that if you openly announced why and when the code would verify the legitimacy of your game, it would make the pirates’ life easier by knowing where to look at for the crack.

You see nothing wrong there?
OK, let’s look at Fitch’s posts a little more in details then:

The research I've seen pegs the piracy rate at between 70-85% on PC in the US, 90%+ in Europe, off the charts in Asia. I didn't believe it at first. It seemed way too high. Then I saw that Bioshock was selling 5 to 1 on console vs. PC. And Call of Duty 4 was selling 10 to 1. These are hardcore games, shooters, classic PC audience stuff. Given the difference in install base, I can't believe that there's that big of a difference in who played these games, but I guess there can be in who actually payed for them.

Let's dig a little deeper there. So, if 90% of your audience is stealing your game, even if you got a little bit more, say 10% of that audience to change their ways and pony up, what's the difference in income? Just about double. That's right, double. That's easily the difference between commercial failure and success. That's definitely the difference between doing okay and founding a lasting franchise. Even if you cut that down to 1% - 1 out of every hundred people who are pirating the game - who would actually buy the game, that's still a 10% increase in revenue. Again, that's big enough to make the difference between breaking even and making a profit.

Let’s look at the numbers for Bioshock and CoD4.

Do these games belong to a genre which is not known for being a staple of the PC gaming lore? No, they’re both FPSes, and many, including me, would say that you never played a FPS until you’ve played it on the PC. Any excuse to dispute this statement will be sanctioned by death.
So obviously the fault is not in the games’ genre.

Are these games made of large amounts of suck?
Oh no, certainly not.

So what could it be?

Were the ratios solely based on sales numbers, or did they account the install bases?
The first case would correspond to comparing 100 copies sold on the 360 and 20 sales on the PC. You’ve got a ratio of 5:1.
But what happens if you work from the estimations of PC sales which correspond to a horse power range between mid to high gaming performance? I’m pulling a number out of the blue here, but somehow I doubt that the 360 has outnumbered the quantity of PC which can run Bioshock or Call of Duty 4 smoothly enough.
In this second case, considering the number of PCs sold, let’s say far more than 360s, even if both systems had “sold” the same amount of copies, relatively speaking, the PC would have done worse than the 360.

So we’d rather consider that sales numbers were opposed and only that, if we don’t want to allege an even bleaker situation.

Fitch cited, later on, the relatively functional and efficient DRMs behind Bioshock and Mass Effect. But if the numbers forwarded by Fitch are reliable, and that the low sales are solely related to PC piracy, then the PC DRMs are an absolutely pathetic failure. How could he hold them as examples of as security systems which still give hackers a bone to chew if at the same time, he points to piracy being behind the low sales of such games on the PC, notably after presenting the ratios of death?

These protections either fail at protecting the game correctly, or they rebut consumers from buying the game because of their rigidity. The second option, although having some certain truth to it, is relatively absurd if we start thinking it would so fiercely affect sales, so it only leaves option one: they fail.

It leaves a sour taste in the mouth of ILE staff, and something tells me that had the publisher or ILE had not bothered with such a strict DRM at all, as absurd as it may seem to some, this nonsensical ruckus would have been avoided. Where word of mouth matters a lot, a badly thought DRM can literally kill a reputation, and thus the sales.

This is why I have a difficulty to consider that with the huge piracy on the PC, a polite message box, telling illegal owners why their copy of the game crashed, would have saved the game’s face without sacrificing sales numbers to more piracy. I’d even make a wager that the removal of any DRM wouldn’t change much.

I feel sad for ILE, but a bit of projection and forethought would have probably prevented this.

Worst Bugs, top three:

  1. PC shutdown.

  2. Blue screen of death.

  3. Return to Windows.

Literally putting anything in your game that makes it look like it’s buggy to the bone is bad thinking. It will surely serve as an example, for studios to think of the consequences.

When the cumbersome shield doesn’t protect from a backstab

Let’s get other references. Game Set Watch published two articles, Opinion: Casual Games and Piracy: The Truth, and its follow-up. Most striking elements: crazy piracy ratios (92%) for their casual game Ricochet Infinity, and how fighting piracy with various methods, including the most efficient one being fixing DRM exploits, hardly records as a blip on the radar.
They conclude that after all these efforts, they only gain one more sale for a thousand illegal downloads less, these downloads being different than the ones where you try the game and buy the full version, we’re talking about downloading the full game here, the exact opposite of buying the entire copy.
They did get significantly positive results with the first fix, a DRM update. But that was the first fix, and the 92% of piracy figure is obtained after all four fixes, after nearly two years of fiddling or so.

Sidenote: You can’t help thinking how (not so) amusing it would be if DRM builders made sure games kept being pirated.

The real question is: since your games get pirated up to rates of 90%, why do you still bother with anti-piracy protections? Up this point, it makes no difference, it's a waste of money which is best invested elsewhere, and all securities get cracked anyway... and we've rarely seen an anti-piracy system which wasn't intrusive in the lives of consumers.

There’s a point to consider. While it appears that pirates won’t buy games anyway, when your sales are afflicted by piracy rates up to 80-90%, then you can be sure that those who bought the game would still buy it even if the DRMs were removed.
Let me extrapolate that these customers either:

  1. have made the effort to pay the game, despite the rampant piracy.

  2. felt more comfortable knowing they had a legit copy.

  3. didn’t care about the DRM.

  4. didn’t even know it was there to begin with.

Remove the DRMs and those confirmed and precious sales won’t suddenly shrink like a snowball in hell.

More than often, DRMs are a hassle, the hell on Earth, encumbering customers and making pirates laugh (most of the time). This has been going on for years now, be it afflicting music, films or games. Companies manage to sign deals with governments, which deputes call laws, to be sure that de facto criminals (you by default) pay for their future crimes, fulfilled or not. You get taxes on various memory supports and what not and nothing gets done for that.
That’s like a bad episode of the 4th dimension or cyberpunk mixed into one. But it’s happening today, right now because giant business machines think strictly vertically to face a problem, without actually trying to dodge the piracy arrow by smarter moves, and governments think they know what’s better for the citizens and basically end fucking them up.

OK, that’s fine brave man, but how do you boost sales then?

Well, dear reader, I hope you’ll enjoy my next trick, which I called “Weasel my way out by announcing a future post about it”.


ceolstan said...

Interesting read. For the past couple of weeks, the gaming sphere has been touting the defection of pc-publishers over to the console market, with piracy as a major factor in their arguments. While I do believe that piracy is an important factor in undercutting the bottom line, I think that attributing poor sales to piracy is a case of industry execs' unwillingness to look at their own business processes, including market demographics, quality assurance, and distribution.

Market demographics include not only buyer segment, but also hardware segment. You're quite right that publishers do need to look at their markets. Devil May Cry has been a consistently highly-rated console game. However, I'm a pc gamer. Platformers and fighting games are not what I typically play. If you want me to play a fighting game, you need to sell it to me. Tell me that the controls are intuitive. Every review I've seen says that I need to go out to get a gamepad to play this, and that the keyboard controls are frustratingly bad. Word to Capcom: Don't give me a console port with crap controls that show it's a console port. Do console gamers have to buy keyboards to play fps games? No! So don't make us go buy gamepads. And count yourself lucky that anyone even bothers enough about your game to pirate it. I'd let it rot on the shelf.

Crysis is a great game that fits the pc gamer market. However, not everyone who likes fps games will like Crysis, and those who do will be put off by the insane system requirements. Crysis has the same kind of sandbox level design as Far Cry did, and while some of us loved the flexibility of Far Cry, others had problems with what to do next. The other issue is that of hardware. My pc was very high end when I built it, but Crysis made even bleeding edge machines cry. Dear Mr. Developer, please do research on the kind of gaming rigs that your target demographic will likely have at the release of your game. Don't have those figures? Why not look at the published figures on Steam or see if the nice folks at xfire will allow you access to that info. If you look at Steam user hardware profiles and the changes over a year, you'll have a sense of how fast users adopt new technology, and where the average buyer's machine will be. Plan to meet that part of your market. The fact is, a lot of people want to play your game, but they know their systems aren't up to specs. The result is that they'll not see a downside to downloading a pirated version, as they can attribute the bugginess to the pirated version, not to their dodgy hardware.

Let's put it this way, no one playing on a PS3 ever says, "gosh, I wonder if this PS3 game will run on my PS3. Will I have to upgrade my video card to have acceptable framerates?"

The other thing you need to do is better quality assurance, especially with your DRMs. DRMs have been known to interfere with legitimate pc applications. I didn't know that I'd installed a DRM game when I installed Neverwinter Nights 2 until my virus scanner said I had a rootkit. Yes, the DRM was showing up as a virus. Now I'm afraid that if I install another DRM game, the two DRMs may not play nice. For a game like Bioshock where the DRM allows a limited number of installs, the effect is that you no longer own your game; you rent it. These are only a handful of the reasons that PC Gamer now lists whether a game has DRM protection. DRM QA frankly sucks, and anything that buggy and intrusive to the legit player should be eliminated.

I agree that pirated software should bring a system to a screeching halt--but the user should see big flashing letters to the effect of "This crash brought to you by your pirated Game X." And if you insist on DRM, make sure that it doesn't interfere with legitimate computer uses. Or take note of the recent "Talking to Pirates" on positech.co.uk and remember that PC Gamer tells players which titles have DRM.

Finally, I think publishers should do more with digital distribution. I do realize there are problems with Steam, and that Steam's process for game selection is less than transparent. However, Steam does a lot of things right from the consumer perspective. First, it's easy. Consumers don't have to play the DVD shuffle. Heck, consumers need only remember their SteamID/password. When they rebuild their computer, they reinstall Steam, which then downloads the patched software. Life is good. Steam also provides a fairly robust social networking infrastructure, along with voice chat support. That's value-added, and it's something that bootlegged games don't provide. From a publisher's perspective, Steam has a fairly easy delivery system and provides protection from common forms of piracy. The drawback is that Steam isn't always easy to work with, but that's why publishers need to encourage similar services. Gamers won't care. We're used to IRC, at least one IM program, one or more voice chat servers, xfire, and Steam. One more delivery service isn't going to bother us, and we feel no product loyalty to Steam v. other delivery systems with similar features.

My advice to publishers blaming their woes on piracy is to stop whining and refocus on what they did wrong with respect to their product. Examine their business models. Look at the demographics. Employ good QA practices. Try to learn from history.

Then, when industry execs bemoan the impact of piracy, they can point to their hit game that's generated millions in sales, and say that piracy undercut their profits, not that piracy killed their game studio.

Stone Bytes said...

Tom Jubert, at Edge website (formerly Next Generation's), had an interesting view on this topic as well:


One point which many didn't consider is that we don't know which regions were observed for the piracy numbers they cite. More precisely, we don't know what people, what countries were considered.
It's obvious that if these numbers are world wide, then there are countries which will considerably boost those numbers up, like India, China and many South American nations.

It's rather dishonest, since only the mature markets are traditionally looked at for relevant sales numbers. Europe, Japan, North America are the big ones, the ones which guide the industry.
We need numbers which only concern those locations. Only then we'll get a clearer picture of the situation.