So, the long awaited report is out and it is stupid.
Why commission the report at all when there is no known problem that needs addressing? This is just another waste of taxpayers money and an example of blame culture running amok. The nanny state out of control. There are far more pressing social issues that the government continually fails to address.
The real problem is ignorant politicians and journalists like Hillary Clinton and Keith Vaz who don’t understand video games and who lash out in their ignorance. These self publicists do a lot more harm than good.
Why choose a populist TV celebrity psychologist for this report? Why not Jade Goody? Seriously, this is a political matter of state control over children. There are many far better qualified people who could have written it.
Why does the report not include books (which have no age rating), pop music, films, television, radio, videos etc? Different popular culture is treated differently in a wholly illogical manner. This ruins any vestige of credibility that the report may otherwise have had. Games have far milder content, in general, than the more established media.
Using the BBFC film censorship to prejudge every game is just plain stupid, as I explained in this article. This is going to be a major, completely unnecessary, burden on the games industry.
The report Grand Theft Childhood is about to be published which is based on vastly more research and which totally refutes the basis for the British government’s worries and therefore the Byron report. Every politician or journalist should read Grand Theft Childhood before commenting or voting on this subject.
Why don’t we just stick with the PEGI system, like the rest of Europe? This would give us trade harmony and not put us at the trading disadvantage that the Byron report would bring if implemented.
At the end of the day those kids who want to play Grand Theft Auto will. You cannot wrap children in cotton wool then lock them in a safe.
So there we have it. A sad day for politics and another sad day for the British gaming industry.
Wednesday 21 May 2008
The PC is the top gaming platform part 1
Just recently Electronic Arts has announced that they are cutting back on their boxed PC releases, including Madden NFL ‘09. Some have interpreted this with doom and gloom as being a sign of the demise of the PC as a gaming platform. In fact nothing could be further from the truth, the Electronic Arts announcement is just symptomatic that people find that it is cheaper to steal boxed PC games using bit torrent instead of buying them. There is far more to gaming than boxed product and it is in these wider areas that the PC is king.
The PC is ubiquitous in a way that consoles can only dream of. They are in every office and most home in the west and many people use two or even three different PCs every day. Most of these PCs come with Microsoft Windows and that means they come with a bunch of games, including solitaire, probably the most played video game in the world. So many times in offices I have seen bored secretaries playing this. And so many times on aeroplanes I have seen bored executives get out their laptops, to play solitaire. Amazing for a game which was originally written as a mouse usage trainer.
Then there are the 200+ million people who play online casual games every month. Both downloadable and browser games. Services such as Pogo.com, Sandlot Games, Big Fish Games, Boonty, PlayFirst, Reflexive, RealArcade, and Trymedia Systems. These are growing at a huge rate and as Flash becomes more powerful, so casual games become more sophisticated.
MMOs have huge audiences. World of Warcraft has over 10 million subscribers. And there are a whole pile of games with millions of players: RuneScape (6 million), Habbo (86 million avatars created, 8 million monthly unique users), Maple Story (nearly 60 million), Dofus (4 million), Ragnarok Online (25 million), Guild Wars (3 million), Club Penguin (4 million) and Webkinz (over 3 million).
As gaming and social networking slowly converge we are seeing more games played more often on the big social networking sites. The 69 million users of Facebook have a wide range of games including the famous Scrabulous. This is a massive growth area of gaming and we have a lot of innovation to come.
I have written about Steam on here many times before. A digital distribution, digital rights management, multiplayer and communications platform with 15 million accounts. This could very well become the replacement for boxed product when it comes to traditional PC game releases. Certainly there is no reason for every publisher not to put every PC title they publish onto this platform.
There is more, but just looking at the above you can see that consoles pale in comparison. The PC is truly the gaming king.
The PC is ubiquitous in a way that consoles can only dream of. They are in every office and most home in the west and many people use two or even three different PCs every day. Most of these PCs come with Microsoft Windows and that means they come with a bunch of games, including solitaire, probably the most played video game in the world. So many times in offices I have seen bored secretaries playing this. And so many times on aeroplanes I have seen bored executives get out their laptops, to play solitaire. Amazing for a game which was originally written as a mouse usage trainer.
Then there are the 200+ million people who play online casual games every month. Both downloadable and browser games. Services such as Pogo.com, Sandlot Games, Big Fish Games, Boonty, PlayFirst, Reflexive, RealArcade, and Trymedia Systems. These are growing at a huge rate and as Flash becomes more powerful, so casual games become more sophisticated.
MMOs have huge audiences. World of Warcraft has over 10 million subscribers. And there are a whole pile of games with millions of players: RuneScape (6 million), Habbo (86 million avatars created, 8 million monthly unique users), Maple Story (nearly 60 million), Dofus (4 million), Ragnarok Online (25 million), Guild Wars (3 million), Club Penguin (4 million) and Webkinz (over 3 million).
As gaming and social networking slowly converge we are seeing more games played more often on the big social networking sites. The 69 million users of Facebook have a wide range of games including the famous Scrabulous. This is a massive growth area of gaming and we have a lot of innovation to come.
I have written about Steam on here many times before. A digital distribution, digital rights management, multiplayer and communications platform with 15 million accounts. This could very well become the replacement for boxed product when it comes to traditional PC game releases. Certainly there is no reason for every publisher not to put every PC title they publish onto this platform.
There is more, but just looking at the above you can see that consoles pale in comparison. The PC is truly the gaming king.
Some correct predictions
If I don’t blow my own trumpet nobody is going to blow it for me, so here are some of the articles on here that predicted real world events.
Everybody knows now that the iPod/iPhone is going to be a huge gaming success. Apple are putting massive resources into making it so and there are lots of developers working on bringing games to it. There were a couple of articles on here at the end of last summer that predicted this months before any announcements.
There has been a lot of publisher consolidation activity in recent months, this was predicted in advance. Also the role of the film industry in this was explained long before a whole raft of events.
The game industry is riddled with bad management and this article was timed to explain this well before the clean out of the board of directors at SCI/EIDOS.
Then in December, at the height of the Christmas rush there was this article explaining that Microsoft were going to reduce the price of the Xbox 360 and why they were going to do this.
And finally there were a couple of articles about the subsidies that game companies receive in Canada, how these were probably illegal under WTO rules and how the British government should do something about it. Which now, belatedly, they have.
So if you want to know what is going to happen in the game industry there is no need for expensive analysts when you can read the articles here for free!
Everybody knows now that the iPod/iPhone is going to be a huge gaming success. Apple are putting massive resources into making it so and there are lots of developers working on bringing games to it. There were a couple of articles on here at the end of last summer that predicted this months before any announcements.
There has been a lot of publisher consolidation activity in recent months, this was predicted in advance. Also the role of the film industry in this was explained long before a whole raft of events.
The game industry is riddled with bad management and this article was timed to explain this well before the clean out of the board of directors at SCI/EIDOS.
Then in December, at the height of the Christmas rush there was this article explaining that Microsoft were going to reduce the price of the Xbox 360 and why they were going to do this.
And finally there were a couple of articles about the subsidies that game companies receive in Canada, how these were probably illegal under WTO rules and how the British government should do something about it. Which now, belatedly, they have.
So if you want to know what is going to happen in the game industry there is no need for expensive analysts when you can read the articles here for free!
Friday 16 May 2008
Piracy, Imagine and the Megagames
Browsing the internet I came across this interview of me in Your Spectrum from June 1984. It brings up several issues that were very pertinent at the time and which still have resonance today. They have never adequately been explained with the benefit of hindsight so I thought that I would do that now because things were not as they seemed. As a director of Imagine I was involved in all the discussions and decision making that went on behind the scenes. This is the definitive story of what happened.
Imagine software was an amazing success. We doubled turnover pretty much every month until by December 1983 2003 it was a million pounds a month. A massive figure in those days. In January 1984 2004 sales collapsed and we were initially at a loss as to what had happened. We employed a lot of young people on the government Youth Opportunity Programme, which kept us in touch with our customer base. They pretty soon told us that nobody was buying games anymore. Tape to tape copying had been discovered and stealing games was a lot cheaper than buying them.
We reacted by sending a letter to all the magazines explaining the damage this would do to the industry. Some magazines published the letter in full and some took a stronger line in not carrying adverts related to piracy. But overall their reaction was pretty muted. Which is surprising really because they relied on advertising revenue from the game publishers for income. Game piracy ended up hitting them too with one magazine publisher, Newsfield in Ludlow, eventually going out of business.
Our next tactic was to reduce our prices. To become cheap enough that customers wouldn’t want to copy because they could have the real thing at a low price. This tactic would have worked and eventually did with budget software pretty much taking over the 8 bit cassette game market. However we were ahead of our time and the retailers and trade threw a complete and utter fit at our price reduction. Mostly they said they wouldn’t buy our games off us anymore at the lower pricepoint. We were forced to keep prices up.
Because the games were being professionally as well home copied we started printing our inlay cards using a metallic fifth colour. This made it much more difficult to reproduce counterfeit inlay cards.
So next we came up with the idea of a hardware add on or dongle to plug into the game computer without which the game would not run. Initially we looked at putting the Z80 maths co-processor in the dongle which would allow our programmers to write more powerful code. But in the end we settled for putting a ROM in which would allow us to write a much bigger game. Combined with several development breakthroughs we had made this would have allowed us to make some very special games. The megames, Psyclapse and Bandersnatch were born.
But is was not to be. Piracy knocked our income so badly that we could not afford to run the company. There was no money to pay the bills and we went out of business. All filmed by the BBC for their Commercial Breaks programme, which you can still see on YouTube.
You can find a full article on game piracy here.
Imagine software was an amazing success. We doubled turnover pretty much every month until by December 1983 2003 it was a million pounds a month. A massive figure in those days. In January 1984 2004 sales collapsed and we were initially at a loss as to what had happened. We employed a lot of young people on the government Youth Opportunity Programme, which kept us in touch with our customer base. They pretty soon told us that nobody was buying games anymore. Tape to tape copying had been discovered and stealing games was a lot cheaper than buying them.
We reacted by sending a letter to all the magazines explaining the damage this would do to the industry. Some magazines published the letter in full and some took a stronger line in not carrying adverts related to piracy. But overall their reaction was pretty muted. Which is surprising really because they relied on advertising revenue from the game publishers for income. Game piracy ended up hitting them too with one magazine publisher, Newsfield in Ludlow, eventually going out of business.
Our next tactic was to reduce our prices. To become cheap enough that customers wouldn’t want to copy because they could have the real thing at a low price. This tactic would have worked and eventually did with budget software pretty much taking over the 8 bit cassette game market. However we were ahead of our time and the retailers and trade threw a complete and utter fit at our price reduction. Mostly they said they wouldn’t buy our games off us anymore at the lower pricepoint. We were forced to keep prices up.
Because the games were being professionally as well home copied we started printing our inlay cards using a metallic fifth colour. This made it much more difficult to reproduce counterfeit inlay cards.
So next we came up with the idea of a hardware add on or dongle to plug into the game computer without which the game would not run. Initially we looked at putting the Z80 maths co-processor in the dongle which would allow our programmers to write more powerful code. But in the end we settled for putting a ROM in which would allow us to write a much bigger game. Combined with several development breakthroughs we had made this would have allowed us to make some very special games. The megames, Psyclapse and Bandersnatch were born.
But is was not to be. Piracy knocked our income so badly that we could not afford to run the company. There was no money to pay the bills and we went out of business. All filmed by the BBC for their Commercial Breaks programme, which you can still see on YouTube.
You can find a full article on game piracy here.
Popular Articles
It is a complete mystery to me how some articles have legs and are seen by tens of thousands of people whilst others, often more erudite (in my opinion!) and containing much more work and thought just disappear into oblivion. It is all down to aggregators like N4G and Reddit and also to which articles are picked up on by journalists elsewhere to comment on.
Obviously most articles get their most views when they are on the front page and I have no accurate measure of how this readership is split up. What is in this list is the article permalinks that have had the most views. So this is mainly people coming specifically to read that one article. Which is a pity as they mostly never get to see all the other wonderful stuff.
Fanboys is about that army of gamers whose enthusiasm for one brand goes too far. To the point of emotional attachment. The article is tongue in cheek but does contain some home truths.
Is Blu-ray a Microsoft victory? Very unexpected that this brief piece did so well. At a time when people were trumpeting Blu-ray as a Sony victory over Microsoft I thought that a bit of perspective was in order.
A big Microsoft mistake? From quite early in the life of this blog, this article looks at whether stopping production of the original Xbox so early was the best idea.
Piracy, Imagine Software and the Megagames. This was a sleeper for a month before it exploded on to the world’s radar screens. It is an anecdote of what actually happened at Imagine when I was on the board of directors. Schoolboy pirates from that time who never went near the company disagree with me.
The next console generation, #1 Home consoles. A bit of fun this, trying to second guess what the three big platform holders are going to do. And, perhaps more importantly, when.
Surfer Girl and Skater Boy. The game industry’s two most notorious rumour mongers. Sometimes they are right, sometimes they aren’t.
The Bible Vs video games. People complain about the sex and violence in video games. The bible is worse. And it doesn’t even have an age rating!
How big will Super Smash Bros. Brawl be? There was a lot of hysteria about this game so I wrote an article to put it into context.
PS3 is a waste of everyone’s time. Gabe Newell of Valve’s unique view on the current platform generation. It certainly is an attention getting headline.
Some great game development blogs. In a way I am very surprised that this is not more popular. These blogs are solid gold, their content gives an inside view of games that every enthusiast would surely rave over.
So, out of more than 250 articles, these have risen to the top in the popularity stakes. The challenge now is to write articles that become even more popular.
Obviously most articles get their most views when they are on the front page and I have no accurate measure of how this readership is split up. What is in this list is the article permalinks that have had the most views. So this is mainly people coming specifically to read that one article. Which is a pity as they mostly never get to see all the other wonderful stuff.
Fanboys is about that army of gamers whose enthusiasm for one brand goes too far. To the point of emotional attachment. The article is tongue in cheek but does contain some home truths.
Is Blu-ray a Microsoft victory? Very unexpected that this brief piece did so well. At a time when people were trumpeting Blu-ray as a Sony victory over Microsoft I thought that a bit of perspective was in order.
A big Microsoft mistake? From quite early in the life of this blog, this article looks at whether stopping production of the original Xbox so early was the best idea.
Piracy, Imagine Software and the Megagames. This was a sleeper for a month before it exploded on to the world’s radar screens. It is an anecdote of what actually happened at Imagine when I was on the board of directors. Schoolboy pirates from that time who never went near the company disagree with me.
The next console generation, #1 Home consoles. A bit of fun this, trying to second guess what the three big platform holders are going to do. And, perhaps more importantly, when.
Surfer Girl and Skater Boy. The game industry’s two most notorious rumour mongers. Sometimes they are right, sometimes they aren’t.
The Bible Vs video games. People complain about the sex and violence in video games. The bible is worse. And it doesn’t even have an age rating!
How big will Super Smash Bros. Brawl be? There was a lot of hysteria about this game so I wrote an article to put it into context.
PS3 is a waste of everyone’s time. Gabe Newell of Valve’s unique view on the current platform generation. It certainly is an attention getting headline.
Some great game development blogs. In a way I am very surprised that this is not more popular. These blogs are solid gold, their content gives an inside view of games that every enthusiast would surely rave over.
So, out of more than 250 articles, these have risen to the top in the popularity stakes. The challenge now is to write articles that become even more popular.
Popular Media U Turn
I don’t want this blog to become some sort of media watch, but we are at a very critical point in the development of the video gaming industry and it’s relationship with the press. We are in the middle of a transition of gaming from being a hardcore niche hobby to it being a mainstream activity enjoyed by most people. Eventually it will be bigger than film and TV combined. And the popular press are having problems getting a grip on this. Especially Fox News in America and the Daily Mail in the UK.
The issue here is ignorance of journalists and the problems are age and perception.
The age problem is that the senior people (with all the power) in the media are too old to understand. They went through their formative years before video gaming became popular. So they have no concept of the art form that gaming is or of it’s social resonance. They can understand the Beatles but GTA IV is beyond them.
The perception problem is that a lot of the media persist in the notion that gaming is a solitary activity for adolescent boys. Which is completely wrong. Gaming is most prevelant for people in their late 20s and early 30s. Unlike all previous popular entertainment media gaming is immensely social with multi player on a single platform or via online connection. It has bought about a quiet (and largely unreported) revolution in human relationships. And gaming is relatively non violent compared with films and books.
So we have a situation where a lot of media are at odds with many of their readers. The press are generating a plethora of anti gaming articles that bear no relationship whatsoever to reality. And most readers of these articles can see just how stupid they are. Which reflects very badly on the journalist writing them and on the media who publish them. Basically the Daily Mail, Fox News etc are just shooting themselves in the foot.
However some of their readers and viewers don’t understand gaming and so may believe these stupid articles. Which is leading to a polarisation. On the one hand there is now a majority who understand gaming and who are bemused by the ignorance of the media. And there is a minority who have taken the lies on board and who believe that gaming is some sort of great social evil. I have had discussions with some of these people and they have been totally brainwashed.
However there is a glimmer of hope. Earlier this year Janice Turner and Giles Whittell wrote articles for the Times that were litanies of ignorance and prejudice. They were text book examples of how badly wrong the media can be about gaming. Then the Times made a massive U turn in an article about GTA IV. The writer of the article was obviously not a gamer but at least the sentiment was headed in the right direction at last.
The Mail, though, is a different matter. They are the bastion of indignation and fear, displaying an unheathy obsession with immigration and house prices. And a long running war against video games. Recently two rent-an-article journalists have put substantial blots on their career records by writing very silly anti gaming articles in the Mail. Anne Diamond went first with a totally crass sensationalist piece about adult games having adult content. But this was bettered in the stupidity stakes by Rosie Millard writing an article that said more about her parenting skills and intellectual grasp than it did about gaming.
The Rosie Millard article was so bad that the Mail website did not receive one positive comment that they could publish. Instead it was inundated with negative comments that they refused to publish. Many people wrote letters to the editor. And there was a uniform negative response across the online media. I hope the fee that Rosie Millard received for this article was worth the massive damage to her reputation.
Which brings us to GTA IV. The Mail’s attitude was that it is ”a squalid game that steals young minds”. Which flies in the face of academic research such as the book Grand Theft Chidhood. In other words they were wrong, as usual. So it is amazing that they have now done a complete about turn. A 180 of enormous ramification for the popular reporting of gaming. If we can win the Mail over then we have a chance at defeating ignorant prejudice everywhere.
The volte-face comes in a TV &showbiz review of GTA IV by James O’Brien. He obviouly realises that this is one of the greatest games ever, but more than that it is a major global cultural event. At last the Mail reports gaming as it really is: “There’s no denying, however, that this latest version of the Grand Theft franchise is a phenomenal technological and creative achievement that is set to generate more money for its British designers than any Hollywood release in years.” and “The action is as epic as it is violent, with graphics and cinematic “motion capture” technology delivering a degree of verisimilitude so great that it frequently feels more like participating in a movie than playing a game. Stunts are better than ever, but the driving itself is a revelation.” and “Killing is occasionally optional, dialogue and cut scenes are devoted to Nikos’s inner turmoil and while criminality and violence are certainly glorified, its perpetrators are somehow not. Even Nikos has sufficient soul to see his employers for the scum they are.”
Intelligent and informed stuff. And almost unbelievable that it was in the Mail. Let’s hope they can maintain these new, high, journalistic standards. And not fall back to the ignorance and prejudice that was their former hallmark on the subject.
Game Piracy
Games are a form of intellectual property, like books and film, that, once they have been created, can be copied. Copying a game is a lot cheaper than buying it because the copier is making no contribution to the cost of making the game in the first place. But, obviously, if everybody copied there would be no revenue for games makers and there would be no games.
There are two main forms of game piracy. There is piracy by the individual game player, these days usually over the internet but in the past often by copying using physical media, this is what this article is about. And there is commercial counterfeiting where a professional criminal mass manufactures the game, which is a different matter.
The profile of pirating different platforms is always different because of the technology, the demographics of the users, the state of the market at a given time, relative costs and a number of other factors. What is for sure is that when piracy takes hold on a platform many hundreds of thousands (sometimes million) of copies of a game are made. The huge scale of this theft deprives the publisher of vast amounts of legitimate income and quite obviously harms the game development industry. To think otherwise is to be in self denial.
Of course it is very obvious that not every pirated game is a lost sale. This is because simple price elasticity of demand tells you that far more units will be consumed at a lower price than at a higher price. Yet apologists of piracy use this as an excuse for their behaviour. They try and make out that piracy is a victimless crime. But obviously they are wrong because potential sales are being lost. And the lesson of history is that when piracy on a given platform gets out of hand then it causes huge damage to the game market for that platform. This is common sense really.
The Old Days
The first mass market game machine in the UK was the Sinclair Spectrum. Software was loaded via a tape interface so games were sold on audio compact cassettes. These were very, very easy to copy from a technical point of view. Especially when dual cassette players proliferated and became cheaper. Schoolyard and club copying proliferated on a massive scale and badly hurt the game publishers. Look at a list of games and you can see the many publishers that went out of business or were forced into mergers. A whole range of technical anti piracy solutions were introduced including, for instance, Lenslok. The publishers would not have gone to the huge trouble of these technical solutions if copying had not been a great threat to their businesses. Another solution was budget games, initially at £1.99, then at £2.99, prices at which they were not worth copying. That these budget games proliferated and came to dominate the market is yet another measure of just how bad the piracy was.
I was a director of the game publisher Imagine software, which went bankrupt in 1984, largely because sales came to an abrupt halt when piracy took off. (Imagine had other problems that made it especially vulnerable to a large and sudden drop in revenue.) Another publisher that was badly affected was Ultimate Play The Game (which later morphed into Rare), one of the most highly regarded publishers of games for the 8 bit home computers. Their initial response to the huge rise in piracy and drop off in sales was to raise prices from £5.50 a game to £9.95. The idea being that if customers paid more for a game they would be less inclined to give away copies. However this didn’t work and they laboured on for just one more year after the demise of Imagine before switching their attention to the Nintendo Entertainment System, which did not suffer from piracy. Spectrum and other 8 bit computer owners lost out heavily as publishers put less and less resources into developing for their machine or quit entirely, as Ultimate did.
Then came the Commodore Amiga and Atari ST. Once again copying was technically easy so it was rife. Once again it was up to the publishers to come up with technical solutions. So a technology war broke out between the software publishers and the pirates. Measures would include copying in random pieces of text from the manual. The led to a huge amount of photocopying by the pirates until the publishers started using photocopy proof manuals. Obviously all this piracy made revenue generation difficult so the game publishing industry did not blossom in the way we see now. In fact piracy has often been cited as part of the reason for the downfall of these machines.
Consoles Arrive
Then came the game consoles. From Sega and from Nintendo. They had their games held on chips inside cartridges so they were technically difficult and expensive to copy. So piracy didn’t happen anywhere near the massive extent that it had on the Spectrum, Amiga and ST. So the game industry blossomed into what we know today. This was the time when many of the great key franchises of our industry were established.
Cartridges were expensive to make so eventually the hardware manufacturers returned to recordable media. This way they could make vastly larger games with far lower production costs. The first to do this was the Sony Playstation (PSX, later PS1) in 1995 in Europe and America, which used a CD-ROM to load games. Sony had a whole pile of technical anti piracy measures which protected it from piracy for several years. However with the introduction of modchips and the development of PC CD-ROM burners that could burn data in the same modes that the PSX used it was game over. Chipping was nearly universal and game sales collapsed. Pirates were selling their copied games door to door in housing estates, at places of work, in car boot sales and anywhere else they could find a customer. This caused huge problems for game publishers. I was working at Codemasters at the time and we were forced to lay off about 60 people. This was terrible as there were no other industry jobs for them to go to, everyone was having the same trouble. The number of games published shrank dramatically. In 1999 there were 100, in 2000 there were 78 and in 2001 there were just 33. Yet the PSX remained in production till 2006, so software publishing for it collapsed just half way through it’s sales life.
The Dreamcast from Sega came out in 1998 and used a special unique disk format called GD-ROM. Once this was circumvented with things like the Utopia bootdisk it was game over. Piracy became rampant and the Dreamcast died after just a couple of years with over 10 million sold. This piracy is sometimes credited with not only seeing off the Dreamcast but also removing Sega from the console hardware market completely (as ever there were other factors that muddy the waters somewhat, what is for sure is that losing so much revenue did not help). It was a huge loss to the industry.
The PC
The IBM PC has been around since 1981 and was the first home machine to be connected to the internet in massive numbers. So it obviously has a long history of software piracy and has been at the forefront of anti piracy technology. Often this technology had nuisance value as it actually impeded the use of the computer. But the pirates did bring it upon themselves. At Codemasters we published an excellent PC game called Severance, Blade of Darkness which was well received with a Metacritic of 75 and a user score of 9.5. This game was popular, building an active community of mod makers. Yet Codemasters sold very few copies of the game, most people just downloaded it for free from the internet. So the developer, Rebel Act received very little royalties and went bust. Once again piracy damaging the industry.
Nowadays it is virtually impossible to viably publish boxed PC games, most appear on the internet as free bit torrents before they are even in the shops. In fact it is far quicker and easier to pirate a game than it is to buy it. So most publishers, even those with a decades long tradition in PC games, have given up. And the PC gamer suffers. One casual game publisher reported a piracy rate of 92%, which is probably typical. When they tightened up their protection it didn’t help much because people just moved on to some of the many other games that are available for free by bit torrent. Now Electronics arts have started releasing PC games for free, with their development cost supported by in game advertising and micro payments. But the real way to make PC games as a viable business is to make online games (MMOs), these are server based so impossible to pirate. One day virtually all games will be published in this way and piracy will be over.
Today’s Consoles
The PSP is a very popular mobile gaming machine and media player made by Sony. They have sold 33 million. Yet it is a graveyard for games publishers. It has been hacked since early in it’s life, it is simple to copy games onto and everything an owner can want is very easily available for free online. Here are some download figures for PSP games from just one torrent site:
God of War: Chains of Olympus - 94,154Patapon - 112,183Ratchet & Clank - Size Matters - 197,113Crush - 48,959LOCO ROCO - 163,904Wipeout Pulse - 116,965Castlevania X Chronicles - 102,354Metal Gear Solid - Portable Ops (Not Including Plus) - 231,054Burnout Dominator - 269,486
So most developers just don’t invest millions into AAA games for it, they would be wasting their money. This lack of quality games on the PSP (obviously along with some other factors) left the door open for the Nintendo DS to become a massive success with 70 million sold. But even this is being pirated now using flash memory cards in dummy cartridges. This will impact heavily on DS game sales and could lead to publishers becoming reluctant to develop for it, as they are with every heavily pirated platform.
The current generations of home consoles, the Microsoft Xbox 360, the Nintendo Wii and the Sony PS3, are all at that stage in the cycle where there is a phoney war. All three machines have good technical anti piracy. Nintendo went so far as to embed a secret second CPU (an ARM) in the graphics chip to run some of it’s system software (they lost $975 million to piracy in 2007). But all three have been cracked (not fully yet with the PS3), click their names for more details. Owners will be able to bypass the anti piracy and play free games. This hasn’t taken off yet but there are signs that it is just starting to. If previous generations of console are anything to go by then piracy on these three machines could soon snowball. And publishers will move their development resources away.
In the meantime Nintendo are making successive popular game releases that look to see if the machine has been modified before they will play. If it has the Wii becomes a “brick” for that game. Microsoft use Xbox Live to look for modified 360s and cancel the accounts of any that they find. And Sony have the advantage that Blu-ray media is expensive to buy and difficult to copy. All these are just current positions in an ongoing technology war. Very many people are putting so much time and effort into cracking these machines that, ultimately, they will find a way round everything and anything the manufacturers do.
Conclusions
There is one thing that beats pirates on any platform. This is when a game is so big that it becomes a mass culture popular event. The current launch of GTA IV is a prime example. Then a far higher percentage of people just have to have the real thing. A pirated copy just isn’t cool enough. And with these sorts of games there is a massive gift market. All this explains how the rare, exceptional title can still sell well on a heavily pirated platform.
There are the excuses that pirates make that games are too expensive (they are), but then Ferraris are too expensive and I don’t go round stealing them. Then there is the game quality argument, that there is a lot of dross around, which is very true, especially on the Wii. Once again we live in the age of the internet and it is very easy to very rapidly find out everything about every game. Metacritic and Game Rankings will quickly tell you most of what you need to know. Perhaps, as an industry, we ought to publicise these two sites more, just to remove that excuse.
And the game industry continues to grow and prosper, despite the piracy. This is because the proliferation of platforms allows publishers to more easily abandon platforms that are pirated to the point of being uneconomic. Instead they concentrate on platforms where there are windows of opportunity to run a viable business. Either because the anti piracy technology is on top or because there is a sufficient number of honest customers to get a return, even sometimes with a heavily pirated platform. Games with an online element can often be made very pirate proof which has been a major incentive for developers to go down this route.
So for 25 years or so game players have been stealing games in truly massive numbers with zero chance of being caught and punished for their crime. Very often far more copies of a game title have been pirated than have been bought. This self evidently causes harm to the games industry, ultimately leading to less money being invested in games for the pirated platform. So, the game player suffers for his theft by having less games and lower quality games. All pretty obvious to anyone but the pirates who make all sorts of feeble excuses to justify their stealing
There are two main forms of game piracy. There is piracy by the individual game player, these days usually over the internet but in the past often by copying using physical media, this is what this article is about. And there is commercial counterfeiting where a professional criminal mass manufactures the game, which is a different matter.
The profile of pirating different platforms is always different because of the technology, the demographics of the users, the state of the market at a given time, relative costs and a number of other factors. What is for sure is that when piracy takes hold on a platform many hundreds of thousands (sometimes million) of copies of a game are made. The huge scale of this theft deprives the publisher of vast amounts of legitimate income and quite obviously harms the game development industry. To think otherwise is to be in self denial.
Of course it is very obvious that not every pirated game is a lost sale. This is because simple price elasticity of demand tells you that far more units will be consumed at a lower price than at a higher price. Yet apologists of piracy use this as an excuse for their behaviour. They try and make out that piracy is a victimless crime. But obviously they are wrong because potential sales are being lost. And the lesson of history is that when piracy on a given platform gets out of hand then it causes huge damage to the game market for that platform. This is common sense really.
The Old Days
The first mass market game machine in the UK was the Sinclair Spectrum. Software was loaded via a tape interface so games were sold on audio compact cassettes. These were very, very easy to copy from a technical point of view. Especially when dual cassette players proliferated and became cheaper. Schoolyard and club copying proliferated on a massive scale and badly hurt the game publishers. Look at a list of games and you can see the many publishers that went out of business or were forced into mergers. A whole range of technical anti piracy solutions were introduced including, for instance, Lenslok. The publishers would not have gone to the huge trouble of these technical solutions if copying had not been a great threat to their businesses. Another solution was budget games, initially at £1.99, then at £2.99, prices at which they were not worth copying. That these budget games proliferated and came to dominate the market is yet another measure of just how bad the piracy was.
I was a director of the game publisher Imagine software, which went bankrupt in 1984, largely because sales came to an abrupt halt when piracy took off. (Imagine had other problems that made it especially vulnerable to a large and sudden drop in revenue.) Another publisher that was badly affected was Ultimate Play The Game (which later morphed into Rare), one of the most highly regarded publishers of games for the 8 bit home computers. Their initial response to the huge rise in piracy and drop off in sales was to raise prices from £5.50 a game to £9.95. The idea being that if customers paid more for a game they would be less inclined to give away copies. However this didn’t work and they laboured on for just one more year after the demise of Imagine before switching their attention to the Nintendo Entertainment System, which did not suffer from piracy. Spectrum and other 8 bit computer owners lost out heavily as publishers put less and less resources into developing for their machine or quit entirely, as Ultimate did.
Then came the Commodore Amiga and Atari ST. Once again copying was technically easy so it was rife. Once again it was up to the publishers to come up with technical solutions. So a technology war broke out between the software publishers and the pirates. Measures would include copying in random pieces of text from the manual. The led to a huge amount of photocopying by the pirates until the publishers started using photocopy proof manuals. Obviously all this piracy made revenue generation difficult so the game publishing industry did not blossom in the way we see now. In fact piracy has often been cited as part of the reason for the downfall of these machines.
Consoles Arrive
Then came the game consoles. From Sega and from Nintendo. They had their games held on chips inside cartridges so they were technically difficult and expensive to copy. So piracy didn’t happen anywhere near the massive extent that it had on the Spectrum, Amiga and ST. So the game industry blossomed into what we know today. This was the time when many of the great key franchises of our industry were established.
Cartridges were expensive to make so eventually the hardware manufacturers returned to recordable media. This way they could make vastly larger games with far lower production costs. The first to do this was the Sony Playstation (PSX, later PS1) in 1995 in Europe and America, which used a CD-ROM to load games. Sony had a whole pile of technical anti piracy measures which protected it from piracy for several years. However with the introduction of modchips and the development of PC CD-ROM burners that could burn data in the same modes that the PSX used it was game over. Chipping was nearly universal and game sales collapsed. Pirates were selling their copied games door to door in housing estates, at places of work, in car boot sales and anywhere else they could find a customer. This caused huge problems for game publishers. I was working at Codemasters at the time and we were forced to lay off about 60 people. This was terrible as there were no other industry jobs for them to go to, everyone was having the same trouble. The number of games published shrank dramatically. In 1999 there were 100, in 2000 there were 78 and in 2001 there were just 33. Yet the PSX remained in production till 2006, so software publishing for it collapsed just half way through it’s sales life.
The Dreamcast from Sega came out in 1998 and used a special unique disk format called GD-ROM. Once this was circumvented with things like the Utopia bootdisk it was game over. Piracy became rampant and the Dreamcast died after just a couple of years with over 10 million sold. This piracy is sometimes credited with not only seeing off the Dreamcast but also removing Sega from the console hardware market completely (as ever there were other factors that muddy the waters somewhat, what is for sure is that losing so much revenue did not help). It was a huge loss to the industry.
The PC
The IBM PC has been around since 1981 and was the first home machine to be connected to the internet in massive numbers. So it obviously has a long history of software piracy and has been at the forefront of anti piracy technology. Often this technology had nuisance value as it actually impeded the use of the computer. But the pirates did bring it upon themselves. At Codemasters we published an excellent PC game called Severance, Blade of Darkness which was well received with a Metacritic of 75 and a user score of 9.5. This game was popular, building an active community of mod makers. Yet Codemasters sold very few copies of the game, most people just downloaded it for free from the internet. So the developer, Rebel Act received very little royalties and went bust. Once again piracy damaging the industry.
Nowadays it is virtually impossible to viably publish boxed PC games, most appear on the internet as free bit torrents before they are even in the shops. In fact it is far quicker and easier to pirate a game than it is to buy it. So most publishers, even those with a decades long tradition in PC games, have given up. And the PC gamer suffers. One casual game publisher reported a piracy rate of 92%, which is probably typical. When they tightened up their protection it didn’t help much because people just moved on to some of the many other games that are available for free by bit torrent. Now Electronics arts have started releasing PC games for free, with their development cost supported by in game advertising and micro payments. But the real way to make PC games as a viable business is to make online games (MMOs), these are server based so impossible to pirate. One day virtually all games will be published in this way and piracy will be over.
Today’s Consoles
The PSP is a very popular mobile gaming machine and media player made by Sony. They have sold 33 million. Yet it is a graveyard for games publishers. It has been hacked since early in it’s life, it is simple to copy games onto and everything an owner can want is very easily available for free online. Here are some download figures for PSP games from just one torrent site:
God of War: Chains of Olympus - 94,154Patapon - 112,183Ratchet & Clank - Size Matters - 197,113Crush - 48,959LOCO ROCO - 163,904Wipeout Pulse - 116,965Castlevania X Chronicles - 102,354Metal Gear Solid - Portable Ops (Not Including Plus) - 231,054Burnout Dominator - 269,486
So most developers just don’t invest millions into AAA games for it, they would be wasting their money. This lack of quality games on the PSP (obviously along with some other factors) left the door open for the Nintendo DS to become a massive success with 70 million sold. But even this is being pirated now using flash memory cards in dummy cartridges. This will impact heavily on DS game sales and could lead to publishers becoming reluctant to develop for it, as they are with every heavily pirated platform.
The current generations of home consoles, the Microsoft Xbox 360, the Nintendo Wii and the Sony PS3, are all at that stage in the cycle where there is a phoney war. All three machines have good technical anti piracy. Nintendo went so far as to embed a secret second CPU (an ARM) in the graphics chip to run some of it’s system software (they lost $975 million to piracy in 2007). But all three have been cracked (not fully yet with the PS3), click their names for more details. Owners will be able to bypass the anti piracy and play free games. This hasn’t taken off yet but there are signs that it is just starting to. If previous generations of console are anything to go by then piracy on these three machines could soon snowball. And publishers will move their development resources away.
In the meantime Nintendo are making successive popular game releases that look to see if the machine has been modified before they will play. If it has the Wii becomes a “brick” for that game. Microsoft use Xbox Live to look for modified 360s and cancel the accounts of any that they find. And Sony have the advantage that Blu-ray media is expensive to buy and difficult to copy. All these are just current positions in an ongoing technology war. Very many people are putting so much time and effort into cracking these machines that, ultimately, they will find a way round everything and anything the manufacturers do.
Conclusions
There is one thing that beats pirates on any platform. This is when a game is so big that it becomes a mass culture popular event. The current launch of GTA IV is a prime example. Then a far higher percentage of people just have to have the real thing. A pirated copy just isn’t cool enough. And with these sorts of games there is a massive gift market. All this explains how the rare, exceptional title can still sell well on a heavily pirated platform.
There are the excuses that pirates make that games are too expensive (they are), but then Ferraris are too expensive and I don’t go round stealing them. Then there is the game quality argument, that there is a lot of dross around, which is very true, especially on the Wii. Once again we live in the age of the internet and it is very easy to very rapidly find out everything about every game. Metacritic and Game Rankings will quickly tell you most of what you need to know. Perhaps, as an industry, we ought to publicise these two sites more, just to remove that excuse.
And the game industry continues to grow and prosper, despite the piracy. This is because the proliferation of platforms allows publishers to more easily abandon platforms that are pirated to the point of being uneconomic. Instead they concentrate on platforms where there are windows of opportunity to run a viable business. Either because the anti piracy technology is on top or because there is a sufficient number of honest customers to get a return, even sometimes with a heavily pirated platform. Games with an online element can often be made very pirate proof which has been a major incentive for developers to go down this route.
So for 25 years or so game players have been stealing games in truly massive numbers with zero chance of being caught and punished for their crime. Very often far more copies of a game title have been pirated than have been bought. This self evidently causes harm to the games industry, ultimately leading to less money being invested in games for the pirated platform. So, the game player suffers for his theft by having less games and lower quality games. All pretty obvious to anyone but the pirates who make all sorts of feeble excuses to justify their stealing
Investing in games
Investing in games
May 13th, 2008 Opinion
The video game industry must be one of the most attractive areas to invest in right now. The business is booming, growing far faster than anyone predicted, as it makes the transition to being popular entertainment for the masses. And the industry is still at it’s very beginning, it will grow to be bigger than movies and TV combined as it leverages it’s key advantages of interactivity, connectivity and non linearity.
In recent years the industry has fragmented into many genres on many platforms, this trend will continue for some time. Also technology has changed the marketing, sales and distribution model, significantly reducing the entry cost into many areas of game publishing. And there is the constant spectre of piracy, with over half the video games in the world being stolen it is important to invest in areas where at least a majority of customers actually pay for playing the game.
The king of the market, the gold standard, is the subscription MMO. When these work they become massive cash cows generating tens of millions in monthly revenue. But they cost many tens of millions to make, need constant ongoing investment and have a very high probability of failure. The current leader is World of Warcraft which took the market over from Ultima Online and Everquest. One day it’s position will be challenged but it doesn’t look like happening any day soon.
Next comes the free to play MMO, often aimed at younger players. These are even bigger in player numbers than the subscription MMOs and seem to be less risky as businesses. Revenue comes from advertising, premium membership levels and micro payments for in game items. Some of the big players are RuneScape (6 million),Habbo (86 million avatars created, 8 million monthly unique users), Maple Story (nearly 60 million), Dofus (4 million), Ragnarok Online (25 million), Guild Wars (3 million), Club Penguin (4 million) and Webkinz (over 3 million).
Console gaming is easier to understand. Hit driven boxed retail products just like music CDs and film DVDs. The main opportunities are with the Microsoft Xbox 360 and the Sony Playstation PS3 which are both a fair way from peaking in their product cycles. Product quality has now become immensely critical as knowledge travels instantly via the internet. To Metacritic below 8 is increasingly uncommercial, which is a good thing for everyone. Get it right and you too can gross half a billion dollars in one week as GTA IV just has. The total cost of developing and globally marketing a cross platform AAA game can now be in the tens of millions of dollars area. You need big resources so your hits can finance your inevitable misses, one reason the industry is consolidating into a small number of big players.
The console acts as an anti piracy dongle and is the main reason for the success of these platforms. The downside is that the platform holders take a fee out of every game published. These two factors together mean that console games are ridiculously expensive. Something that could eventually come to damage the business model.
The Nintendo Wii is not worth developing for. It is nearer the end of it’s life cycle than the other two consoles and it is mainly first party games published by Nintendo themselves that sell. Third party titles from other publishers are mainly low quality shovelware that have now frightened the consumer off.
The two handheld consoles, the Nintendo DS and Sony PSP are also not worth developing for despite the immense numbers of these that have been sold. Quite simply piracy has ripped the market up. Vastly more people will steal your game than will pay for it.
Casual gaming is huge and probably growing faster than any other area of gaming. The ability to just drop in and spend a little time having fun then log out and get on with the rest of your life is very convenient. Far more appealing to many people than the commitment needed by hardcore games. There are 200+ million people who play online casual games every month. Both downloadable and browser games. Services such as Pogo.com, Sandlot Games, Big Fish Games, Boonty, PlayFirst, Reflexive, RealArcade, and Trymedia Systems. Games are cheap to develop using Flash but the average quality is still very low, something that will change as the market matures. Revenue can come from advertising, premier membership and micropayments.
Traditional boxed PC retail games that have been with us for decades are just about dead, with most publishers giving up, killed by rampant piracy. Instead there is a new breed of PC game centring on online play and sometimes episodic content. With unique user keys and services like Steam these can be made largely pirate proof. The PC game reinvented.
Mobile phone gaming has been declining in popularity. Largely because the market is doubly fragmented. Too many different platforms and too many different air time providers make it almost impossible as a business model. All this is changing immensely rapidly with gaming on the Apple iPhone and the reinvention of Nokia nGage as a software based gaming platform. These two will certainly overtake casual gaming to become the fastest growing sector of the business and have the potential to grow to become one of the major forms of gaming. This is the most exciting place to be just now.
There are still more valid business areas in gaming. All three platform holders now sell games online. These are smaller and so easier to make then their full price boxed equivalent and the revenue stream is steady over a long period rather than spectacular over a short life. This business can only grow and grow and is well worth investing in, just make sure that you put marketing effort behind your games on these services, you can’t expect good sales otherwise.
Finally there is gaming on the social networking sites such as Facebook and MySpace. This is still small but has massive potential and we have seen the first cult hit with Scrabulous.
So there you have a quick sketch plan of the market. It is a dynamic and exciting place and you can be sure that it won’t be the same twelve months from now.
May 13th, 2008 Opinion
The video game industry must be one of the most attractive areas to invest in right now. The business is booming, growing far faster than anyone predicted, as it makes the transition to being popular entertainment for the masses. And the industry is still at it’s very beginning, it will grow to be bigger than movies and TV combined as it leverages it’s key advantages of interactivity, connectivity and non linearity.
In recent years the industry has fragmented into many genres on many platforms, this trend will continue for some time. Also technology has changed the marketing, sales and distribution model, significantly reducing the entry cost into many areas of game publishing. And there is the constant spectre of piracy, with over half the video games in the world being stolen it is important to invest in areas where at least a majority of customers actually pay for playing the game.
The king of the market, the gold standard, is the subscription MMO. When these work they become massive cash cows generating tens of millions in monthly revenue. But they cost many tens of millions to make, need constant ongoing investment and have a very high probability of failure. The current leader is World of Warcraft which took the market over from Ultima Online and Everquest. One day it’s position will be challenged but it doesn’t look like happening any day soon.
Next comes the free to play MMO, often aimed at younger players. These are even bigger in player numbers than the subscription MMOs and seem to be less risky as businesses. Revenue comes from advertising, premium membership levels and micro payments for in game items. Some of the big players are RuneScape (6 million),Habbo (86 million avatars created, 8 million monthly unique users), Maple Story (nearly 60 million), Dofus (4 million), Ragnarok Online (25 million), Guild Wars (3 million), Club Penguin (4 million) and Webkinz (over 3 million).
Console gaming is easier to understand. Hit driven boxed retail products just like music CDs and film DVDs. The main opportunities are with the Microsoft Xbox 360 and the Sony Playstation PS3 which are both a fair way from peaking in their product cycles. Product quality has now become immensely critical as knowledge travels instantly via the internet. To Metacritic below 8 is increasingly uncommercial, which is a good thing for everyone. Get it right and you too can gross half a billion dollars in one week as GTA IV just has. The total cost of developing and globally marketing a cross platform AAA game can now be in the tens of millions of dollars area. You need big resources so your hits can finance your inevitable misses, one reason the industry is consolidating into a small number of big players.
The console acts as an anti piracy dongle and is the main reason for the success of these platforms. The downside is that the platform holders take a fee out of every game published. These two factors together mean that console games are ridiculously expensive. Something that could eventually come to damage the business model.
The Nintendo Wii is not worth developing for. It is nearer the end of it’s life cycle than the other two consoles and it is mainly first party games published by Nintendo themselves that sell. Third party titles from other publishers are mainly low quality shovelware that have now frightened the consumer off.
The two handheld consoles, the Nintendo DS and Sony PSP are also not worth developing for despite the immense numbers of these that have been sold. Quite simply piracy has ripped the market up. Vastly more people will steal your game than will pay for it.
Casual gaming is huge and probably growing faster than any other area of gaming. The ability to just drop in and spend a little time having fun then log out and get on with the rest of your life is very convenient. Far more appealing to many people than the commitment needed by hardcore games. There are 200+ million people who play online casual games every month. Both downloadable and browser games. Services such as Pogo.com, Sandlot Games, Big Fish Games, Boonty, PlayFirst, Reflexive, RealArcade, and Trymedia Systems. Games are cheap to develop using Flash but the average quality is still very low, something that will change as the market matures. Revenue can come from advertising, premier membership and micropayments.
Traditional boxed PC retail games that have been with us for decades are just about dead, with most publishers giving up, killed by rampant piracy. Instead there is a new breed of PC game centring on online play and sometimes episodic content. With unique user keys and services like Steam these can be made largely pirate proof. The PC game reinvented.
Mobile phone gaming has been declining in popularity. Largely because the market is doubly fragmented. Too many different platforms and too many different air time providers make it almost impossible as a business model. All this is changing immensely rapidly with gaming on the Apple iPhone and the reinvention of Nokia nGage as a software based gaming platform. These two will certainly overtake casual gaming to become the fastest growing sector of the business and have the potential to grow to become one of the major forms of gaming. This is the most exciting place to be just now.
There are still more valid business areas in gaming. All three platform holders now sell games online. These are smaller and so easier to make then their full price boxed equivalent and the revenue stream is steady over a long period rather than spectacular over a short life. This business can only grow and grow and is well worth investing in, just make sure that you put marketing effort behind your games on these services, you can’t expect good sales otherwise.
Finally there is gaming on the social networking sites such as Facebook and MySpace. This is still small but has massive potential and we have seen the first cult hit with Scrabulous.
So there you have a quick sketch plan of the market. It is a dynamic and exciting place and you can be sure that it won’t be the same twelve months from now.
Monday 12 May 2008
New Website
There is a new community forum for the area around where Codemasters is.
http://harbury.villagebuzz.co.uk/
http://harbury.villagebuzz.co.uk/
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