Video games. I've had a very up and down relationship with video games. The ones that I like, I like a lot. And the ones that I hate, I despise. Of all the media I come in contact with, video games have the hardest time drawing money from me and the main reason is their pricing.
Take World of Goo for instance. I first heard about them in 2008 when Techdirt featured their blog post saying they had a 90% piracy rate. The World of Goo makers weren't complaining about piracy, they were just trying to put some numbers out there for analysis. I downloaded the game to see what all the fuss was about, to see what was so great about this game to give it a 90% piracy rate. I felt it was a decent puzzle-type game, and liked the attitude the makers had about piracy, so I considered buying it. The problem was it was $20. I'm not paying $20 for a puzzle-like game that is nothing more than a bunch of similar but different levels. $5 probably, maybe $7, not even $10. I played it a couple of more times to see if it would hook me. It didn't so I deleted it.
Fast forward to 2010 when the first Humble Bundle was released. Upon hearing the details, I thought it was a fantastic concept and had already decided I was going to participate. Low and behold, World of Goo was one of the games. I paid $20 that day and got six games. I still haven't played World of Goo, but they got my money. I've purchased all 7 Humble Bundles and expect to continue doing so.
Now let's look at the big budget games, like Call of Duty, Halo and Madden. $60 for one video game? Forget that, I'm going to download it. If I spend $60 on this game, that means having to skip a future game I might like even more because there's less money in my pot. Even getting these games on sale for $40 is too steep. Right now, $30 seems to be the most I'm willing to spend on a game. And those prices are for when I buy physical copies. I expect discounts when I buy digitally. I think $20 is the max I'd pay for a digital game.
Someone out there right now is thinking, "What?! We spent $25 million making this game, there's no way we can make a profit selling it at $20." Not my problem. If you want me to buy it, you've got to get the price down. Here's an idea, don't drop $25 million making one stupid game. So while you bitch about it, I'm downloading it and playing it anyway.
Here's a real life example of how this works. I heard from a friend that Mafia was an enjoyable game. I downloaded it, played it and enjoyed it. Did I immediately go rush out and buy it? No, of course not. But when I heard Mafia II was coming out and it was made by the same company as the first one, I pre-ordered it. During my pre-order, for $10 more, they offered a Mafia I/II bundle, so I bought the bundle. When the games arrived, I gave Mafia I to a friend.
Why did I download Mafia I instead of trying out their demo? Because video game demos are the worst kind of samples of any media out there. I played the demo of this one adventure game and the demo was nothing more than a series of well-crafted interactive cutscenes. When I bought the game, I discovered the main gameplay was horrible which explains why it wasn't present in the demo. And the cutscenes weren't interactive. I got baited and switched. I once played the demo of an RPG that lasted about 10 minutes and had you fighting through one dungeon. When I bought the game, I found out it had only one other dungeon and the total game time was about 35 minutes. It's not worth it, it's easier to just download the full game. I'm done gambling.
The interesting thing about Mafia II was that I still pirated it. When I went to install the game for the first time, they tried to force Steam down my throat. I will not install Steam or any other DRM package just to play your game. I'm starting to soften up on Steam because it looks like the guys running the show seem to understand gamers. But my biggest complaint with Steam is that I want to play my game. I don't want to wade through advertisements, memos, updates and reminders. I want to play my game. The one I bought.
One company who will never get my money until they get their act together is Ubisoft. I refuse to give them any money until they stop with this nonsense. I'll still be playing their games though, but I'm tired of having my system mucked up or made less secure because of poorly designed DRM. The farthest I'm willing to go is entering a serial number one time, during installation. Anything more complicated than that and I'll probably ignore your game completely. If there is a lot of buzz, maybe I'll download it to check it out. Many times I've had a better experience with the pirated version of a game than the retail version. If something isn't working right with a game, the pirates usually include a fix in the download package.
Ubisoft's stance on their upcoming game I Am Alive is rather amusing. Even though they later backpedaled, Ubisoft originally said there would be no PC-port because of piracy and it would initially be released on Xbox and PlayStation. What I find funny is that the people clamoring for a PC-port are the ones who would probably buy it. The rest of us will just download the iso and play it on an emulator.
If you expect to have any hope of me buying your game, you really need to work on your pricing structure. Nobody buys one game and plays is for 24 months straight and then buys another game. We are constantly bombarded with advertisements for the next new big game. And you know what? It's exciting, we like it. We want to play your games. When they're $60 a pop, it limits the number of games we can buy, but it doesn't limit the number of games we can download.
Movies, TV and video. Pretty much any movie I can think of is at my fingertips, and in the unrestricted formats I like. Hulu and Netflix can't even come close to matching what the pirates have accomplished. Why subscribe to Netflix when some other movie studio can decide to not renew their agreement and 25% of my available viewing material disappears overnight?
Get your movies and shows on the file-sharing sites. If it's good, word of mouth will get me to watch it which is always the first needed step. Just like the other media I described, I probably won't rush out and buy it if I liked it, but I will be checking up on you to see what you're up to next so have a website.
Every DVD I have ever purchased I have also pirated. The pirated files are compressed so they take up less computer space than just copying the DVD files. You can fit 3-6 digital movies in the same amount of space that one DVD uses. I can also easily convert these digital files to other formats when needed. Just like with music, I will not tolerate you making me jump through hoops to watch your movies. I will not use special hardware or install special software. I already have everything I need to play videos. If you can't give me what I want, I will download it instead, which means I may or may not buy it.
If Hollywood would offer up a service that had the same breadth of content the pirates offer, and it was reasonably priced, I'd be a subscriber. The problem is that every legitimate service was never 'complete' and those that were trying to do so are becoming fractured as the content owners decide that they can do better.
If you want me to buy your physical DVD, there needs to be no copy protection and no licensing restrictions for personal use. It should also include a digital copy that is available in multiple formats. Yes, I have a DVD player, but I also have a home theater PC and it's way better than a DVD player. I can keep my entire archive of movies and TV shows on there for immediate viewing. You know what you can't immediately view? A store-bought DVD. After you put it in the DVD player, you sit through the FBI warning, possibly another anti-copying message, then some promotional stills of the studios involved in the movie, then some trailers for other movies and then you finally get to the main menu. If you're watching a TV show DVD, you still have to cycle through the menus to find the episode you want. With digital files, it's instant playback.
If you're selling digital videos, they need to be DRM-free with no licensing restrictions for personal use. They need to be available in different formats and bitrates, or at least a high-quality bitrate so I can do my own transcoding. Years ago, I made a mistake and purchased a digital movie that had DRM. After downloading it, I found out I couldn't move it to another computer which meant I couldn't watch it on my home theater PC. No big deal. I used a program called Fairuse4WM to remove the DRM and was able to copy it over. The experience annoyed me enough that when a friend with a similar setup mentioned he was going to buy that same movie, I told him not to bother because it had DRM and I gave him a copy of the one I had. There's your definition of a lost sale.
$20 is the most I'm willing to pay for a physical DVD, whether it be a movie or a season of a TV show. They really should be in the $10-$15 range. If I buy your DVD, you should give me digital copies for free. I know it's wishful thinking, but can you remove all the FBI/preview crap from the beginning of your DVDs so we can get right to video? If you're selling digital videos, they need to be cheaper. If you want me to buy your digital movie, it needs to be around $5, same for a season of a TV show. A single episode of a TV show should be around $1.
I'm not even going to entertain 'renting' video anymore. This is a concept that for me has outlived its usefulness. I might still rent a physical DVD in a special circumstance but it won't be too long before every media player I come in contact with will play digital video files out of the box. I will never rent digital video files, mainly because I think those, "You have 48-hours to watch this rental" restrictions are stupid. Instead of going through that song and dance, I'm just going to download it and watch it anywhere and any hour that I want.
Even with all this downloading, I still go to the theaters twice a month. Why? It's not for the movie itself. I can always wait for a movie to hit the file-sharing sites if I really wanted to. I go to the movies because I enjoy going to the movies. I enjoy sitting in nice dark theater in front of a huge screen being entertained with my friends. And even though I have downloaded every episode of South Park, I still own every season on DVD because I want them to keep making it.
You know which movie I'll never buy? Hurt Locker. Voltage Pictures may know how to make a good movie, but they don't know squat about customer satisfaction. Once I heard they were going after file-sharers, I specifically downloaded the movie just to spite them.
Techdirt stresses that content creators need to connect with fans in order to get them to buy. When I first started hearing that, I thought it was off-base. I could see anecdotal evidence showing it worked but my brain was telling me just because a content creator shows me their creative process or does a Q&A doesn't mean I'm more inclined to purchase their products. But the more I thought about it, the more I realized Techdirt is absolutely correct. The reason I buy the products I buy is because I am connecting with you, in my own way. I want my content creators to not be like Scott Ian and Lars Ulrich. I want my content creators to understand where technology is taking us. The South Park guys have every episode of their show available for online viewing free of charge. And I just so happen to own every set of their DVDs. The Humble Bundle guys know I just want to play my games with as little hassle as possible. And I just so happen to own every Humble Bundle. When I look at the software I have purchased, it's the ones with the unrestrictive EULAs. The kind of agreements where I can install the software on any computer I own, not just on this computer.
Do I feel bad for file-sharing? No, not in the least. True, it's technically illegal, but so is rolling through a stop sign and jaywalking. Yet everyone reading this has committed both of those crimes. The main reason I don't feel bad is because, like I detailed above, I know I'm buying content. Another important reason I don't feel bad is because I'm not profiting. I'm not taking your content and trying to resell it as though I'm a legitimate vendor. Physical piracy is a genuine problem and even the file-sharing community supports laws against it.
Being an active file-sharer means I have a clearer picture than you do of what's really happening. I know when I download something that it's not a lost sale and it's not theft. The fact that you can't see that is not my issue. I'm not going to let you stop me from sailing the world just because you think the Earth is flat.
I have no desire to support the RIAA and the MPAA. The unfortunate part is that I know they represent artists who are not fond of the tactics being used. I'm not going to refuse to buy your product, but I will take a long hard look before I buy. I would hate to be judged by the politicians who represent me, so I won't judge you by the sue-happy trade groups that represent you.
Lastly, I don't have to be your friend or share your same political views to like and purchase your products. You can make mistakes or hold a viewpoint I don't agree with, but if you're a horrible person, you can be certain I'm downloading everything you produce for free. Roman Polanski and Chris Brown are assholes. Don't expect me to buy their content. If you decide to work with them, I will not buy your products either, but I will enjoy them.
This section is for the people who can't be swayed from the 'online piracy is damaging' viewpoint. You likely didn't read my post, but I assure you there was no hyperbole. I didn't try to convince you copying is not theft, I didn't try to convince you I'm too poor to buy products and I didn't try to convince you file-sharing is akin to advertising. I just tried to tell it like it is.
Selling music, movies, books and video games is a business, big business. There is a lot of money generated by big entertainment and there are shareholders who won't stand for nonsense. For the last 10 years, I've been told the music, movie and game industries have been losing money, lots of money. Year after year I'm told online file-sharing is decimating sales, everyone is losing money, we have to do something to stop it. I'm not going to try and convince you you're wrong, but I do have a question:
If you were selling hotdogs and you started losing money, would you continue selling hotdogs at a loss for 10 straight years? The reason I ask is because I looked at some of the industries own numbers and it baffles me. If online file-sharing is killing these industries, why would they keep producing more content? And I'm sure someone is going to pull out a study showing trends in per-capita spending adjusted for inflation versus discretionary income per single-family residence that shows the entertainment industry is in a bleak position, but that's not what I'm after. If nobody is buying buggy-whips, you don't increase production year after year. Yet over the last 10 years:
The number of movies released is up 23% - 
The number of books published is up 47% - 
The number of albums released is up 25% - 
The video games industry is up 23% - 
When I look at those numbers, I have a hard time believing what Chris Dodd, Hilary Rosen and Stanislas Mettra have to say. Didn't Warner Bros. just set a company record for quarterly profits? I'm confused. My guess is that these industries really aren't losing money, but they are losing control. And maybe to them, control is more valuable than profits? I don't know, that's why I'm asking.
 - http://bit.ly/rj5mRT
MPAA industry report page 13.
454 movies released in 2001.
560 movies released in 2010.
 - http://bit.ly/uRb4KC
R.R Bowker output report, 2002 thru 2010.
215,138 books published in 2002.
316,480 books published in 2010.
 - http://bit.ly/tneVtC
90,324 music items for 2001.
113,080 music items for 2010.
Unfortunately, I could not find any release statistics on the RIAA website. Instead, I used Discogs browse by year feature and noted the number of items listed at the bottom of the page. This wasn't ideal so I'm hoping someone out there can dig up a relevant report.
 - http://bit.ly/kLHJ2Q
ESA industry report page 10.
208.7 million units sold 2001.
257.2 million units sold 2010.
I was unable to find any information regarding the number of releases per year. I used the number of units sold per year instead. Admittedly, the last two years have shown decreases of 7% and 8% but it should be noted that the chart in question is for "sales of new physical content at retail exclusively." So if you didn't buy at a retail chain or if you legally downloaded your purchase, it's not included in this chart. Page 11 of the same report states 24% of content was digital in 2010. I know it's not a perfect methodology but if we increase 2010's units sold by 24% we would get 318.9 million units which would be a 52% increase over 2001. I believe the 23% increase stated above is lower than the actual number, but I also thought it was important to use the numbers supplied by the industry.