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No Xbox DRM: Consumer voice matters when industry is competitive

The internet took a victory lap when Microsoft announced a major policy u-turn regarding it’s next-generation video game system. Microsoft pulled back limitations on used video game sales and frequent online checks verifying the system.  Key in their decision was massive consumer backlash. But also key to the u-turn was the presence of strong competition, specifically Sony, who announced their system would lack any restrictive DRM.  The pressure of consumer backlash combine with a viable alternative compelled Microsoft to give consumers what they wanted.

The video game console industry is particularly unique. It’s a large industry with only three significant players (Microsoft, Sony, and Nintendo), but profit margins can be very tight, particularly early in a new console’s life cycle. Consoles are often sold at a loss in order to establish a larger user base and make up the costs from software licenses. Early values are valued, even when selling at a loss, because the lifetime customer value will be higher and third party game developers will be more interested in selling games on the platform (leading to greater license revenue).

Microsoft and Sony are heated competitors, even on many fronts. Both have comparably functional consoles. Exclusive games, mostly developed by Microsoft and Sony’s own studios, are the key differentiating factors. Nintendo, while also a key competitor, has been targeting a lower price point and more casual gamer, whereas Microsoft and Sony have preferred the hardcore gamer and all-around entertainment center market.  Competition from mobile devices and the PC have further constrained the market size and profitability of the console market.

Compare Microsoft’s response to consumer demands for Apple to open up its iPhone platform, for example, allowing alternative default applications.  Apple and Android are engaged in a mostly two-sided war.  Android, in fact, is by far dominating in market share. But even with its lower market share, Apple is far more profitable. Incredibly profitable. Apple, who manufacturers both the hardware and software for its iOS platform, generates so much revenue, and commands such loyalty from its customers, that Apple has little incentive to respond to those customer demands. Rather, Apple can provide the product it wants to provide, not the product its customers claim they want.

Once again, we’re reminding how important competition is to improving the customer experience.


Difference between price and value: An iPhone App Store case study

Game developers have frequently lamented the drive for lower cost games on the iPhone.  “The push to 99 cents is the single most frustrating and terrible thing about App Store pricing,” says Nathan Vella, co-founder of Capybara, makers of Critter Crunch. “Since it became ‘expected’ by consumers, it forces a lot of developers, specifically indies, to devalue their game and significantly increase the number of sales needed for developers to get back their investment.”

But what Vella thinks as devaluing is really basic economics. Competition, the healthy and rewarding heart of capitalism, encourages makers of goods to try to one-up each other, whether by lowering prices or offering a more compelling product.

The App Store, with more than 100,000 applications, 13,000 of which are games, competition is pretty fierce. It is to be expected that price will be pushed down. Most game makers have stayed around 99 cents, so if someone really wanted to stand out, maybe they should sell at 98 cents. Or there’s lots of free games and that soon might become “expected”. Not even including truly free apps, estimates (which I strongly question) claim 75 percent of apps are pirated meaning Vella and game developers have more to fear from free than 99 cents. If Vella thinks 99 cents devalues his games, how will he feel when he’s forced to sell it for free?

iPhone developers, like many in the media industry, forget that price and value are two different things. Value is subjective. I, as a consumer, value a game a $10. As long as the price is less than $10, I will buy the game, even if it is $2. The developer chooses the price that will make them the most money, specifically by setting the price low enough as to attract the largest number of buyers. The $2 price in no way devalues the game. While I might have paid more, 10 other people might not have. Meaning the developer attracted more purchases and made more money over all. This is known as price elasticity.

We see evidence of this in many digital services. The PC game Left4Dead took 50 percent off its price and jumped 3,000 percent in sales. Variable pricing on iTunes led to lots of $1.29 songs and very few 69 cent songs. Those higher priced songs have seen enough of a drop in unit sales that overall revenue is lower. Maybe at 69 cents, they’d actually make more money.

For game developers, it seems the App Store just has too much competition to make it easy for anyone. There are so many games vying for attention, thanks to the low cost of entry (until traditional gaming consoles), that its a major challenge to get the attention of enough consumers willing to pay the 99 cents (or even pirate it). The benefits of the Long Tail in the App Store necessitates better search and organization to help people find the apps they want (the App Store does lack this robust a function). But game developers can look for their own solutions to stand out by using social media, pricing, and excellent games to build the buzz. It’s not Apple’s fault, it’s not consumers fault, piracy’s fault, or other developers faults. It is up to each developer to give consumers a reason to buy their game.  If consumers don’t pay, then change what you’re doing. That’s innovation and competition makes sure it happens.


One console to rule them all

Screen_Grab_OnLive_Welcome

The gaming world got some giddy news to mull over at last week’s Game Developers Conference. OnLive unveiled a new gaming console and platform dedicated to streaming games over the internet. There will be no discs – just a constant internet connection bringing a variety of games to computers and televisions. Most interestingly, all the processing of the games happen on some server, allowing basic PCs to play the most graphically intense games.  Displays at GDC showed basic laptops playing Crysis, a game that taxes even the most top-of-the line PCs.

Very little is known about how the system works, especially details like pricing. But in continuing the hype machine, OnLive is an exciting endeavor and even more thrilling experiment into the future of video games and digital distribution. There are many technical hurdles, specifically how fast connections will be. Streaming high-definition games at the demanded 30 frames per second requires a rapid and steady connection. It’s possible OnLive is a few years too early with broadband speeds no up to their challenge.

The experiment itself is in launching a new business opportunity for video games, and even a model for the entertainment industry.  OnLive is offering a microconole for gamers who want to play on their televisions, but they are also offering a browser plug-in so people can play right on their computers.  No hardware requirement means an instant customer base open to the product.  Hardware’s a tough business as movie-streaming services like Blockbuster and Netflix are learning.  Screenshots show options to rent or buy games, showing flexible pricing, though I’d prefer a subscription option similar to GameTap.  There are no details about downloading content onto hard drives to play offline, but that also would be appreciated.

OnLive boasts impressive support from leading game developers and now the debate begins of will it succeed or lose. Too many details are up in the air (how open is the system, how much value does the service offer the user, how comfortable is the controller). Certainly a slick interface and high-profile (if not out-dated) library makes me think OnLive is on the right path.  The case study alone will be worth the price of admission.

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Suddenly violent video games mean the medium is grown up

Nintendo DSi

The New York Times claims the new video game Grand Theft Auto: Chinatown Wars is “one of the most important” because of its story telling and maturity.

But really, it’s just because this is a violent video game on a stereotypically kiddie and girlie gaming system, the Nintendo DS. The article praises game developer Rockstar and Nintendo for being “bold” and making a “vital statement to the public” that video games are not just for children.

Didn’t we already know this?

How is it bold of Nintendo for approving one of the best-selling video game series of all time to make a game exclusively for their system, almost certain to sell millions of copies. GTA is a safe-bet, not bold. And as amazing as Chinatown Wars is, it’s not a “crucial moment in the maturation of the gaming industry.” It’s a well-known franchise in an industry more known for violence than child-friendly fare. The New York Times itself has pushed flawed research about how all this violence is harmful.

Video games are still maturing yes, and Chinatown Wars is a helpful step to spreading the rich storytelling potential of the medium. But it’s a miniature version of the also adult GTA IV released only a year ago. Just as adult and arguably more visually spectacular. Adult is not always maturity.  Video games can be mature without violence, but talking animals and magic spells don’t get the same headlines as blood and gore.

I recognize the DS itself has expanded the video game market. Yay. It’s more than four years old. About time the New York Times realized violence can sometimes make good storytelling.


More money grabs for doing nothing

brutal_legend I missed posting about the Watchmen fiasco. Basically, Fox once owned the rights to the Watchmen movie and actively decided not to make the film. So a few months before Warner Bros. releases their version, Fox sues saying it still owned the rights.  To keep its release date, Warner Bros. settled, paying off Fox for doing nothing. Copyright doing its duty, right?

Activision, likely giddy at the prospect of being its own Fox, is threatening to sue EA for publishing a game Activision gave up on.  Activision merged with Vivendi Games and in the merger, Activision dropped several titles including Brutal Legend, which EA picked up. Now that Brutal Legend is getting hype and an anticipated release, Activision is claiming EA is infringing on their rights on a game Activision said they don’t want to release – they want money for doing nothing.  I particularly love EA’s response.

We doubt that Activision would try to sue. That would be like a husband abandoning his family and then suing after his wife meets a better looking guy.


7 best games of October

Last year, video game companies gave us plenty to be thankful for in November. To keep gamers on their toes, this year publishers are padding the months of October with the biggest collections of AAA game releases. In fact, I could make a top 7 list for the week of the 20th alone.  So get advances on your paychecks and allowances because you don’t want to wait ’till the holidays for these games.

rise_of_the_argonauts 7. Rise of the Argonauts

This innovative new action RPG professes several impressively immersive features, from a near-HUD-less screen to realistic combat where stabbing once is all your need. Playing as Jason, the player pilots the mythological Argo ship in search of the Golden Fleece, teaming up with Hercules and different Greek Gods while fighting hordes of monsters and God of War extras. Cool tech demos have disappointed before (looking at you Force Unleashed), but Argonauts looks to keep gameplay just as important. Fingers crossed.

6. Far Cry 2

The sequel to 2004’s critically acclaimed shooter, Far Cry 2 aims to push open-world games and graphics cards to the next-generation. Set in a huge African wilderness, players employ tons of weapons, gadgets, vehicles, and skills to play a part in the war-torn region.

5. Fable 2

It’s hard to trust Peter Molyneux. His games are great but so over hyped they seem bad on release.  After ignoring everything he says, Fable II looks like an engaging fantasy adventure with a real emphasis on that fable_2role-playing we always forget about.  Local and online co-op and some of the funniest achievements yet (Chicken kicker and Hunter are my top priority) are features even Molyneux has yet to spoil for me.

4. Resistance 2

8 player online campaign. 60 player war zones. And Starbuck. Insomniac’s pushing PS3 capabilities with some features and exciting gameplay.  Assuming the online powerhouse pulls through, Resistance 2 could be the online shooting king for the holiday season. Sorry Gears, November’s just too late.

3. Dead Space

EA’s pushing a new franchise without Sims in the name. Shockingly it looks amazing. This sci-fi horror survival game looks gorgeous with an equally intriguing story and some exciting gameplay ideas that make my thumbs twitch.

2. Fallout 3

Gamers once again emerge from the Vault with a mission and Pip-Boy.  The Elder Scroll mavens at Bethesda apply their open-world know how to this first/third person RPG. The team creates an apocalyptic Washington DC (which will be disturbingly pleasing in this political climate) filled with mutants, giant insects, and your destiny. Plus, the game’s really bloody, so yay.

1. LittleBigPlanet

Certain to be the cutes game of the year, LittleBigPlanet offers too much awesome not be camping out in front of GameStop right now. First, there’s a lengthy campaign filled with physics-powered plaforming goodness and co-op slapping contests. After you finish the 12 plus hours, there’s the most impressive set of creation tools in console gaming history built right in, allowing you to build all the penis shaped-levels you can dream up and share with the world. This means never-ending hours of levels to play, build, and share. And let’s not forget Sackboy. Maybe I’m just a sucker for sadistic cuteness.

Honorable mentions

I did say this month was huge. Here are more games to keep your eyes out for:

Motorstorm: Pacific Rim

Spider-Man: Web of Shadows (It looks like it might be good, but don’t hold your breath)

Wii Music (I fear it like a sneezing child near a salad bar, but Nintendo seems to think video games are better without a challenge)

Guitar Hero World Tour

Legendary

Saints Row 2

Golden Axe: Beast Rider

Fracture


Spore Review: The least godly god game

Will Wright’s sim-everything hit stores last week to some harsh criticism (I hate DRM). I rarely write reviews on Prodigeek, but wanted to give attention to Spore’s unique failings as they help clarify the joy of the god game genre.

Wright gave gamers two of the best god games ever, Sim City and the Sims. Both games appeals to hardcore and casual players (shocking) by giving players a sandbox with unique rules to experiment in and explore. Spore lacks the experimental and exploration that makes god games worth player. Instead, Spore is a primer in video game genres, giving casual players a taste of the other games they can play, then scaring them off with an obtuse yet bland final act.

spore_creature_creator

The best way to understand god games, and why Spore fails to join the genre, is watching gamers discover how not to play the game.  You could spend hours building a huge city and then destroy it with an alien invasion or hurricane. The Sims allowed you to trap your Sim in a room with no toilet or better, set them on fire.

Only in the final Space stage can you wreck havoc, and even that is tame, giving you strict criteria for planet teraforming and killing creatures before you can see them writhe in pain.

I don’t think Spore needs to be a sadist’s paradise, but the freedom to play however you want to is what makes god games appealing.

Spore’s other major feature, its creators, are amazing pieces of technology. I compare these creators to the Sims home creator which, even though it was far simpler, was so much more rewarding. The interior design feed the game and lent itself to how you played from enhancing stats to peeing standing up. Spore relied on a barebones system where more feet didn’t make you faster.  The lack of complexity made upgrading your character as simple as using the most powerful pieces, even if they didn’t fit your creature.  And once you entered the Tribal stage, all those stats became meaningless rendering the highly publicized Creature Creator obsolete two hours in.

Spore never evolves into being the god game it set out to be. Instead of being an all powerful influencer, pulling strings with the click of a mouse, you are an evolving amoebae with just enough influence to get to dinner and back. Even once you enter space, you still just a guy in a ship with no armada or easy-to-destroy-type weapons.  Spore remains an unsatisfying action/strategy game because Spore never bills itself as one.

Spore could have pushed the god game envelope with a universe of exploration, allowing more complexity in the creatures created by letting experimentation dictate gameplay – how would five arms really benefit you.  And to keep the creation going later in the game, let us play god by creating new creatures, prey and predators, to infect other planets with. Unleash a flying T-Rex on the bunny planet and see them try to fight with floppy tanks.  I would totally pay $50 for any game that allows that to happen. Unfortunately Spore does not.


Gamers revolt against Spore DRM

spore EA released the long-in-development Spore this weekend, packed with repressive DRM.  Gamers have responded by flooding Spore’s Amazon with one star reviews (more than 650).  EA limits Spore to only three installations.  Uninstalling the game does not increase that number, leaving paying customers to prove they legally purchased the game to EA for permission to play the game.

All this happens in the name of preventing piracy. But Spore has been available on Bittorrent sites for almost a week sans DRM. This leaves paying customers to deal with restrictive DRM.

EA knew a public relations nightmare was brewing when it announced the DRM back in the spring.  After public outcry, EA removed part of the DRM requiring a validation check every 10 days, but EA kept the three installs limit that is frustrating gamers.

So piracy is running free and paying customers are pissed off.  How is DRM supposed to work again?


Courts let Blizzard expand copyright; Blizzard wants to expand it more

Blizzard recently won its case against MDY, the makers of Glider, a program that played the World of Warcraft game by itself.  The court banned the distribution of Glider on the ludicrous claim of copyright violations.  Blizzard pointed to its EULA document (which can only be read after buying the game and are “enforced” once you open the package) that tries to limit what users can do with a product they legally purchased.  Blizzard says it sells you a limited license of the game, not the game itself thus negating your First Sale Doctrine rights.  Courts have been mixed on the power of EULA agreements since no one reads them or actually agrees to them.

Now that Blizzard won its summary judgement, it’s looking to push harder on Glider, asking the court to ban the source code from being open-sourced and preventing the developers from helping anyone else create a similar product.

I already have issue with the initial ruling, negating consumer’s first sale doctrine rights just because Blizzard says those don’t count because of a document no one read or agreed to.  The court believes this instance is copyright infringement, but now Blizzard wants the court to basically ban any future products just because.

This case already sets a bad precedent for future EULA and software modification cases.


7 most-wanted comic book video games

Comic book video games have well documented crapiness with a few shining gems.  The problem is comic book geeks (like me) want these comic book games. We want to feel like Spider-Man, and Superman, and Batman.  These are the comic books game that will best bring to life a new super hero experience.

7. Flash

A sandbox Central City might not be on everyone’s Christmas list, but it’s the only way to do Flash justice.  This speedster needs a huge environment to zoom through, fighting Gorilla Grodd, Mirror Master, and Reverse Flash as he tries to save his iron_man wife and kids (this is the Wally West Flash, Barry Allen’s unlockable). Key battles pit you against teamed up villains for high pressure boss battles.

6. Real Iron Man game

The recent Iron Man game unfortunately sucked. But this awesome character should be a video game staple.  Let’s revamp the controls (more control, less speed) and focus the campaign on the Mandarin and his rag-tag group of baddies. The twist is this is an action/business simulation game.

In Mega Man-esque level choosing, you fight Whirlwind, Dreadknight, Crimson Dynamo, and more. Give us some epic boss battles with Fin Fang Foom and Ultimo and even a Dr. Doom sidequest.

The business sim comes from Tony Stark. You choose how to run Stark Enterprises, with some investments making the company more valuable and other investments making your armor more powerful.  By running the company well, you make money in order to buy those upgrades and other armor types. If you run the company badly, Justin Hammer will buy it up and you won’t be able to upgrade your armor.

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