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This seems an ill advised stance:

Page last updated at 23:25 GMT, Wednesday, 19 August 2009 00:25 UK
Retailers 'limit UK games market'

By Daniel Emery
Technology reporter, BBC News, Cologne

One of Germany's largest video games publishers has said that the UK's retail chains make it difficult for publishers to break into the UK market.

Georg Larch, Koch Media's marketing director, also blamed the exchange rate and UK pricing structure for the difficulties faced by games publishers.

Industry experts say the second-hand market also stifles industry growth.

Mr Larch said at the gamescom meeting that a rise in digital distribution would make things easier in the future.

He told BBC News while the firm's turnover in Germany had risen by 18% this year, in Britain that figure was much lower.

"We're seeing companies like Amazon take a larger market share, and the growth of digital distribution, but it's going to be a long-term development as people still want to have something in their hands," he said.

Mr Larch said that other economic factors were at work against overseas publishers.

"We can see a lot of cheap imports from the UK to Europe [due to the current exchange rates]."

Ian Livingstone, president of UK-based publisher Eidos, told BBC News publishers still wanted to work with retail.

"These aren't just shops, they are a marketing tool, a window into our world where software houses can display their wares," he said.

The problem that publishers have with retail, he said, was due to the growth of the second-hand games market.

"The pre-owned market is a serious problem, because there is no benefit to developers or publishers," said Mr Livingstone.

While retailers have to pay a percentage to the publishers for a sale of a new game, there is no such requirement when selling a second hand game, with the shop pocketing all the profit.

Mr Livingstone estimated that the pre-owned market made up more than a quarter of a video-game retailers turnover.

"A shop makes a bigger margin on a pre-owned title, and can sell them six or seven times, so there is no incentive for them to reorder and the content creator gets no slice of the action," he said.

Industry experts say the landscape of what makes a successful video game is changing.

While software developers could turn a profit if a game made it into the top 20, with rising development costs and more platforms to develop on, a game often needs to be listed in the top 10 for publishers to justify any investment.

This has made some developers more cautious on what they develop and has also seen retailers allocate more space to the best-selling games.

Retailers may then refuse to stock so-called "tier two" games altogether.

Have they learned anything about the music industry's self-inflicted decline?

Shite, here's the link to the BBC article.

I wander what would happen if the industry underwent a massive shift and started to axe cross platform development. I can see a number of benefits to the industry.
1) stimulation of the market as people buy new systems to play the software. This would have to coinside with a decrease in the systems cost to around the $300 USD mark (seems to be kinda a sweep spot for what people are willing to pay for a gaming only machine and possibly what led to Sony's PS3 troubles by charging more and having it be both a decent Blue-Ray player and a game console). I realize that the consoles cost money produce and only tend to get more expensive each generation, however, the idea that you make up the cost lost on hardware with software sales seems sensible (and I believe worked to some degree with the original Xbox). This would also have to come with a cost cut of games. I'd say maybe $40 USD for new games, the idea is to sell more games at a cheaper price by trying increasing impulse buys. This idea may or may not work, but $60-70 USD for a game pretty much kills impulse buys when the game is new (when I believe most of the profit is made).

2) Allows for developers to focus on getting the most out of a particular set of hardware, and more importantly it allows for easier development of the software as multi system games have to take into account different capabilities of different hardware sets.

This may not be great for the consumer at first. However, I believe that this would eventually lead to more competition in the market and hopefully better quality products. I figure that instead of the next average FPS for every system being made, that if multiple unique products are being developed for different systems we'll see a quality increase and more variety.

I wonder how prevalent is gamestop. I recall watching a video about gamestop, from an ex-employee's standpoint and it told that gamestop specialize in this. They do so to such a degree that stoners regularly sell their stolen caches of video games from them (I'm not kidding, they told the employees so) and shamelessly re-sell a broken hardware or game.

I figure that instead of the next average FPS for every system being made, that if multiple unique products are being developed for different systems we'll see a quality increase and more variety.

No, what we'll have is that we will have more copy-cats, like we already do. The current problem is that the publisher's idea of a successful game is one that tries to mimic all other previous successful games. Risk is minimized to the point that its almost unthinkable to integrate to have a game from a first-person standpoint and not have guns, a sexed-up warrior-woman who does supermodelling in every second she has to spare, the poly count about the year income of a small nation, a 100+hour physics engine to perfectly model the behavior of cardboard boxes and the vague pretense of sandbox-gameplay even if the design was not accosted to it from the start.

Wing Commander MAD wrote:I'd say maybe $40 USD for new games, the idea is to sell more games at a cheaper price by trying increasing impulse buys. This idea may or may not work, but $60-70 USD for a game pretty much kills impulse buys when the game is new (when I believe most of the profit is made).

Cheaper games would be nice. Here new games are priced at the equivalent of 94USD, and stay like that for months on end. Older games are priced at around 47USD. No wonder piracy is widespread.

[R_H] wrote:

Wing Commander MAD wrote:I'd say maybe $40 USD for new games, the idea is to sell more games at a cheaper price by trying increasing impulse buys. This idea may or may not work, but $60-70 USD for a game pretty much kills impulse buys when the game is new (when I believe most of the profit is made).

Cheaper games would be nice. Here new games are priced at the equivalent of 94USD, and stay like that for months on end. Older games are priced at around 47USD. No wonder piracy is widespread.

Surely the prices will correct themselves if Australians are really dissatisfied. Don't you believe in the invisible hand of the free market?

General Zod wrote: Surely the prices will correct themselves if Australians are really dissatisfied. Don't you believe in the invisible hand of the free market?

Well, they (the gaming industry) shouldn't be surprised if the attach-rate is shit in Europe and Australia. For crying out loud, an Xbox 360 Pro costs as much as three newly/recently released games. It's just ridiculous. I think I'm going to start ordering games off of Play Asia.

By the way, the videos I'm talking about is called Zero Originality. Its the first episode and the author's account was deleted on youtube. The first few minutes or so will tell you my point, but watch on and you can see what they meant under second-hand market. If you don't believe me about the stoner bit, go to the video's 12:00 minute and listen for a bit.

Wing Commander MAD wrote:I wander what would happen if the industry underwent a massive shift and started to axe cross platform development. I can see a number of benefits to the industry.
1) stimulation of the market as people buy new systems to play the software. This would have to coinside with a decrease in the systems cost to around the $300 USD mark (seems to be kinda a sweep spot for what people are willing to pay for a gaming only machine and possibly what led to Sony's PS3 troubles by charging more and having it be both a decent Blue-Ray player and a game console). I realize that the consoles cost money produce and only tend to get more expensive each generation, however, the idea that you make up the cost lost on hardware with software sales seems sensible (and I believe worked to some degree with the original Xbox). This would also have to come with a cost cut of games. I'd say maybe $40 USD for new games, the idea is to sell more games at a cheaper price by trying increasing impulse buys. This idea may or may not work, but $60-70 USD for a game pretty much kills impulse buys when the game is new (when I believe most of the profit is made).

2) Allows for developers to focus on getting the most out of a particular set of hardware, and more importantly it allows for easier development of the software as multi system games have to take into account different capabilities of different hardware sets.

This may not be great for the consumer at first. However, I believe that this would eventually lead to more competition in the market and hopefully better quality products. I figure that instead of the next average FPS for every system being made, that if multiple unique products are being developed for different systems we'll see a quality increase and more variety.

This has nothing to do with the issue at hand, which deals entirely with the reselling of used games, and more to the point, it only helps out one group: the console makers. Single platform games earn a lot less for the software developer and thus less incentive to make said games. But yeah, single-platform development means LOWER prices.

Seriously, what world are you from?

Industry experts say the landscape of what makes a successful video game is changing.

While software developers could turn a profit if a game made it into the top 20, with rising development costs and more platforms to develop on, a game often needs to be listed in the top 10 for publishers to justify any investment.

I was referring to this little gem here. Its one area that creates costs, just not the largest. The second hand market is not something they're ever going to get rid of unless they go completely digital, and even then some conoutries have better consumer protection than others (I can't think of an example off the top of my head, but I believe in some places the whole your only being the given a license to use the software and don't actually own the game doesn't fly). It's about the only way, development costs can be kept down, as I don't see the complexity or the need for better visuals (in the eyes of your average gamer) to be decreasing anytime soon. Finally, keep in mind that this is the publisher bitching. Even if the publisher were to have its way I highly doubt much if any new money would find its way into the pockets of the developers.

When it comes down to it 9/10 of the time the publisher(s) have the developers by the balls anyway. There haven't been exactly a whole lot of companys that have gone the direct distribution route, and many that due I would imagine would be working without a very secure source of founding other than employees/owners and maybe bank loans as a source of funding, as its usually the publishers who foots the development cost of game. I believe generally once the agreements were drawn that the developer's aren't going to see anymore money no matter how well the game sells unless they get contracted for an exapansion, sequal, or another game (ie i doubt most developers see any kind of royalties for the most part). I don't even want to think of how screwed the internally owned development houses are screwed by the publishers.

I admit that this may not be the best idea for cutting development costs, but something has to give somewhere and multiplatform development (particularly those with vastly different hardware and environments) seem to be the best place to cut without sacrficing the quality of the final product in both the developers and the consumers eyes.

So...in order to resolve an issue that's presumably massively cutting overall sales and likely driving prices up (even though $50-60 for a game has been a standard for nearly two decades, when most other costs go up over time), you'd...do something that would drive up prices even more, and increase the overall initial cost, cut sales for developers even more...

Yeah, you've lost the plot kid. There are a number of better solutions that fix the problem, like digital distribution, which is growing in popularity. In fact, the developers and publishers hold a big threat over the brick and mortar stores by means of the various digital distribution methods. All it takes is for the big boys to get fed up and start only selling games digitally. Lower the price of the game by $10 or $20, and boom, resale problem solved. That's an endgame scenario, but with lower bandwidth costs and larger hard drives on computers and consoles alike, it's a very real thing. Hell, there's a reason XBL now offers full 360 games for download these days.

But nah, it's cool, you don't have to think too hard. Just whine about how everything was so much better with exclusive only titles. By the by, I hear that art is one of the biggest costs game developers have to deal with, not cross-platform compatibility. That doesn't matter though, keep coming up with solutions that cost more than they save. I hear that's the way to do things in a bad economy. Sony should hire you, seriously.

Hotfoot wrote:So...in order to resolve an issue that's presumably massively cutting overall sales and likely driving prices up (even though $50-60 for a game has been a standard for nearly two decades)

PC Games have not followed that trend. As for two decades. Lets say 15 years ago so we are at 1994-1995 area. So we are talking Nintendo 64's and Dreamcasts. By my knowledge the Dreamcast was the first 50$ standard pricing console. I had bought my Super Nintendo new releases like FF-6 for $40 not 50$ and had gotten the first run of N-64 games for similar prices.

And the 60$ price point has only been true of the post Xbox time frame because for whatever reason console gamers enjoy paying 10$ more than PC gamers do. Nevermind PC Gaming has tiers unlike Xbox360 or PS3 games. PC shovelware games hit store shelves for 19.99$ or even 9.99 with launch prices of at most 29.99$. PC games are a standard 50$ minus a dollar or two for pre-orders or online re-sellers like Newegg.

Mr Bean wrote:

Hotfoot wrote:So...in order to resolve an issue that's presumably massively cutting overall sales and likely driving prices up (even though $50-60 for a game has been a standard for nearly two decades)

PC Games have not followed that trend. As for two decades. Lets say 15 years ago so we are at 1994-1995 area. So we are talking Nintendo 64's and Dreamcasts. By my knowledge the Dreamcast was the first 50$ standard pricing console. I had bought my Super Nintendo new releases like FF-6 for $40 not 50$ and had gotten the first run of N-64 games for similar prices.

And the 60$ price point has only been true of the post Xbox time frame because for whatever reason console gamers enjoy paying 10$ more than PC gamers do. Nevermind PC Gaming has tiers unlike Xbox360 or PS3 games. PC shovelware games hit store shelves for 19.99$ or even 9.99 with launch prices of at most 29.99$. PC games are a standard 50$ minus a dollar or two for pre-orders or online re-sellers like Newegg.

PC games have not followed that trend? Really? I remember having to pay $50-60 for new games back in 1995. The prices you're quoting are more like the used game prices. Now, I only bought PC games back then, my last console before getting a slimline PS2 for about $100 was a Sega Genesis. And yes, there were games that cost $60 for the PC, and for a while, that was rather the standard. It dropped back down after a while, and stayed there. The $60 console price point has only been for the most recent generation of HD gaming, not the Xbox, but the 360. PS2 and Xbox games were still $50 for quite some time.

Now, with regards to shovelware, you're right that it's classically been cheaper, but that's really not what we're talking about, is it? There's actually shovelware for consoles too, it's just not as common, at least until recently. Hell, if you want to bring everything into account, you can take in the PSN and XBL arcades, and the Wii VM store, and some of those are full games, for really cheap prices. But yeah, there's no tiers for consoles, just PCs.

And yes, I said a standard, meaning most games fit that range. Obviously you're going to find exceptions on both ends of the spectrum. Shall we count $80+ special editions too? Or games like Steel Batallion with crazy controllers?

You're just picking nits, and you're not even doing it well. We're clearly talking about games that are supposed to be top shelf, not shovelware, or special editions, or collections of puzzle games, or whatever other special case thing you'll claim is super relevant next.

Even given you're more than right, that you're being conservative, we're looking at a price increase of...$40 to $50 for PC games, and $50 to $60 for console games. Right? How much have movie tickets gone up over the years? According to this site, the "average" price of movie tickets in the US was $4.35 in 1995. In 2008, that went up to $7.18. By comparison, gamers have been making out like bandits over the years. Oh no, a twenty percent increase over 15 years! Even if you go from $40 to $60, that's a 50% increase, which still beats out the roughly 65% increase in movie tickets. $40 in 1995 is worth about $56 in 2008/2009. If anything, blast games for giving us less content per dollar than they used to. Today, 8 hours is considered just fine for most games, but back in the day, that would have been considered abysmally short for most games. Sure, the graphics are nicer, but what about gameplay? There are games from the mid to late nineties with more gameplay depth than games today.

So yeah, whine all you want about how much more games cost today. The $50 or so I plopped down for MW2: Mercs back in 1996 is worth about $70 today, and yet I predict that when MW5 comes out some time in 2010 or 2011, it will be $50. I call that a deal, personally. Hell, it's a deal at even $60.

Now, does this mean that the current pricing isn't bullshit? I'll leave that to you. I think there need to be different tiers of games, and we're seeing that happen right now all over, with cheaper games by third parties with lower requirements all over the damn place. If you look around, maybe you'd see more of it.

Well I remember PC games being about £45 each easily over here. This was round about the era of Pacific Strike and Strike Commander. The first CD-Rom titles, especially FMV intensives like Wing Commander 3 were more expensive, sometimes reaching £60.

The UK has a decent range of budget titles for PC usually about the £10 mark, or even cheaper at £5. Someone on ICQ told me there isn't really much of an equivalent of this in the US though sometimes titles do just naturally fall in price due to age.

Hotfoot wrote:So...in order to resolve an issue that's presumably massively cutting overall sales and likely driving prices up (even though $50-60 for a game has been a standard for nearly two decades, when most other costs go up over time), you'd...do something that would drive up prices even more, and increase the overall initial cost, cut sales for developers even more...

Yeah, you've lost the plot kid. There are a number of better solutions that fix the problem, like digital distribution, which is growing in popularity. In fact, the developers and publishers hold a big threat over the brick and mortar stores by means of the various digital distribution methods. All it takes is for the big boys to get fed up and start only selling games digitally. Lower the price of the game by $10 or $20, and boom, resale problem solved. That's an endgame scenario, but with lower bandwidth costs and larger hard drives on computers and consoles alike, it's a very real thing. Hell, there's a reason XBL now offers full 360 games for download these days.

But nah, it's cool, you don't have to think too hard. Just whine about how everything was so much better with exclusive only titles. By the by, I hear that art is one of the biggest costs game developers have to deal with, not cross-platform compatibility. That doesn't matter though, keep coming up with solutions that cost more than they save. I hear that's the way to do things in a bad economy. Sony should hire you, seriously.

I agree about digital distribution and personally prefer it. However, it needs to be done right (ie no download limitations, and appriate regional pricing), and the required infrastructure needs to be present. The U.S. currently doesn't have the needed infrastructure to completely move away from physical media. Heck the general trend seems to be discourage people from using lots of bandwidth rather than upgrading the capacity of the network. I am honestly not even sure it will be possible to get the U.S to a state similar to parts of Europe and Japan, simply due to the size of the country. Unfortunately, that is also the scale that will be needed if we are to wholly embrace digital distribution.

Resale is a bit of a sticky issue in and of itself. Most people aren't exactly familiar with concept of purchasing a license to use something. Heck, how many people who buy software even realise that they are only purchasing a license to use a product and not the actual product and all the associated limitations that that implies? The EULA is probably the least read document in the history of man, when compared to other documents that have the same amount of distribution. If the secondhand market is destroyed, I expect to see a fair amount of public backlash as a result. Hell, that may even increase piracy to a point where it is no longer the boogieman of the industry, but a real threat. I imagine the console market would suffer particularly, as there are plenty of games that are not worth $60 USD that they ask for, and the concept of tiered pricing seems completely foreign. I am also sure you'll have a hard time convincing the industry to adapt tiered pricing, as they've become used to charging a flat rate no matter the quality of the product and I doubt they'll be willing to risk the potential loss of profits by adopting one. Unfortunately, it is also the console market that is hit by the problem of secondhand games.

I agree that my idea was not the most effective, and in hindsight probably not even a great idea. I however, don't see the removal of the secondhand market as something that will be easy to accomplish.

It's not like they have to totally abandon physical media by moving to digital distribution - they could still sell games on the internet, and offer customers an optional $5 fee to mail them a disc.

Hotfoot wrote:There are a number of better solutions that fix the problem, like digital distribution, which is growing in popularity. In fact, the developers and publishers hold a big threat over the brick and mortar stores by means of the various digital distribution methods. All it takes is for the big boys to get fed up and start only selling games digitally. Lower the price of the game by $10 or $20, and boom, resale problem solved. That's an endgame scenario, but with lower bandwidth costs and larger hard drives on computers and consoles alike, it's a very real thing. Hell, there's a reason XBL now offers full 360 games for download these days.

So, I assume you expect them to ask for prices which would acceptably mirror the value saved by cutting out the distribution, fares, taxes and such? Since as afar as I know this is not the case. It's rather the opposite - Publishers ask for the digital equivalent the same price as that of a disc. If you assume the added revenue goes to the developer you're naive, which I don't expect you to be.
I have no qualms with digital distribution - if it is at a pricepoint and with rights that make it acceptable. Especially the DRM is an itchy point. Say, a game will be rated higher after something came up, a week after its been published. Since we're talking about platforms which are regularly online the publisher may revoke my license and maybe, if I'm really lucky, I will be compensated. With a gift card or some other fishy thing.

I want the judicial equivalent of a hardcopy of software, not some fucked up excuse of license to use as the rights holder deems fit. If I want to play the game at my friends console, I don't want to buy it again. If my console dies, I still want to be able to play them, without having to purchasing them again. After all, IT IS ALREADY MY PROPERTY! I'm looking at you, Nintendo, dammit!

Buritot wrote: I want the judicial equivalent of a hardcopy of software, not some fucked up excuse of license to use as the rights holder deems fit. If I want to play the game at my friends console, I don't want to buy it again. If my console dies, I still want to be able to play them, without having to purchasing them again. After all, IT IS ALREADY MY PROPERTY! I'm looking at you, Nintendo, dammit!

This is one of the reasons I like Steam. The game is tied to your account information, but you can install it on (as far as I know) an unlimited number of PCs with the right to re-download the title as much as you like. None of this hokey bullshit about limiting the number of machines you can use it on and de-activating it after you hit your limit (I'm looking at you, Apple).

Buritot wrote:So, I assume you expect them to ask for prices which would acceptably mirror the value saved by cutting out the distribution, fares, taxes and such? Since as afar as I know this is not the case. It's rather the opposite - Publishers ask for the digital equivalent the same price as that of a disc. If you assume the added revenue goes to the developer you're naive, which I don't expect you to be.

Ideally, yes, I'd like the prices to go down across the board. Incidentally, they have for the XBL service that offers full digital downloads of certain games. After all, it is trying to compete with the used game market.

For PC games, well, yeah, there is a bit of resistance there. Some games by third parties sell for less, but most of the big name titles sell for the full amount. Keep in mind that Steam, along with other digital distribution networks are acting as the brick and mortar store, so the money that might go to Gamestop and the rest is instead going to the owners of the digital distribution networks. It's not like no work is being done, bandwidth does cost money after all, but you're right in that it should be a little cheaper. That said, the benefits of a service like Steam to me are more beneficial than having the disk in hand.

Let's also not forget that, as I've stated above, what I paid for Mechwarrior 2: Mercenaries back in 1996 is basically the same dollar amount I expect to pay for Mechwarrior 5 in 2010. The basic reality is that I'm spending $20 less for the game released a year from now than I did for a game released back in 1996. PC game publishers and developers earn less money per game sold today than they used to.


And Zod, I hate to burst your bubble, but not all games offered on Steam follow Valve's rather liberal digital rights management. Most do, but there are some that are excessively limited, by publisher fiat. I don't remember which ones exactly, but I recall Bioshock might have such limitations. I know there's at least one that installs the dreaded Starforce, but it doesn't come to mind immediately.

Hotfoot wrote: And Zod, I hate to burst your bubble, but not all games offered on Steam follow Valve's rather liberal digital rights management. Most do, but there are some that are excessively limited, by publisher fiat. I don't remember which ones exactly, but I recall Bioshock might have such limitations. I know there's at least one that installs the dreaded Starforce, but it doesn't come to mind immediately.

All the ones that I care about do, so that's good enough for me.

General Zod wrote:

Buritot wrote: I want the judicial equivalent of a hardcopy of software, not some fucked up excuse of license to use as the rights holder deems fit. If I want to play the game at my friends console, I don't want to buy it again. If my console dies, I still want to be able to play them, without having to purchasing them again. After all, IT IS ALREADY MY PROPERTY! I'm looking at you, Nintendo, dammit!

This is one of the reasons I like Steam. The game is tied to your account information, but you can install it on (as far as I know) an unlimited number of PCs with the right to re-download the title as much as you like. None of this hokey bullshit about limiting the number of machines you can use it on and de-activating it after you hit your limit (I'm looking at you, Apple).

Games have been yanked from the Steam library before and removed from being playable.

Doesn't help the Steam example. It's just a shame that Steam is the benchmark for digital distribution, since it originated in a very different industry situation but isn't really the best solution. Is it funny or sad that there's room for many movie DDs, many book DDs, many music DDs, but there's basically Steam and a whole bunch of shit DDs when it comes to games? Impulse lets me buy the solid gold hits of Eastern Europe, GOO lets me buy games I already own...

I assume Steam sells actual keys (ie, not Steam specific authentication) so complaining about 'not having the disks wah' is beyond stupid. I wouldn't know, because none of the shit on Steam even remotely interests me. Hopefully Steam has a portable archive format.

EDIT - Bah Aly instaposted.

Stark wrote:Doesn't help the Steam example. It's just a shame that Steam is the benchmark for digital distribution, since it originated in a very different industry situation but isn't really the best solution. Is it funny or sad that there's room for many movie DDs, many book DDs, many music DDs, but there's basically Steam and a whole bunch of shit DDs when it comes to games? Impulse lets me buy the solid gold hits of Eastern Europe, GOO lets me buy games I already own...

I assume Steam sells actual keys (ie, not Steam specific authentication) so complaining about 'not having the disks wah' is beyond stupid. I wouldn't know, because none of the shit on Steam even remotely interests me. Hopefully Steam has a portable archive format.

EDIT - Bah Aly instaposted.

Since there's an option to get the game's key from Steam itself (works for physical discs ala DoW 2), and the ability to backup the game to a physical disc, I would assume they're selling the actual keys. Games being pulled seems more of an exception than the rule.

Yeah, that's what the others do but I wasn't sure about Steam. If the disk version is available and you're sold a 'proper' key, you don't even need to use Steam's download service AT ALL. I bought UT3 off Impulse for 30USD (instead of 85USD lol) and have never downloaded the 7ish gig because I just used a disk to install it. And if Impulse explodes or goes insane or the internet is stolen by bats, I can still use/play it.

Amazing.

Alyeska wrote:Games have been yanked from the Steam library before and removed from being playable.

What games have been removed from Steam?