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Default PC Gaming Alliance Report-The State of PC Gaming

August 20th, 2008, 16:28
The PC Gaming Alliance, a nonprofit corporation promoting PC gaming composed of PC industry members such as Microsoft, Intel, AMD, NVIDIA, and Dell, has a report out called "Horizons," looking at the state of PC gaming and coming to some overall positive conclusions. You can read a summary of it here, but here's a sample of the main points revealed so far:
Speaking at the Games Convention Developer’s Conference in Leipzig, PCGA president Randy Stude announced that PC gaming was a $10.7 billion industry during the year of 2007, with retail sales accounting for just 30 percent of total revenues. According to the report, growth was largely driven by online revenues from Asia, the world’s largest market, which is approaching half of total worldwide sales.
Online PC gaming revenue led the way in 2007 with $4.8 billion, nearly double the worldwide retail sales numbers for PC games. Digital distribution sales approached $2 billion, while advertising revenues from websites, portals, and in-game ads accounted for $800 million. Both are expected to grow substantially as major developers and publishers begin to adopt formal strategies to take advantage of new online opportunities.
“Our analysis clearly shows incredible growth in online PC gaming, proof that this industry is far stronger than anyone has reported,” said Stude. “Today’s consumers shop where they live - online.”
IGN also has a Q & A with PCGA pres Randy Stude(Intel), and Roy Taylor(NVidia), the PCGA's CTO, that goes into the subject of what the Alliance is about a bit further. Here's a sample question:
IGN: The issue of PC game piracy creeps into just about every "state of PC gaming" discussion, but how are we to know how much damage it's actually doing? Will we ever really be able to get a definite sense of how piracy is really affecting game sales, or will it remain the sort of nebulous threat it appears to be today?…

Roy Taylor: Piracy is stealing. It's as bad as taking money from someone's wallet. Those users that do it often hide behind a number of excuses. We are very serious about addressing all aspects of this issue. But this includes not treating honest and desired users as bad guys. Poor anti-theft measures are part of the problem. They help justify downloading illegal non-protected copies and they cause resentment. The subcommittee is aware of all of these and is working on them. It's a big subject.
More information.

Where there's smoke, there's mirrors.
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August 20th, 2008, 16:28
GN: The issue of PC game piracy creeps into just about every "state of PC gaming" discussion, but how are we to know how much damage it's actually doing? Will we ever really be able to get a definite sense of how piracy is really affecting game sales, or will it remain the sort of nebulous threat it appears to be today?…


Roy Taylor: Piracy is stealing. It's as bad as taking money from someone's wallet. Those users that do it often hide behind a number of excuses. We are very serious about addressing all aspects of this issue. But this includes not treating honest and desired users as bad guys. Poor anti-theft measures are part of the problem. They help justify downloading illegal non-protected copies and they cause resentment. The subcommittee is aware of all of these and is working on them. It's a big subject.

What is this guy a politician? I haven't seen a question dodge that good since Hillary Clinton was still showing up on the today show every other day.

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August 20th, 2008, 16:45
@blatantninja :

Haha, yes, that's what I thought also. "blablabla piracyisbad blablabla weretakingseriousmeasures" He didn't even answered partially to the question dammit!
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August 20th, 2008, 16:48
Originally Posted by blatantninja View Post
What is this guy a politician? I haven't seen a question dodge that good since Hillary Clinton was still showing up on the today show every other day.
Indeed lol. But there's no need to be a genius to know the question of that journalist is impossible to answer. So he tried as hard as he could not to look dumb, after all if you represent a corp that puts together Microsoft Intel AMD DELL nVIDIA you just can't get away with a "I don't know". You have to justify your salary.

How much piracy is affecting the revenues of the PC game industry is impossible to determine. You can have a pretty accurate estimate of how many game copies are being downloaded but that's about it.

There's no way to really determine how many of that number is actually copies that would have been bought had the pirate have no access to a pirated copy.
Same with music. I for example have downloaded records from artists that I would never have bought if it wasn't free. And no matter what their propaganda say I know I'm not harming the industry by doing so : I wouldn't have bought it anyway so it's not like they're losing any money.
Now it's true I have downloaded other things that I would probably have bought had it not been so easy to get it for free, and I know in that case that's stealing because it's money they should have gotten from me but they hadn't.

But there's absolutely no way to figure out on large scale what's the percentage of actual theft and what's just "people downloading out of curiosity who wouldnt have bought it anyway". Among that second group piracy has even become a marketing/advertisment tool for the industry: people downloading for free sometimes end up buying that product or another in the same franchise legally… and they wouldn't have had they not had access to it for free in the first place. (happened to me a lot)
And you could also add people who download stuff that they already own legally, for example I downloaded Fallout 2 recently because I wanted to try the english version (the french version I have with french voice-over just sucks). Also downloaded Baldur's Gate last year because for some reasons my computer couldn't read one of the CDs anymore.

And how do you calculate the contribution of people who -even though they pirate games- are willing to spend hundreds of dollars to upgrade their gaming rig. That's actually money indirectly injected in the gaming industry (nVIDIA and ATI redistribute part of their profits to game developers through sponsorship progams and such).

Anyway I can't even tell what's the percentage of stuff I pirated that I was actually stealing and the stuff I downloaded just out of curiosity. If I can't figure it out for just myself, there's no way someone is ever going to determine such a percentage for the total bulk of pirated copies in the world.

Now what happens is that people like this PC Gaming Alliance know that percentage is impossible to determine but it's in their interest to convince everyone that 1 illegal download = 1 product not sold = 1 theft. Of course that's wrong and they know it but they try hard to keep everything blurry so they can continue their brainwashing.
Last edited by Hedek; August 20th, 2008 at 17:04.
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August 20th, 2008, 16:55
@Hedek:

Couldn't have said it better myself. Well put, mate!
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August 20th, 2008, 17:13
I'm against piracy, but I'm also against brainwashing.

Seems I'm stuck between two parties.

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August 20th, 2008, 17:15
We're used to that in the US!

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August 20th, 2008, 17:18
LOL !

To me, this person is just an BEEEP, the way he dodges around any clear answer. And he might have his motives … Corporate Brainwashing.

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August 20th, 2008, 20:09
BBZZZZZTTT!

Yeah folks, it's impossible to say exactly how much piracy is hurting the PC gaming industry. However, it's pretty obvious that it's having a BIG effect.

1. Is 1 download = 1 lost sale really silly? There are other ways to pirate than just via download. How many sales are lost to pirates who download one ISO then make DVDs for half a dozen friends? Who then pass the DVD off to their friends after they finish with the game? It's quite possible that 1 download = 5 lost sales. It's really hard to tell for sure but I would be surprised if anything more than 3 downloads translated to 1 lost sale. Even that would make a huge difference in PC sales charts.

2. The MMO industry is growing huge. MMOs get their money via accounts so piracy is irrelevant. Anybody who wants City of Heroes can go download it from their FTP site right now. Fat lot of good it will do you until you pay for an account. No piracy, big sales. Coincidence? Don't be stupid.

3. Games for casual gamers are another big seller. Sure, low system requirements are a big reason for that. But I think it's pretty obvious that another big reason for that is the fact that the folks playing these games aren't "sophisticated" enough to know how to download a free copy or get ahold of somebody who can.

No, piracy is not the only problem facing PC gaming. But it's blatantly obvious that it's one of the biggest problems, if not the biggest.

So out come the "can only be installed N times" DRM features. Works for me.
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August 20th, 2008, 20:38
Originally Posted by magerette View Post
IGN: The issue of PC game piracy creeps into just about every "state of PC gaming" discussion, but how are we to know how much damage it's actually doing? Will we ever really be able to get a definite sense of how piracy is really affecting game sales, or will it remain the sort of nebulous threat it appears to be today?…
Compare the number of PCs around the world vs consoles. Theres so many PCs (even if you just pick those that can run games) that consoles dont even exist really but still most of the gamedev money is put on the consoles - because on them you can get better sales.

It wasnt always like this though. Perhaps the faster internet connections and advanced p2p software have made freeloading so easy on PC that people dont see any point in buying games anymore. Thats atleast how my friends see it.

While you can d/l console games for free too you cant do it as easily as you can with pc aka few clicks of mousebutton. Once you can d/l p2p software and games with few clicks of gamepad button console freeloading will be as popular as on PC.

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August 20th, 2008, 22:12
It's good to see that the report indicates pc game sales are at least 'healthy.' It's a bit of a bummer that a lot of emphasis is on mmo's tho.

Regardless, all this positive chatter about pc gaming must have at least a dozen or so 'game reporters' busily scribbling up more 'pc gaming is dying' articles at this very moment…

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August 20th, 2008, 22:20
Originally Posted by zakhal View Post
Compare the number of PCs around the world vs consoles. Theres so many PCs (even if you just pick those that can run games) that consoles dont even exist really but still most of the gamedev money is put on the consoles - because on them you can get better sales.
That misses a big point. The vast majority of PC's out there can't run the bast majority of games published in the past 3 years.

The only way this is going to change is if more games are played online in an environment where the server is doing the bulk of the computing or they get IGP's to a point that they can handle most modern games at an acceptable framerate.

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August 20th, 2008, 22:30
Originally Posted by Zloth View Post
1. Is 1 download = 1 lost sale really silly?
Imagine if a TV channel show a movie and millions watch it. Then imagine if they got payed for a full-price movie for every person who watched it. Lots of money right?

Imagine if you sold 1000 T-shirts for 1 penny each. Now imagine that everyone who bought the T-shirt bought the T-shirt for full price. Again, lots of money right?

Those examples are pretty much the same and equally dreamy. 1 download is not 1 lost sale, pronto.
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August 20th, 2008, 23:24
Originally Posted by JemyM View Post
Imagine if a TV channel show a movie and millions watch it. Then imagine if they got payed for a full-price movie for every person who watched it. Lots of money right?

Imagine if you sold 1000 T-shirts for 1 penny each. Now imagine that everyone who bought the T-shirt bought the T-shirt for full price. Again, lots of money right?
Imagine that you steal 1000 t-shirts and then give them away for free. It doesnt matter whether those receiving them have any interest to buy them - you still gave away 1000 shirts that didnt belong to you and you must pay for them so in the end it is 1-1.

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Last edited by zakhal; August 20th, 2008 at 23:37.
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August 20th, 2008, 23:34
In my opinion, every time we argue the minutiae of how many lost sales piracy really represents, we are enabling pirates.

Piracy is bad for the industry. Full stop.

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August 21st, 2008, 00:12
Originally Posted by Dhruin View Post
In my opinion, every time we argue the minutiae of how many lost sales piracy really represents, we are enabling pirates.

Piracy is bad for the industry. Full stop.
That's true. Another problem is when piracy becomes the excuse for everything. A publisher who sold 1000 copies and tracked 10000 illegal downloads will tell his investors "we had a potential of 11000 sales had it not been for piracy, you can't blame us for that failure, we did an excellent job our game was great". Those numbers don't add up that way.
So piracy actually harms the industry in two ways : by lowering sales, but also by being the easy veil shed over things that may have not only been caused by piracy.

No matter how harmful it is however, I'm surprised the industry still hasn't managed to solve that problem. I mean the tools exist. We know how to prevent piracy. Other games showed how (yes I'm thinking MMOs, so what's stopping single player games from using the same model except for the monthly fee?). And yet countless publishers make stupid decisions and totally fail on how they fight piracy (like paying to include secuROM in their product only to have it removed by "fixed exe" once released, and the only people who really suffer in the end are the legit costumers).

Another solution would be to force ISPs to deny access to pirating websites (torrents, emule and such - and it doesn't just solve the issue of computer gaming piracy), technically it's easy to do and would put an end to all illegal downloads. Politically and legally that's another story though.
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August 21st, 2008, 00:26
Originally Posted by Hedek View Post
A publisher who sold 1000 copies and tracked 10000 illegal downloads will tell his investors "we had a potential of 11000 sales had it not been for piracy, you can't blame us for that failure, we did an excellent job our game was great".
It is even worse : Piracy can be used as an substitute for explaining low sales which are in reality quality-based.

It's a very similar thing as in the music indistry. In my opinion, they say the same and there really aren't much differences between both industries.

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August 21st, 2008, 03:17
Originally Posted by Dhruin View Post
In my opinion, every time we argue the minutiae of how many lost sales piracy really represents, we are enabling pirates.

Piracy is bad for the industry. Full stop.
A single pirate causes the industry a non-zero loss in revenue. Together, pirates cost the industry billions. No argument there.

But you appear to be suggesting here that arguments over the exact damage caused by piracy will themselves encourage piracy which would not otherwise have taken place. (That's how I read "enabling"; correct me if I'm wrong.)

Taken as a whole, how many lost sales do you suppose all of these arguments represent?

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August 21st, 2008, 03:53
Originally Posted by zakhal View Post
Imagine that you steal 1000 t-shirts and then give them away for free. It doesnt matter whether those receiving them have any interest to buy them - you still gave away 1000 shirts that didnt belong to you and you must pay for them so in the end it is 1-1.
It's not the same thing because there is a marginal cost to producing each t-shirt where there is not on pirated content. A better example would someone copying a t-shirt themselves and selling the copies (or giving them away).

Regardless, I still don't think you can say that one download = one lost sale. The example above about the pirate making a dozen copies for friends who them make copies or loan it, etc. is pretty far off reality. Most people that pirate games are downloading them, not trading physical discs (at least in the US).

It all comes back to that invisible number of how many would buy if piracy was not an option.


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August 21st, 2008, 04:31
Originally Posted by Alrik Fassbauer View Post
It is even worse : Piracy can be used as an substitute for explaining low sales which are in reality quality-based.
Of course people will always search for a way to shift the blame when sales are disappointing. BUT if we're all in agreement that the impact of piracy is significant yet impossible to assess, then musn't we also accept that you can't ever say for sure what "in reality" was the cause for low sales?

Remember that lousy games might have very good sales on consoles, just like lousy movies can break $100m in ticket sales. The idea that only a certain small percentage of high quality games are worthy of actual purchase is exactly the sort of notion that makes casual PC piracy feel so innocent.
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