Piracy Can Boost Bottom Line?

A new study claims that a moderate level of piracy can have a positive impact on the bottom line for both manufacturer & retailers not at the expense of consumers.

Link - https://www.eurekalert.org/pub_releases/2019-01/iu-tht012519.php

HBO's popular television series "Game of Thrones" returns in April, but millions of fans continue to illegally download the program, giving it the dubious distinction of being the most pirated program.

Many may wonder why the TV network hasn't taken a more aggressive approach to combating illegal streaming services and downloaders. Perhaps it is because the benefits to the company outweigh the consequences. Research analysis by faculty in Indiana University's Kelley School of Business and two other schools found that a moderate level of piracy can have a positive impact on the bottom line for both the manufacturer and the retailer -- and not at the expense of consumers.

"When information goods are sold to consumers via a retailer, in certain situations, a moderate level of piracy seems to have a surprisingly positive impact on the profits of the manufacturer and the retailer while, at the same time, enhancing consumer welfare," wrote Antino Kim, assistant professor of operations and decision technologies at Kelley, and his co-authors.

"Such a win-win-win situation is not only good for the supply chain but is also beneficial for the overall economy."

While not condoning piracy, Kim and his colleagues were surprised to find that it can actually reduce, or completely eliminate at times, the adverse effect of double marginalization, an economic concept where both manufacturers and retailers in the same supply chain add to the price of a product, passing these markups along to consumers.

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*sigh*

Word of mouth boosts sales of high quality products. It also screws sales of worthless junk. Pirates aren't silent, don't think imdb users, especially those that watch bollywood movies, actually went to cinema.

Who's scared of pirates? Those who are aware their product is garbage noone sane should buy.

Piracy will never be exterminated completely. Well then. If it's there and you know your product is so good, make most of it, reach masses who don't watch anything because they can't filter what's worth their precious little free time. As noted in that article, HBO did it. If some accurate data ever appears, I bet for every pirate who praised the show HBO got at least a dozen of new subscribers.

Sadly when it comes to videogames, $ goes to silly Denuvo instead of adding hairworks to a game. And I don't think Denuvo sells.

joxer said:

Who's scared of pirates?

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Dull boring investors in stock meetings are as they are obsessed about earnings.

Anyway you watch Jim Sterling's videos he explained it already. Basically when you make all the money you could possibly get its never enough. A huge stagnant pond.


Or as he calls it "Below Expectations" for triple AAA game publishers.

I guess that's greed from 7 deadly sins. Extreme.
Those people would probably skin people alive if it could earn them $.

I think I'm just too......seasoned to get behind theft being a viable option in any situation, except perhaps food and shelter, as I find those absolute necessities. Theft of recreational properties I'm completely against.

I have deja vu.

Anyways, the question is not are we pro or cons - of course we can't possibly accept theft as tomorrow someone will steal our hard work and what then. Stealing is crime and that's it.
The fact is piracy exists and there is no cure to it. Currently. There is a possiblity something happens in the future which will kill it off, but the technology progress isn't helping - what do you think all those cloud storages with "endless" space are used for actually? Forget cheap external HDDs, noone is pirating stuff that way, it's clouds.

But just like we're planning to vaccinate people by using annoying mosquitos that can't ever be removed from this planet, we can, and some already did, (ab)use the very same hardcore pirates for some benefits. If HBO could, anyone can.

I don't pirate games...that said, I can understand why some gamers get pissed off at certain big game companies who do things that seem anti-consumer and decide to pirate the game because of it.

If I were to pirate stuff, it would be more like certain tv programs, and also books. For example, certain books that are still in copyright even though they are ancient in terms of when they were written, the authors have died, and not only that, but they have ridiculous prices even on kindle books of like, $10 or more. (*cough* such as Agatha Christie detective novels)

But it has become very difficult to pirate things, at least compared to the past. The U.S. Government has really cracked down on sites like Pirate Bay and others. Most of those torrrent and pirate sites are shut down these days or unable to reach them unless you use a vpn service. It is not so easy to pirate anything with ease like it used to be.

Arkadia7 said:

It is not so easy to pirate anything with ease like it used to be.

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Depends where you are.

porcozaur said:

Depends where you are.

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Well he has a point as DRM like Denuvo and the rise of live service games have slowed down piracy. Yes it can be hacked in a coupe of days or a few months it still works.

As games a few years ago were cracked on day one. Here's a fun fact Denuvo was built by a few ex-scene elite crackers, but now it's owned by a security corporation.

I very much doubt piracy helps more than it hurts.

However, it's incredibly obvious that you can make lots of money even with piracy as a factor.

But it all depends on the game and what a pirated copy will represent as an alternative to the full game.

These days, most games come with some sort of online feature - and frequent updates - which means a pirated copy will be an obviously inferior experience for people who care about getting everything on time.

For small indie games, piracy can definitely make a huge difference - but I think it's less common than it used to be.

If your price is modest - then I think most people would just go ahead and buy it if they're genuinely interested.

Of course, then we have rare cases like Grimoire - where the developer is an obvious piece of shit personality-wise - and that's probably not going to help sell the game to would-be pirates.

On the other hand, he made enough waves to garner some measure of attention - and that's probably boosted sales as well.

In short, it's complicated.

But actually helping games more than hurting them, I think is a misunderstanding. It might be true in EXTREMELY rare cases - but I refuse to accept it as the norm. It just doesn't make enough sense to me in that way.

I'm of the opinion that piracy will not cause much of a hit on the game's sales under the right conditions. And the right conditions are, if you make buying the game an easier/better option than pirating it. This involves having a mostly unobtrusive DRM system, receiving bonus content that is usually ripped out by crackers, etc.

I like to believe most people like to support what they love, and will support it as long as it's an easier option. In my opinion people would break down in these categories:

1. people that are 100% against piracy and will only play if they buy
2. people that will choose to buy and support the devs if its an easier/better option and you don't make them just through 1000 hoops
3. people that would love to support, but are financially unable to (from my experience here you have people that live in countries where the 60 euro is just too much of a hit compared to the minimum/median wage)
4. people that will not buy it, regardless if they have or do not have the money for it.

Most people, I like to believe, fall in category 2. Most people like to support what they love, and there's just a feeling unmatched when you know you contributed to something you love. People want that. They want to be able to publicly be proud of what they support.

When I was growing up there's no way I would have been able to afford full price games. My parents were not making much. I personally didn't even have the concept of an allowance with which to buy stuff for myself. But I always felt bad about that. And, now that I'm a grown-up and that my situation is drastically different, as a way to compensate for my childhood, I choose to support games in droves, even though I haven't played most of them. I've got almost 1000 on steam, 300+ on gog, and in the dozens on the other 3-4 platforms. Heck, I have 30% of them in duplicates across multiple platforms. And bought pretty much any game I played as a child. And I now have no moral issues with myself.

But one thing does bother me, is the constant bullshit you hear being spewed by game publishers when they equate every pirated copy with a lost sale. No way. As I said, people that don't want to support won't support. But on the other hand, if someone does play it pirated, they might become a future buyer. They might even be guilted into it.

And another thing that bothers me, is the absolute shit that gets peddled as games these days. Most of the shit should not be bought and supported. And since real trust-worthy demos are a thing of the past, for some people a pirated copy might act as a true demo, which could lead to a sale.

Another thing that piracy helps with is saving maintaining IPs/games that publishers have no interest in, if they can't make money off them. Or if there's a complicated legal mess where no one can sell the game anymore. And especially if that game cannot run on modern hardware. Or if the platform that sells the game shutsdown, rendering your copy useless without the DRM checks. You're gonna love to have a cracker take those checks out so that you can use the copy you legally purchased.

Anyways, that's my 2 cents on the issue.