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November 28, 2014, 10:05:36 AM
TIGSource ForumsDeveloperBusinessPiracy and the four currencies
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Author Topic: Piracy and the four currencies  (Read 3607 times)
larsiusprime
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« on: February 28, 2012, 12:11:36 PM »

Hey guys!

After releasing our game Defender's Quest with no DRM, it started showing up on some torrent sites after a few weeks and it made me start thinking about what motivates people to pirate games.  (For the record, I feel that our decision not to put DRM in our game resulted in more sales than we would have gotten had we tried to lock it down.)

So, I wrote some articles about it:

Part 1 - The basic theory

Part 2 - Cases studies (Steam/Consoles/A Game of Thrones)

The basic premise is that the often-quoted RIAA/MPAA complaint "you can't compete with free" is false because it assumes piracy is "free." If we look at costs beyond just money-dollars, it's clear that there are other "currencies" that people are spending when they make a decision.

The "four currencies" in my articles are:
($M) Money-dollars
($T) Time-dollars
($P) Pain-in-the-butt-dollars
($I) Integrity-dollars

Part 1 outlines the basic idea and part 2 responds to comments, includes limitations to the theory, adds nuances, and applies the idea to various case studies to analyze the effect of DRM.

Also this whole thing provided a good excuse to put icons of butts on dollar bills:




Any thoughts?

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Nostrils!
Nix
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« Reply #1 on: February 28, 2012, 12:20:04 PM »

The only dollar that counts is a money dollar. You could argue that time is money, and it is, but people who pirate for money reasons are people who are more likely to have a spare half hour than a spare $5.
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Zaphos
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« Reply #2 on: February 28, 2012, 12:30:15 PM »

I feel like I've seen these points made (or at least alluded to) many times before, but it's a nice write up of them and I agree.

Nix: Why are you only considering people who pirate for money reasons?  theoatmeal's game of thrones comic (linked in the second article) is a good example of a person pirating largely for time/convenience reasons: http://theoatmeal.com/comics/game_of_thrones
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larsiusprime
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« Reply #3 on: February 28, 2012, 12:32:30 PM »

Yeah, this isn't exactly a brand new theory. Someone wrote a very similar article 2 years ago, this is just me putting it into my own words since a lot of people still think in terms of just money.
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Nix
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« Reply #4 on: February 28, 2012, 12:37:30 PM »

Nix: Why are you only considering people who pirate for money reasons? 

Because that is the group that my statement pertained to. I have no doubt that people pirate for plenty of other reasons as well.
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Zaphos
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« Reply #5 on: February 28, 2012, 12:57:18 PM »

Okay, then I don't understand why you said "the only dollar that counts is a money dollar."  Had assumed the second sentence was justifying the first, which was general.
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Moczan
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« Reply #6 on: February 28, 2012, 02:23:42 PM »

Not completely new, but completely right. Since I've started earning my own money and discovered digital distribution I've never pirated a game again and that's mainly because the actual 'money-dollar' was never actually a biggest problem, even though I'm from poor European country with outrageous game prices.
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larsiusprime
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« Reply #7 on: February 28, 2012, 02:27:03 PM »

@Moczan:

In your particular case, what motivated you the most to buy from digital distribution rather than piracy?
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Moczan
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« Reply #8 on: February 28, 2012, 02:46:34 PM »

I'm not sure, both $P and $I and the amount I actually gain by buying a legal copy far overwhelms the $M. There is also a huge $T gain when I use digital distribution vs traditional, but it's both in 'legal zone'.

$P - mainly finding the right files and the huge risk of getting my computer infected. Also, pirated games often lack patches/updates, lack multiplayer options (or only through hacks with hamachi etc.), it's almost like not getting the full product.

$I - since I'm developing games myself, even making some pocket money from it, I just find it morally impossible to pirate games not. I prefer buying indie games over AAA titles, as the $I of buying indie game is negative and I can credit myself for supporting other indies (I own Defender's Quest Wink )

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larsiusprime
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« Reply #9 on: February 28, 2012, 02:50:29 PM »

Awww shucks Smiley

The $I thing you mention is really interesting - "negative $I cost" for supporting someone you like is even better than just not feeling guilty, it makes you feel good about yourself.

Speaking of, got any games you're working on I should check out?  Hand Money Left Smiley Hand Money Right
« Last Edit: February 28, 2012, 03:06:03 PM by larsiusprime » Logged

Nostrils!
Moczan
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« Reply #10 on: February 28, 2012, 03:32:41 PM »

My work was mainly in realm of freeware Flash games, from games-related contract jobs to getting sponsorship. I think I've first discovered Steam as a viable distribution during second Humble Bundle. I was amazed at how easy it was. Log in to PayPal, accept payment, enter Steam code and that's practically all. Then in 2011 I got my first 'QA job' testing an indie game over the weekend. As I was already pretty experienced with AS3 back than and the programmer on that project droped out, I've get the gig to finish the game. That was the time when I first felt "I've earned this money making a game, I should spend it on games then!" and the urge to pirate anything practically vanished. Recently I even lack time to play through every game I have collected during past year, with many great yet unfinished games waiting on my hard drive, why should I bother pirating anything?
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Chromanoid
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« Reply #11 on: February 28, 2012, 03:48:53 PM »

Very nice stuff! I think you nailed it. I am not sure, but there should be scientific models similar to your articles. Your articles remind me of "An Economic Analysis on Online Game Service" by Jun-Sok Huhh. A nice analysis/model about the reasons behind inofficial RMT in MMOs.

Do you plan to investigate the best cost combination for your next product (for the average user in your target group) to maximize profit?

BTW great game, my girlfriend loved it (we bought it, I think mainly because I "like" to pay for indie games as long as they are not that expensive). Is there a way to import save games from the demo version?  Grin

PS I think you should measure $P $I $T in $ too. Everything has a price :D
« Last Edit: February 28, 2012, 04:06:37 PM by Chromanoid » Logged
Moczan
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« Reply #12 on: February 28, 2012, 04:03:18 PM »

BTW great game, my girlfriend loved it (we bought it, I think mainly because I "like" to pay for indie games as long as they are not that expensive). Is there a way to import save games from the demo version?  Grin

It's funny cause he's actually mentioning it in the article. Yes you can Wink
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Chromanoid
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« Reply #13 on: February 28, 2012, 04:11:59 PM »

cool I just skimmed through the articles for the theories. I will have to tell her. The strange thing is that I didn't find any button in the flash version, because I thought there should be a way. Are your sure there is a way even in the in-browser version?

edit: wtf i just checked the web version, there is a button 0o. I was sure there was no button when I checked last time  Epileptic.
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larsiusprime
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« Reply #14 on: February 28, 2012, 04:29:12 PM »

If you're talking about the Kongregate version, you're right - Kong made us remove the import button, but then we talked them into letting us put it back Smiley
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Chromanoid
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« Reply #15 on: February 28, 2012, 05:36:02 PM »

ah just talked to my gf, she used the version on your page, there was the button, but it didn't work. now i remember the situation correctly. i dont know if it works now, maybe it has something to do with her computer, i will check tomorrow Smiley

I just read the articles word by word. I think you answered this already "I think you should measure $P $I $T in $ too. Everything has a price". I think it would be a good idea to express these other currencies in hard $. This would be a good way to tell a big game company manager how distribution methods, company reputation, DRM barriers etc. influence the price perception of a product. When it is possible to track/estimate the numbers of pirating users while decreasing the product price during the product life cycle it should be possible to roughly estimate some values.

I think the best way to overcome pirating would be more P due to not working online features. You could tie the export-save-game-feature to legal users. Using different savegame formats for different product versions and an online converter might be a good idea in general Grin. I'm afraid $I is very unstable and unfavorably tied to the price.
« Last Edit: February 28, 2012, 06:16:19 PM by Chromanoid » Logged
larsiusprime
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« Reply #16 on: February 29, 2012, 06:17:34 AM »

Hey, interesting thoughts!

The difficulty in translating $P, $I, and $T into $M is that those values keep changing and will vary between individuals.

It's not impossible to come up with some sort of value, of course, for instance, bribery is a good example of a case where people are more than willing to put an exact dollar figure on their integrity:

Quote
"Will you forge this document for me for $10?"
"No."
"How about for $100?"
"Okay."

So in that contrived example, the $I cost of forging is worth 100 $M to that person. For our piracy examples, we might be able to calculate how much $M the $P+$I+$T is worth, but probably only on an individual basis. I'm also no math genius, so I leave that exercise to someone better versed in those fields  Grin

The example you give of online features that don't work in pirated versions is indeed a strategy that works, and usually works best for games that rely on a server. People get that it's an online game so they need to connect to the server, so there's not a big $I cost there, but a server is much harder to pirate than a standalone single-player game. How do you pirate WOW? By connecting to a pirate server instead of Blizzard's, and those pirate servers generally are buggy, suck, have bad connection rates, and in the rare case that they're actually good, they still don't have all your friends who are playing on Blizzard's. The quality of the product is far lower, and the $P cost (as well as $T if you count bad server lag) is higher, and most importantly - only for the pirates.

It'd be very hard, for instance, for us to put any kind of DRM into Defender's Quest that would make pirates pay the $P cost without it falling on legal customers instead. What would likely happen is a cracker would strip out the DRM and put it on a torrent site, so the restrictions would only remain in effect for the legal version of the game.

"Fighting" piracy is difficult because it's so hard to come up with measures that only selectively target pirates. If you have any more cool ideas on this subject, let me know! It's been a fun conversation Smiley
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« Reply #17 on: March 01, 2012, 03:22:13 AM »

My stance on piracy is that I don't think it's a problem, so there is no need to fight them.  Piracy allow your games to reach more audiences. And if they really like the game, and if they can afford it, they will pay. For me, getting money from people who've played the game and love it is more satisfying than getting money from someone who don't.

I wonder if these 4 units can answer the question that I've been wondering for a while. The question is this :

You know that this game is already pirated, but you pay for legal version anyway. Does this mean you choose to donate, considering you already know there's a way to get the game for free?
On the other hand, if the game is free, why wouldn't you pay for it? Why do we need the developer to force us and put some price on it before we think we should pay? That is, if the developer reduce $M to 0. Can $I make the customer decided to come up with $M out of his own will?
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Chromanoid
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« Reply #18 on: March 01, 2012, 03:42:26 AM »

I think pay-what-you-want-payment-models answer your questions. Yes and Yes. When you have to constantly pay a little $P for a pirated version this might also be a reason to buy it at some point. As an example I even bought a game I love multiple times (I own several versions of Fallout 2, the version on Steam has the lowest $P price btw ^^) I bought it multiple times although I am not averse to piracy, I even had to pay for a warning letter...

When some parts of your game are offered as a service you may have to fight piracy to survive. The good thing is that these services are often easier to protect from pirates than the game itself.

When looking at piracy with the 4 currencies you don't fight piracy you just maximize profit. Increasing the pain-in-the-butt-price for non-paying customers or so is much different from "fighting piracy". Legal threats also increase the pain-in-the-butt-price, but nowadays they will probably decrease the $I price for pirated versions in an extreme way.

I think the problem of a world with only donationware and pay-what-you-want payment models is, that it has probably a severe negative effect on $I. We use $M prices as estimates for the real value of things. Without this estimation framework you as a consumer cannot estimate the value of things. $M as estimation framework is also why premium pricing works.

BTW I think one can describe free to play games and virtual item trading with similar measures. Paying for pay-to-win items might have a high $I price but they may stop a constant $P fee.
« Last Edit: March 01, 2012, 04:44:17 AM by Chromanoid » Logged
nico
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« Reply #19 on: March 01, 2012, 05:55:27 AM »

I agree with Hima. You can't fight piracy, because the fight was over years ago. The pirates won. If your game gets popular enough to make it onto the major torrent sites, then it's already a pay-if-you-want product.

I think far too much effort today is spent on preventing piracy, and far too little on converting pirates into paying customers. Pirates are people too, and they're just as susceptible to marketing and conversion as everybody else. Maybe their conversion rates will be lower, but that's just a number.

For example, someone who pirated your main game may easily choose to buy add-ons and level packs, if they know for certain they will work with their pirated version. And a pirate is probably just as likely as anyone else to become a raving fan, to partake in your forums, to tell all his friends, and to buy all your follow-up products, if you'll let him in.
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