This is the face of Yves Guillemot, Ubisoft’s CEO who has been piloting the company since its inception as one of the five founding brothers from the Guillemot family in 1986. He’s been at the helm as CEO for longer than most people can remember and has been the main driving force for the company adopting always-online DRM and various other authentication systems since the industry caught wind of the issue of piracy.
Recently, Yves stated that five to seven percent of people actually pay for their games on PC platforms, with the rest resorting to piracy. Yes, that means close to 95% of NAG readers who own computers apparently are rampant pirates. This means that the 25 million plus players on Valve’s Steam network are representative of the five percent of five hundred million gamers in those percentages, the rest who pirate everything else.
Yves went on in his announcement to say that Ubisoft would concentrate more on free-to-play business models, with in-game purchases making up the bulk of revenue while in-game advertising is also thrown in to increase profits. In a nutshell, this is what Yves tried to say:
F2P makes money in territories where the company never made money before
F2P rewards the gamers who pay and also sends funds directly to the software company (Pay-to-Win, in other words)
F2P games are cheaper to produce and distribute (duh)
Older IPs can be cannibalised to make viable new F2P titles
So wait, this is all about the money and not about the gamers? I’m tired of corporations claiming that piracy makes them lose money because people who don’t want to pay for stuff will pirate it, regardless of how it’s priced. This implies that even if games appear in a bargain bin or are more easily available through other channels, people will still pirate them and break the law rather than support the developer that makes good games because they’d rather not pay for all that hard work. This brings up the two possible future paths the industry has been swaying between and how they reason it:
1) The amount of people willing to pay for the games aren’t giving up enough money to do so. Either the publishers jack up their prices in order to make more profit, or they strangle the way the games are played so that you’re only able to play it while connected to an online authentication service – this in a bid to stop the exodus of gamers from not buying the title because they’re unhappy with the prices. This means that only countries with good broadband capability and reach will be able to buy and play the titles the way they were designed. That leaves things, roughly, to a handful of EMEA regions, all of Ameria, most of Europe and Russia and all of the United Kingdom and the Scottish and Irish nations. Great, those are all the countries with money anyway.
2) Companies drop the AAA titles from their lists and only produce one or a few games that may or may not rehash old IP so that money isn’t wasted creating new ones. The company turns to the Free-to-Play model and charges for in-game items and turns the entire industry into a Pay-to-Win scenario. The gamers get games for free (that’s what they want, right?), the company gets money from the in-game sales and they can now complain about new things instead of “lost sales” due to piracy. The industry stagnates, Call of Duty reaches its fifteenth iteration and everyone finds that without an internet connection, being a gamer is no longer an option, even on consoles.
Or, rather alarmingly, the publishers turn to finding ways of negating second-hand sales, which they claim is a large market that earns lots of money that they’re not getting and its the same as piracy because its a lost sale. Its like the argument is going around in circles and won’t end unless someone nukes the internet and everything goes back to square one – making great games and pricing them properly so that they’ll sell well in retail stores.
I hate this “lost sale” nonsense that everyone seems to be repeating. If someone didn’t buy a game and pirated it instead, it wasn’t a lost sale because of piracy, its mostly a lost sale because the game wasn’t priced properly or is less available in the channels that the person pirating the title prefers. Granted, you still get cretins who will pirate it regardless and then say its because “I’m not supporting XY company but I will pirate their game because I like it, lol!”
Blaming piracy outright isn’t the answer because the internet helped to create an entire two generations of people used to having everything ready at the click of a mouse. Torrents are popular because its an incredibly effective way of sharing stuff with other people. Steam and Origin’s sales pick up every year because they price their games properly and have it available ready to download whenever – no damaged discs, no waiting in queues and, most importantly, no invasive, troublesome DRM. They even have rock-bottom prices during their sales, bringing in more people to their services because its a better method than waiting for retail stores to drop their prices after months of the game being on the shelf.
Here’s the facts as I see them, Yves, whether you like them or not: you sound incredibly butthurt that your company didn’t see the changes on the horizon and made appropriate changes to your distribution and pricing model to make sure you stayed abreast with technology and the needs and wants of gamers who embrace it. You’re sad that you don’t have your own successful online store for the PC, Mac and console platforms and you’ve been using crummy DRM to make sure that the players who are loyal to their favourite titles won’t resort to piracy in future. With the Free-to-Play model, you’re almost insinuating that everyone’s a thief and that your company has come up with zero alternative ways to earn money because you’re too busy paying to use the online services of other companies that picked up this trend long before you did.
The reason why you’ve come to this point is because you (and most of the industry) priced things up too high in order to get in as much profit in as quick a time as possible, while also using DRM software to prevent people from copying it, even if it meant that gamers who would have gladly bought it would be shafted for whatever reason if they couldn’t meet your company’s requirements. This means that you don’t care about the customer, you just want their money. Its the same reason why you can’t return games at a store for a refund these days – only if the disc is broken will you get anything back. An interesting article on Eurogamer popped up recently (discussed in a forum thread) that evangelises pirates but also says the same thing: change the way you do business, or risk watching a mass exodus of customers infuriated at your lack or willingness to change for them.
Do you know, Mr. Guillemot, that Spore was the most pirated game in history because people wanted to make their point that DRM was useless and invasive? Did you see how subscription numbers for Star Wars: The Old Republic fell in the build-up to the Diablo III launch? Diablo III racked in 3.5 million sales in one day. This means that there are scores of gamers playing Free-To-Play titles willing to drop money on an enjoyable title that does things right. This also means that if a company like Blizzard wants your money, they’re making damn sure you get your money’s worth because they want to keep you as their customer. CD Projekt Red famously includes no DRM with their games and they still racked up great sales with The Witcher 2 and were able to track those who pirated the game easier, allowing the company to see where they were going wrong and how they could improve their sales numbers.
Does it mean that for the 1.7 million sales the game got for the company that 32,300,000 others pirated it? No, because it was recorded that the game only saw it being pirated around four-and-a-half million times, a number roughly equivalent to one in four gamers actually buying it. This means that out of roughly 6.2 million copies of the game in the wild today installed on systems around the globe, only 27% of those were legitimate buys.
Wait, they’re getting 27%. Where the hell are you getting your 5-7% figures from? Maybe there’s something you’re doing wrong here.