Printing Error Shows Flaw In 'Lock-It-Up' Video Game Business Model

from the clerical-error dept

It should come as no surprise to Techdirt readers that many people within the games industry hate used game sales. One of the methods these companies are implementing to fight these sales is to force buyers of used games to pay extra to gain access to the multiplayer portion. This works by inserting a one time use code in the new copies of games. Once the multiplayer code has been used, only the owner of the console used to activate it can access the multiplayer parts of the game. If that player decides to later sell or give away the game, the new owner would have to buy a new multiplayer code from the publisher, generally $10. So far EA, THQ, Ubisoft and Activision have dabbled in this system for various games.

It should also come as no surprise that such a system has a major weakness, the printing error.

Edge Magazine is reporting Ubisoft's first foray into this new system has hit a road block. XBox 360 versions of Driver: San Fransisco were shipped to North America with a misprinted multiplayer code. Reports indicate the 360 is expecting a 25-character code, but the insert only contains a 19-character code. This results in an invalid code error when trying to redeem it. In response to this unforeseen (at least to Ubisoft) incident, Ubisoft is making the multiplayer portions of Driver free for all players worldwide, at least for 360 owners. There is no word on if this free multiplayer will be available for PS3 or PC owners.

In the end, it makes you wonder how, after 30+ years of printing registration codes inside PC games, such a system could fail so badly when translated to console games. 

Filed Under: drm, one time use codes, printing error, video games
Companies: ubisoft

More Misplaced Hatred For The Used Games Market

from the learn-some-economics dept

I'm constantly amazed at the general cluelessness of the video gaming industry on basic economics concerning the concept of the first sale doctrine and the ability to resell a product. More than pretty much any other industry, the video game industry is vehemently against the idea of reselling used games. They've claimed that it defrauds the industry, that it hurts consumers (say what, now?) and that it "cheats developers." All of this is ridiculous and economically ignorant.

The latest to jump into the fray, as pointed out by Copysense, is some industry consultant who basically calls used games sales by Gamestop a version of money laundering:

It is time to for Gamestop to fess up and acknowledge their real business. Relative margins reveal Gamestop's actual business to be the collection and resale of used games. New game and accessory sales revenue may equal or exceed the used game revenue, but they do not come close to matching the profit. The stock of used games is financed by the very publishers who are being harmed by the market. They put up the risk capital to make and market the game and put the unit on the shelf. Publishers receive a one time, per unit fee for putting the game into the Gamestop system and are required to pay marketing development funds to Gamestop to have posters and other promotions in store. But Gamestop does not pay for the games, customers do. Gamestop only provides credit until the games are sold. The consumers' payment covers Gamestop's initial outlay, plus a profit. Because Gamestop pays on terms, the consumers' money is in the bank before Gamestop ever makes a payment on the new game units. If the consumers do not sufficiently cover the expense, Gamestop will call on the publishers for price adjustments and protection. While this business shows a profit with no downside risk, the entire retail side is merely a highly cost effective way of funding the used game inventory. To ensure return of the games, consumers who buy a games are bombarded with offers to turn them back in for credit. Each turned in game builds the used inventory, at no cost to Gamestop. When sold, the only person receiving the benefit, is Gamestop. When I put it this way . . . . I don't want to say it sounds like laundering, but . . . . . They take a game unit a publisher should get paid for, run it though a consumer, and turn into a game unit they can sell over, and over, and over, and over without compensation to the publisher.

Of course, all of this is based on faulty economic theory. They all seem to ignore the fact that a healthy resale market increases primary market sales, by making the primary sale more valuable. It's a pretty simple equation. If I can buy a $60 game, knowing that I can sell it back later, that reduces the risk and the real "cost" to me. That increases sales. Separately, a strong resale market has other secondary benefits, such as hooking people on series of video games, so that they're more interested in buying the "new" (full price) versions.

But, overall, what these gaming industry execs and consultants are whining about is that they just don't like a free market where they can't artificially inflate the market price of games even higher. The used market acts as a check on the primary market to keep it realistic. And, as a result of a more efficient market, you actually have a bigger market. Those who assume that demand is totally inelastic think this is bad, but they don't recognize that game buyers have choices, and one of those choices is not to buy games that are too expensive. It's not fraud and it's certainly not money laundering. It's called keeping a market healthy.

Filed Under: copyright, economics, first sale, video games

Ubisoft Learns Nothing From Its DRM Past; Condemns Paying Customers To Repeat It

from the achievement-unlocked:-infinite-stupidity dept

Rock Paper Shotgun brings us the unfortunate (but rather unsurprising) news that Ubisoft will be (once again) requiring an online connection to play their upcoming title, Driver: San Francisco. As far as DRM options go, this is by far the worst one, especially considering the failure of Ubisoft itself in keeping its own servers up and running.

As is par for Ubisoft's effed-up course, this DRM will also cripple the apparently unsociable "single player" part of the game. This crippling will also extend to any player, single or not, whose internet connection fails them for whatever reason:

Even if the system weren't a gross mistreatment of customers, unforgivably stupid and spiteful, it's a DRM designed for a universe other than this one. My home internet, with the extremely reliable Be, drops frequently. A noise on our BT line causes problems, along with normal service outages, sudden blips, and all the times I trip over the phone wire and pull it out of the wall. Let alone if I want to do something crazy like, I don't know, play a game outside of my house.

Compounding this farce is the fact that console players will be saddled with additional DRM in the form of U-Play. Granted, this won't affect the original purchasers whose outlay of ~$60 will nab them a full-featured game that will often be rendered unplayable. However, second-hand gamers looking to save a few dollars will find themselves in possession of an incomplete game.

"In each new copy of a Uplay Passport-enhanced game will be a one-time use registration code that, when redeemed, provides access to Uplay Passport content and features," the company said in an emailed statement. "The code can be found on the insert card inside the game box. Gamers can identify Uplay Passport-enhanced games by looking for the logo on the back of the box."

Given that this code can only be redeemed once, consumers who purchase a used game laced with Uplay Passport restrictions will be forced to shell out an extra $9.99 to unlock online content and features. This means that a used game which normally costs $5 less than the new packaged version will essentially cost $5 more than the new unopened copy.

Well, that is certainly a fine way to stick it to the second-hand market. At this point you might as well buy it new, or better yet, not buy it all. And you have to love the PR team's misinterpretation of "enhanced," which is rarely linked to something that is also described as "mandatory."

But it's not all bad news, as RPS points out. Ubisoft is going the extra mile to make sure that PC gamers will be screwed just as quickly as their console counterparts:

Astonishingly, Eurogamer reports, when one customer complained on Twitter about the PC DRM, Ubisoft replied saying, "Bear in mind though that the PC version of DRVSF is released simultaneously to consoles."

Brilliant. I suppose the bright side is that cracked versions for consoles and PCs should appear within moments of each other. But Ubisoft isn't done ruining the "game experience" yet:

Oh, this one just keeps getting better. As reader Anarki points out, Ubisoft have now tweeted confirming the driving game will not support steering wheels!

The question at this point is no longer "When will Ubisoft learn?" but rather "How much does Ubisoft despise its customers?" And it looks as if the answer to the second question is swiftly approaching "infinitely."

Filed Under: drm, internet connection, video games
Companies: ubisoft

And Here Comes The Video Game Backlash Due To The Norway Tragedy

from the tragic dept

We already discussed how the tragic situation in Norway is already being exploited by some politicians to try to ratchet up security theater, but it may impact other issues as well. In the 1,500-page manifesto that the madman, Anders Breivik, posted online before beginning his rampage, he notes that he used Modern Warfare 2 for "training" and "simulation."

I just bought Modern Warfare 2, the game. It is probably the best military simulator out there and it’s one of the hottest games this year. … I see MW2 more as a part of my training-simulation than anything else. I’ve still learned to love it though and especially the multiplayer part is amazing. You can more or less completely simulate actual operations.

Separately, he talks up the value of using World of Warcraft as a "cover story" for why he was busy all the time, and notes that he did actually play WoW for a while to "isolate himself from the 'consumerist' world in preparation for his attacks." I'm at a bit of a loss as to how playing a commercial game like that isolates one from consumerism, but Breivik does not appear to be particularly big on logic.

But, of course, as with past tragedies involving people who played video games, this has only given new ammunition to those who push the moral panic that violent video games are evil. That article notes that the website "Conservapedia" is using this incident to call for the reversal of the recent Supreme Court ruling that laws banning sales of violent video games are a First Amendment violation. When I looked at the site, it was highlighting a stupid quote from a USA Today editorial about how evil violent video games are, predicting that the next tragedy would involve someone who "was first addicted to harmful video games."

That's an interesting spin. It's also ridiculous. There is no indication, whatsoever, that Breivik was "addicted" to these video games. Or that he was driven to do any of this because of the video games. There is no indication that without these video games he wouldn't have carried out these attacks (or other attacks). He had clearly decided to carry out such a massacre long before Modern Warfare 2 existed.

Filed Under: norway, tragedy, video games

Australian Attorneys General Still Feel The Need To Think About The 37-Year-Old 'Children'

from the GTA-is-nothing-but-a-'midlife-crisis-simulator' dept

Australia has a long history of video game censorship, mainly due to the fact that its rating system stops at age 15. This has resulted in a great many games being censored by the manufacturers in order to reach the Australian market and, in some cases, has prevented the sale of offending titles entirely.

Despite the fact that the average gamer is now 37 years old, Australia is still refusing to treat gamers like adults. There has been a lot of talk (some of it dating back to last year) among various politicians about the subject of a new R18+ rating that would bring them in line with much of the rest of the world, but just when it seemed the various parties might reach a consensus, certain holdouts decided to "not vote";:

While the Standing Committee of Attorneys-General had planned on making a decision regarding the introduction of an R18+ rating for video games on Friday at a meeting in Adelaide, the NSW Attorney-General has announced he will not vote on the topic at this time.

In order to change the classification, all nine federal, state and territory censorship ministers must agree - even if all eight remaining vote for the change, one person holding back means the whole deal is postponed until at least the next SCAG meeting.

Well, if these three attorneys general have some concern about the "proper" level of censorship, they must be acting in their constituent's best interests, right?

According to recent studies, two-thirds of the Australian states and territories are publicly in favour of the R18+ introduction (including the controversial South Australian vote) - while the remaining three (NSW, Victoria and Western Australia) announced they would hold off on making a decision until some time closer to the meeting.

So, it comes down to this: certain members of Australia's governing body still firmly believe that gamers are children, and, despite public sentiment otherwise, are now deploying stalling tactics in order to hold off any movement toward treating their game-buying citizens as adults until 2012 at least.

In a recent statement issued to GameSpot AU, a spokesperson for Smith explained:

"We're not going down a definitive route. More work needs to be done on this issue. We want to wait to see the results of the ALRC [Australian Law Reform Commission] classification review."

The ALRC review is currently underway, but no results are expected until early 2012 at the earliest. The review addresses video games, but also other classification-related issues, with an overhaul of the Australian national classification scheme predicted as a result.

At the earliest, Australian gamers will have to wait until they turn 38 in order to have a chance to buy unaltered videogames approved for those ages 18 and above. Of course, what else can be expected from a governing body that included an attorney general who felt that gamers are more dangerous than biker gangs?

Filed Under: australia, censorship, video games

Incubus Promotes New Album With Misguided Anti-Piracy 8-Bit Video Game?

from the yeah,-that'll-win-fans dept

The band Incubus has decided that a way to attract fans to its new album is to release an 8-bit video game in which the point is to "fight music pirates," by literally punching them as they try to get and leak Incubus' new album. However, as Rob Sheridan points out, the new album has already actually leaked in real life, "so I guess the game can't be won." I think Sheridan sums it up nicely:

Seriously? How about fighting the record label dorks or manufacturing companies who let the album leak in the first place? Maybe the boss battle should be with the label exec who can't come up with a modern release plan that avoids leaks entirely?

Oddly, Mashable claims that attacking fans who are interested in the band's music is part of the band's savvy "social-media flavored album release campaign." Sorry, but calling your fans pirates, and showing how you want to beat them up doesn't seem particularly social. The whole target of the campaign just seems weird and misguided.

Filed Under: fans, incubus, leaks, pirates, video games

Video Gamers Realizing Streaming Criminalization Bill Might Make A Lot Of Them Into Criminals

from the a-joke-of-a-bill dept

We've been covering just what an awful bill S.978 is. That's the anti-streaming, anti-embedding bill from Senators Amy Klobuchar, John Cornyn and Christopher Coons, which would allow law enforcement to seek jail time against people for streaming infringing works. As I've explained before, the clear intent of the bill is to go after sites that are streaming TV and movies. And the method to do so is to make a pretty small change to the criminal side of copyright law. Criminal copyright law was limited to reproduction and distribution among the various "rights" given to copyright holders. Civil law covers many more. This bill seeks to add "public performance" to the list of things that can be considered criminally infringing, potentially sentencing people to five years in jail.

The problem is that "public performance" is not at all well-defined. And while the bill does require that the effort be done as a commercial enterprise to be criminally liable, the fact that pretty much anyone can have AdSense or simple ads on their website makes nearly any website a commercial operation these days. And, yes, there have been cases where people have used simple ads, even if they make a few dollars total, as evidence of a "commercial" operation.

And that's a huge problem, because this bill, if it becomes law creates a massive liability for pretty much anyone who embeds or streams anything. The backers of the bill claim it's clearly not intended for the FBI to go bust down the door of someone singing along with their favorite song in a video... but it's entirely possible that the law could be used that way, and that's why people should be concerned about it. We've seen time and time again that federal prosecutors will toss in charges on questionable laws like these when they're going after people for something else and don't have enough evidence. The risk that this law will be abused is quite high.

Thankfully, more and more people are recognizing this. Dennis S. was a first of a bunch of you to note that the video gamers have jumped onto this cause in a big bad way, starting with a great overview of the problems with S.978 for video gamers who show footage from video games, and also points us to a YouTube video of a gamer explaining why people should be worried. That video doesn't quite have all the legal details straight (which is too bad), but it is generating attention, with over 400,000 plays start to finish (for a 17 minute video). Hopefully many of the gamers are making their voices heard among politicians.

Filed Under: copyright, criminal law, public performance, streaming, video games, youtube

Developer Takes Game Down Due To Piracy, But With A Twist

from the not-what-you-think dept

Perhaps like some of you, I follow Notch, the creator of Minecraft, on Twitter, and he frequently plugs other games he thinks are worthwhile (or not; see his Duke Nukem "review"). So it was with great interest that I read a tweet of his showing solidarity with the developers of a game called ProjectZomboid and their recent struggle with piracy. Naturally, I had to look into this, both because Notch's recommendations are usually very worthwhile, and because, as a Techdirt reader, I wanted to see what all the piracy fuss was about. Given Notch's previous statements about his lack of concern over "piracy," it certainly caught my attention. As it turns out, and as the title of this post implies, the developers of ProjectZomboid had recently taken down the paid version of their game due to piracy.

Now, if you're a regular reader and fellow Kool-Aid drinker I know what you're going to say. I had a facepalm moment myself, since we often see misguided creators try to combat piracy by removing the only legal avenue to purchase their work online, thus ensuring that the pirated version is the only version their fans can get their hands on. But when I read more about their decision making, I found that their reasons had nothing to do with the typical, fallacious "every pirated copy is a lost sale" mentality, and instead were centered on a technical flaw in their distribution system that actually cost them money from pirated copies. Their news item about the take down made it quite clear that while they would, of course, prefer that people paid, they don't see piracy as some kind of demon that sucks away their revenues:

Pirates have made a version of the game that auto-downloads Project Zomboid from our server whenever the player clicks an 'update' button.

We've always turned a blind eye to pirate copies, even on occasion recommending people who had problems with the legit version try a pirate version until the issues are resolved. We realise the potential viral benefits of pirate copies, and while obviously we’d prefer people to purchase our issue is not with those.

However, these 'auto updating' versions of the game could screw us completely. We have a cloud based distribution model, where the files are copied all over the world and are served to players on request, which means we are charged money for people downloading the game. Whether piracy actually amounts to lost sales we're not going to get into. The possibility that it raises awareness and promotes the game cannot be ignored, but the difference is offline versions on torrents, which we've been largely unconcerned about, do not cost us real money, only potential money, and even then we can't really guess at what the net effect is.

Those are the words of a developer who has gotten past the standard knee-jerk reaction to piracy and are starting to think about how it can be a benefit, which is something I always like to see. And after they took down the paid version of the game, they wisely put up a free tech demo in its stead to tide the public over until they can get a new distribution model set up.

All in all, their attitude toward the whole situation and their quality demo certainly worked on me, an IP "abolitionist". I ended up forking over my ~$8 quite eagerly, and if you enjoy a good zombie apocalypse, maybe you will too.

Filed Under: piracy, video games

Capcom's Resident Evil DRM Is Evil: You Get To Play The Game Once And That's It

from the so,-it's-a-railshooter? dept

DRM use by game manufacturers is old news. Every so often, a software company thinks it's got something "nigh invulnerable" (+30 Geek points to whoever recognizes that reference), only to find its latest piece of copy protection hacked and discarded along the virtual superhighway faster than you can say "stoptreatingyourcustomerslikethieves." Lately though, the game companies seem nearly as distraught by used game sales, which bypass their pocketbooks completely. Consequently, they've shifted their efforts towards making second-hand users feel like the last kid in line for family hand-me-downs by giving them the tattered remnants of the latest game in exchange for their second-hand money.

Capcom, however, has trumped everyone with its latest DRM, scheduled to debut on the Nintendo's 3DS. "Resident Evil: The Mercenaries 3D," along with being a mouthful-and-a-half to say, will feature this crippling new "feature":

You only get one save file.

And...

It can never be overwritten.

In other words, if you decide you'd like to start your game over and replay the whole zombie shooting match from the get-go, too bad. You only get one shot. How's that for sticking it to the second-hand market? If you, being the good non-pirating customer that you are, go and plunk down your $40 for this game, you would kind of expect to do things that you could do with all the other games you've spent money on. Like have multiple save files. Or a chance to start over.

Instead, Capcom is going to give you a piece of software with all the save features of the original Nintendo and possibly even less. Let's say you happen to have friends/family members who'd like to play the game. (I know: gamersz. But some of them still socialize/co-habitate.) Too bad. Those free-loading bastards you used to call friends and family will just have to open up their wallets and buy their own damn copy if they want to experience the game for themselves, rather than "enjoy" it vicariously through your save file. 

You're twice as screwed if you decide to save a few bucks and pick this up at Upsell Boutique or GameReserveYourCopy or wherever. You're starting wherever the previously unimpressed gamer left off. And if they finished the game, well... then I guess you get to watch the end credits and try to determine which of the scrolling names deserves the full blast of your rage.

And Capcom's already has its "out" for when the angry gamers come calling. "Why, we printed it right there in the manual! That's hardly hidden and/or underhanded!" The manual? You mean that worthless little booklet that had no importance until I tried to resell RE:TM3D down at the local GameUpsellBoutique? That thing? Who even reads those? More importantly, why is the clerk at the trade-in counter giving me a pro-rated payout based on completion percentage? What the hell?

Oh, Capcom. You've built yourself a very slippery slope with this move. You care so much about the potential loss of income from secondhand sales that you've completely removed yourselves from reality. I have a feeling there's some nasty backlash in your future, and I fully expect to enjoy every second of it.

Filed Under: drm, play once, resident evil, video games
Companies: capcom