Steam sales "cheapen intellectual property"...says EA...

[Bakhtosh]

According to a senior VP at EA, Steam is hurting the industry by putting games on deep discount.

What a moron!
And that kind of thinking is exactly why Steam will continue to outperform the Origins and other developer-housed digital distribution platforms.

[JonathanStrange]

Wasn't there a forum thread here where some argued something similar? I like Steam Sales - and now Amazon sales (which can be just as deep) - but one wonders how smaller game creators can make money. Volume? I don't lose sleep over it but still...

[Chaz]

There is an argument to be made that there's less perceived value in something that you get for next to nothing.

But there's also an argument to be made that Steam sales do wonders for the sales volumes of discounted games, let the developers make a good chunk of money, and get their work in front of a much wider audience that might go on to buy their subsequent games at full price.

[Lorini]

They do them because they work. They've been awesome for consumers and tough shit to EA. Not everyone wants to deal with your crap Electronic Arts, get a clue.

[stessier]

The gamemakers work incredibly hard to make this intellectual property, and we’re not trying to be Target. We’re trying to be Nordstrom.

That works because there can be real quality differences in the products at those two stores. Is he promising better quality at Origins? Better ambiance? Or just the higher prices?

I suspect I know the answer.

[miltonite]

If we look at both companies how many game studios did EA consume and then destroy? Then we look at Steam. I cannot recall a single studio that started releasing total crap after making Steam the publisher.

EA cares about 1 thing and that is profit margins. Now that Steam does their sales they are making more money and more people are watching what Steam has for sale on a regular basis instead of origins. I would suspect people are buying 3 games on Steam instead of 1 at Origins and that is making EA angry because. EA cannot even fathom selling games at a discount. "If someone wants a game regardless of the age they should have to pay full price. The game is still just as good and deserves a price that reflects that" even if that game is actually complete crap.

That is how I feel at least.

[LawBeefaroni]

No one would be buying Dead Space today at $50. They sell a ton at $5.

[GreenGoo]

EA and the music industry (and the movie industry could benefit as well) need to either go back to business school or get a refund on their business degrees.

I am all over this schadenfreude though. I fucking hate intellectual property executives with a passion.

[GreenGoo]

No one would be buying Dead Space today at $50. They sell a ton at $5.

They would if you'd stop selling them for 5 dollars! You are destroying the entire gaming industry! Stop shifting the supply/demand curve to the left! Why aren't you pretending supply is limited like the rest of us learned in business school?

Do you understand what a supply of infinity does?!

[Sepiche]

If anyone wants to delve into the hive of scum and villainy that is Quarter to 3, they exhaustively talked about a similar topic here:
http://www.quartertothree.com/game-talk ... hp?t=69130

[GreenGoo]

Lastly, if Steam sales weren't generating more revenue (not sales, revenue) then both they as the publisher and their client the game manufacturer would stop the sales.

Now it can be tricky as to when to drop the price, and Steam absolutely has made me a more savvy game buyer so I wait for sales a helluva lot more, so an argument could be made that Steam occasionally rushes the price down when they could be making a bit more money with less sales, but that's shaving things to a very fine edge. Steam probably has mathematical algorithms making these decisions for them.

I tend to shop around until i get the biggest discount on my new car too. And buy new tv's when they are on sale. In fact I don't pay retail for much any more, if I can help it. Does that make me or the store doing the discounting a bad guy?

If making my dollars go farther is causing the ruination of the gaming industry, then I think we're going to have to learn to live without a gaming industry. Luckily I don't think it is, and only a moron trying to see how much tripe the consumer could swallow would suggest otherwise.

[Smoove_B]

Between STEAM and $15 Kickstarter projects, I have to believe EA is starting to take notice. Here's an idea - instead of figuring out a way to s-t-r-e-t-c-h a gamer's time with your title by making sure to release DLC 21 days after the game comes out or forcing them to register an online key for MP, perhaps you should focus on making a self-contained product. Something a gamer would want to keep around and re-visit from time to time.

[Rip]

In their defense nobody EA knows more about cheapening intellectual property than anyone I can think of.

[Lordnine]

I actually agree to a point. Putting a 5 year old game on sale for a fraction of the price makes sense (everybody wins) but it’s incredibly common now for people to hold off buying a game they know they will love because they think they can get it for half the price in 6 months. As game development prices continue to balloon this sends a message to publishers, nobody was interested in the game at launch so it was a failure. Let’s fire the company that made it.

This is even worse for indie developers who bet their livelihood on a single game. If you don’t support them at full price they may never get to make another game. If you don’t care about them at least consider this; if they fail you never get a sequel to that game you loved that you paid $2 for instead of $15.

[Vorret]

Poor EA... I kinda feel bad for them, they're so dumb.

[LordMortis]

Fuck Steam and their sales. I spend hundreds of dollars a year on games I'd never buy otherwise and it's really beginning to piss me off.

I actually agree to a point. Putting a 5 year old game on sale for a fraction of the price makes sense (everybody wins) but it’s incredibly common now for people to hold off buying a game they know they will love because they think they can get it for half the price in 6 months. As game development prices continue to balloon this sends a message to publishers, nobody was interested in the game at launch so it was a failure. Let’s fire the company that made it.

That's because I don't feel I can get $50 worth of entertainment out of most games and because I'm not spending $50 for something I may or may not enjoy. I did enough of that in 90s for a lifetime. I'm finished acting as Cash Cow... Largely because of companies like EA. Go figure.

[GreenGoo]

As I said, discounted games move to curve leftwards.

If Steam could make more money by setting higher prices rather than lower prices, we'd see price jumps upwards instead of downwards.

Again, as I said, revenue INCREASES when Steam has sales. Not individual sales (which do go up too of course) but revenue. These discounted prices bring in more money than selling the product at full price. Which is why the sales happen in the first place.

There is no warehouse. There is no overhead (we can argue this if you want). There is simply give us money, consume our bandwidth. Steam wants the most $$ they can get. They don't have any overstock they need to get rid of. They have infinite show room/warehouse space. Just enough for a couple of copies of each game.

If steam can produce more revenue by altering prices, they should do it. It's what's best for them and their client. Luckily, it's also a benefit to the buyer as well.

Steam is like the optimal market analysis tool. They have demand and pricing data available live. What they are doing is what's best for generating the most net money. Given that the per unit costs are small, and fixed, moving more units is almost always going to be a better idea.

Again, math says that x people will buy at 50. y people will buy at 30. z people will buy at 5. As theory has been argued for years (especially in the music industry), getting your product short and wide is almost always a better idea than tall and narrow.

[NickAragua]

Translated: "I wish that basic economic principles didn't apply to us" and "Steam is kicking our asses and will continue to do so for the foreseeable future".

Just like physical goods, video games depreciate in value over time. If I'm not going to pay full price for a 2007 model car now, why the hell would I want to pay full price for Call of Battlefield Honor 2 (or whatever EA put out in 2007)? If you want to move a bunch of outdated product, you put it on sale.

This guy is making the mistake of thinking that every time you sell a unit at half price (or whatever), you're losing the other half. Except, chances are, the guy buying the game wasn't going to buy it full price, or didn't even know the damn thing existed until it popped up in the "Steam Update".

Personally, Steam was pretty much responsible for converting me from an unrepentant pirate to a cheapskate legitimate buyer. So, from $0 in earnings to more than that, for no additional cost.

Additionally, wishing for something to be true does not make it so. Whether or not early sales devalue a given software product doesn't really matter. That's the way it is. I just don't have any sympathy for this argument given the source. Perhaps EA could work on improving its intellectual property by not punishing legitimate consumers with "always online" copy protection and shady license agreements.

[Lordnine]

I spend hundreds of dollars a year on games I'd never buy otherwise and it's really beginning to piss me off.

That is fine for you and Steam but that money doesn’t do the team that made the game any good if they are fired by the time you buy the title. At that point only the publisher benefits. There are exceptions of course, I think Introversion was one company that was saved from bankruptcy by deeply discounted Steam sales but that is a special case.

[GreenGoo]

I spend hundreds of dollars a year on games I'd never buy otherwise and it's really beginning to piss me off.

That is fine for you and Steam but that money doesn’t do the team that made the game any good if they are fired by the time you buy the title. At that point only the publisher benefits. There are exceptions of course, I think Introversion was one company that was saved from bankruptcy by deeply discounted Steam sales but that is a special case.

There is a disconnect here. One, EA has been chewing up development shops since long before digital distribution. This is not unique to Steam sales and in fact I'm really struggling to understand your tying it to Steam sales.

Two, if a product makes a company money (meets expectations in this case), it's a good product. That Samsung has fired it's entire engineering department before their current models of monitors have become profitable is on Samsung's shoulders, not the retailers selling the monitors. How odd that you would suggest it does.

If a game meets expectations then it's a good game (from a business standpoint). That you've already fired the people who made it before you realize it's a successful product is either a stupid business decision, or a brilliant one, depending on a million factors and viewpoint.

I struggle to see a connection between products on sale = fired employees. Especially when theory and Steam (bless their tiny black hearts) have proven that sales earn more money for the game, not less.

Steam can't guarantee a game is profitable. If it's a sucky game then it's a sucky game, and no amount of sales are going to save it. What Steam can, and does do, is get the most money out of the market place possible for the game, whatever the quality of the game.

[Smoove_B]

Except what EA isn't admitting is that their interest isn't in the success of a particular game company -- I'm sure they're viewed as replaceable mercenaries -- but in the sale of units. Look no further than the entire Call of Duty nonsense - two teams cranking out a new set of maps each year, selling them back to the community for $60 and then hosing them again for $15 every three months...until the next $60 game comes out. When there were problems with Infinity Ward doing what they were told, they were replaced. Now, that's Activision / Blizzard, but I don't get the impression EA is any better. Particularly with their "BioWare studios"
shell game where they get to use the name and former reputation of the original Bioware crew.

If I was an indie developer, I'd be worshiping at the altar of STEAM right now rather than trying to align myself with EA or some other corporate maniac.

[GreenGoo]

Steam, if an indie developer can even get on there (no small task) is a godsend for indies.

At least from increased sales and revenue perspective. Steam comes with it's own laundry list of control, legal and timeline issues that can not be in the indie's favour, but for getting their product out and money in, Steam is a HUGE step up from what came before.

[PLW]

I wish our competitors would raise their prices.

[GreenGoo]

I wish our competitors would raise their prices.

Exactly.

Man, you could have saved me a pile of writing if you had just found this thread before me.

[LordMortis]

I spend hundreds of dollars a year on games I'd never buy otherwise and it's really beginning to piss me off.

That is fine for you and Steam but that money doesn’t do the team that made the game any good if they are fired by the time you buy the title. At that point only the publisher benefits. There are exceptions of course, I think Introversion was one company that was saved from bankruptcy by deeply discounted Steam sales but that is a special case.

I can't help a team that wants to sell a product I value at $15 through a publisher that wants to sell it for $50. If they can't make enough money at $15 then the game isn't important for me to play.

So perhaps it's game designers or publishers that have cheapened IP and leave us believing their games simply aren't worth $50 a pop anymore.

[Lordnine]

I spend hundreds of dollars a year on games I'd never buy otherwise and it's really beginning to piss me off.

That is fine for you and Steam but that money doesn’t do the team that made the game any good if they are fired by the time you buy the title. At that point only the publisher benefits. There are exceptions of course, I think Introversion was one company that was saved from bankruptcy by deeply discounted Steam sales but that is a special case.

There is a disconnect here. One, EA has been chewing up development shops since long before digital distribution. This is not unique to Steam sales and in fact I'm really struggling to understand your tying it to Steam sales.

Two, if a product makes a company money (meets expectations in this case), it's a good product. That Samsung has fired it's entire engineering department before their current models of monitors have become profitable is on Samsung's shoulders, not the retailers selling the monitors. How odd that you would suggest it does.

If a game meets expectations then it's a good game (from a business standpoint). That you've already fired the people who made it before you realize it's a successful product is either a stupid business decision, or a brilliant one, depending on a million factors and viewpoint.

I struggle to see a connection between products on sale = fired employees. Especially when theory and Steam (bless their tiny black hearts) have proven that sales earn more money for the game, not less.

My comments were not aimed specifically at EA but at people who wait for a game to go on sale even if they know they will love it. It’s rare that a new game comes out and someone here DOESN’T say, “Well I loved the demo but I’m going to wait till I can get it for $20 anyways.” Most publishers don’t care about sales over the long term, if that 5 million dollar title doesn’t at least make back its cost in the first 6 months then you better believe the team is either going to be let go at least experience major layoffs.

[Bob]

I spend hundreds of dollars a year on games I'd never buy otherwise and it's really beginning to piss me off.

That is fine for you and Steam but that money doesn’t do the team that made the game any good if they are fired by the time you buy the title.

Maybe they should lower the price sooner then.

[LordMortis]

My comments were not aimed specifically at EA but at people who wait for a game to go on sale even if they know they will love it. It’s rare that a new game comes out and someone here DOESN’T say, “Well I loved the demo but I’m going to wait till I can get it for $20 anyways.” Most publishers don’t care about sales over the long term, if that 5 million dollar title doesn’t at least make back its cost in the first 6 months then you better believe the team is either going to be let go at least experience major layoffs.

And they can feel free to market to people who need to own a game when it comes out, the way movie makers make movies for people who see movies within the first two weeks they are released and I'll occasionally buy one at full price.

And maybe find ways to make cheaper games that are worth sitting down and playing for that cheaper price.

OTOH, if I love a demo, I'm inclined to buy a game. I find that many a $50 game doesn't give you much of demo though. So it's rare to demo then buy a $50 game for me. I also find that $50 games have an 80+% chance of giving me buyers remorse whereas $15 games often just get back burnered with no thought about the $15 game being a waste. So not only am I out $50 for a crappy $50 game, I'm angry about being out $50 for a crappy $50 game.

[GreenGoo]

But....that's just smart consuming. I already feel like a sheep dropped into this economy run by wolves. Now I'm making companies go out of business because I buy their products on sale?

I understand your point L9, I do. I just don't care for the implication that I owe companies more money for their products, or that by managing my money and making it go farther, I'm doing a disservice to the gaming industry.

If I was a more avid consumer rights guy than I actually am, I'd be frothing at the mouth by now. You're basically suggesting I'm not being sheep-like enough.

Consider this the free market at work.

And Smoove mentioned, Kickstarter is the place to put your money if you're concern is supporting individuals or groups of game makers. You can pay heavily inflated prices and reverse the trend! Love the idea and want to support the developer? Drop a grand on him. Go Team! (I'm trying to be funny but not cruel or sarcastic).

[Smoove_B]

6 months used to be the norm, but now 30 days isn't unusual. Hell, I picked up a copy of Prototype 2 for 50% off a month after it was released. Why? Because the game lasts ~12 hours. I'd imagine there are very few people that want to pay $60 for a 12 hour game with no replay value. But if they just went crazy and released it for $30 on day one? I bet it would have sold many more copies initially. The price drops are seemingly related to media reviews and word-of-mouth regarding the quality of the game. Similar drops occurred rather quickly with Dragon Age 2 and Mass Effect 3. There are no price drops with the Modern Warfare games because people are out of their minds to play them. Hell, look at Civilization V. I'd have to look at historical data, but I'm nearly certain it was over a year before Civilization IV experienced any type of price drop. However, less than stellar reviews and the departure of the game's lead designer 30 days after it shipped and magically Civ 5 could be found for considerably less within 90 days after it was released.

Look at the confusion over Warlock from Paradox. My unofficial take from reading here and elsewhere is that people are still enjoying it and they feel the $18-20 it cost them was money well spent. I have no doubts if they paid $50-60 there would be a different sentiment.

[Vorret]

The main problem is there's very few quality games left or games that are worth their price.

If you buy Call of Duty 6 expecting the kind of singleplayer* you had when you bought the first one, you'll be very disapointed with your 60$ purchase.

If you buy Civilization 5 and you put 50,100,200 hours on it then that 60$ looks better.

You've got other studio that make a 20-25 hour game (Serious Sam 3) and the game is priced accordingly (+- 30-40$) at release depending on where you got it.

Game I'm expecting and know I'll put hours on I don't mind paying the full price (Diablo 3, Civ 5, Guild Wars 2, SS3, etc) there are others that are more of a I'll try on sale since I'm not sure I'll enjoy it.

Make me want to buy your game and you'll get my 50-60$ is what I'm trying to say, EA isn't doing that for me (though I did pay full price for BF3 and I don't regret it)

[Carpet_pissr]

My comments were not aimed specifically at EA but at people who wait for a game to go on sale even if they know they will love it. It’s rare that a new game comes out and someone here DOESN’T say, “Well I loved the demo but I’m going to wait till I can get it for $20 anyways.”

At least for me, there is a third dimension to that thinking though - back log. Ironically, in part due to the massive previous Steam sales, and ridiculously low costs, I now have more games lined up to play that have not even been installed, than games I have completed in my lifetime.

So it's almost damn near impossible to get me to buy a game on Day or even Month 1 anymore (not that I was a "DAY ONE! DAY ONE!" kind of person before), and it has absolutely nothing to do with cost.

[PLW]

I REALLY love having clean water to drink. Does that mean I am morally obligated to pay my life savings for it?

[TiLT]

I haven't got anything constructive to say, but I'll say this: I just love that not a single person in this thread has bothered to get the name of EA's online store, Origin, right.

[Carpet_pissr]

I haven't got anything constructive to say, but I'll say this: I just love that not a single person in this thread has bothered to get the name of EA's online store, Origin, right.

And with that, Tilt sealed his position as King of the Internet's Pedantic Word Nerds.

[GreenGoo]

Well, I was talking in generalities and market theory. The who's and why's are almost meaningless for me, EXCEPT they provide real world context now, whereas these kinds of discussions used to disolve into unprovable assertions.

[YellowKing]

My comments were not aimed specifically at EA but at people who wait for a game to go on sale even if they know they will love it. It’s rare that a new game comes out and someone here DOESN’T say, “Well I loved the demo but I’m going to wait till I can get it for $20 anyways.”

People did that before Steam. I'm not going to argue that Steam doesn't make it easier for folks to hold out, but it's not like Steam is the first entity to discount old PC games.

I think that any losses publishers are incurring as a result of people holding out for sales is more than offset by the larger distribution channel Steam gives them. Plus they're making money off old games they would have made zero money off of before Steam, because there was no retail space/distribution channels to sell them.

[Zaxxon]

I wish our competitors would raise their prices.

This. Look, we have a certain amount of disposable income. Lots of companies compete for those buckazoids. We choose the products we want based on a huge array of factors, only one of which is price. The big publishers over the last 5 years or so (OK, over the last 20 or so, but most egregiously the last 5) have focused almost exclusively on reducing their annual product development risk and maximizing revenue per gamer. That's fine--I'm sure their shareholders are ecstatic about that.

The end result--I'm looking at you, EA--is an annual release cycle at $60 of tweaked versions of last year's games with what used to be a fraction of a $60 game's content. Plus another $60 of add-on content to bring the title back to the 'normal' level of content. Of course when a disruptor comes in and shakes things up by offering more reasonable pricing, folks are going to jump, and the incumbents are going to bleat. It's the same reason that the big publishers are moaning about Gamestop's used games racket--the publisher wants everyone to plop down $60 and hang onto that game forever, as though that's something that can happen. I'm not Gamestop's biggest fan, but you nuke the used game market, and you nuke a shit-ton of new game sales along with it. It's especially egregious with the EA Sports games--many of them aren't even functional games when they ship and require multiple patches before they're actual usable software. EA is surprised that some people would rather wait some time, then buy the actual finished game for $30?

Bill Harris has a number of posts on this and similar issues.

Steam scares the living daylights out of the larger publishers, but I haven't seen a whole lot of moaning out of smaller or well-respected devs. It seems to me that if you produce a quality product and price it accordingly, Steam doesn't harm your profitability. Has any game development executive disputed this? Did cheap game availability on Steam harm Diablo 3's sales? Did multiple sales on Torchlight result in Runic Games going up in smoke? Has Skyrim's price cratered months after release? How about its revenue? It's pretty objectively clear that Steam isn't the problem.

TL:DR - When the big pubs are so transparently focused on getting the most bucks out of the lowest amount of development possible, of course a significant subset of gamers are going to jump ship to a platform that offers games at their true market value. There was and is <Trent Steel> NO CHANCE </Trent Steel> of any other outcome once Pandora's Box is opened.

[Sepiche]

Well said Zax. I pretty much agree with all of that.

[Lorini]

Exactly Zaxxon. I don't know many people who wouldn't love to see EA put out of business. And if Steam can help do that, I'll happily buy games on sale on Steam. EA is simply the most uncaring game company there is.