
Piracy and the Four Currencies - cobrausn
http://www.gamasutra.com/blogs/LarsDoucet/20120222/9501/Piracy_and_the_four_currencies.php
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gm
I think this is just a different way of expressing the idea that piracy exists
only because the pirate user experience is better than the non-pirate user
experience. So if the non-pirate experience, for example, does not require
that you have the disk in your dvd drive in order to play (since all the
assets are copied to your hard drive at install time), then the pirate
experience is better. And so on.

so the trick is to make the non-pirate experience better and the piracy
problem goes away. The only people pirating are the ones who would not buy
your software/game anyway, so free advertisement/word of mouth should be
welcome anyway.

The industry's problem is that it's hard to make a better experience, existing
cash cows being existing cash cows and all. It's easier to protect them than
to innovate.

But the point is well-taken.

~~~
paulhauggis
"so the trick is to make the non-pirate experience better and the piracy
problem goes away. The only people pirating are the ones who would not buy
your software/game anyway, so free advertisement/word of mouth should be
welcome anyway."

There are a couple of problems with this line of thinking.

First, the Louis CK $5 comedy show is a good example of this not working. Even
though it has no protection and is very cheap, it's all over the torrent
sites. Why would piracy continue in such massive numbers of the end user is
getting everything they could possibly want?

Second, Yes, those people may not purchase your stuff. But, the bigger problem
is that if everyone knows they can just download your stuff for free (and you
don't care and there are basically no consequences), they will not pay you.
They will get it from their friends or download it for free. I've seen this
happen time and time again. Since software isn't a physical good, its value is
almost like currency: it's only what people are willing to pay.

Piracy is also much worse than theft because if a TV is stolen, you just lose
that TV. Over time, piracy can ruin an entire product line. Not just that one
copy.

"The industry's problem is that it's hard to make a better experience,
existing cash cows being existing cash cows and all. It's easier to protect
them than to innovate."

Piracy has actually stifled innovation. Under normal circumstances, if I'm
losing money, I'm going to figure out why, which will result in a better
customer experience and product. Instead, since there is mass piracy, I'm just
going to try to stop that first (Since it's obvious people like the product,
they just aren't paying for it).

~~~
gm
"Instead, since there is mass piracy, I'm just going to try to stop that
first"

I didn't say the _incumbents_ would necessarily innovate; new competition will
if they do not.

There are people that say piracy is a symptom of a broken business model. I
tend to agree with that.

------
chaostheory
Humble Bundle, Steam, and most app stores solve these problems for gaming.

It's too bad some titles from Steam include some really horrible DRM from
their respective publishers, namely Ubisoft. Whenever I somehow lose a
connection to Ubisoft servers, my game pauses with a 'Waiting to connect to
Ubisoft servers' screen. The only way to get out of this screen is to quit the
game. Based on this experience, I will never buy another Ubisoft game again,
and yes this is post Ubisoft PR release about lightening up their online
connection DRM.

~~~
yason
_Humble Bundle, Steam, and most app stores solve these problems for gaming._

Still, there's another unit of currency in play that the app stores and
subscription services don't offer. It's $VPO or Value of Proud Ownership and
it's a currency you get instead of spend. You only get $VPO from buying while
these centralized stores are more like renting.

I've written many times that the desire and ability to own something is an
inherent motivation to buy it. If I like the band and the album, I buy the cd-
or-equivalent because I want to _own it_. And to own means investing in
something that belongs to you to the degree that you can resell it. That's my
tribute to the creators, because it's human nature to try to liken yourself to
what you admire. Owning a copy is flattery. Even owning a pirated copy is
flattery because the price isn't a major factor there: owning it is.

I've been playing games in this decade that I bought in the 90's. Granted, I
use an emulator and I often download, from abandonware sites, the ports most
suitable for my emulator: I might have originally bought the game for Amiga
but now I'm playing the PC version under DOSBox. Other games I've salvaged in
time from 3.5-inch disks to my hard drive as images. But I still own the games
I bought and nobody has taken it away from me.

This is why I'm not into app stores either.

While I might be a hermit retrogamer and certainly not a fan of the bleeding
edge releases, and while I realize that for many people services like Steam
might be a exact best solution, the underlying fundamentals don't change.
There's a significant motivation factor buried in it.

If I really loved a game made this year I would want to buy it, not rent it.
If I smelled it's a classic I would want to be able to play it in an emulator
in the 2030's or even later. This means I need an "internet-age hardcopy",
i.e. something that I can stash somewhere and unpack later for use with an
emulator or original hardware. This would not be possible when I can't be sure
any of the app stores is online after the next five years. This is the same
reason Spotify doesn't speak to me at all.

~~~
chaostheory
You're pretty rare. I don't know of anyone who would still play ancient games
or abandonware. The closest thing that I know of are people who still keep the
Dreamcast, and I can count how many times they've played it over the last 10
years: 0. I don't feel that $VPO is a cost for most gamers as long as they can
still access their game within at most a 5 year period. I would also argue
that with services like Steam, players will be able to access their games for
a longer period of time after changing machines.

~~~
Natsu
They're not as rare as you might think. More than a few of us know about
gog.com, DOSBox and the like...

------
metabrew
This is why Steam is so good - it's less of a pain, and takes less time, than
piracy.

~~~
teamonkey
But not for someone who's previously had their account locked, someone on
usage-capped broadband, someone who doesn't know if their PC is up to scratch
and knows that they can't get a refund...

~~~
chc
I'm not sure how Steam would be worse than piracy for someone on usage-capped
broadband. It would be better than BitTorrent, at least. And I think Steam
lists system requirements for everything in its inventory, so though the
refund situation still sucks, it does address the "Is my PC up to scratch?"
question somewhat.

~~~
teamonkey
With piracy you can download it somewhere else and use a memory stick.

PC system requirements are still notoriously inaccurate. There are too many
variables and the wrong combination of CPU, GPU, motherboard, memory bus, OS
or drivers can make or break performance of a game. Minimum (or recommended)
spec doesn't always mean that playing will be enjoyable.

~~~
waitwhat
You can actually backup&restore local content on Steam, so you can do the
"download elsewhere then copy to memory stick" thing as well.

------
iwwr
Don't forget silly things like fleecing European customers or region-locking.

~~~
davidw
Sometimes (but not always) the fleecing is being done by European governments.
The Value Added Tax in Italy is currently at 21%, with the possibility that
it'll rise to 23%! Not to mention various "fees" when importing stuff.

They tried to get me to pay import fees on a birth certificate my dad sent me
from the US. It cost him $50 to get it from the state of Oregon, so he
declared that as the value (it would have cost him that to replace it,
right?), and they tried to make me pay duties on that $50. I asked them what
they thought the retail value of a birth certificate with my name on it was,
and they backed down, but...sheesh.

~~~
paulhauggis
"The Value Added Tax in Italy is currently at 21%"

Which is hilarious to me. Everyone wants socialized health care and huge
government benefits..but then complain when they are forced to pay enormous
taxes and take their mis-placed anger out on business owners.

~~~
davidw
That's actually a long and complex discussion, but suffice it to say that,
overall, health care costs a lot less in Italy than it does in the US. The
"waste" is elsewhere - people retiring at 59/60 and then living through their
90ies.

------
wtvanhest
Sort of a Devil's Advocate point here -

This analysis is a great way to frame the discussion, but I think it is worth
noting that it really depends on your user makeup by segment. As an example:

HN Reader | Very small % of population | Really good with torrents and pirated
software | Higher Average Income | More likely to sleep better after not
pirating

Non HN Reader | Really big % of population | Really bad with torrents and
pirated software (on avg) | Lower Average Income than HN user | Less care
about programmer well being

Obviously things would be easier without DRM, but some programs may (or may
not) benefit from DRM for profit maximization because they derive far more
revenue from the latter group. A non DRM product can easily be shared by the
mainstream where a DRM product is still fairly hard to share for the
mainstream.

~~~
finnw
Even if I did not care about programmer well-being, I would be reluctant to
use torrents and pirate sites because of the threat of malware.

But then I have one Windows PC that I use for both games and online banking.
Maybe that's rare among HN readers.

~~~
Zirro
I stick with TV-series, and I've never seen an infected file. If I had been
downloading software, sure, I would have been slightly more worried, but even
so most sites have comments and ratingsystems. Looking at them probably helps
you find out if a torrent is malicious or not.

TL;DR-version: In my experience, with some sense, your risk of running into
malware in torrents is slim.

~~~
vibrunazo
That's because you're knowledgeable enough to not click on the misleading ads
yelling "download here". Average users might not be.

Offering a safe easy medium does have an appeal to many users, as shown by the
success of Steam.

------
finnw
"Integrity dollars" are not like the other three.

1\. There is no limit to how many you can spend in a lifetime.

2\. They are non-linear: the more you spend, the lower the integrity cost of
everything you do in the future.

3\. The effect of #2 is localized - if I still have a rack full of pirated CDs
(both music and games) from my student days, I am less reluctant to pirate
music, but that will not necessarily make me more likely to pirate movies or
business software.

~~~
Natsu
They can also go "negative" in a way, in that people who _want_ to support
someone will spend more than is reasonable. Just look at some of those recent
Kickstarter drives if you want an example of that. People are willing to spend
more real dollars because there are so many "negative" integrity dollars that
the price is still "cheap" to them.

------
kenrikm
Steam and the Mac App Store are good examples of how all of these different
factors can work if applied right. Why can't these companies understand that I
WANT TO PAY THEM. If you treat me like a criminal with a purchased copy of the
game but I can get one without all the DRM from a torrent then it's really
tempting to just go with the torrent. I don't pirate however there have been
times that I felt so abused by the DRM that I can understand why people do.

~~~
sedev
The author mentions this a little in the article, but I feel like they
probably could have expanded on that point - the "$I" cost of piracy can
change depending on the seller's track record. As noted recently in the
Oatmeal comic about pirating Game Of Thrones (and Andy Ihnatko's response),
the state of piracy is such that, effectively, _all efforts to make piracy
harder, make piracy more appealing._

I wonder how much pain these various industries will need to endure before
they realize that the solution is to stop punching themselves in the face.

------
Zirro
I would be prepared to pay all the $M the media industry wants today as long
as they reduced the other three currencies considerably. My main reason for
piracy is availability. I can't even buy the things I want where I live.

My dream scenario is a 1080p, DRM-free film, available worldwide behind a pay-
link. I want to be able to download it, to feel that I own it. And that my
money doesn't go to suppressing human rights and suing file-sharers. Pull that
off, and you'll get my $M.

------
idle_processor
The author doesn't mention that buying from companies¹ perceived as evil
incurs an $I cost. In the same fashion one wants to support indie devs,
there's resistance to feeding the beast responsible for bad market direction.
It's basically a boycott; one still consumes the product, but without
supporting the publisher.

For example, think back to when Spore was pirated:
[http://torrentfreak.com/spore-most-pirated-game-ever-
thanks-...](http://torrentfreak.com/spore-most-pirated-game-ever-thanks-to-
drm-080913/). That's an example of a negative $I cost: even people with no
interest in the game were getting on board, to send a message to EA.

¹Companies with dodgy user-experience track records, intrusive DRM, or who are
perceived as having a negative effect on industry or the direction game design
is going. Examples: Ubisoft, due to the forced-online connection even for
single-player games, EA for Origins and banning policy, etc.

------
cobrausn
I thought this was a good analysis, though the author seemed to think the
'Integrity Dollars' were constant. In reality, they seem to be different per
person.

Also he did not mention Value-Added bucks, which would be a benefit you get
for playing the real version that you can't get with the pirated version.

~~~
rheide
The time is different per person too, depending on tech-savvy-ness. Pain-in-
the-butt-ness also is dependent from person to person. Even price is not a
constant if you consider coupons, discounts and price drops.

~~~
cobrausn
True enough. After all, I like the features provided for me by Steam
(cataloging, cloud, achievements, friends, etc.), so what some would consider
a cost (in terms of DRM) I would consider a benefit.

------
vrsmn
that's so freakonomics, awesome

