Category: business

Here is a pet theory.

lets say there are two logging companies. Treehugger Corp only cuts down trees in sustainable plantations, and its price per kilo to customers is $20. Bastard Corp cuts down trees where the hell it likes, and it’s price per kilo to customers is $20 too. Customers are happy with the $20 price point. $2/kilo is the ‘normal profit’ that makes the industry a worthwhile endeavour.

But…

profit / kilo for treehugger is $2. for bastard corp, it’s $4. So what does bastard corp do? It obviously lowers it’s price to $18. It still makes a decent profit margin, but suddenly treehugger corp costs more. 95% of customers don’t look past the PR spin to see which company is really the ‘nice’ company, and thus treehugger desperately loses market share. With falling market share and revenue, it cannot afford to fight back. Soon Bastard corp has the market to itself. cackle cackle, twirl moustache. They probably even raise their prices to $22 later.

Here is where my theory kicks in…

Lets say there is a third company ‘CleverCorp‘. Clevercorp would like to be like treehugger corp, but once-bitten twice shy. They aren’t going to go-down like TreeHugger corp, but they have the same ‘nice’ goals. When BastardCorp lowers it’s price, CC does the same, and begins to sell unsustainable wood too. At the same time it complains to the government and the press, that this is all wrong, and that the industry needs regulation, pointing to BastardCorp. The problem is, to the cynical public, govt and media, Clever Corp is as bad as Bastard Corp. They are involved in the same shady practices too, and their bleeding-heart PR is just a smokescreen. How can we have any sympathy for Clever Corp?

I’m reminded of this phenomena (game theory probably has a nice name for it, if it’s not just a moral race-to-the-bottom?) when I see ‘bullshots’ (mocked-up screenshots) and sexist ads for games. I’ll never release screenshots that were mocked up in photoshop, nor will I stick a semi-naked buxom elf in my games, or my ads. I do, however, realise this puts me at a commercial disadvantage.

This is why it’s really good for customers and industry pundits to rail against stuff that is bad, like the aforementioned PR lies and sexism. note also Duke Nukems PR threats to journalists for higher scores, flying journos to the bahamas to review a game, and the old story of how people in gaming are worked to death for shit wages.

When that sort of stuff is made unacceptable, it’s not only a welcome kick to the bastard corps, it’s also a change that enables the ‘nice’ corps to stay idealistic, and not go down the understandable-but-still-evil middle route.

This coming week is solar week. By friday, it might become OMFGLOOKITSIMAGESOFANEWGAME week.

Lets look at how many people are logged into steam right now, in the middle of their BIG summer sale:

2.3 million

Wow etc. Lets all say how huge the steam audience is. It certainly shows how much bigger valve is than positech, that’s for sure :D. But hold on…

Zyngas IPO means some real stats on the people playing zyngas games:

148 million unique monthly players

Holy alphabeti spaghetti batman. That’s a lot of people. Even though the majority of them never give Z any money, it’s still a staggeringly good business. Granted, Zyngas profits aren’t that high given the silly value the company has been put at, but even so, lets forget the money for a moment, and look at the fact that there are 148 million people prepared to play zyngas games.

That’s incredible.

It’s just a pity that the company was founded by a guy who didn’t give a fuck about his customers, and even bragged about it. I don’t care if my next game sells 1/100th of GSB. I still won’t bundle some shitty toolbar with it.

I hate it when companies like that do so well, mostly because it sends out signals that encourage the good guys to do the same thing. That’s whats so cool about successes by minecraft, frozen synapse, world of goo etc. It’s so cool when game devs who are nice guys and genuinely love games do so well. You don’t have to be like zynga to make a career from making games :D

I got a lot of grief from various parts of the web for daring (how dare I!!) even mentioning the topic of games pricing, and the value of an indie game. Apparently, this topic is as off limits as anti-semitism or saying that The Phantom Menace was cool.

Meh.

Free markets conspire to give people what we want. We get exactly what we deserve in so many ways. People don’t care about politics, so we get corrupt politicians. People don’t care about eating healthily, so we get hormone boosted beef and…

People like games where you just click stuff and spam your friends. So we get farmville. And to go one stage further…

People LIKE to argue about the price of games, DRM and piracy. Trust me, I know, I have blog traffic stats. I know what gets people reading, and commenting. A tiny fraction of people get abusive and angry, but then this is the internet and as charlie brooker has said, you could give people online a free massage and they’d moan at you.

It would be simpler, and pretty boring to have a blog where I just talked about vertex buffers, never said anything about the games industry was bad or could be improved, and just had some cat pictures. But that would be boring to type and you wouldn’t read it. 99% of games developers talk purely in tedious bullshit marketing cliches about “How we are excited to work with our partners to bring this compelling new SKU to the market”. I’m pretty sure we have enough people doing that already :D