Origin Boss Says Steam Sales "Cheapen Intellectual Property"

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What steam sales do to me, and I'm pretty sure I got the same attitude as many people is Steam crazy sales made me buy games that I will not buy under normal circumstances.

If I'm excited about big games, I will buy it within 2 weeks of release, the games that I'm kinda iffy about I'll wait until massive price drop either online or in retail.

Just another reason not to use Origin besides for select EA titles.

Origin
We got no Games
We also got no Sales

rolfwesselius:
If everybody buys games just because their cheap and not because their good,then yes that decreases value.
Also everybody waiting is not good for the devīs who need money the moment their done with a game and not 5 months down the line.

Except you can't prove either of those statements, and Valve has probably got a lot more data to pull from than you to decisively evaluate whether or not those sales work, or if they just cannibalize new sales.

But hey, you clearly know more than the big company who's dominating the PC games market with your no evidence to refute their detailed statistics and business plan. So clearly what they do is bad for the industry.

so, let me get this straight EA, you'd rather Steam gets what little money I can afford to spend on games... I understand and will comply with your wishes.
How is this even close to good business practice?

Firstly, F@$% you, Mr. DeMartini.

Secondly, my experience is that allowing a top-down control of prices leads to an unrealistic over-valuing of the properties. This is doubly the case in the matter of the digital world, where innovation moves quickly and five or six months brings an entirely new wave of software, leaving the hot titles of yesterday in the dustbin. Far from devaluing older titles, reduced prices on older titles like those seen in Steam sales may be the only thing that allows the franchise-only thinking of big names like EA and Activision to have some degree of success, giving otherwise leery gamers reason to try titles within their limited budget and perhaps see that there's some merit to those games beyond the ridiculous hype that goes hand in hand with initial releases.

By way of contrast, I've noted that all the GameStops in my area seem to insist on pricing all their Mario-related used DS games at around the $25 mark, probably in part because they still insist on selling the new versions at the $30 mark. This may in part be because of pressure from the big N... but it also means I've seen five or six copies of some of these games collecting dust, unsold, behind the counter. I would happily buy some of these games if they were allowed to naturally devalue like all the other games on the shelf (Super Mario 64 DS is now seven years old), but at the $25 point I can buy two or three other perfectly good games, so what are the chances I'm going to shell out for Mario instead?

Gee, news flash... Companies like bigwig EA love market dynamics right up until they bite them in the ass.

Which brings me to:

Thirdly, Steam is not going to go away, so you've just announced to the world that your biggest competitor's strongest point is going to remain their strongest point, you yield all ground on that issue. In return for which, you're offering...

(*crickets*)

I'm a little surprised your stockholders aren't ready to tear you a new one for this.

Basically, you're banking everything on the colossally arrogant assumption that EA's games are so good, they're worth every damn thing you've put your customers through to play them. Apparently, someone hasn't been reading the news.

Fourthly, F@$% you, Mr. DeMartini.

Daemascus:
Yet another reason Origin will never be able to truly compete with Steam. Besides the usual Origin issues...

And as to training people to wait for Steam sales... Maybe kinda true? Most people who want a new game want it NOW. If they wait, that probably means they cant afford to pay 60 bucks just to get something right away. So its giving them a chance to buy the game at a more affordable price at the cost of waiting. A cheap sale is better than no sale at all.

Exactly.

Not much for me to add beyond what you've already stated.

EDIT: This might be interesting to add I guess:

http://www.escapistmagazine.com/articles/view/features/9011-The-Terrifying-Tale-of-Amnesia

Oh yeah, and I got Civ 5 whilst it was on sale the other day for Ģ7.49 and now I'm seriously considering purchasing the new expansion for Ģ17.99.

Ickorus:

Daemascus:
Yet another reason Origin will never be able to truly compete with Steam. Besides the usual Origin issues...

And as to training people to wait for Steam sales... Maybe kinda true? Most people who want a new game want it NOW. If they wait, that probably means they cant afford to pay 60 bucks just to get something right away. So its giving them a chance to buy the game at a more affordable price at the cost of waiting. A cheap sale is better than no sale at all.

Exactly.

Not much for me to add beyond what you've already stated.

I agree.

I'd also add that Steam sales make a good opportunity for games that didn't get really hyped or got critically panned to find new life. I know I've picked up a couple of lower score games I'd never heard of on Steam sales and then loved them to death. Makes for a good counterpoint to the insatiable hype engine which you'd need to sell everything at your original price point. Makes sense coming from the company putting out a new sports game edition every 12 months though- long term sales are not their business. Hell, you see that with lots of "AAA" titles now, its just like antivirus programs- what used to be Program version 2.0 is now Program 2009 - the search for more money.

Jay444111:

It makes sense, the Amnesia dark descent guys had a sale and did say they made SOME money, but due to it being on sale all the time they didn't even get close to what they wanted.

Oh, you mean those guys that literally stated the only reason they didn't go bankrupt before releasing Amnesia was because Steam held a sale on Penumbra? One that literally more than doubled the total units sold?

Link to source

1) Publishers are the ones who tell Valve to put their game on sale. If EA wants their games to only be 20% off during a Steam sale, then they can do that.

2) Traditional economics says that a 50% sale will gain you twice the sales, giving you the same amount of revenue as before. This is false. Valve has found that putting games on sale increases the revenue by orders of magnitude.

3) If you put a game on sale, tons of people will buy it. But then the sale ends, and those players' friends will hear how cool the game is, and will buy it at full price, so they can play along with their friends.

WarpPhoenix:
And since another digital unit costs $0 to give to someone it is going to be pure profit to the developers.

Eh, not quite $0, you still need to pay for bandwidth, and you're still paying to keep some copies sitting on a server somewhere. But, then again, that's nothing compared to the costs of producing and distributing another physical copy of the game...

Thing is, the Steam Sales do three things.

1) They inspire brand loyalty. I ran across a phrase once, "there's no brand loyalty so strong it can survive a 50% off coupon." Steam's taken that idea and run screaming with it, and upped the ante. "50%? BULLSHIT! We'll do 90% off!" And we're off to the races. Steam may not be a perfect service, but the (now constant) sales transform it into a very likeable one.

2) They generate revenue. The big sales, Christmas, summer, groundhog day, those sales actually get people spending money on things they don't even want. Show of hands, who here has come out of a major Steam Sale with a backlog of 10 or more games? How many of those games would you have ever considered buying under normal circumstances? That 75% off tag causes all of us to loose our goddamn minds. It's not something we blame Steam for afterwards, which is pretty important. But still, it's money they would not have gotten otherwise.

3) They underline just how bullshit the $60 price point is. And that's what DeMartini's freaking out about. The $60 price point is absolute bullshit. It is simply an attempt to squeeze as much money out of the dwindling "buy it release day" crowd. Of course, DeMartini is looking in terror at the prospect of having to cut prices, because he assumes lower prices don't equal more sales... which is, idiotic.

Here's a summation of my experience using origin.

Even when I have the game on a disc, I need to re-install origin EVERY SINGLE TIME I WANT TO PLAY A GAME and I have to use a crack on my pre-ordered N7 edition of Mass Effect 3 to get the DLC to work.

There's a reason EA; a company probably 100x the size of Valve cant maintain a desirable digital service: You don't have your ears to the ground.

Oh EA....You almost have to love how brazen they are when it comes to things like this. They're like the Fox News of gaming.

Daemascus:
Most people who want a new game want it NOW. If they wait, that probably means they cant afford to pay 60 bucks just to get something right away. So its giving them a chance to buy the game at a more affordable price at the cost of waiting. A cheap sale is better than no sale at all.

/thread

That's how I go about the issue. There are games I want to buy but due to financial obligations I can't have them NOW but when the sale runs around it's great because I can legally get the game and enjoy/support that particular IP.

further example: after getting the full run of borderlands goty edition for really cheap on steam, seeing the money burner edition with the cool stuff that is more cool with the context of the original, plus being shown practical dlc included with any preorder (a special fifth character whose presence is entirely optional on top of the four characters that we expect to be the main part of the game because the original game also had four characters), actually brings up a hard decision on whether or not to preorder the normal version of the game, or get the moneyburner edition now before they run out of awesome life sized loot chests with haunting realistic glow action

you will notice how "not buying the game at all" has not entered this decision to begin with, because by now, having experienced the first game, you know the second one will probably continue the tradition of over the top violence humor and sweet loots

rolfwesselius:
As much as i hate to admit it training gamers to wait 3 4 months before buying a game is not good in the short run only in the looooooooong run.

I don't know about you, but I don't think I'm a fucking dog that exists to be trained by EA and Valve into behaving a certain way. I'm a rational human being, I can make my own decisions. EA can go to hell.

Treblaine:
So Activison aren't trying to be bad, they are trying to do the right thing they are just utter hacks. EA is deliberately and knowingly bad.

Ha ha ha ha.

OK, first off, nobody, not even EA, is trying to be evil for its own sake. Somewhere out there is someone who genuinely thinks the dick moves they pull are good for business somehow. What makes a company evil is being willing to stoop to anything to make more money.

As for all that other stuff you said, read up on Activision's history with Infinity Ward sometime, or their habit of shutting down every studio that wasn't making franchises they could exploit with sequel after sequel (six studios shut down in the last two years), or how their CEO said flat-out that his goal was to make video game development less fun.

cursedseishi:
GoG said HUGE sales can cheapen a game. Remember that GoG.com has its own regular chunk of sale specials going on all the time, what they said was harmful were the "80%" off kind of big sales.

Yeah, and they said it was bad because it encouraged people to impulse buy and never even try a chunk of the games they pick up as well as causing an extreme boom/bust sales cycle... one that evens out in the end, certainly, but is firmly under the control of Valve. They also took the position that lower regular prices with less extreme discounting during sales was a more sustainable, positive long term alternative for the industry and more importantly for gamers.

EA Guy: "Steam sales cheapen IPs and are damaging to the industry."

What, you mean like how retail games often drop rapidly in price shortly after release, or get slapped in two-for-X (or better) deals? 'cos that's been happening for ages. Or is this different because this time the one who has to take a divot out of their earnings is you and not the store (who incedentally also sell pre-owned games and are thus EVIL)?

Or how you yourselves have already trained us to wait for the price to drop and/or for the inevitable Ultimate Arcade Hyper-Fighting Game of the Year Edition with all the DLC features?

Kinda hard to see this as anything but EA bitching that their money pool isn't big and full enough.

I see where his coming from, but I think the trick is to sell more copies than you normally would to make up the price reduction. You do that by making better games.

If you think overpricing shit games is good for the industry than you are wrong.

Marv666:

Dastardly:

I think there's something you're misunderstanding, and I think it's the same thing EA's folks are missing. We only see the developer "getting screwed" if we look at the per-copy sale price and compare it to the usual. In the retail world, that comparison holds water -- it costs money to burn the disks, package and ship it all, and get it stocked on shelves. In the digital world, however, there is no per-copy cost. Moving one unit at $1 million is exactly the same as moving a million units at $1 each.

The problem is that the logic most people are using in this thread doesnt hold any water if you know the even slightest thing about economics or running a business.

But it also seems a little like your arguments are mostly founded up Valve hate rather than on any support you've provided for what you've said. Namely, how Valve is hurting the developer (at least in any way that is different from the usual way publisher-distributors screw the 'little guy').

What is it specifically about Valve's business practices that present a unique harm to the developer, and how?

Steve the Pocket:

Treblaine:
So Activison aren't trying to be bad, they are trying to do the right thing they are just utter hacks. EA is deliberately and knowingly bad.

Ha ha ha ha.

OK, first off, nobody, not even EA, is trying to be evil for its own sake. Somewhere out there is someone who genuinely thinks the dick moves they pull are good for business somehow. What makes a company evil is being willing to stoop to anything to make more money.

As for all that other stuff you said, read up on Activision's history with Infinity Ward sometime, or their habit of shutting down every studio that wasn't making franchises they could exploit with sequel after sequel (six studios shut down in the last two years), or how their CEO said flat-out that his goal was to make video game development less fun.

You're very right, many companies can look good in comparison to EA, it's like comparing Activision with Enron. Activision is still a really awful company but they seem to be contained in their damage, they are only in the CoD cycle and a plethora of movie licences games where they seem to be happy to stay. Activison may have purged many studios but unlike EA they didn't immediately begin buying up more to liquidate them. Activison let studios go intact, like the Sleeping Dogs studio. EA doesn't do that. They have accepted a limited partnership with Bungie, not demanding control. This is comparatively good.

What I mean by EA is they seem to have chosen the "fuck em" path of easiest buck that most other companies wouldn't do because it would be insulting and negative to their customers and the industry as a whole, but the EA has cornered that market if being completely unscrupulous and pig headed cashing in every shred of their reputation to hammer home a simplistic obsolete pricing model where they know they have the upper hand. And please, DO NOT DOUBT that EA is in dire straight, look at how their stock has been at a 50 degree slope down into the danger zone for almost a year now. This wouldn't be the first company it the world to be run into the ground by bad management.

There are a lot of "hardcore capitalists" out there who genuinely think the strategy for everything - even with your consumers - is to fuck them over at every opportunity and never give them an inch. The "greed is good" generation that don't want to make anything better, just syphon off as much as they can and as long as they are big and strong (enough money) they'll live. The "might is right" attitude.

They aren't being evil for evil's sake. They are being evil for greed and callousness. And I don't mean "serial killer evil" I mean as evil as a Video Game publisher can be without being raided by the FBI.

The surprise can't be always-online DRM... Origin already gives that 'gift'.

Andy Chalk:
Like it or not, there's no arguing that Steam sales don't offer tremendously good deals.

Are you sure about that triple negative there, Chalk? Because the rest of the paragraph alludes to a different point of view.

rolfwesselius:

Daemascus:
Yet another reason Origin will never be able to truly compete with Steam.

Well their servers are better than steamīs and donīt crap out when you donīt want them to.
Also the games launch faster.

Um...bullshit? I've had Origin's servers crap out on me far more than Steams.

As for game launches, that's on the devs shoulders, not Steams. That's more about the engine, not the platform.

rolfwesselius:

If everybody buys games just because their cheap and not because their good,then yes that decreases value.
Also everybody waiting is not good for the devīs who need money the moment their done with a game and not 5 months down the line.

Except that that's also bullshit. Steam sales have not, and probably will not, ever truly effected the launch of a new game. The ONLY effect the Steam Sales have had on game purchases is vastly increasing the number of products sold; even long after the release date.

In fact, several developers have said that their profit margins have done nothing but improve thanks to Steam Sales. Hell, in the case of a few (like Introversion), Steam Sales actually SAVED them from bankruptcy.

So, um...yeah. I'm calling bullshit on your statements.

This story brought up a question in my head about publishers (sorry if off topic a bit). What do larger developers stand to gain by joining a publisher (I understand why tiny ones do). For example, why would Bioware join EA? For games like SWTOR or ME3, does EA really increase sales enough to justify the cut that they take on BW's profits? What does EA do that Bioware couldn't have done on their own? When ME3 was announced, I couldn't wait for it. I preordered it as soon as the release date was announced. I didn't need EA to promote it, nor did I need to see commercials about it on TV. Don't most gamers get their info online anyway? Who actually finds out about new games from TV, anyway?

Marv666:

Dastardly:

But it also seems a little like your arguments are mostly founded up Valve hate rather than on any support you've provided for what you've said. Namely, how Valve is hurting the developer (at least in any way that is different from the usual way publisher-distributors screw the 'little guy').

What is it specifically about Valve's business practices that present a unique harm to the developer, and how?

I said it earlier but the more often you put games on sale especially newer ones the more likely people are to wait a month or two and buy it when it is on sale instead of new. As this continues the problem only gets bigger and bigger. These are obviously not your week one sales people these are your month one and two guys. The economy being bad right now also serves to enlarge the issue.

The less sales a game gets in the first couple months the more likely they are to give in to the steam sales that caused them to have lower sales in the first place. This is the never ending cycle of doom that both EA and GOG were talking about when they say that steam sales are bad.

See my above post please. Because EA and GoG are spewing rhetoric and bullshit. In fact, the reality of it is almost the opposite of their doom-saying.

Marv666:

Treblaine:

Steam does the same big deals with their games, the ones they put their money into. Hell they have made several of their games free to play, even and opened up steam to competing free-to-play games on their service.

Your either forgetting or ignoring on purpose a very important factor. That is both the ratios of valves games to total games on steam and to the number that have gone on sale. When your own product makes up such a miniscule percentage of what your selling its very easy to discount it once in a while. Origin is very different in this in that the vast majority of the games on it are EA titles.

TF2 went free to play for the same reason that most mmos have and facebook games. They realized that they can bring in more money off of microtransactions then from copies of the game. Yep thats right I am saying that what valve is doing with TF2 is on the exact same level and everything that zinga creates. Hell I would say its ever worse because valve isnt even creating the content anymore they are relying on the player base to do it.

That doesn't contradict the refutation I made of your argument.

The reason there aren't many third party games on Origin is no one want to jump on a sinking ship, there are just as many titles that owned by EA on Origin as there are titles owned by Valve on Steam.

Most MMO games are NOT free-to-play, they cost money to buy the game and a high fee EVERY MONTH. You claim it's the same as "zinga". That's not an argument, that's a baseless assertion. You might as well say "Odin is the one true god" and expect me to believe you.

And it shows your ignorance, the player base may make some of the content but THEY ARE PAID FOR THEIR CONTRIBUTIONS if they get officially adopted and featured! The only unpaid content is the content distributed for free that gamers install on their own initiative on their own install. Are you seriously holding it at a negative that Steam games have an active modding community that keeps their games fresh and interesting.

You're new to escapist aren't you?

Steam's method seems to be working quite well for the industry. Nobody is forcing publishers to sell their games there.
If EA wants people to buy games when they come out, they need to price games fairly and not just give all games the standard $50 price (and no game should start at $60).
Some "AAA" titles don't deserve more than $5, being fun but very short.

Its hilarious that he mentions Target. Super Markets and Origin being very similar by being ridiculously expensive AND having a pathetic selection.

First, the costs of distributing and selling a game are starkly different between retail and digital (namely a fair amount compared to virtually nothing), so the costs of games on Origin shouldn't be $60 to begin with. Heck, I'd give them props if they made them $50 as the starting price.

Second, people will pay good money for a game they know will be good, not one you tell them will be good. However, they might be willing to buy it at a sale. Additionally, if you put it on sale, you will sell more copies. If you never do, chances are you will never sell any copies of that game again.

Third, if they shared the money lost from the sale between the developers and the EA admin staff then the actual developers wouldn't suffer a great loss. I dunno, I just feel when EA says that, they think when a game goes on sale then the loss is taken straight out of the developers paycheck and nothing out of their own share in profits so they think if they did that to their already underpaid developers then the developers would all quit.

Fourth, people will be willing to wait for a game and buy it if they know it's going to be discounted. If they know, from a statement such as EA has provided, that it will never much be discounted, they will pirate it and the developers will get nothing.

I don't feel a need to buy a game for $80. I haven't played any of the previous games, and whilst I think it looks good, I'm not prepared to pay that.
A couple of months later, I might see it for $40. I think that's good value, so I buy it.

Also, PC sales for any game will drop off after the first 3 months, as will the interest in the title. Look at Skyrim, one of the biggest games to come out on PC in years. 6 months on, there really isn't any buzz about it.
So as a business (Valve or the developer), would you rather try to generate more sales at a cheaper cost, or leave it at the same price and hope someone buys it who hasn't already? And if something isn't selling, wouldn't you drop the price in the hopes that it will generate sales?

Origin should really look at David DeMartini. This is Business 101.

Marv666:

Treblaine:

That doesn't contradict the refutation I made of your argument.

The reason there aren't many third party games on Origin is no one want to jump on a sinking ship, there are just as many titles that owned by EA on Origin as there are titles owned by Valve on Steam.

Wrong its because Origin is still fairly new. EA already said before that they wanted to get origin up and running and then work on getting titles from other developers on it. Something that they are already doing. It also took steam a very long time to build up and get something other then valve games on it. Yes yes I know that there are more people on the internet now then then.

Most MMO games are NOT free-to-play, they cost money to buy the game and a high fee EVERY MONTH. You claim it's the same as "zinga". That's not an argument, that's a baseless assertion. You might as well say "Odin is the one true god" and expect me to believe you.

Well actually most MMO games are free to play. Its only the very big ones that charge you. I am saying they are the same as zinga because they rely on the same business model. You have already admitted that they do so you cant try and deny it now. Both zinga games and TF2 rely on microtranactions in order to make money. The only difference is that valve lets its users create the content they are selling.

And it shows your ignorance, the player base may make some of the content but THEY ARE PAID FOR THEIR CONTRIBUTIONS if they get officially adopted and featured! The only unpaid content is the content distributed for free that gamers install on their own initiative on their own install. Are you seriously holding it at a negative that Steam games have an active modding community that keeps their games fresh and interesting.

You're new to escapist aren't you?

I never said they didnt get paid. I said valve doesnt pay people to create the content, there is a difference. In the case of TF2 valve is simply acting as the retailer for other people to sell their stuff. Except the difference is that they are taking that content and going see see look at us we are releasing free content to people.

Origin has been out for over a year now. That's long enough. Yet they have only convinced 13 games to be released on their system from other publishers. Steam came to Mac only 2 years ago, In that time it has managed to accrue 593 titles for a small market like Steam on Apple-Macs

http://store.steampowered.com/search/?snr=1_230_231__12&term=awf#os=mac&advanced=0&sort_order=ASC&page=1

This is more than just lack of focus. This is a doomed service. Gog.com is a very small company and has 402 titles in its library which averages 115 games per year. The market is ripe for digital distribution but Origin is toxic. Origin is EA. But they control developers like DICE.

As to TF2 = "zinga"(sic), you are still using spurious logic. Having a superficially similar business model (if you look at it in and EXTREMELY simplified way) doesn't make them the same. You don't seem to know or care about the details or distinctions of either. You insist on calling the company "zinga" instead of Zynga. You seem to get mixed up between Steam and Valve as if Steam is the company rather than the name of a service.

Yes yes, they ARE releasing free content to people. Have you even played TF2? Most of the new weapons, hats and items have been made by Valve. There isn't a difference: 'Being paid to create featured content' is the same as 'being paid to create featured content'. They don't act as the retailer, you clearly haven't played TF2 for any length of time, the weapon once featured is entered into the weapon roster like everything else.

yeaaahhh no.

i saw a bunch of games were in a cheap bundle yesterday in a genre i was interested in, havent installed them but i bought them, and would not have bought them if it wasnt for the special steam sale.

anticipated games get purchased immediately, while odd games and curiosities get to wait until their on sale...which when buying from steam is probably just a week or two

sales sell games that people dont know if they'll like, and if their good their sequels can become part of the coveted anticipated group

I think EA are missing a huge thing here as well. DLC. I've bought a ton of games when they've been on sale, and ended up buying all the DLC because I enjoyed them.

Hell I bought Mass Effect 2 for $10 on Steam and then bought $40 worth of content from Origin :\

As much as we dislike, he does have a right to his opinion. Whether that opinion is smart or not is a whole other kettle of fish.

Doesn't Amazon do the same thing? I recall them discounting ME3 only a month after release or so.

I have to admit after my disappointment with buying games on launch day, waiting for a discount is the smart thing to do. It gives the devs time to patch and fix their product and its saves money for the inevitable DLC (I'm looking at you ME3)

UNHchabo:
1) Publishers are the ones who tell Valve to put their game on sale. If EA wants their games to only be 20% off during a Steam sale, then they can do that.

Funny thing is, they HAVE done that, I'm fairly sure that before they launched Origin that there has been at least one "EA Week" on Steam where there was a different EA game discounted (quite fiercely) each day of the week.

But I guess EA is trying to retcon that out of their own history.

And here I was, thinking that the developers had to agree with Valve on how much to sell the game for.

Anyways, I find it weird how he's finger-pointing at Steam for "cheapening intellectual property" and not even looking at gog.com for doing something even more insidious (from their point of view).

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