This Dumb Industry: A Lack of Vision and Leadership

By Shamus
on Jul 18, 2017
Filed under:
Column

In the past I’ve spent a lot of time criticizing the behavior of the big videogame publishers: EA, the Game Division of Microsoft, Ubisoft, and the rest. I’ve criticized their approach to staffing, scheduling game development, marketing and selling products, setting prices, fighting piracy, forging business relationships, and managing creative decisions. I see a lot of problems in all of these areas and I always hope that if I outline their shortcomings in enough detail, using clever enough metaphors, and using interesting enough stock photos, that eventually more people will follow my site and I’ll be able to complain to an even larger audience.

Well, let’s give it another go…

Part 1: Corporations

You`re suggesting this STEAM program thing could ever compete with US?! That`s HILARIOUS!

You`re suggesting this STEAM program thing could ever compete with US?! That`s HILARIOUS!

Whenever I make these complaints, I always try to frame it in terms of the companies making bad decisions and missing out on opportunities. The objections I get from people generally fall into one of two categories:

  1. Corporations exist to make money.
  2. Hey, they’re making money, so they must be doing something right!

The first response incorrectly assumes that I’m making some kind of moral argument. They seem to think that I’m demanding that the leadership of these companies all magically transform their enterprises into utopian non-profit arthouse gaming studios. But I’m not. I know that would be an unreasonable and unrealistic demand. I’m actually saying that even when judged solely on their merits as a money-making enterprise, these companies frequently make horrible decisions that destroy opportunities for profit.

Which brings me to the second response, which is that if they’re making money – and some of these companies are indeed making an amazing amount of money – that they’re doing fine and there’s nothing to criticize. It’s silly for a programmer to question the expertise or actions of a CEO, because these companies wouldn’t do these things if they weren’t a good idea.

This argument is a logical fallacy known as appeal to authority. Sure, a business major is in general more likely to make better business decisions than a programmer, but that does not mean that business majors always make good decisions or that a programmer can’t ever make better ones.

Now, most people arguing on the internet would stop here. You made a logical fallacy, therefore I win the argument LOL. But I respect you too much to dismiss this with such a glib answer, so instead let me give a long, disorganized answer that begins with a tangent talking about…

Part 2: Baseball

Baseball is America`s pastime. At least when America isn`t busy watching football, NASCAR, and the Kardashians.

Baseball is America`s pastime. At least when America isn`t busy watching football, NASCAR, and the Kardashians.

I want to talk about the 2003 book Moneyball by Michael Lewis. And to be clear, I’m really talking about the book and not the 2011 movie based on it. The movie is good, but you need to read the book if you really want to understand what happened to baseball.

Baseball nerds are notoriously obsessed with statistics. Ask one for information on their favorite player, and they’ll send you a spreadsheet so incomprehensible and so filled with inscrutable acronyms, you’ll think it was taken from the back pages of a Dungeon Master’s Guide. It will contain rows and rows of carefully gathered and curated numbers that describe the abilities and performance of the player. These numbers are ostensibly as important as the attributes on a D&D player’s character sheet. It’s a document that clearly defines what they can and can’t do.

Except, Paul DePodesta, assistant general manager of the Oakland A’s, didn’t think this was the case. He suspected that those numbers were wrong. Or if not wrong, they were tracking the wrong things or interpreting the data in the wrong way. He believed that everyone else in baseball was measuring the worth of a player using incorrect statistics and a faulty premise.

Imagine if scouts sought FIFA players by looking for guys who were tall, wore large shoes, had really big foreheads, and could jump really high. Those are all basically good things in the context of the game, but none of them will automatically make you a champion futbol player. None of them are as important as being able to control the ball and having keen situational awareness. DePodesta’s thinking was that this is what baseball scouts were doing. They were fighting over players who might be great sprinters or look great in a baseball uniform, but weren’t necessarily the best baseball players. They might look like baseball players and they might be great athletes, but nobody was paying any attention to the stats that showed how good they were at scoring points and preventing the other team from doing the same.

It’s not that they were recruiting bad players, it’s that they were greatly over-valuing certain attributes and under-valuing (or even outright ignoring) others. DePodesta began looking at things in very practical terms. “Given the stats of this player, how much will we pay for each run we score?” This stripped away decades of tradition, habit, and superstition that had shaped the way players were recruited.

Brad Pitt and Jonah Hill in Moneyball. Brad Pitt`s character is (based on) a real person, but Jonah Hill`s character serves DePodesta`s function without pretending to be DePodesta.

Brad Pitt and Jonah Hill in Moneyball. Brad Pitt`s character is (based on) a real person, but Jonah Hill`s character serves DePodesta`s function without pretending to be DePodesta.

The Oakland A’s began quietly looking for people based on the stats that DePodesta thought mattered. They recruited guys from the farm leagues that nobody else thought was pro material. They found players who were under-valued on other teams and traded for them. They traded away their own players that weren’t performing well in terms of dollars-to-runs, even if they were supposedly the best players on the team according to convential wisdom.

As the new team took shape people began laughing at the A’s and their lineup of mutants. None of these guys had the attributes baseball scouts prized. Some of them were fat. Their pitcher was called “The Creature” for his bizarre throwing style. One guy even had a limp. They were Baseball’s Island of Misfit Toys.

More importantly, Oakland began beating bigger, more well-funded teams. They beat teams that could afford players with supposedly better stats. This happened often enough and went on long enough that it clearly wasn’t a fluke. DePodesta had been right.

My goal here is not to lionize DePodesta. I don’t think he’s some one-of-a-kind super genius. I mean sure, he’s probably smarter than me. But that’s not a very high bar. He didn’t come up with these ideas on his own. This supposedly “new” thinking went all the way back to the 1970’s at least. DePodesta wasn’t the first person to seriously question the system, he was just the first person to question the system who was in a position to do something about it. What’s interesting about this story isn’t DePodesta, it’s everyone else. Because everyone else was wrong.

Even once the new strategy started winning games, other people had trouble believing it wasn’t a fluke, simply because it meant that an entire industry had been wrong for a century. Billions of dollars were misspent by generations of baseball scouts, recruiting players using faulty thinking. Anyone could have come to DePodesta’s conclusions at any time, and yet nobody did. People kept doing things the way they’d always done them.

These teams made money, but they were wrong. These teams won games, while being wrong. These teams grew their fanbase, expanded to new stadiums, made the playoffs, and won the World Series, while the whole time they were wrong about how to measure players and appraise their skills. They won because they were up against teams who were just as wrong as they were. All it took was for one person to be right to upset the entire balance.

And they did upset the balance. When the Oakland A’s rolled out their new strategy, the second-poorest team in baseball was suddenly competitive with the richest teams.

If a large number of baseball experts can be wrong about a century-old game, then certainly it’s plausible that a small number of game publishers could be wrong about this relatively new industry. So claiming “EA is fine because they’re making lots of money” is missing the point.

Part 3: The High Cost of Wrongness

A randomly chosen image from SimCity, which shouldn`t be taken as a metaphor for how EA handled the game. Unless you think the metaphor is clever, in which case you should totally take it that way.

A randomly chosen image from SimCity, which shouldn`t be taken as a metaphor for how EA handled the game. Unless you think the metaphor is clever, in which case you should totally take it that way.

So I imagine your next demand is that I have something to back all of this up. Sure, many people in Major League Baseball were wrong, but if I’m going to sit here and claim I know better than the titans of the gaming industry then I ought to be able to point to some long-term mistake in gaming. Can I point to an instance where a small underdog might outwit and overpower a gigantic company?

Yes I can. It’s already happened. It’s still happening right now. In fact, it’s been happening for thirteen years. Steam happened.

Back in 2003, Valve was not a gigantic corporation. Sure, they had a really successful game. Half-Life was a popular title and had lots of expansion packs, but Valve was still much smaller and less famous than the likes of Blizzard, BioWare, and iD Software. This was right around the time when lots of medium-sized studios like Valve were being absorbed into big publishers.

But instead of being absorbed, Valve launched their own digital delivery platform. This small company correctly predicted where the market was headed and what the consumer wanted, and they built a platform to meet that demandBut not me. I had to be dragged onto Steam kicking and screaming. I’m one of those people who LIKES boxed goods..

The big publishers had no answer to this. Ubisoft had nothing. Microsoft had nothing. Activision had nothing. At the time, EA had their own digital service called EA Downloader. It was dreadful and EA didn’t seem to be inclined to improve on it. Steam began to eat up the digital market and none of the big players even showed up to compete with them.

In less than a decade Valve – who started as a medium-sized game developer with a single hit game – became a multibillion dollar juggernaut. They did this without an infusion of public investment money. They did it without selling themselves to someone larger. As far as I can tell they did it without even acquiring debt. They just understood the market better than the supposed experts. Everyone makes a big deal about how big Wal-Mart is, but today Steam controls the digital PC market more thoroughly than Wal-Mart dominates the retail marketWhile numbers are all over the place, This article claims Wal-Mart has a 25% share while most of the estimates regarding Steam market share are in the 50% to 80% range..

This isn`t what I had in mind when I suggested you guys should compete with Steam.

This isn`t what I had in mind when I suggested you guys should compete with Steam.

Just like the Oakland A’s were able to beat better-funded teams, Valve was able to crush companies many times their size.

I’m not faulting EA and the rest because they didn’t make Steam first. That sort of thing happens all the time. I’m faulting them for not being second or even third. It took Electronic Arts seven years to get around to releasing Origin, their answer to Steam. That’s eons in this industry. And EA was the smart one. Microsoft had Games for Windows LIVE, which was even worse. Ubisoft has Uplay, which I can’t even criticize properly because I can’t tell what they’re trying to do with the platform beyond annoy people. This would be a shameful display if these companies had showed up with this stuff in 2007, much less 2017. The degree to which they have failed to understand and adapt to the market is astounding. Today these companies are at the mercy of Valve. If they want to sell on the PC, they need to hand over a big chunk of their gross income to this new rival.

Just like the baseball leadership was wrong for generations, the publishers have failed to grasp many basic principles of the business.

The publishers claimed you couldn’t make money in Russia because Russians would just pirate games. Then Valve turned around and made money from Russians who were perfectly willing to pay for games if it meant they could enjoy the convenience of Steam over the hassle of torrents.

The publishers insisted the $60 price point was ideal and that AAA games should forever remain there. Valve cleaned up by selling games at a variety of price points, discovering a largely still-ignored source of downmarket sales.

The publishers were sure that the market was cleanly divided into AAA and “casual”, and that the people who bought expensive AAA shooters were unrelated to the people who played cutesy 2D games. The indie revolution showed that us AAA players actually enjoy a good point-and-click or a match-three or a 2D platformer after a hard day of Battlefielding and Grand Theft Autoing. Valve sold indie games and AAA games alike, from the same storefront and to the same people.

Shockingly, it`s possible for a single human being to enjoy both Left 4 Dead AND Plants vs. Zombies. Just, you know, not at the same time.

Shockingly, it`s possible for a single human being to enjoy both Left 4 Dead AND Plants vs. Zombies. Just, you know, not at the same time.

So yeah. It is possible for an entire industry of experienced executives to completely miss the boat and make billion-dollar blunders. It is my belief that the publishers have been led poorly, and continue to be led poorly, because the people in charge do not have a background in gaming and are thus unable to see trends as they form. Instead they can only respond in a reactionary way. Their understanding of the market comes from earnings reports, not from buying and playing games.

The fact that they post profits at the end of the year does nothing to change this. A lot of people were very wrong about digital platforms for a very long time, and so it’s plausible that they might be wrong about other things that are equally important.

I anticipate that now you’re saying to me, “Shamus, I totally buy into your premise that companies can be wrong about stuff. And I think that you – an indie developer and author of very minor renown – are totally qualified to second-guess these executives and explain how their companies should be run. So please tell us what they should be doing differently.”

Well thanks. I appreciate your vote of confidence. Okay then. Next week I’ll talk about how I’d do things if I were elected King of All Videogame Business.

Enjoyed this post? Please share!

Footnotes:

[1] But not me. I had to be dragged onto Steam kicking and screaming. I’m one of those people who LIKES boxed goods.

[2] While numbers are all over the place, This article claims Wal-Mart has a 25% share while most of the estimates regarding Steam market share are in the 50% to 80% range.


is a programmer, an author, and nearly a composer. He works on this site full time. If you’d like to support him, you can do so via Patreon or PayPal.

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From the Archives:

  1. Infinitron says:

    Here’s a company that people don’t generally think of as a “small studio that outwitted the giants”, but is one. Bethesda. Yes, Bethesda.

    Did you know that Bethesda Game Studios are actually a relatively small studio who develop their open world RPGs on a relative pittance? They got a head-start on making huge open world single player RPGs when everybody else was thinking “Hey, if you’re going to create that much content, shouldn’t it be an MMO so you can make even more money?”

    Result: Today, Bethesda completely own the open world RPG niche even though their games are sub-standard in quality.

    • Droid says:

      “Today, Bethesda completely own the open world RPG niche”

      CD Project Red, Obsidian, Beamdog, Piranha Bytes and BioWare. I’m sure I missed some. MMOs already excluded.

      Sure, my aversion for Bethesda cannot make them any less money than they currently do, but I will not let them have laurels that they did not earn.

      • Primogenitor says:

        Bethesda are an example of This Dumb Industry changing over time. When they were small with Elder Scrolls I,II,III,IV then yes, they did better than bigger ones. But then when other people started copying them, they lost out because they no longer had that one special power that no-one else did – everyone else had that special power too.

        To continue the Baseball analogy, Oakland Atheltics are not the number one in the world any more because other teams realised they were wrong and changed.

      • Agammamon says:

        Bioware just dropped Mass Effect Andromeda – which by all accounts pretty much sucked.

        Beamdog seems to just be remastering old Infinity Engine games.

        Pirahna Bytes has one OWRPG coming out – their other stuff seems to be aRPG’s

        CDP seems to be BGS’ only real competition today.

        • Droid says:

          And Bethesda seems to just be remastering Skyrim.

          This was not about whether Bethesda’s products suck more or less than any other company’s, though, but about market share, and there they are not quite alone.

          • So Grand Theft Auto/Saints Row got sucked into a vortex and no longer exists?

            • Droid says:

              GTA is a lot but not an RPG. It’s open-world, and action-y, but that’s it. San Andreas once had a few stats to push. You do play a person, play a role, but that is also true of walking simulators like the Telltale games, which are also not RPGs.

              Saint’s Row I would be more inclined to call RPGs. They do have multiple ways of character progression, quests and an open world, even some loot.

              • TheJungerLudendorff says:

                The focus is also very different.
                GTA and SR are more focused on open world mayhem, mixed with self-contained, story missions with predetermined narratives.

                Skyrim is more focused on player freedom, exploration, and quests which you can pick up or drop at your leasure, as well as a certain amount of influence from the player on the narrative.

      • Ivan says:

        Today, Bethesda is owned, body and soul, by Zenimax. Hence Fallout 4 & ESO turning out how they did (and ESO existing rather than Elder Scrolls 6). Valve is owned by Valve.

    • baud001 says:

      Bethesda is mostly doing it right on the PR front, by creating hype beforehand.

  2. Peter Street says:

    Shamus, I totally buy into your premise that companies can be wrong about stuff. And I think that you – an indie developer and author of very minor renown – are totally qualified to second-guess these executives and explain how their companies should be run. So please tell us what they should be doing differently.

    ;)

    I’m enjoying this series quite a lot…

    • Bubble181 says:

      Well, wait, when’s the election? And who else is running? Are there public debates? Can I read Shamus’ program before voting?
      How often are these elections held, anyway? And are we sure Shamus isn’t already in the pocket of Big Gaming? He’s had some *awfully* close ties to game developers and publishers lately – and those Pterodactyl guys look skeezy.
      Has anyone seen Shamus and Gabe Newell in the same room at the same time? Can I get an official statement saying they’re not the same person?

    • Durican says:

      I for one welcome our new indie overlords.

      I particularly enjoyed the baseball comparison. I was actually expecting Shamus to compare the buying and selling of players to how companies like EA keep buying up small successful companies and then transforming them into unsuccessful companies.

      I miss Westwood. And Maxis. And (coming soon) Bioware.

  3. Robyrt says:

    I’d love to see an analysis of the recent furor over Paradox Studios, a smallish niche publisher who got burned for what probably seemed like an innocent business decision.

    The previous situation: Paradox games consist primarily of dozens of expansion packs, which are priced at basically whatever the previous one sold for. No consistent pricing strategy, no bundles, just the occasional 75% off Steam sale. The price of games could vary widely depending on what country you were buying in.

    The attempt: Paradox raised their prices worldwide to roughly match US/EU prices. They waited until a Steam sale to soften the blow. Most of our profits come from dollars and euros already, right, so who will care?

    The reaction: Fans see a massive price hike (700 rubles to 1200 rubles for each expansion pack) and are outraged. This serves as the catalyst for their Western fans to post their own grievances about the pricing model in general, their frustrations with recent releases, etc. Paradox is forced to revert all the price increases and offer free merchandise to anyone who paid 1200 rubles for anything.

    • Naota says:

      I’m surprised the furor wasn’t already in effect, given how frequent and expensive Paradox’s tiny bits of fragmented DLC are. It’s quite literally the fast food analogy Shamus gave, where a restaurant charges its customers individually for forks, salt packets, and napkins.

      • Retsam says:

        Paradox’s DLC policies are a bit divisive, but they get as much praise as they get criticism. (Actually, my subjective perception is that they get more praise than criticism).

        Personally, I’m in the camp of really liking Paradox DLC. It’s generally small and fragmentary, meaning you can pick what’s interesting to you, without feeling like you’re “missing out” if you don’t buy a particular piece of it. If CK2 is a standard “Medieval European Dynasty Simulator”-burger, then something like the India expansion is like a side order of fries. Not essential to the experience, not a full meal in itself, but a nice complement to the meal, if it suits your taste.

        Whereas all the “meat” of the expansion, all the mechanical additions and improvement are added to the base game, even if you don’t pay for the expansion. (It’s like they keep improving the recipe of the burger, even if you don’t buy any side orders? I dunno, the metaphor really breaks down)

        Compare to something like Civilizations (and, for the record, I feel that Civ’s expansion policy is pretty fair, too: this is a comparison between something I like, and something I like more, not bashing Civ’s expansion policies). The base game for Civ V just feels threadbare compared to the version with the two expansions.

        The expansions don’t feel like “optional things I can get if they’re interesting”, they feel like major changes that I need to pick up if I want the “real CivV experience”. Particularly if I want to play multiplayer with friends. (By contrast, Paradox lets you play with other players who have DLC you don’t have in multiplayer games)

        If Civ ran DLC like Paradox did, I wouldn’t need to buy Gods & Kings to add religion to my game, or Brave New World to add Tourism; I’d just get those for free, when the expansions came out, and the expansions would change the game in some less major way.

        Frankly, their expansion policy is why I bought Stellaris Day 1, and I won’t buy Civ VI until the game is discounted quite a bit. I’m sure Civ VI will be a really fun game, but I can’t help but think of it as just the downpayment towards the “full” game once a couple expansions are out.

        • Naota says:

          To be fair, Gods & Kings is the kind of modular DLC I’d hail as a complete thematic package with enough content to sell fairly at the price it does. Selling ambient songs, character faces, and variations of the tiny models which represent armies on the world map individually by faction/culture base is more the kind of nickle-and-diming I was referring to.

          • Retsam says:

            I’m not really trying to argue that Gods & Kings is bad value: but I do think if it had been Paradox DLC, the mechanical changes (religions, espionage, et al.) would have been added to the vanilla game and the DLC itself would have contained the other features like the new wonders, new civilizations, and new units, and would have sold for about half the price. (It costs $30, most new Paradox DLC goes for $15)

            That’s a better deal, both for the people who buy the DLC – they end up with the same content for less money, (even if the stripped down DLC feels like less “value per money unit”) – and for the people who don’t buy the DLC – they get new features anyway.

            Yeah, now that I actually look at the complete list of DLC for CKII, there’s a ton of little “unit packs” and “song packs” and such, (and Civ VI has “map packs” which feel pretty equivalent). And those don’t really bother me, either. They don’t interest me, but neither do I really feel like the base game is lacking for not having them.

            If selling unit models or background music (or hats) to people who care enough to buy them helps finance the studio to be able to give away major mechanical changes for free, and if other people care enough to spend a couple bucks on it, more power to them.

            • Naota says:

              Whoops – I forgot Gods & Kings was the Civ expansion, and I actually meant the Old Gods CKII package. Addons of those sizes I have no issue with, but I think it’s a little ridiculous that you need to separately purchase, say, Mongol faces, Mongol army graphics, and Mongol songs, each at a markup that would simply not be the case if they came packaged as a single “Mongol Culture Addon” of some description – and then you need to do it again for every other culture you care about.

              • guy says:

                I can’t bring myself to feel upset about selling cosmetic DLC more or less ever. I’m not interested enough in it to pay much of anything most of the time, so I just don’t buy it. The only time I’ve ever bought any cosmetic DLC for anything is the Tales Of series, because I must obtain additional outfits.

            • Bubble181 says:

              And I’d say I really like the Civ version. There’s DLC – some cosmetic, some small added value (new maps, new civilizations, new wonders) – you don’t need them, but they can help keep a game fresh if you play a lot of it.
              Then there’s the expansion packs (Gods & Kings, Brave New World) which really change the base game. These are bigger game changing things that introduce new mechanics, scrap old mechanics, and so on. These are more or less expansions the way expansion packs worked way back in the Good Old Days.

        • Mousazz says:

          Unfortunately, there’s a general backlash against this model concerning Paradox’s Hearts of Iron 4 team, due to the fact that seemingly critical game systems were locked behind DLC. The main example:

          HoI4 has a system for drawing fronts and battle plans, assinging units to said plans, and executing the plans, allowing the AI to automatically move troops around. This system doesn’t lock out user input, allowing the player to individually override commands of divisions to exploit gaps and vulnerabilities in the enemy’s defences. However, the plans themselves are slightly broken – if you make a 5 province front in Russia, and make a straight line towards a 5 province offensive line deep into enemy territory, it spirals out of control, and your army slowly expands into a 25 province wide front slugfest, instead of the concentrated breakthrough WW2 blitzkrieg was known for.

          The first DLC, Together for Victory, added a spearhead option to battle plans, whereupon your army dashes straight for the offensive spearhead line, ignoring any provinces on the sides, and effectively fixing the flaws with the system. Needless to say, fans were furious – they believe such an option should have been part of the free patch, instead of locked away behind a paywall.

          It seems fans of the game have lost faith in Paradox. The second DLC, Death or Dishonor, added a system of buying licenses from other countries to produce more advanced weaponry. This, once again, was attacked as a lockout of an essential feature, even though, in my experience, it’s actually a rather trivial system (unless you specifically try to exploit it in multiplayer).

          • TheJungerLudendorff says:

            It’s not the first time they put improvement to the user interface behind DLC. The EUIV army designer is another example:
            In vanilla, if you want more troops, you need to manually create every new regiment. And since you could have hundreds of regiments in the late game, that can be a real chore. With the army designer, you could just tell the computer to give you an army of a certain size and composition and it would train, move and group them for you, which saves a lot of needless clicking.

            Unfortunately, you can only get it by buying one of the expansion packs (The military one, can’t remember the name)

        • Mistwraithe says:

          I like Paradox’s DLC policy because it means that their games experience significant ongoing development for years, rather than the few months most games might get. The end result is games which are incredibly deep and full of features.

          The flip side is that the games cost a lot of money (although waiting until half a dozen DLC are out and then buying at 75% off will help) but if the choice is between paying a lot of money for great games that no one else makes, or just having relatively shallow cheaper games (ie like the initially released versions of EU4 and Stellaris) then I’ll happily cough up the money.

          For me, one expensive great game is far better than half a dozen mediocre games which together cost the same amount.

      • John says:

        I’m not so sure that this is the proper analogy. To my mind, a game like Crusader Kings II is a full meal with condiments and utensils included. I mean, it was a complete game at launch. You don’t need any of the DLC to have a full, rich experience. I think that the expansions that actually matter (stuff like Old Gods, Sword of Islam, or Horse Lords) are very reasonably priced, especially during one of the many, many sales each year. I suppose you could argue that the the cosmetic or audio DLC is a ripoff, but I have a hard time caring about that. They could cost a million dollars each and I wouldn’t mind because I wouldn’t take the trouble to download them even if they were free. No, Paradox’s real sin is that they are bad at communicating to new players that you don’t need to buy all the DLC along with the base game.

        • Rodyle says:

          EU4 is unplayable now without DLC though. I often play EU4 with all expansions on LANs with friends, and the game is pretty good like that. However, my experience with the base game is horrible. They keep patching the base game for features in expansions which just break the experience further a0nd further.

          Two examples:

          – For one of the DLCs they added that when a colony reaches a certain size it becomes its own nation. This was in the base game. Most of the interaction with these colony states was not in the basegame however, breaking the experience for everyone with the base game who wanted to expand to the New World.
          – Playing as a Junior partner in the base game is useless. You cannot form alliances, you cannot start wars, and in the base game there is no way to ask befriended nations to help free you, so, seeing how you cannot form alliances, you’ll have to fight off a (usually) larger nation and their friends without any help, if they even give you the opportunity to start

    • guy says:

      They, uh, should probably have seen people being upset about doubling their prices coming. And reflected on why they had regional price variation to begin with.

      I’m generally pretty fond of their system; the DLC generally seems like a decent value and comes with a free patch that includes a lot of the underlying systems even if they’re not always made accessible to the player. Though I have to say I’ve been kind of losing faith in Paradox since about the Utopia update to Stellaris; both that and the most recent CK2 expansion released with some pretty big issues that should’ve been grounds to delay release, especially given how they don’t announce release dates very far in advance. It turned out that a major part of Utopia’s faction and ethics rebuild simply didn’t function; global modifiers to ethics attraction had no effect whatsoever. With Monks and Mystics, the Hermetic ingredients system they’d been talking up wasn’t actually implemented at release; you could get ingredients but they didn’t do anything, and Paradox didn’t bother actually telling anyone until we started filing bug reports. That annoyed me enough to override my default sympathy for programmers and QA teams.

    • Philadelphus says:

      Paradox games consist primarily of dozens of expansion packs, which are priced at basically whatever the previous one sold for. No consistent pricing strategy[…]

      Not entirely correct, though it can easily seem that way from the outside; but according to some of the developers each DLC is priced very specifically based on an estimation of both how wide-reaching and how difficult to implement (i.e., how many man-hours of programmer and artist time are needed for it) each feature in it is, in almost a sort of point-buy system.

      Which is why it really grinds my gears when people authoritatively complain that such-and-such DLC isn’t worth $X, as if value was some Platonic ideal inherent in a piece of software that everyone could agree on rather than a subjective personal preference.

  4. Hal says:

    Oh, king of all video games, eh? Very nice. And how’d you get that, eh? By exploiting the players. By hanging on to outdated imperialist dogma which perpetuates the economic and social differences in our society.

    Listen Shamus, strange women lyin’ in ponds distributin’ swords is no basis for a system of government. Supreme executive power derives from a mandate from the masses, not from some farcical aquatic ceremony.

  5. KarmaTheAlligator says:

    if I were elected King of All Videogame Business

    Where do we vote?

  6. Daemian Lucifer says:

    Baseball is not the only industry(really the only human endeavor)that has been wrong for a long time before someone shook their foundation.Jim Sterling recently rereleased a video talking about this exact thing,only using pasta instead of baseball.

    But hey,if it took 40 something years for baseball to start reforming,somewhere around 2050 we will finally have some of the smart ideas incorporated into the games industry as well.

  7. Echo Tango says:

    @Shamus @meta

    Sure, a bunch of people in Major League Baseball was wrong

    Typo.

    Then Valve turned around and made money from Russians who were perfectly willing to pay for games if it meant they could enjoy the convenience of Steam over the hassle of torrents.

    The link in this text is a Google-search click-tracking redirect. I believe you meant to directly link to the article.

  8. Alan says:

    I’m always a bit baffled by people who believe that making a lot of money must mean the the person or company is smart, efficient, or whatever. Have these people not had jobs? Do they not talk to their friends and family members who have jobs? Do they not hear stories of gross waste, missed opportunities, and expensive boondoggles that I do? Incompetent contractors repeatedly hired over the objections of staff who have to actually do the work. Laying off support staff who knew their jobs inside and out, so that more expensive staff can spend more total hours doing those tasks and not working on actual products. Cutting a small benefit that costs a few dollars per month per staff member, trashing morale. Penny pinching on computers so expensive staff end up twiddling their thumbs. Using a large meeting to essentially hold a series of one-on-one discussions while everyone else twiddled their thumbs. Having employees attend a meeting utterly irrelevant to what they do, and to which they can add nothing.

    • Daemian Lucifer says:

      Yeah,I really hate that argument.Its just so stupid and assumes that making a ton of money means its somehow a success,even if the expenses outweigh those huge sums.

    • BlueHorus says:

      It’s a good point.

      Sure, the company exists to make money.
      But the person/people running the company doesn’t/don’t, necessarily. Ideally, they are constantly trying to make the company as profitable as possible, but in practice?

      I know if I were making a seven-figure salary as a CEO just by maintaining the status quo, I wouldn’t change a damn thing. I could try something different, and maybe make even more money (or just profit the company) – but would I risk it?
      No way.

      And that’s before considering corruption, office politics or similar that are possible in a large company.

    • TheJungerLudendorff says:

      I see that argument, and I raise those people the 2008 financial crisis.

      Tons of people making bucketloads of money, but because it was completely unsustainable they eventually blew up half the global economy. Including everyone who hadn’t bailed out of the game yet.

  9. Dreadjaws says:

    “Corporations exist to make money.”

    This saying gets on my nerves. Not only is missing the point, it’s painfully wrong. It’s like saying that people only get in relationships to have sex. Now surely that probably is the goal of some relationships, and it most certainly is an important part of each, or at the very least most of them, but to believe it’s the only goal in existence, or even the most important one, is preposterous.

    But yeah, the “appeal to authority” thing might be even more infuriating. Lots of people seem to believe two things:

    a) Making money is indication of superiority in every field (this person has more money than you, ergo he’s right and you’re wrong, he’s smart and you’re dumb, he’s sexy and you’re ugly, etc.) and
    b) If you’re making money, it’s clearly because you’re doing things right (ignoring external factors like luck, scamming, lack of competition, etc.).

    Also, many don’t seem to realize that a corporation is not a living being. It’s a conglomerate of constantly-shifting living beings. Just because a corporation has money it doesn’t mean that such money was made by people currently forming part of it. I guarantee you that the people who put certain corporations on the map are not actually related to them in any way now.

    • exsiccation says:

      I’ll just chime in and say that if you go into the games business with the hope of making lots of money, you are going to be profoundly disappointed. Nobody works in games to get rich quick. There are many related industries for tech professionals that offer far better stability and earnings potential.

    • In most cases, you only need to do ONE THING reasonably right to become a big business. Most of your business model can be bad or mediocre if you offer SOME kind of advantage.

      For instance, I use Shipt to get groceries probably 80% of the time because I don’t have a car and I’m lazy and even though I have Amazon Prime I’m not interested in waiting 2 days to get my groceries from Amazon (plus you have to pay like $300 a year for Amazon’s grocery delivery service ON TOP of Prime). I love Shipt, because they let me get groceries when I don’t have transportation.

      And their business model SUCKS. Their website is TERRIBLE. It is SO badly designed. It’s hard to search for stuff. If you click on a filter (like “frozen food”), you have to exit the site completely and log back in to clear the filter. It’s like a 7th grade “web development” project. There isn’t even a place to LOG IN on the main website page, you have to click “create an account” and squint to find the tiny, virtually invisible “NO WAIT I HAVE AN ACCOUNT!” button.

      But I still use them.

    • Abnaxis says:

      Not trying to get into a partisan bickering session, this just seems like it’s topical…

      Whenever someone complains about inefficiency in government, I want to take them on a job-shadowing tour through Honeywell and see the stupid, absurd, inefficient crap monolithic corporations (which, incidentally, control most of the economy) waste their resources on every day. The main difference in efficiency between the private and public sector is that the public sector has all their dumb-ass bureaucratic nonsense on public display for everyone to criticize.

      Having Scrooge McDuck levels of money pretty much guarantees you can continue to make money barring massive societal shifts out of your favor.

      • Currently, yes. Giant businesses often FAVOR government interventionism and regulation because while it hurts the big guys, it hurts the little businesses that might become their competitors MORE.

        If you read the histories of large corporations in various industries, there’s a consistent chain of events that goes something like this:

        1. New industry starts up. It’s a mess. There’s no standardization whatsoever, just a bunch of adventurer types running around, some of them producing product. There are huge numbers of scams because nobody understands the new industry well enough to invest in it. Everything is expensive, most stuff doesn’t work well.

        2. One firm makes some big efficiency improvements that lead to a sudden, huge increase in profits while simultaneously dropping prices enormously. Now, this can be just about ANY kind of improvement.

        3. That firm becomes an industry juggernaut, a world-bestriding colossus swallowing smaller firms like tic-tacs and dominating market share to an absurd degree.

        4. The giant starts to stagnate, the technology moves on and they don’t adopt, the platform becomes more accessible, and smaller firms that are a lot more customer-friendly move in and start squeezing the former giant.

        Step 4 is the one that gets screwed over the worst by govt interventions that attempt to prevent step 3. Very often it can freeze an entire industry on step 3 for DECADES.

        • Well, that and corporations suing the pants off of each other, but due to the state of the patent system this could be argued to be a flavor of govt intervention.

          From the consumer’s perspective (and we’re all consumers ultimately, so really it’s better for everyone in the long run), step 4 is where we want to be. Step 3 is vitally important, but freezing there for a long time SUCKS.

        • Abnaxis says:

          Sort of veering into politicking territory here, but I feel the need to point out that there is a lot more at work besides “govt intervention” as far as giant corporations squeezing out smaller competitors. I have personally been part of a business that was put out of business by a large corporation which decided to take a loss in our local market (which was probably less than they lose on accounting rounding errors) so they could undercut any local entrepreneurs trying to establish a foothold. This required little to no intervention on the government’s part (though a lot of the contracts they low-bid us on were government contracts)

          Big corporations do a plenty good job of squeezing stifling competition with or without government intervention. That’s one of the primary advantages of being big. Backing regulations that hurt competitors more than themselves is just one tool in the toolbox uniquely afforded to massive corporations

          • Daemian Lucifer says:

            Thats why anti monopoly laws were invented for.But not everyone enforces them,which leads to such situations.

            • Abnaxis says:

              Who said anything about monopoly? The massive corporation in question doesn’t have anything close to approaching monopoly, they compete with companies big and small. Think of them more like Wal-Mart–they’ll drive out local businesses with pricing pressure, but the other competing big-box stores will carry on just fine. Hell the big-time competition loves them for it because they get to scoop up some of the customers we lured away from them back when we started up.

              • Daemian Lucifer says:

                When you take a loss in order to destroy all the competition in a region,you are basically creating a monopoly in that region.

                • Abnaxis says:

                  First, not all competition, just the competition that isn’t big enough to weather the storm.

                  Second, good luck trying to prove it. When you’re bidding on a job that includes many man-hours of non-trade labor (like programming) you can fudge the numbers a lot to get the bid you want. I might know perfectly good and well they aren’t doing that 100 hour job in 50 hours, but there’s no way I’m convincing a layman of that. Hell, half the time programming jobs blow through their programmer time budget even if you bid in good faith, just because that’s how programming is.

                  • Daemian Lucifer says:

                    First, not all competition, just the competition that isn’t big enough to weather the storm.

                    Oligopolies arent much better,as have been shown by the cable companies in the usa.

                    Second, good luck trying to prove it.

                    Yeah,thats a tough one.

            • Anti-monopoly laws are useless anyway–they are undefined so they can mean anything to anyone at any time. The biggest, most abusive monopolies were created by the gov’t in the first place. Way back in the 1600’s when corporations first came into existence, that’s what they WERE–government-issued monopolies. The East India Tea Company being the prime example.

              And before you complain about the “loss leader” . . . this is the business model for the cosmetics company that later became Elder Beerman, and started when their founder was literally making cosmetics in her kitchen. You don’t have to be a big company to offer a loss leader–in fact, big companies that attempt to adopt this policy usually fail, because they can’t sustain it.

              The trick is to wait until after they’ve raised their prices, then make your bid. A lot of times, however, people can’t do this, because the bigger and more efficient company doesn’t raise their prices ABOVE market levels (which is what they’re accused of) but merely TO the normal market level.

              • Daemian Lucifer says:

                Anti-monopoly laws are useless anyway

                Not always.One worked in favor of the people in my country when cell phone companies started propping up.If only thats how other things worked here,….Oh well,better something than nothing.

              • Abnaxis says:

                I feel like you’re stuck thinking about this in terms of manufactured goods. Like, just hold on to your inventory until the competition has to raise prices!

                Except you don’t have inventory, you have engineers with high salaries that expect a paycheck on time. And you’re up against a subsidiary of a multinational company that has enough money to keep this up forever.

                “More efficient”? Have you ever actually BEEN in one of these companies?

    • stratigo says:

      corporations exist to make money. Flat. They don’t exist for any other reason.

      Or, more specifically, corporations exist to acquire capital to invest to acquie more capital. It is thier purpose, they have no other (Well some charities are incorporated I believe, but you get what I am saying).

      A corporation doesn’t exist to make its employees money (not even the CEO, unless he is also an investor, despite the lavish salaries they get now) and in fact it behooves the bottom like to screw their employees out of as much or a paycheck as it can.

      The individuals who are to benefit are the capitalists, eg the investors. In privately owned companies, an individual or a small handful may have enough moral objections (though business success selects for sociopathic tendencies) so as to not be entirely unscrupulous, but on a publicly traded company, the ownership is so diffuse that the corporation becomes unto an entity to itself, and it has no morals.

      A corporate structure that fails to make money is eliminated and replaced, and if they failed egregiously enough and deliberately they are prosecuted.

      A corporation isn’t a person, doesn’t have morals, and exists for profit. So when one says a corporation exists to make money, it is entirely factually true. It exists to make money so that it may use that money to make more money.

      • Dreadjaws says:

        So, your response to me saying this is an ignorant claim is simply to repeat that ignorant claim?

        *clap, clap, clap*

        Well done. Now I’m convinced. You, sir, are a master of arguing.

        • Actually, if you look at the legal purpose of corporations and why people incorporate AT ALL, they exist first and foremost to avoid LOSING money beyond a certain amount. You form a corporation to limit liability so that, should financial disaster strike, the personal property of the investors is not attached to pay the corporation’s debts. Corporations aren’t created to generate revenue (make money) but first and foremost to LIMIT LIABILITY.

          That’s the legal purpose. The practical purpose it to pursue ventures. Making money is the desired outcome, but they’re FORMED to undertake ventures.

          • Daemian Lucifer says:

            This is a very good point.A successful corporation is one that can last for a long time,that can steadily grow and increase its profits.Such a corporation is practically guaranteed to never lose enough money for the investors to take a hit.A corporation that is barely afloat on the other hand can absorb maybe one financial hit before it collapses,and is therefore not successful.

            So thank you for providing such a perfect and succinct rebuttal to the fallacy that corporations exist to make money.

            With this,its easy to point out which video game publishers are doing something wrong.Those who have very little profit growth and are constantly closing studios left and right are not successful.

          • Joshua says:

            Yep, technically, Corporations (C-Corps, anyway) have the lowest profitability of any other business structure due to double-taxation*. However, the benefits so outweigh being a Sole Proprietorship, it would be ludicrous to not do one, even if you’re the only owner. Of course, that’s why lots of individuals elect more complicated “pass-through” entities like LLCs and S-Corps, but that’s slightly more complicated.

            *Which there are many legal ways to reduce or eliminate, the most common being paying yourself a good (but reasonable) salary, but also includes the owner(s) buying land/equipment the corporation needs and then leasing said capital items to the business.

            However, I would argue that part of the problem is just inherent to bloated organizational hierarchies themselves. Some people like to blame corporations, and others government, but I’ve noticed there tends to be some overlap with administrative bloat. Hence why so many colleges have skyrocketing tuition and yet under-compensated instructors due to expanding administration, and businesses have the same problem.

            I’ve survived a few layoffs, and it’s sobering how well a company can still perform despite gutting 25-50% of its staff. Too many people wasting their time reporting to other people, going to meetings with other people, or otherwise just being unnecessary cogs in the machine.

  10. RCN says:

    Steam wasn’t a success only in Russia. It was a success in Latin America as well. I know I’ve already said this before, but games were abusively expensive in Latin America, Brazil in particular, because of general dickness in import fees. And it is partially fault of SEGA. It happens that SEGA lobbied in Brazil to have a HUGE spike in import fees because it planed to build factories inside Brazil. So they’d sell their own console and games at market value while any competitor who didn’t do the same would be faced with these fees.

    The problem? This was in 1999. SEGA literally died off right after screwing the the Brazilian market when Brazilians were already as suspicious as Russians about paying a lot to huge corporations for games when they could just pirate them.

    The PS3 was launched in Brazil at a price mark of US$ 3000, with games going for 100 – 150 US$. Then SONY simply declared Brazil a dead market. Because of course a country where the minimum wage was 270 US$ A MONTH at the time could afford those prices. Sure, this entire time the Brazilian congress was in power to roll back their import tax… but that would require at least single Brazilian congressman who cared abou the videogame industry and no-one in the industry was interested in lobbying for that because Brazil was already considered a dead market (despite the fact of how good the Brazilian market did with SEGA previously).

    Then STEAM came and simply took the Brazilian market by itself. Then it changed its policy so it could be TAXED by the Brazilian government and… the prices dropped even further because they were now being calculated in Brazilian Reals instead of Dollars. Brazilians are perfectly willing to pay for things too, as long as they are not being asked an arm and a leg to pay for simple entertainment.

    And to be fair, your assessment about the Games Industry could probably be applied to almost ALL industries.

    They are ALL wrong ALL the time but follow tradition because they’re too afraid to do something different and screw themselves over EVEN if just for the short term.

    I’ve read somewhere that 80% of CEOs said they’d never make an investment that would make their company grow for the next DECADE if it would cost them profit margins for the next quarter ALONE. This is wrong on soooo many levels. It is the old paradigm that businessmen are willing to crash their business into the ground head-on by following blueprints and spreadsheets than actually take two seconds to realize that, hey, maybe firing the chief engineer/coder/artist just to save a bit in the next quarter report might be a bad idea.

    • Supah Ewok says:

      No, it just means that the modern corporate world is run by folks who’ll better the stock price at their current job a few years, then use that record to jump ship to another company that’ll pay them more. Then they’ll try to keep that stock up again, then jump ship for a better deal again, etc, etc. It’s also why modern CEOs don’t tend to keep much of their own company’s stock. They don’t give a damn about the long term health of their business. It’s just a step on the ladder to a bigger and bigger paycheck.

      • Dev Null says:

        To be fair: if you build a system that rewards a certain type of behavior to huge excess, you can hardly blame the people who win the game for playing it.

        • Supah Ewok says:

          True, but it’s hard to talk about systemic problems of this sort without detouring into the economic side of politics, especially when I was on my 30 minute lunchbreak and a phone.

        • Viktor says:

          Yeah, you can, especially when “playing the game well” involves ruining lives. The mortgage crisis was a perfect example of that, but also oil spills, pollution in general, or plenty of major class-action lawsuits. People suffer or die and the CEOs who make those decisions lose nothing. The laws and financial systems don’t discourage that behavior, but I can certainly blame them for making those decisions.

          • Daemian Lucifer says:

            And the lawmakers for allowing such behavior to go unpunished.Because their job should be making the laws to protect the people,not screw them over.

          • The Rocketeer says:

            Have you never found a soapbox you aren’t eager to climb? Do you not understand or care that when you make a series of bold statements that no one could substantively contradict without breaking the standing no-politics rule, you are already breaking that rule in spirit?

      • stratigo says:

        Business managers are adverse to risk. A certainty for small growth is superior than taking an expensive risk.

        It’s outsiders that take the risks, reap the rewards, and then usually have their success bought by the business manager whose company has been accumulating wealth for decades who then act as risk adverse as before (Though sometimes that aversion comes in the flavor of “We don’t know what you did to be successful, but as long as you continue to be so, here’s a blank check” which something like Blizzard gets)

    • Dreadjaws says:

      I second the latin american market assertion. There was practically no market for videogames here until Steam. More than 95% of the videogames in my country were pirated. If you could even find a place that sold original games they’d be few, belong to a select few companies and their prices would be ridiculous (a copy of Half-Life 2 was, at the time, 300% more expensive). Importing games was hard and ridiculously expensive. Even legitimate stores would sell pirated games. Yeah, it was that bad.

      Then Steam came, and suddenly everyone’s playing legit videogames. Price and convenience made original games accessible to everyone. Then all of those things made the national gaming community a legitimate market. More stores started bringing up more physical games and more convenience of payment, which lowered their prices. Then digital market was opened to consoles.

      Nowadays it’s rare to see anyone purchasing pirated videogames, which used to be sold at every corner. Piracy is low and those who pirate tend to get more inconveniences than paying customers. And all because someone out there used their brains.

    • tzeneth says:

      This may more be a structural/incentive issue for companies but if I’m a CEO who is elected to his position by stock holders, my investment may pay off in a decade but I probably won’t be there to enjoy it due to normal rotation or because my quarterly earnings report is completely terrible. Especially if my bonus is based on THIS earnings report or a challenger can take advantage of this low earnings report and then claim the success later on as his own without having changed anything.

      • Joe Informatico says:

        I don’t know if this is still or ever was accurate, but I’ve read that publicly-traded corporations in the US are required by law to maximize returns to their shareholders above any other considerations–even the long term survival of the business. Can anyone verify that? It would explain a lot of corporate shenanigans.

        • Joshua says:

          There are laws about who would be considered a “stakeholder”, but I think that what you’re talking about would be difficult to enforce, and counter-productive to do so.

          The unfortunate reality is that shareholders tend to be obsessively short-sighted, and do tend to encourage leadership to focus on short-term profits over long-term sustainability. They wouldn’t need a law to force CEOs or other executives to do their bidding, they are the boss of those people.

          There are also concerns with the “golden parachute” system that CEOs are encouraged to build up a business in a short-time, and then sell the business for a profit, essentially “Fixing and flipping” the business, which isn’t good for it long-term if it happens repeatedly, but is usually good for the shareholders, if not the employees.

        • Gethsemani says:

          Not by law, but the shareholders are well within their rights to motion for a vote of no confidence in a board that shows lower then expected earnings, especially if said lower earnings is due to decisions that obviously meant lower short term earnings.

          Without politicking too much, I’d argue that the problem is with the entire concept of publicly traded companies and the stock market. The real money in a business today is in its’ publicly traded stock, which value has no real correlation to the actual worth of the business property and produced goods/services. Shareholders wants quick payouts, because most major shareholders want to flip stocks for profit in a short time frame, a few years at the most, and that means that the board and CEO they elect are expected to maximize short term profit, because that’s what drives stock prices.

          And so it can be that game companies can be run with people who have no idea about games, because they are great at turning nothing into something in terms of stock market price. Whether it is Activision driving hype for CoD or EA pushing Origin like it was going out of style, they do this because they know that having THE FPS franchise drives hype (which drives stock price) and being able to say that you’ve got your own marketplace that exposes the customer to your entire product library is the kind of stuff that makes business analysts drool, which in turn influences their assessment of the corporations stock price. Kotick et al. aren’t CEOs because they understand the game’s market or gaming community. They are CEOs because they know how to keep stock prices high on game publishing corporations. As much as I hate to say it, from a shareholders perspective they are the right people in the right places.

          • Shamus says:

            “As much as I hate to say it, from a shareholders perspective they are the right people in the right places.”

            I’d actually agree with this. If your only goal is to keep pumping up the stock price and focusing on the short term, then the current crop of guys are doing their jobs. Of course, you can’t keep pumping up a stock forever. The hype cycle comes back to bite you in the ass when your big AAA flagship title is a dud. So the stock rolls up and down. Overall the trend is upward because the industry itself is growing as more people join the hobby, but the whole thing is basically an exercise in chasing trends and engaging in a long series of hilarious over-corrections.

            My premise (which I should have simply stated up front) is that this is passing up on massive opportunities for long-term growth. The right leadership could turn one of these companies into something like the Disney of videogames. We could be getting better products for less waste with less human cost. Instead of serving their customers, they’re actually serving the legions of reactionary gamblers playing the market. That’s probably pretty close to the rotten root of all of this, but getting into that is getting into politics. Much easier to focus on, “If you’re trying to serve your customers, here is how you’re failing.”

            This is probably another reason Valve does so well. They’re not a publicly traded company, which means there’s no outside pressure to do something showy and headline-grabbing every quarter to keep people excited about the stock. They still make bad decisions, but they’re not obliged to always focus on the short term.

            • Abnaxis says:

              This actually puts the “we sold 2 million copies but this is still a failure” stories from publishers into perspective. I suppose those “expectations” we more like blowing hot air up shareholders skirts?

              • Daemian Lucifer says:

                Not necessarily.Sometimes these people actually believe the stupid expectations they keep ramping up.Thats why so many movies were planned for and had some money sunk into them before the mummy was released(and flopped).Same with any other movie franchise that tried to ape the potter and marvel successes.Its easy to see your competition doing good and trying to ape their success without actually realizing why it was a success.

    • AReasonWhy says:

      I’ll second my experiences on the balkans. Once steam made games cheap as hell no wonder even the most hardcore pirates suddenly dont mind dropping the amount of cash youd usually drop on one or two good meals for a game, especially if its MP. At least that’s my experience with the people I know. And we’re a “dead” market too.

    • Blue_Pie_Ninja says:

      Damn, if only Steam paying taxes to the government dropped prices on Steam where I am in Australia. But nope, still getting charged in USD with a price rise to account for the 10% GST tax on imported goods.

      I guess the only difference is that we can afford the higher prices but it is still a pain in the ass for everyone when we could possibly be getting cheaper games in our own currency (when you take into account conversion fees) :(

      • Philadelphus says:

        As an American moving to Australia within the year for grad school, I am not looking forward to this. :(

      • Dirigible says:

        The really fun part is companies that don’t match prices either. Worst one was a game I was really interested in (And is now gone from Steam for some reason) – $10 US? $50 Australia. Both in USD, too.

    • Noumenon72 says:

      I’ve read somewhere that 80% of CEOs said they’d never make an investment that would make their company grow for the next DECADE if it would cost them profit margins for the next quarter ALONE. This is wrong on soooo many levels.

      Principally, the factual level. This is the opposite of how companies are run, which you can see most clearly in the oil industry, where private firms beat the pants off government in upkeep and investment.

      The “shareholders demand quarterly results” thing is wrong too, because of stock buybacks:

      Buybacks are better understood as a tool of corporate executives seeking to manage investors in service of their medium- and longer-term strategic plans.

      The case of General Electric is illustrative. Far from encouraging GE managers to focus on the short term, enriching themselves through the sale and exercise of stock options while disregarding the company’s long-term profitability and growth, buybacks have been a core part of a long-term strategy for restructuring and investment… buybacks are being used to carry out a massive, long-term strategic restructuring of one of the world’s largest and most important corporations.

      GE is using buybacks to literally buy time, encouraging Wall Street to be patient as it executes its plan to break up and divest GE Capital while investing in sectors management believes show long-term growth potential.

      And although Lazonick suggests that corporations have not been adequately investing, it’s worth pointing out that the past thirty years have seen some of the most significant restructuring in capitalism’s history — and it’s only been possible because of investment.

      This restructuring has included relocating production and organizing globally integrated value chains, as well as the emergence of new economic sectors and intensified competitive pressures for new technologies and organizational forms (each of which entails long-term planning).

      Steam may have beaten the larger, slower companies into a brand new market, but 20 or 50 years from now it’s going to be one of these giant, organized companies selling all the games.

  11. Paul Spooner says:

    I believe the correct response to objection number two (2) at the top is “but they could be making MORE money”. It’s possible to stat objection 2 in a way that is not an appeal to authority, but it is nearly impossible to prove absence of a superior technique. Since a superior technique is your core message, the justification should tie directly into the admitted profit-seeking premise given in response to objection one.

    For another example, people look at T-mobile and Verizon and Comcast and Samsung and say “they are turning a profit, so they must be doing something right.” and this is true. But they are clearly not doing everything right, because Apple is the most profitable company on the planet.

    They are making money, so they aren’t doing everything wrong. But they aren’t making Steam or Apple money, so they can’t be doing everything right either.

    • Fade2Gray says:

      Yep. That was my thinking too. Making money =/= making ALL the money.

      I was going to say something about black and white arguments and grey areas, but meh. I’ll leave it there.

    • Rodyle says:

      > They are making money, so they aren’t doing everything wrong. But they aren’t making Steam or Apple money, so they can’t be doing everything right either.

      Except that there are some branches in which you could do everything right, and you’d never still make Steam or Apple money. If you, for example, run a company making specialized microscopes (let’s say scanning tunneling microscopes), you could be the best company in the world, with excellent costumer support, the right pricing, using the right channels to sell your products, but even then you’ll make just a tiny fraction of the money Steam is making, because you run a business in a highly specialized branch.

    • Ingo says:

      It’s akin to pointing at a morbidly obese guy on a respirator and saying “Well, he’s still alive, so he must be doing something right.”

  12. Darren says:

    I’d also look at the current age of remasters and re-releases to demonstrate how poorly managed companies like EA run beloved franchises like Dungeon Keeper into the ground while a company like Square-Enix–which is not without its own problems–re-releases a 17-year-old game and has it top the charts (http://www.eurogamer.net/articles/2017-07-17-ps4-exclusive-final-fantasy-12-the-zodiac-age-tops-uk-chart).

  13. Mokap says:

    “and that the people who bought expensive AAA shooters were unrelated to the people who played cutsy 2D games”

    Is this supposed to be cutesy? Sorry, I can’t help but proof-read things.

  14. Leviathan902 says:

    Yeah, I don’t have anything to say about this other than that I’m REALLY looking forward to this series

  15. Mousazz says:

    but Valve was still much smaller and less famous than the likes of Blizzard, BioWare, and iD Software.

    Weird way to type out id there, Shamus. They use both lower-case letters ever since DOOM, and they had both upper-case up until Wolfenstein 3D. Never was there such a mishmash between first lower-case and second upper-case letter.

  16. mechaninja says:

    I always wonder why you’re yelling when you talk about GFWL.

  17. Tim Keating says:

    What you describe Steam doing to the likes of EA is basically the Innovator’s Dilemma, which actually explains a lot of the problems in the AAA industry. There’s a whole book on it! But, if I can wittily summarize: once your dick gets to be a certain size, it’s hard to avoid stepping on it.

  18. AReasonWhy says:

    Ssomeone playing a casual game while waiting on queue times or loading times of a big AAA games isn’t unheard of either. I do it all the time because I am like that, heck I am reading this article while waiting on a round of titanfall 2 to start.. And I wanna say its another untapped market that has only recently been tapped into by some games. Meanwhile AAA devs still fail to realise that being able to alt tab their full screen big important games should be a selling point, not last priority of osme dev who might implement it if they are bored on their break.

    Just trying to say this is just another point AAA is blind to realise besides many others.

    • Viktor says:

      I’m actually a little surprised no AAA dev has tried putting some sort of optional minigame you can play during queues/load times. You’d have to make sure it’s not terrible, but it seems like there are unexplored options there.

      (Hell, figure out a way for me to do my inventory management/crafting in TES games while the next zone loads and you’ve just solved 2 problems at once. I realize tech issues are likely the problem there, but that just seems so useful.)

      • AReasonWhy says:

        Wasn’t there something about namco or someone copyrighting loading time games so no one else could use it? It would have been a good idea to use those last console gen, and as much as I love my ps3 those loading times on some games got ridiculous (looking at you gran turismo)

        I mean look at dark souls, they based half their storytelling on reading item descriptions in loading screens just cause they used to be so long on consoles (good luck reading those long paragraphs on a pc port).

        So yeah, trading items or crafting on a loading screen would be bonkers. heck just let me look at my profile or stats on recent games if its an MP game. SOMETHING

  19. Grampy_bone says:

    1. Moneyball was a fad

    2. Valve had a special unique advantage: They had a product EVERYONE wanted, and they forced you to use their platform to get it. People held their noses and downloaded Steam, reluctantly.

    3. If publishers start playing MoneyGaming for real, the whole market will be shitty phone games.

    • Shamus says:

      1. ??? Did it win games or not? Did people move on to some other system, or go back to choosing ball players based on looks? Even if it was temporary (ignoring the fact that in all my research for this article I never saw anyone suggest that this was the case) that doesn’t mean it was wrong. If it was replaced by something better, it was still an improvement over the old system. The fact that it worked was probably enough to shatter the institutional assumptions so that new systems could be explored.

      2. That certainly helped them launch the platform, but does nothing to explain why it took the others so long to show. Or why Valve figured out the Russian / Brazilian markets first. Or why Valve was the first to see the opportunity to explore downmarket sales. Or why Valve was the first one to see the potential of mixing indie and AAA games. This wasn’t a case of them getting lucky once, this is a pattern of repeatedly being years ahead of the competition.

      3. I have no idea why you’d say this. The mobile market is already flooded with shitty knockoffs. Single-developer operations have trouble just making a living, so why would (say) EA abandon a space where indies can’t compete (AAA development) and try to make a living in a crowded market where they have almost no advantage?

  20. Da Mage says:

    Only problem with Steam, they continue to abuse the Australian market, simply because our consumer rights groups won’t let them do what they please.

    It is funny that when the ACCC put Value under pressure (with court cases) about refunds that Value suddenly developed their current refunds system.

    I don’t think Valve have ever quite forgiven for having their hand forced, so Australians are stuck paying for jacked up prices that are also still in $USD.

    And companies wonder why Australia is ‘full of pirates’, hell steam is actually one of the most expensive places to buy games, brick and mortar are cheaper. Origin actually has fair prices and has won a decent market share. It’s history repeating itself.

  21. Philadelphus says:

    Now, most people arguing on the internet would stop here. You made a logical fallacy, therefore I win the argument LOL. But I respect you too much to dismiss this with such a glib answer…

    Thanks! It’s also good to keep in mind that someone can use a fallacy and still be right; for instance, if we disagree over the sum of 1 + 1 and I appeal to the authority of my math teacher that the answer is 2 (since I don’t actually know the Peano axioms well enough to formally prove it), I’m using a fallacy but I’m not wrong. It’s the difference between formal logic (concerned solely with the validity and structure of the premises and conclusions of a syllogism, where fallacies apply) and material logic (concerned with whether a particular argument is actually true or not). Someone may be making a true argument but due to ignorance or other non-intentional reasons are expressing it fallaciously.

    Not that I’m suggesting people making the arguments in this post are particularly correct, mind you; I haven’t really given the matter much thought either way and am interested in seeing where this goes. I just wanted to point out another reason why a full analysis rather than a glib answer is a good thing. =)

    • Droid says:

      Of course, TVTropes had to call this the Fallacy fallacy

    • Daemian Lucifer says:

      I’m using a fallacy but I’m not wrong.

      Technically youre not.The key point of any fallacy that people regularly forget is that it has to be fallacious.Saying “Authority X says this” is not a fallacy as long as what the authority is saying is not wrong.

      • Droid says:

        Since you used the word “technically”, I guess you mean “from a formal-logic perspective”. In that way, no, a fallacy is an argument that is trying to draw a logical conclusion that is invalid.
        For example, an implication “X=>Y” is called invalid iff the implication is false. That means there is at least one example where X is true but Y is false. This need not be a real-life example, it depends on what kind of statements X and Y are.
        If you learn an implication is false, the consequence is that you can say nothing whatsoever about the relationship between X and Y (unless you have more information from somewhere else).
        The fallacy fallacy is basically: “If X does not imply Y, then Y must be false.” which is an invalid claim and therefore a real fallacy.

        • Daemian Lucifer says:

          Yes,with elementary statements like that,its easy.But in informal speech “A is an expert on X,and they say Y” can actually imply “Y is true”.For example:
          1.Neil deGrasse Tyson is a famous astrophysicist
          2.Neil deGrasse Tyson says that the earth orbits around the sun
          3.Earth orbits around the sun

          If you were to observe these as elementary statements,then yes,3 does not follow from 2.But if you look at them as complex statements,youd know that 1 and 2 are composites of bunch of other implications,one of which is either “Neil deGrasse Tyson has observed that the earth orbits around the sun and has experimental proof” or “Neil deGrasse Tyson has studied the experiments that experimentally proved that the earth orbits around the sun”*.So 3 actually follows from one of these subsections of 2,and the chain of implications is not fallacious.

          • Droid says:

            It is still an appeal to authority. In your argument, you are trying to convince me to believe you that Neil deGrasse Tyson has a way to convince me that what you state is true. It still depends on trust and not any logical argument.

            Also, implicitly stated information is a great way to get your argument misunderstood: if you do not state your argument outright, why should the audience have to search for it? It might search for a convenient strawman instead.

            • Daemian Lucifer says:

              It is an appeal to authority,but it is not a fallacious one.You dont have to believe what Neil is saying,you can check his arguments whenever you wish.Sure,I can go a step further and link to a video where he is talking about it,or even verbatim quote him,but the statement would remain the same.The only difference is the number of steps you and me are taking before you can check.

              Heck,every scientific paper that refers to another work is appealing to authority,and requires you to check the referred work yourself(or outright believe that those findings are correct).

              if you do not state your argument outright, why should the audience have to search for it

              They dont have to.They can ask you to search it for them.But that doesnt mean you have to preemptively provide everything.If a physicist is presenting a new research to other physicists,they dont have to preamble it with “As you know,Newton has experimentally proven that….”.Its prudent to do so when talking to non physicists though.But therell always be some unsaid implications whenever you use non elementary statements,and the common starting position for them will depend on what those who are talking agree on.

      • Philadelphus says:

        Technically, I am. Fallacious, in logic, does not mean “the conclusion is false” (though many people use it that way), it means “the conclusion is not logically supported by the premises”. Let me rewrite the argument to a slightly more formal structure:

        My math teacher has a Ph.D. in math.
        My math teacher says 1+1=2.
        Therefore, 1+1=2.

        See? This is not a logically valid formal syllogism, and is therefore fallacious (using the fallacy of Appeal to Authority).

        My point that I was trying to make is that the validity of the argument is a separate and distinct thing from the true or falsity of that argument’s conclusion; the former is the domain of formal logic, and is where fallacies apply, while the latter is the domain of material logic. It’s possible to have a logically invalid argument whose conclusion is nevertheless true, just as it’s possible to have a logically valid argument whose conclusion is totally false. Of course, we should strive to ensure that all our arguments are both valid and have true conclusions for good-faith rational dialog. :)

        • Daemian Lucifer says:

          See? This is not a logically valid formal syllogism, and is therefore fallacious (using the fallacy of Appeal to Authority).

          It may be incomplete,because the statements arent elementary,but its not fallacious.The problem is that its extremely difficult to use formal logic with informal speech.Even the simplest statement like “the sky is blue” implies a plethora of stuff that arent being explicitly said(what is sky?What is blue?Does everyone perceive blue the same way?If two people see blue differently,is it still blue?……..)

          The problem is that all of the descriptions of fallacies show examples of elementary statements,not complex ones.But the statement “My math teacher has a Ph.D. in math.” is a complex statement that can be divided into a plethora of simpler statements,one of which is “My math teacher has done the formal proof for 1+1=2 at least once”.Theres a whole chain of implications involved in those three statements,so the implication is not really wrong.

          Thats not saying that there are no fallacies in informal arguments,but rather that they are less rigid.In order for an appeal to authority to be an actual fallacy in informal arguments,the one invoking the fallacy first needs to show how the problematic statement is incorrect or vague.”Bob knows maths” is a much better start for an appeal to authority fallacy,because it carries far less unspoken statements than “Bob has a phd in maths”.Of course,even “bob has a phd in maths” can be false/unverifiable,but its not as easy to dismiss.Youd have to either point out how that is a lie/unverifiable,or how the phd in question has nothing to do with what was being talked about.

          • Philadelphus says:

            I like how this debate has turned into you trying to convince me that I haven’t used a fallacy in my argument. It’s like, the antithesis of internet debates or something. :)

            Ultimately it sounds like we agree that there can be fallacies in informal arguments, just that we haven’t worked out where the (admittedly fuzzy) boundaries are, so logically at some point there must exist an authority I could appeal to to prove my argument that 1+1=2 which you would agree is fallacious. It still wouldn’t change the truth of my conclusion, which was my point all along: that’s it’s possible to sincerely argue for a true conclusion in a fallacious manner (through ignorance or other non-intentional means), hence why Shamus not dismissing an argument merely for being fallacious is a good move.

  22. Redrock says:

    The interesting thing about the Russian market is that when pre-Steam piracy in Russia is mentioned, people usually assume that this is all torrenting and otherwise downloading illegal copies for free. In reality there was a huge market for selling pirated games. Pirates would make illegal copies and sell them in cheap jewel CD boxes for, as I recall, 100-200 rubles apiece (3-7 dollars at that time). These games also often had unofficial Russian localisations, while the official versions had none.

    All of that was still piracy in the sense that the publishers were seeing none of that money, but it just shows that a large audience was actually willing to pay at some point. If the publishers tried to adjust pricing and establish a foothold in the era before high-speed internet and torrenting, they could have built a culture of actually buying official copies. As such, even people who actually bought stuff bought it from pirates, so they had little moral compunction when moving to full on torrenting.

    By the way, the same market of pirated games existed for the Playstation 1. Now, the PS2 you had to jailbreak, which many people didn’t want to risk doing, so that market shrunk and the legal one started to grow. The PS3 was never jailbroken in any useful way, so that was the end of that.

    One more mostly unrelated thing: in my lifetime the price of a Playstation game had grown from 100 rubles for a pirated PS1 title to 4000 rubles for a legal PS4 game. A PS2 disc was about 1500r, a PS3 – 1500-2500. A lot of this has to do with the exchange rates, but even with the rates stable there would often be a price hike in between generations. I suspect that the same is true for many markets, which gives us a slightly different perspective on the game price discussion discourse in the USA.

  23. Dormin111 says:

    I completely agree with the arguments, excellent article, but I’m surprised you didn’t mention the Oakland A’s manager, Billy Beane, in the Moneyball section. He’s typically considered the vanguard of Sabermetrics in baseball. Was that intentional?

    • Shamus says:

      It’s hard to bring up B.B. without telling his whole story. It’s so complicated and interesting he kinda feels like a fictional character. I felt like I couldn’t do him justice in 2 paragraphs so I left him out entirely.

  24. What makes Steam so great is that they managed to develop a platform that contains all of the games you download in one place. Meaning that if I ever, say, get a new computer with great specs to FINALLY play Total War games at max settings, all I have to do is purchase the game once and then I have a platform I can download it from anywhere.

    Battle.net is company exclusive, and although it doesn’t have as much weight as Steam, it carries its own niche with the Blizzard community. I think it was… some business guy that said to niche down first, then monopolize once there’s a new opening.

  25. Noumenon72 says:

    Moneyball is at least half wishful thinking by people who want to believe cleverness makes them better at things they’ve never tried than the people who actually experience it. Michael Lewis’s favorite players weren’t even the best players on the team.

  26. Ralesfiue says:

    I’d like to make a mention of Square Enix as another notable studio to miss the mark, seeing as all the ones you’ve mentioned are entirely western juggernauts. How so, you ask? Why, because they had their own digital distribution platform. PlayOnline today is a dilapidated launcher for Final Fantasy 11, but contains many of the things that made Steam a viable platform. Among other things, it could download other games (mostly Japan only MMOs), it had social features, it integrated into single player games to add online features, and arguably had the potential to be what Steam is today. Of course, we know how that turned out. Certainly, no discussion of Square would be complete without mention of their hubris or inability to capture good opportunity. But they were definitely close.

  27. poiumty says:

    Unless I’m mistaken Shamus, you’re starting to sound more and more like MrBTongue.

    That last paragraph particularly looks a lot like what he’d write.

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