Defeating Piracy by making it irrelevant

I’ve been thinking about DRM, copy protection, piracy and the current business model for digital media, based on outdated concepts and the idea of false scarcity. I think we need to create a new model. I think it will be hard and have a lot of false starts and failures but eventually I think we can give content providers a method of fighting piracy and maintaining profits while making it easier for consumers to get the games they want and improving relations and communications between consumers and creators. I’m going to explain my thoughts and welcome any discussion that will push this forward. Trolls and pro-piracy arguments will be ignored. On that note, let’s get some of my opinions about pirates out of the way first.

When “Arrr, Matey” sounds like self-righteous, entitled whining

Piracy advocates seem to have a rationalization for every argument thrown against them, some valid and others completely fabricated – and purely there to assuage the pirate’s guilt and stoke their false sense of entitlement. A creator deserves to be compensated for their work. You do not get to use that work for free because you are broke, because you want to see if it’s any good, because it “doesn’t hurt the publisher”, because the DRM has broken the game or any of the hundreds of other pathetic reasons that pirates give to make themselves feel better about stealing a product.

People will argue all day about the theft part; since there isn’t a physical product, only a bunch of digital bits and an invented false scarcity to drive the price, it can’t be considered theft. I would suggest they talk to the people who created the product, who worked for months or even years in some cases to create the work in question. I would ask the art director, the voice-over talent, the scriptwriters, the texture artists, the musicians, testers, advertising department and coders if they spent a good chunk of their life working on a valid product or a random assortment of bits.

We have an obligation, as consumers, to reward content creators at a reasonable level. Piracy side steps this responsibility and then invents a million ways to explain why it’s okay. Pirates don’t ever want to admit that they are cheap (and they have no respect for the content creators) and instead act as if they are modern day Robin Hoods who are stealing these games so that they can give them to entertainment-starved orphans. We do not have a “right” to be entertained. We pay for that privilege.

I’m not anti-pirate, by the way. I don’t think I know a single person under the age of 60 who hasn’t pirated at least one movie or piece of software in their life. We all do it because, and this is what I want pirates to admit, it’s easy, it’s nearly free and in some cases you do get a better product. It’s just not legal nor is it fair to the creators of the content.

So, how do we begin to change the system to make piracy irrelevant while maintaining a profit for content creators? I’ve been thinking about this and have come up with something I’ll call the Community Model.

Developers like Notch and artists like Radiohead and NIN have done something similar to what I’m proposing, but without a sustainable model – I think that Notch got lucky that he went viral (not too lucky since his game is very good and deserved the press) and I think Radiohead and NIN were only successful because they were already very successful, recognized brands. We need to refine these concepts and create a new business model that rewards artists of any caliber while making piracy worthless.

The first thing we do: let’s kill per-user pricing

The first problem with the current model is that it only works through artificial scarcity. You buy a copy of a game for $60, not because each digital copy is worth $60, but because that’s the price that the publisher can charge and expect to return a decent profit in the face of production costs and loss (through piracy, physical theft, sales and giveaways). This artificial scarcity is what makes piracy so attractive to some people. If you know that the system is broken and you know that the system is gamed to expect a level of piracy, being a pirate is just being part of a business ecosystem.  DRM, price increases and crippled user experiences are driving piracy which, in turn, is driving up prices even more and driving development away from computers and onto consoles where control over the system is easier and piracy is tougher (depending on the console, of course).

So, we have to lose the per-user pricing and instead turn to a per-project price model.

In my model, the company has a known cost of production, including salaries, and picks a ROI that would satisfy investors. This is the final total cost of the game, but instead of charging a flat fee to each user, this is a single fee charged to the community.

But wait, there’s more… and more… and more…

How do we get players to chip in and pay the $20 million in production costs and return another $40 million in profit?

Milestones.

The initial stage of the game, the Original Release, would be similar to what is now a demo. It would be restricted in either weapons, levels, features or content. This is released for free to anyone who wants to download it, and its sole purpose is to draw interest and gain momentum. Players who enjoy it can then go to a web site or an in-game prompt and view the current milestones, the current accumulated earnings towards the next milestone (this can be done in dollars, percent or talking clams, as long as there’s a visual representation of the levels) and a way to give some of their hard-earned dough to the developer. For known franchises, this can even happen pre-release so that the when the Original Release comes out, the game is actually several milestones up.

What is a milestone?

Once people have paid enough money to hit a milestone, a new feature, new content, new weapons, or new play types are released. For example, in a game that cost $10 million to create, the developer could have many milestones, including a big one at the ‘cost of production milestone’. When this is reached, they would release an update that would add the multiplayer modes into the game. Another milestone at the first $5 million of profits could mean they release a map pack. If the game shows a long lifespan of consumer support, developers can keep adding content without having to develop a brand new game. Additional milestones can be synonymous with sequels, expansions and the like.

There would be no more Jumpy McMurderer 1, Jumpy McMurderer 2, Jumpy McMurderer 3 and so on. There would just be Jumpy Murderer which would be released with a few levels. When enough people pay to hit a milestone, more levels are released. Future milestones can update content, graphics engines, or add entire new characters and story lines. You wouldn’t need a sequel to a popular franchise, it would just evolve and grow and improve. There could even be ‘vote’ milestones, where a milestone can offer more than one option and consumers vote on which milestone they want to see, or the order they want to see them.

But wait, what about my money?

I hear people on both side screaming about this, most likely because I forgot to take my medication this morning. What happens when I send in $50 and a milestone isn’t met? What if we don’t get enough money to hit a milestone?

When a game hits a point where there is little interest, the last milestone should be enacted and then the game goes out of development, accepting no more payments. This way, anyone who fronted money for that final milestone still gets their features.

The game, by the way, is always available for download, for free. This would legitimize torrent sharing since it would be legal to share the file and this would save huge amounts of bandwidth for developers. The content is still protected under copyright law so that random people can’t start their own Jumpy McMurderer cartoon, but the game itself is available to everyone at no cost to download. The profit doesn’t come from a per download basis; the community has paid for it at every milestone and now the community as a whole owns a license to the game.

How does this affect my bottom line?

For the consumer, people who can pay more, will, and people who can’t pay $60 can still give $5 and contribute to future development. Gamers will have a greater voice in regards to what they want to play and will be able to give better feedback to the companies making the games. Gamers will be able to get their game easily and never have to worry about DRM. No one has to worry about spending two days downloading a crappy torrent that contains a virus, malware, spyware or the wrong program altogether. No one has to hunt for cracks or patches.

For the industry, this would be a huge change, especially for the big boys. This would require a much different organization and development schedule and, if things stay one sided and bloated, less profits. But if companies can adapt, they will have to spend absolutely zero time working on DRM, copy protection and piracy. They will be able to close down production early on games that aren’t showing interest. They are able to continue to milk a profit stream without having to develop brand new games.

What would happen to retailers? Since the games at every milestone would be free to download, this would hamper sales of boxed games. But this isn’t the end of retail games. I envision a kiosk that would swipe your card and allow you to choose a price-point, say $1.99, $10 and $20, and would burn you a copy of the latest release. The $2 price-point would cover the expense of burning, while they could make a cut (10% + $1) of the higher points. This means less real estate, no locked cabinets, no theft and no more dealing with return scams.

Finally, what would happen to the pirates? They would be irrelevant. Since the community as a whole is responsible for paying for the game which is then released back to the community, the game would be attainable by anyone at its current milestone, making it useless to pirate. The only way to continue development or release new features is for the community to pitch in. The digital media becomes communal and the focus goes on the developer, not the medium. Pirates can download for free and, if they decide they want a new feature, can put their $1 or $5 or $200 up like the rest of us, directly to the developer, with no excuses if a game they want fails.

The old adage about it being easier to earn $1 from 1000 people than $1000 from one person is pretty fitting here. Charging $60 for something that can be copied without destroying the original has been one of the biggest arguments for piracy so, instead, lets try asking everyone for a few bucks and give them all a bit of entertainment. If they like it, and they want more, let them vote with their wallets and cough up another few dollars. In this way, you are getting the entire community involved, giving people a voice and making them interested in the process while at the same time making piracy moot

What about me? I’m a [ musician | web comic artist | mashed potato sculptor ]?

I think this would work in almost any creative medium in the digital age.

Web comics update weekly and covered in ads? Remove the ads, giving your users a better experience. Change that to updating when a $50 or $500 milestone is met. The content creator reserves the right to modify this milestone amount based on traffic and things like bandwidth costs. I’m considering trying this for my own comic. Having a visual representation of user support would be a both a great motivator as well as a way to actually earn something for my work.

Musician? Release a couple of tracks for free. Put up some milestones. Release additional tracks as milestones are met. Eventually, people are going to download your album from a torrent site. If you release it in parts, based on profit milestones, you can stop worrying about piracy, release your tracks, make some money and focus on creating more work.

What does this mean for the future of digital products?

As the modern generation of kids mature and more, if not all, of our entertainment is released digitally, this artificial scarcity will eventually wither and die. Most of us know that selling a single music CD or game means that almost immediately, anyone with a bit of internet savvy will be able to download it for free. The thing is, more and more people are becoming this savvy. We can’t stop this by adding DRM, suing people for 100x the money they would ever earn in their lives or being Metallica. We can’t put the burden of profit on the release of individual, digital copies of a work; the burden of profit should be on the back of the work itself. Individual sales of a 10 year old game or album aren’t going to keep you in silken diapers and caviar milkshakes anymore. We have to come up with a new plan. Businesses can’t keep shunning customers and treating them like criminals or, worse, a herd of cattle to be milked and ignored. Content creators need to involve and invite the community to actively support their works and then reward them for doing so. If we can get people interested in the process enough to pay, through incentives, expansions and improvements, while making piracy irrelevant, we can fix this system and make both the creators and consumers of digital media very happy indeed.

Leave a Reply

%d bloggers like this: