So, Persona 4: Arena is region-locked (WTF?)

persona-4-arena-will-not-buy

So, Atlus announced that Persona 4: Arena, a spectacular-looking 2D fighter starring the cast from Shin Megami Tensei Persona 4, will be region-locked.

This… defies logic. Especially given the PS3 has consistently featured its region-free status as a selling point for the console, and is an enormous benefit of owning the console.

But this. Really?

No, really?

To their credit, Atlus sent out a press release stating why it has happened. While I appreciate the honesty in such a response, all it’s done if confirm that the region-locking has been done for the purpose of supporting a price-fixing policy.

… again, really?

Last I checked, the PS3’s region-free nature hasn’t affected sales. Last I checked, I had more PS3 titles than any of my other current generation consoles. This is because the title wasn’t slated to be released in PAL regions (Catherine), the title was superior in another region (Final Fantasy 13, Asian version – Japanese voices, English text), or the price was half the cost of the import locally vs overseas (VF5 set me back AU$100 locally when I bought it in 2007).

So, to enforce a protectionist market, the game is being locked. This not only affects US gamers wanting to pay the premium for the Japanese copy, but also affects all PAL gamers who want to grab the game because they don’t want to wait an unnecessary amount of time to see if it’ll get picked up locally (if at all) or who don’t want to pay an extortionate price for the game (RRP on most AU games is AU$99, nearly double the game’s US RRP).

It’s a shame because niche publishers like Atlus and NIS rely on their passionate fanbase to fuel the sales due to the nature of the titles they bring over, and this is a substantial misstep.

Still, if you’re going to slap the market in the face, don’t be surprised if they get angry.

I for one won’t be buying the game in the immediate future. Once I get over myself and step down from my soapbox, I might reconsider and add it to the collection. Will I really matter in the grand scheme of things? Probably not. But it’s a principle I feel very strongly about (and have discussed previously), and my principles tend to affect my spending habits.

To bring across a currency of thought, I haven’t bought a Capcom game in a while because I’m offended by their awful DLC practices (such as SFxT featuring another ~15 characters on the disc, but locking all of them up under paid-for DLC). Again, I’m not sure if I’m making much of a dent (especially given how many Capcom titles I’ve bought this generation before the SFxT fiasco), but it’s about as much as I can do to emphasise that I love games, but abhor business practices designed to make cheap grabs for my cash. The collective voice of protest only seems to be listened to when it affects the bottom-line, so if that’s the only way I can express myself, then so be it.

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Why the anti-consumer mentality in contemporary gaming?

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Be warned, this is going to be a very lengthy post.

I’ve been thinking of writing this for a while now, but the latest from Kotaku has encouraged me to get onto it.

Today’s soapbox rant is on the emerging anti-consumer mentality becoming prevalent amongst publishers and some developers. The general consensus is about clamping down on second-hand sales as it has a direct effect on sales of new titles. The practice is spurned by game retailers selling second-hand games alongside new games for a fraction of the discount compared to the cost of the new title. This means within a week of the latest blockbuster coming out, in addition to the RRP$120 brand new copies, there will be second-hand copies for $10-$20 less; to the average consumer, the second-hand copy is fine for their purpose and they pick up the cheaper game. This flows more money into the retailer (as the margin on the second-hand game sale is significantly higher compared to the brand new retail copy), leaves extra spending money for the consumer, but it means the publisher has missed out on a sale, and lack of sales at retail equal less money going back to the publisher and in turn to the developer.

The angst from the publishers and developers makes sense, especially if you look at the short-term economic impact. New titles only have a finite shelf-life, and they need to maximise the first few weeks to bring a decent ROI for the publisher. If this is compromised by retailers selling second-hand games with a higher margin to a consumer that’s happy to save a few bucks, the situation gets worse as sales of new titles plummet.

Thus, from the publisher, their issue is that retailers are “double-dipping” the game sales, having made money on the sale of the new game, then making another sale with a considerably more healthy margin on the second sale. Publishers need capital return in order to invest in funding new games from their developers, so if the ROI is affected, it in turn affects the amount of time/resourcing allocated to new games development.

The next portion of the equation is the retailer. Their issue is to be profitable in order to satisfy their investors, pay their rent and pay their staff; these are all common issues to publishers as well, including the final part of the equation in maximising their short-medium term return on investment. In order to achieve this, they need to look at their business and maximise revenue. For years now dedicated game retailers have complained that the margins on new game sales are incredibly slim, so the paradigm has changed to reflect the market – accessories and auxillary merchandise (premium editions, guides, figurines, etc) assist with diversifying their income due to the higher retail margins, not unlike how the sale of cables, extended warranties and powerboards boost the margins for home electronics dealers. Used games are a natural extension of this, as they allow a higher margin at retail and therefore make the running of a dedicated store a sustainable venture, to the point where used game sales are to a large degree propping up the retail model due to the poor margin of new game sales.

The final slice of the pie is arguably the most important one – the consumer. To the average consumer, as long as the game works, there’s no issue – they just want to play it. For the enthusiast, purchasing habits can often be a little more pragmatic, with an emphasis on purchasing brand new copies. Where money is an issue (very important to the average consumer), the purchase of a used game makes sense; conversely, it is also equally important to have the ability to trade in used games and use that credit to purchase new titles as part of a consumer-product lifecycle.

This last point is often cited as a key part of keeping used game sales alive, as the habits of many consumers suggest that games are traded in for credit used to purchase new titles. By extension, it also reduces the risk of purchasing a new game as it allows the consumer to return the product for credit if they don’t like the game and use that credit to purchase another game they may enjoy more.

As a final extension to this model, there is also the preservation side to gaming. At the moment, I can load up a game that is over 30 years old on my Atari 2600 and play it. One may question the logic in doing such an activity, but it’s an important fact to consider. By extension, used games allow for people to enjoy retro games and is good for for the long-term health of gaming as an accessible social history. If you remove the ability to play used games, you effectively destory the ability to experience and partake in gaming from a socially historic perspective.

From a pragmatic business perspective though, this final argument holds absolutely no weight at all, particularly from a short to medium term perspective. This is because it gives the publisher the ability to strictly control the game’s usage patterns, and by extension, purchasing patterns viagra a vendre suisse. Control equates to an ability to extract maximum income from a past venture. This is part of the reason publishers hate the growth of emulation, as it allows intellectual property to be preserved and played without taking into account an additional revenue stream. Thus, the publisher has no interest in the social history of gaming and its contribution to society when viewed from an historical or anthropological perspective.

But there’s a counter-argument to this, which suggests that the birth of emulation has also given way to an acceptance of retro games as a pursuit of leisure and products worth revisiting or re-purchasing. It’s all very chicken/egg, with one side claiming the ease and portability of emulation gave legitmiate market interest in facilities like Nintendo’s Virtual Console; conversely, publishers would argue that the interest was always there, and the presence of free emulation undermines the value of old games.

Things get muddier when you think about how the developers of the emulators themselves are tied up in the situation, with open-source emulation projects inherently contributing to commercially-emulated titles or closed-source emulation authors being hired to create commercial emulation software. There’s also the issue of quality – where freely available emulation has proved superior to commercial emulation, the core gaming community’s desire for comprable (and ideally superior) commercial emulation has lifted the quality of the product. Thus, it could be argued that the improvements in free emulation has in turn contributed to superior commercial emulation, which results in a superior product for the consumer.

Still with me? Good, so to recap, here’s where we’re at:

Publishers want maximum return from their investment and a cut of all sales relating to the sale(s) of games. Their motive is extracting maximum income from the sale of games, and their lack of a cut in the sale of used games undermines their business model. Their emphasis is on short-medium term gains, and to leverage their reputation to create long-term equity in their brand.

Retailers want to maximise their income stream to remain sustainable and profitable. This means making up for low margins on new games by selling items with higher margins (such as used games). They are focused on short-term returns and long-term sustainability of their business.

Consumers want a comprable experience for the best price possible. Consumers should be able to enjoy official (i.e. not bootleg) games for the life of the physical item, even if that means being able to play them in years to come. Consumers have demonstrated an interest in re-purchasing old games on newer systems if the price is right, the quality is in line with a commercial product and the content/setup is accessible and logical.

This then means that, in an ideal scenario, the publisher sells more titles to generate more money, retailers have a higher margin and higher sales to return more money into the store/franchise and consumers purchase games for a cheaper cost.

Something accordingly has to give.

One solution offered is to reduce the RRP on games and allow retailers to retain a higher margin; the crux of this argument is that the lower price will make the purchase of new titles more accessible to consumers and the volume of sales will offset the reduced income per item received by the publisher (economics 101 – sell more at a cheaper price and use volume to sustain your income projections).

The issue with this model is that, should game retailers continue to sell used games, then the consumer habits won’t change and the net result is that publishers will be generating less revenue per capita from sales, retailers will be making higher margins on new sales whilst retaining higher margins on used games and consumers won’t be prepared to pay a premium for their games.

The logical extension is to come to an agreement with retailers to either stop the sale of used game entirely (unlikely), or to add a window of exclusivity so that new titles have a period of time where used games will not be accepted as trade-ins or sold. The issue this would hold with retailers is that if they were to follow in this stead, would the margins from the new game sales be enough to make their businesses sustainable?

For the consumer, they ultimately want to purchase the game at the cheapest price; if games are cheaper, it either means less money in the budget to buy and play new games. A more ambitious outcome would be that gaming budgets remained the same or increased slightly, with the consumer using the same amount of money to purchase more games than before. This equals more sales for gaming, which in turn improves the sustainability of the business.

But it’s a risky move, and in an industry that has severely contracted over the last 5-10 years and has become decidedly risk-adverse, this is not an enticing move.

So, with all parties at a standstill, the break to the stalemate has been to slowly introduce anti-consumer strategies to bully consumers and control their purchasing habits. There are degrees of impact with this strategy, including region-locking consoles (a historical approach to price fixing in the gaming sector), restricting additional online content via a serial key (available free as a one-off use with the game and available for purchase as DLC thereafter), requiring an always-on internet connection to play (including playing single-player) or inherently altering the physical media to not allow for the game to be “factory reset” for a new user.

The news from Kotaku (at the top of this rant) suggests that Sony are looking at going down an extremely anti-consumer path of creating individual keys embedded in the media or printed/inserted with the product that requires the consumer to lock a title directly to their online account. Without the key, the game is stuck in “trial mode”, with the consumer required to pay an additional fee to play the game in its entirety. I can see the logic of locking down the online/multiplayer experience like this, but for single-player or offline games it’s definitely an example of strong-arm contracts.

While this may seem achievable (if mean-spirited), these anti-consumer methods are inherently flawed as it fails to take into practice of playing these games when the servers are ultimately switched off, if there was a misprint with your key or if you have issues with your internet connection in the immediate-term. Pragmatically, the publisher has no issue with this, as you’ve paid your money for the game, and in the instances where live server connections are required for play, it allows them to re-release the title on succeeding platforms and maximise their investment in the title by shutting down any access to the content outside of their rules. It invariably moves console gaming into the same realm as PC gaming, and we’ve all seen how successful strong-arm tactics in the PC gaming arena has been.

Now, all of this assumes that the rights-holders actually stay around though in order to support or re-release their titles – anyone who has read up or been involved with managing rights for old games in order to redistribute them commercially knows its a minefield that can often make it financially unviable. This means for the purpose of short-term profit, an entire generation (and future generations) of social gaming history will be lost owing purely to control and corporate greed.

But this fails to take into consideration the importance of second hand games, their financial accessibility and how these tie into brand equity for the long-term sustainability of the gaming sector.

After all, how many kids played second-hand or emulated Sonic titles in years past, all of which have contributed to the enourmous brand equity in the Sonic franchise to date?

From a personal perspective, when I was a kid we had a collection of new and second-hand games for our consoles – as I was in primary or high school depending on the system, and had limited sources of income, this was how it was; you also borrowed games between friends or took them over peoples’ places for gaming as a group. Where possible, I was lucky enough to have some new titles, and alongside those were a number of second-hand games.

Fast-forward to where I am now, and over the three current generation systems in our household, the collection sits well beyond double-figures, and almost every one was purchased brand new at retail.

If I didn’t have the option of supplanting my gaming habits when I was a kid with second-hand titles, I daresay I wouldn’t be the avid gamer I am today. Sure, it doesn’t make much sense financially short-term, but long term? Those numbers speak for themselves. That’s what makes this industry sustainable long-term.

Going beyond purchase habits, there’s also the topic of harm-minimisation, something I’ve talked about before. If the leaked details are anything to go by, antagonising consumers will do very little to reduce the likelihood of console hardware (and related networks) being compromised in order to attain extended functionality that should have been present day one or play pirated titles (or being able to play legitimate titles offline if the above is any indication); it also raises the question of compromising the network as an act of rebellion or to improve the consumer experience. As before, I’m not endorsing these actions, I’m merely pointing it out as a likely act that may follow in the wake of antagonistic behaviour.

This kind of heavy-handed behaviour also adds fuel to the fire of those wishing to preserve the social history of gaming – under the leaked conditions, this means that once the servers are switched off, none of those games will be accessible. Even if you purchased it at retail but hadn’t opened the seal until the servers had been turned off (granted this is unlikely, though having picked up a brand new 32X in 2011, I don’t think it’s out of the question), the game will not be active.

Therefore in order to preserve the next generation of games, you will need to pirate the software.

This suggests a very short-sighted and flawed approach to the gaming paradigm, and one that is actively setting up the next generation of gaming to be extremely problematic.

Despite all the above being said, I obviously don’t have the answer – after all, I’m a nerdy retro gamer running a small, independent blog where I wax lyrical without any editorial panache.

But I’m also a passionate gamer, and it seems incredibly daft to return to a mindset from several decades ago in order to maximise profits in a way that is antagonistic to your consumers and focused incredibly tightly on short-term cashflow vs a long-term relationship built on respect, progressive attitudes and cashflow.

For me, I think the solution is to meet the retailers part of the way and addressing the needs of the consumer. This means reducing the retail price and working on volume sales whilst increasing the margin for retailers, coming to an agreement with retailers to manage second-hand games in a way that is acceptable to all parties and practicing harm-minimisation by being progressive towards your consumers (e.g. region-free, extensible features, user-serviceable HDDs, etc).

The industry learned some hard lessons this generation, let’s not see all that hard work go to waste with what’s to come.

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Atari issuing cease and desist letters to websites – huh?

This.

My feelings over Atari recent spate of cease and desist letters to websites pertaining to the Atari 2600 are reflected in a far-more articulate response at Atomic PC’s website. I merely wanted to add my voice to the chorus.

Given Atari allegedly gave the community their blessing to develop for and celebrate the history of the Atari 2600 more than a decade ago, it seems a bit petty to go after websites covering the platform. It’s certainly within their legal right to do so, but it does beg an ethical question. Given the enduring value of the brand “Atari” is attributable in part to the ongoing development, discussion and celebration of its legacy by fans, it seems unusually short-sighted to tarnish this reputation by attacking the very people who have assisted in building the ongoing awareness, and by extension value, or Atari.

Hopefully this is the last of such tomfoolery for 2011. It rounds off a trio of arguably anti-consumerist measures by some of the big names in the gaming sector (Sony removing Linux support from the PS3; Capcom’s unoffocial “DRM” for Resident Evil: The Mercenaries 3D on the 3DS; and now Atari and their IP battle for URLs and websites), so hopefully we can all move on from here.

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I think Capcom hates gamers (Resident Evil: The Mercenaries 3D and DRM)

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Capcom’s Resident Evil: The Mercenaries 3D continues to question how much Capcom actually appreciate their market, or if they plain-old hate gamers. Here’s a snippet from DVICE:

It’s been confirmed that Resident Evil: Mercenaries 3D for the Nintendo 3DS is a game that once finished, cannot be reset for complete replay. According to both the U.S. and U.K. game’s instruction manual “saved data on this software cannot be reset.”

Basically what Capcom has done is make Mercenaries 3D a one-time play affair. Once you’ve unlocked all the goodies and played the entire game, you will not be able to erase the game’s save data and start fresh as if it were a new copy. Consider this: lending Mercenaries 3D to a friend, a little brother or sister will be worthless because they’ll only be able to continue playing the game with your saved settings and create their own.
(Source [via Tiny Cartridge, via Eurogamer], and GameStop’s follow-up)

Capcom have made some terrible decisions with DRM in the past (Final Fight Double Impact and Bionic Commando ReArmed 2 need to “phone home” before you can play them on the PS3), and its disappointing to see them acting in such a hostile way towards consumers. While some may argue that this is potentially an act to sabotage second-hand game sales (as they derive zero profit from the on-selling of games once they’re past the first run at the retail counter), it’s important to consider the dependence many gaming stores have on second-hand sales in order to make up for the relatively slim margins offered at retail. Mind, I won’t go into that topic in more detail here, as it’s beyond the scope of this post and has probably been argued more intelligently elsewhere.

Returning to the topic at hand, I think this hurts a little more as I genuinely have a soft spot for Capcom games, having enjoyed so many of them over the years (during the Saturn and Dreamcast era, my purchases [at retail no less] led to many gaming sessions). This is the kind of move I would expect from some of the more aggressive players in the market, but not from them.

It also seems incredibly short-sighted in terms of being able to enjoy your purchase over time – I still crank out Atari 2600 cartridges every now and again, and the notion of anti-consumerist DRM would render this kind of thing impossible in years to come for new games. This means that, in the case of Resident Evil: Mercenaries 3D, I can’t reset the game back to factory settings to start it afresh; or to give another skew on this topic, in the case Bionic Commando ReArmed 2, I probably won’t be able to play it in 10 years time despite having paid money for it in 2011.

It marks a very dangerous point on the slippery slope of DRM and anti-consumer licensing enforcement on behalf of gaming publishers. Whilst only a handful of games on consoles are toying with the concept of DRM that is ultimately detrimental to the gamer, it’s a dangerous path. I hope Capcom is taking stock of the reaction from consumers to what they’ve tried slipping through with Resident Evil: Mercenaries 3D and don’t attempt this kind of tomfoolery in the future.

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WTF is with the DRM on Final Fight: Double Impact Capcom?

So, Capcom recently added what I previously thought was a great release of the arcade versions of Final Fight and Magic Sword as a two-game pack on PSN and XBLA. Owning a PS3, I was tempted to grab it as I really like both games and thought it would be fun to play them in the main living room of the house.

However, I just found out that the game pack has DRM built into it, part of which requires you to have an internet connection at all times when you want to play the game (thanks to Kotaku for the great writeup).

What… the… #$%@?

So let’s get this straight – I’ve bought the game, I’m using it on my PS3, my internet connection drops out (very much a frequent thing in Australia, despite the hard work of ISPs like iiNet and Internode, there’s only so much you can do given the infrastructure), and BAM – no game for me.

Or what happens if my ADSL modem kicks the bucket and I have to wait a couple of weeks between grabbing a new one – I can’t play a game I legitimately downloaded?

Or, as one of the comments left by a reader on Kotaku pointed out, in 5-6+ years time and PSN changes or whatever (or for the sake of retro gaming, 10+ years – the PS3 won’t be Sony’s primary platform forever), I can’t play the game?

It’s… beyond rational.

For the record, I have Final Fight on Mega CD, have previously had it on the SNES, enjoyed playing it on the Capcom Classics Collection releases on the PS2 and even own an original CPS1 Final Fight PCB. Despite this, I was still happy to launch more money over at Capcom (and I am a big Capcom fan) to grab this so I have the convenience of being able to play it in my living room with Wifey, who loves a good scrolling fighter.

But not now. No way am I supporting this kind or behaviour from a company that should know better.

The worrying thing is if this viral attitude that presupposes every user is a pirate starts to infect other PSN releases – I actually have quite a few titles I’ve happily purchased over PSN and think it is such a fantastic service, and as a platform it is fulfilling a niche market of simpler, old-school and retro-inspired titles that aren’t commercially viable via a packaged release.

But this is the wrong way forward.

I respect the rights of a developer and publisher to protect their IP. But in return, I expect the developer and publisher to respect me as a consumer. I also expect that, despite the game being a digital release, that I’ll still be able to fire up my PS3 in 10 or 15 years time and play it. I figure that if I can still fire up my Atari 2600, where some of the carts are probably around 30 years old, why shouldn’t I have that same expectation of a game I have purchased for my PS3?

Capcom have some interesting titles on the way, one of which includes a new entry in the Bionic Commando ReArmed series. I bought Bionic Commando ReArmed within minutes of playing the demo because of impressed I was with it, and thoroughly enjoyed playing through the game. The sequel will potentially be a day-one purchase. However, if there’s even a hint that this kind of draconian DRM is going to be present, I’m walking away.

Shame Capcom, shame.

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