1/2 Billion Dollars Lost to Torrents For Gaming Companies

1/2 Billion Dollars Lost to Torrents

We covered Spore’s strict Digital Rights Management (DRM) a few months ago at its release, and discussed potential affects it may have on piracy. Late last week, TorrentFreak.com posted an interesting end-of-the-year compilation list. This one looked at torrent downloads for the year, and listed the top ten pirated PC games.

PC Gaming has relatively struggled, compared to the console industry, due to the near constant need to upgrade a computer to get the most out of the latest games. Most games will still play on a PC that’s a few years old, but you don’t get the equal or even superior experience you can get from a console or high-end computer. What TorrentFreak’s list has done is given companies and consumers an easily quantifiable idea of just how much money PC game companies have lost to piracy this year. First, here’s TorrentFreak’s list:

#     game                   downloads           released        

1     Spore                   (1,700,000)         (Sept. 2008)

2     The Sims 2           (1,150,000)         (Sept. 2004)

3     Assassins Creed    (1,070,000)         (Nov. 2007)

4     Crysis                  (940,000)            (Nov. 2007)

5     Com&Conquer 3    (860,000)           (Mar. 2007)

6     Call of Duty 4        (830,000)           (Nov. 2007)

7     GTA San Andreas   (740,000)           (Jun. 2005)

8     Fallout 3               (645,000)           (Oct. 2008)

9     Far Cry 2              (585,000)           (Oct. 2008)

10   Pro Evo Soccer ‘09 (470,000)           (Oct. 2008)

That comes out to 8.99 million downloads, via torrents, of just the top ten. Obviously there are way more than 10 PC games that were pirated in the last year, and this number doesn’t include console versions or games downloaded via other means. If for simplicity’s sake we say a new PC game costs $49.99 (allowing for the fact that The Sims 2 obviously no longer costs that much), this is about $449 million dollars in lost revenue for retailers, producers, and developers.

Nearly half a billion dollars is a lot of coin, and understandably game publishers are trying very hard to curb this kind of thing. Unfortunately, some of their attempts, like the strict DRM on Spore, only seem to serve as a challenge to pirates. For most gamers that download a game illegally, price is the cited reason, or some sense of entitlement that equates to a lack of guilt. The game industry has continued to grow year-to-year, as well, including these last 12 months of recession. However, individual companies have felt the sting of the declining U.S. Economy, with layoffs occurring on a seemingly weekly basis at the major companies now, and some long-standing companies in truly dire straits. Would a half billion dollar cash infusion into the industry have prevented some of those job losses? Almost certainly. Unfortunately, even if the industry could convince those gamers to not download their games, they would then also have to convince them to buy them.

Valve Software’s Steam legal download service is a step in the right direction. By making their (and several other developers’) games easily available to purchase and download quickly, they circumvent the retailers, and often offer significant discounts on the software. Dropping the price obviously isn’t the solution, as demonstrated by The Sims 2. The four year old game is still the second most pirated of the year, regardless of the fact gamers can now purchase it plus an expansion or two for as little as $19.99 retail. Gaming companies don’t have live events and external merchandise to recoup some losses due to piracy like the music industry does. Really, the only hope to curb this level of piracy lies in convincing gamers to fundamentally change the way they think about it. The only way this is likely to happen is in further economic problems for game companies, forcing the closure of some and preventing the release of anticipated games.

The problem, at half a billion dollars, is a big enough one to take note of, but not a big enough problem to cripple the industry in any way at this point. No gaming company has come up with a real solution to this yet, and it really seems elusive if it exists at all.

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