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The developer of the indie hit Super Meat Boy says bad DRM implementations could be more financially damaging than piracy.
Tommy Refenes, who created Super Meat Boy, posted in a new blog post his opinion of DRM, in light of the SimCity fiasco. Refenes says that any company worrying too much about losses to piracy simply doesn't understand how accounting works.
"Loss due to piracy is an implied loss because it is not a calculable loss. You cannot, with any accuracy, state that because your game was pirated 300 times you lost 300 sales," Refenes says. “"You cannot prove even one lost sale because there is no evidence to state that any one person who pirated your game would have bought your game if piracy did not exist. From an accounting perspective it’s speculative and a company cannot accurately determine loss or gain based on speculative accounting."
Refenes than challenged developers to show the return on investment of DRM, or even just a way to accurately calculate losses due to piracy.
Speaking of his past experience working at KMart, Refenes compares physical losses, such as a stolen item at KMart, to digital losses, such as piracy. "If you have infinite stock and someone steals 1 trillion units from that stock , you still have infinite stock. There is no loss of stock when you have an infinite amount," Refenes added. "Because of this, in the digital world, there is no loss when someone steals a game because it isn't one less copy you can sell, it is potentially one less sale but that is irrelevant. Everyone in the world with an internet connection and a form of online payment is a potential buyer for your game but that doesn't mean everyone in the world will buy your game."
But at the end of the day, what hurts developers more might be poor DRM implementations, rather than piracy. A poor DRM may make a gamer return the game, as Refenes did with his copy of SimCity, and that becomes a calculable loss. And with customers losing respect for the company and its products, it may mean losing a real potential customer in the long term, all in the name of an ultimately vain effort to go after people who may never have wanted to buy the product in the first place.
"Respect your customers and they may in turn respect your efforts enough to purchase your game instead of pirating it," Refenes said in conclusion.
Tommy Refenes, who created Super Meat Boy, posted in a new blog post his opinion of DRM, in light of the SimCity fiasco. Refenes says that any company worrying too much about losses to piracy simply doesn't understand how accounting works.
"Loss due to piracy is an implied loss because it is not a calculable loss. You cannot, with any accuracy, state that because your game was pirated 300 times you lost 300 sales," Refenes says. “"You cannot prove even one lost sale because there is no evidence to state that any one person who pirated your game would have bought your game if piracy did not exist. From an accounting perspective it’s speculative and a company cannot accurately determine loss or gain based on speculative accounting."
Refenes than challenged developers to show the return on investment of DRM, or even just a way to accurately calculate losses due to piracy.
Speaking of his past experience working at KMart, Refenes compares physical losses, such as a stolen item at KMart, to digital losses, such as piracy. "If you have infinite stock and someone steals 1 trillion units from that stock , you still have infinite stock. There is no loss of stock when you have an infinite amount," Refenes added. "Because of this, in the digital world, there is no loss when someone steals a game because it isn't one less copy you can sell, it is potentially one less sale but that is irrelevant. Everyone in the world with an internet connection and a form of online payment is a potential buyer for your game but that doesn't mean everyone in the world will buy your game."
But at the end of the day, what hurts developers more might be poor DRM implementations, rather than piracy. A poor DRM may make a gamer return the game, as Refenes did with his copy of SimCity, and that becomes a calculable loss. And with customers losing respect for the company and its products, it may mean losing a real potential customer in the long term, all in the name of an ultimately vain effort to go after people who may never have wanted to buy the product in the first place.
"Respect your customers and they may in turn respect your efforts enough to purchase your game instead of pirating it," Refenes said in conclusion.