RPG Illegal File Sharing Hurts the Hobby

[Lonely Tylenol]

To return to the thread topic: much of that success has been from products (such as the Gloom card game) that can't be effectively pirated over the internet, because their value is significantly related to the physical object of the game itself. Heck, we give the rules away for free on our website, for people who lose their rules or want to learn how the game plays before buying. Most everyone agrees that another recent big success in the hobby has been D&D minis -- again, not something you can very well upload to p2p networks.

Coincidence?

Could be. No good evidence on which to make a decision either way.

But anyway, your analysis is interesting. Do you think that your experience is typical for most d20 publishers (I assume you get to chat with them more than I do), or do you think that perhaps there are some subcategories of publishers that do better or worse depending on what it is they're publishing? I still have no reason to doubt WotC's claims that they're doing well, but I understand that they might be thriving on the flotsam left behind as various d20 publishers dwindle and customers turn to the big company with flashy production values and lots of product support...something they can provide because they're so big. But WotC is also really the only company that's spending a lot of money to get new players into the industry, so perhaps they're seeing a market share that nobody else is.

It could be that Atlas was producing something, as the earlier poster suggested, that was niche enough that it didn't have the staying power that WotC's generalist approach with the core books, Complete line, Races of line, well-established campaign settings, etc. did have.

I suspect that Malhavoc has never been doing better than they are now, but I also suspect that several other d20 holdouts that didn't branch out into other areas are suffering. Everyone these days except Malhavoc seems to be producing non-d20 stuff. Mongoose has a few licensed games, Firey Dragon has Tunnels and Trolls, etc. So maybe surviving in a d20-only business depends more on having a really good eye for what will sell to d20 players, something which it seems Malhavoc does possess.

 

[JohnNephew]

Also, you have to understand that some people are just obsessive collectors. Some people want to have the 'complete set of all books put out by such and such company.' Can most people afford that? Do most people have spouses/significant others that would be ok with such an expenditure... I'm going to venture a guess and say no.

Contrast CCGs and RPGs. For CCGs, that obsessive collector urge drives an important part of the game's market, leading to huge financial success for games like Magic, and enabling the publishers of such games to expand and invest in all kinds of exciting new products (such as buying D&D from the failing remains of TSR, launching high-investment lines like prepainted D&D/Star Wars minis, etc.). Some would-be obsessive collectors can't shell out the money for a complete set of Moxes...should we feel bad for them, as you do for the underfunded RPG collectors?

For RPGs, most of those obsessive collectors can now satisfy their compulsion just by downloading files for free.

Knowing that file sharing is here to stay and growing, if you had $100,000 to invest in a business and you loved games but needed to make a living with your nest egg...which one would you pick for the long haul?

The difference between sharing/piracy and robbery is that when you share or pirate any kind of information, the person that you get it from still has it. When you steal something, the person you take it from no longer has it.

Similarly, if you squat in peoples' cabins or vacation homes while they're away, they still have it -- you're just putting it to good use when they're not. As long as you clean up your messes before they get back, I'm sure it's perfectly OK, whatever the law says.

And as far as this hurting small publishers, I'm going to have to say that's probably a no. Check out any major p2p network. WoTC is pretty much the only thing being shared, although I think there is some Green Ronin, AEG, and Mongoose as well. Are those small?

I saw two books of ours show up on a pirate p2p directory website last week. Two books that we sell through RPGNow, specifically (one is a core rulebook, the other an out-of-print supplement for the same). If it hurts anyone, it hurts small publishers as well.

File sharing is here to stay. Few people who have made up their minds will be swayed by arguments about whether it is ethical or if it hurts publishers/authors. There are enough unknowns and ambiguities that people will pick the evidence that they like, to support whatever they want to do and believe to feel good about themselves.

Game publishers just have to accept piracy as a fact of the landscape, and take it into account when they decide where to invest and how much. It may be that a lot of the RPG field should be ceded to amateurs and self-publishers, perhaps to business models like Greg Stolze's "ransom" plan, where once the author gets enough money an item is released free to all the world, so that piracy is irrelevant.

-John Nephew
President, Atlas Games

 

[Janx]

Lots of good points here folks.

Some extra bits, and counters:

John Nephew's point about product sales is interesting. A good point to make is that in ALL markets I've ever observed, the highest sales numbers are always withing the first 3-6 months (depending on the type of product). Basically, if you took ALL the sales you'll ever make on a product, the majority of those sales will be within the 1st 3-6 months. This is true in collectibles, books, computers, and darn near everything. The effect is probably driven by marketting, product buzz, 'newness factor' and lack of competing product.

To counter Dan the lawyer (sorry forgot your name, thread too long), from the top of page 2.
His example was of a pirate who bragged of owning 1000 titles (or some such). Dan's point was how much money those titles were worth, and therefore equated them as lost sales.

While in a strict legal sense, Dan is right, the publisher/author lost those sales, since the pirate legally should have paid them for it. However, the "pirate wouldn't have bought it anyway" side has to be examined. Let's assume we ALL had chips in our head that prevented us from doing anything illegal. If that were the case, what normal person would BUY 1000 RPG titles? Assuming they had the money to do so, of course. The answer is that no normal person would (yes, there are exceptions). So in a perfect legal world, the sale of 1000 titles still wouldn't have happened. The person probably would have bought SOME of those titles, but not all 1000. And that's really where I'm going with this. In both sides of the argument, I see a lot of "all or nothing" mentality going around. People hoard pirated stuff because it's free. It's a weird compulsion. The pirate would never have BOUGHT all that stuff. On the other hand, there is probably some reasonable subset of the collection that they would have bought. If there were a way to guesstimate that amount, that amount is the TRUE value of lost sales due to piracy (for that one individual).

Now on the technical front, I keep seeing folks say, "all you gotta do is install a P2P program..." This is kinda bogus. To distribute something on the internet (you know, that thing Al Gore invented). You simply need a website, file share, or FTP site. Websites are the vehicle of choice for public consumption (nice interface). I sure as heck wouldn't use a P2P to transmit financial data to a business partner. I'd use a file share or FTP site (better yet, an encrypted method). All 3 methods are as simple as enabling IIS or right clicking a folder and choosing "Share As" on a windows box. If you wanted your stuff to be accessible to anybody and be findable, you'd make a web site (easy to do) and host your files there, then get listed on all the popular search engines.

You don't need a P2P to do any of this for legitimate personal or business purposes. The only reason, therefore, to install a P2P, is distribute files surreptiously. I used to be able to find an download MP3 off of websites, until the RIIA started cracking down on piracy. Thus, the P2P's took over as the main source of MP3s, for people interested in getting free MP3. Musicians who make music and self-publish are likely to use their band's web page to release their free MP3 (whole songs and samples). So once again, the primary use of P2P is for the illegal stuff. While technically, you can put freely distributable material on a P2P network (and people do), there's little point to do so, and that's NOT why people use P2P's. P2P's are in use because they provide a greater level of obfuscation on the source of the files, thereby increasing the ease of maintaining the availability of pirate material.

My summary opinions are: I don't endorse piracy. I don't have a horde of stolen MP3s or PDFs. Piracy does hurt publishers and authors. Copy protection is always defeatable, and often the cost more than it saves. I haven't seen a clear answer to the problem.

Janx

 

[Lonely Tylenol]

I guess its just me. I am amazed that people even DEBATE that its bad for business.

Well, it's obviously not good for business, but it's not necessarily bad for business. Is it a mosquito, or is it a man-eating tiger? If it's a mosquito, don't worry about it, it's just a drop of blood. If it's a tiger, you might want to buy a gun. There's a lot of talk on the subject, but nobody's been able to demonstrate either way. I think it's probably impossible. Even if you can demonstrate the numbers of illegally-shared files, you can't extrapolate to lost sales. Any such extrapolation is just a guess. Would they all (as Dannyalcatraz suggests) have bought the book if they hadn't downloaded the .pdf? I doubt it. Maybe a few. Maybe some extra sales result from a try-before-you-buy situation. It's all just guesswork. Who knows?

So, the debate continues, with nothing but opinion and anecdote on either side. I'm interested in anecdote from people who actually might know something about the industry, but even publishers often just assume it must be hurting/not hurting them and leave it at that.

 

[Lonely Tylenol]

Contrary to the link's writer, I don't think many RPG downloaders think downloading is legal. There are some, for sure, but I think that's largely limited to the young and is more prevalent in the music and video downloads community.

It's legal to download music in Canada. I'm not sure if this extends to other types of media, but we pay extra on every blank piece of media as a levy to be provided to the recording industry based on a government payment plan. If I go and download the complete works of Michael Jackson, nobody can say boo because it's legal.

Even if it's not legal to download .pdfs of published works, I can see how people wouldn't decide there's a big difference between that and music, not caring about technicalities in the law that aren't well-known anyway. Canada's not the only country in which downloading music is legal, but the U.S. is, for some reason, the only location taken into account in these arguments (and if something's illegal in the U.S., it's somehow immoral for it to be legal somewhere else). I seem to remember reading that there are almost as many Canadians on the internet as there are Americans. We're just more wired. And then there's the whole rest of the world, who have varying laws of varying severity on the subject.

 

[XO]

Several Factors of Influence...

Yesterday, I packed my laptop and counters and we played a solid 11 hour session over at a friend's. The ongoing now "edge of 15th level" campaign.

At some point, I had the following open in PDF, stacked in the same window:

- 3.5 PHB
- 3E PHB (because Lightning Bolt description in 3.5 really SUCKS for dimensions)
- 3.5 DMG
- MM2
- Libris Mortis
- 3.5 MM
- Complete Divine (for spell references)
- Frostburn (quickly, spell reference)
- Player's Guide to Faerûn (more spells)
- Book of Eldritch Might
- At any given time, a few other titles


Do we own these books? Yes.

Is it feasible to run the same game w/o the PDFs? No! You can't SERIOUSLY be suggesting that I carry my bookcases over, are you ? A book is great to pour over while lying in bed, whereas even AD&D could be unmanageable without a moving van (DMG, PHB, MM, MM2, FF, UA, DSG, WSG and a few other things for good measures).

Have I ever downloaded PDFs of books I did NOT own? Yes. Had I not downloaded Scarred Lands titles, I NEVER would have bought Scarred Lands.

Will I pay for the PDF version once I've bought the book? No. In my view, I've already paid my "licensing rights". Keep in mind that many PDFs are sold at almost the same price as the book itself (WAY unreasonable) or in some cases, at a small discount. Some 10+ year old titles almost sell for a higher price in PDF form than their original cover price.

Take note that for music piracy, the issue of older media is seldom raised: I'm older, a statement applicable to a growing number of gamers (the pertinency of which I will expound upon in a second, bear with me).

Being older, I've bought vynil. Lots of it! For Pink Floyd's "Wish You Were Here", I may have bought as many as THREE vynil copies (1st worn down, 2nd as replacement, 3rd being remastered anniversary edition, or some such). I then bought the CD since those 12" black things really didn;t fit too well in that 3.5" reader

No one ever asked me if I already OWNED (had paid for) the royalties on any of these. So I paid.... And paid.... And paid again.... Four times I did! We COULD venture that recording companies, for that title ALONE (and trust me, there were MANY others), owes me THREE albums free of royalty dues.

Onwards to the RPG parallel: I bought Greyhawk and Realms when they first came out. For Realms, I cycled through 1st Ed., 2nd. and 3E. Same for Core books, not to mention the TWO original DMGs I purchased (one was getting worn down quickly from heavy use).

We COULD consider that a lot of this material is "recycled" from one edition to the next (anyone need Elminster stats for Runequest? Anyone?). Older DMs (and players) reach a point where "another" Forgotten Realms Campaign Setting book, or "another" Waterdeep title are likely to bring very little to our gaming table. I'll let you delve on the significance of that statement relative to whether or not we might purchase the product.

Have the likes of me supported the RPG industry over the years? I own roughly 35 cu.ft. of the stuff... Cubic feet? Yes, I might overwhelm smaller local shops. The full capital spent on games and gaming material over a span of 27 years averages over $1200 a year (from which we might extrapolate the following estimate: that 1cu.ft. of RPG books costs roughly $1000 buckolas). It has not been evenly spread over the years.

There are less "kids" in North America. Statistically, US demographics show people growing older. It is older than it has ever been (at 36 or 37 on average?). And Canada is WAY ahead in terms of average age (47-48). This will have a direct impact on sales volume and selling titles.

We are also becoming poorer (statistically). Debt is growing in the US at a frightening pace. Revenue is not keeping up with inflation. RPG books are probably not a priority for people who find their budget squeezed by an increase in gas prices.

The almighty buck MUST stretch further, and many will seek reviews and downloads as a management tool to get some bang for their buck. Gone the days of trial and error at a cost of $20 or $30. Some RPG books reach prices upwards of $50. You want us to give it a shot ?

Some publishers do a good job. I have always been well pleased with Malhavoc's products. WotC seems to be the butt of many complaints when we read boards. Necromancer usually has value for the money. Atlas has published some neat titles, and others that merely raised by eyebrow without further attention. The d20 Niagara may eventually be a mere trickle. A lot of the titles for that license have been.... yuck. In number of published pages, D&D / d20 and spin-offs have probably dumped anywhere from 15:1 or even 25:1 (relative to the 80's and early 90's) onto the market.

I buy from Amazon. When I can. When they deliver the promised title. I buy from my local retailer, in the following order of my purchase volume: 1) 2nd hand books, 2) sale items and 3) New titles. I buy Dragon and Dungeon from the newsstand. I used to visit my RPG retailer every 2nd week in "Ye Ole Days", now, I go twice a year.

The times they are ever achanging...

 

[Lonely Tylenol]

Knowing that file sharing is here to stay and growing, if you had $100,000 to invest in a business and you loved games but needed to make a living with your nest egg...which one would you pick for the long haul?

I wouldn't put money into RPGs, but piracy doesn't enter into it. It's just not likely to be a profitable industry for a newcomer. I'd put my money into buying an existing company that manufactures and sells medical equipment. The baby boomers are all going to need to be on life support soon, and they're still as rich as they ever were.

I'd take my profits and maybe write a couple of supplements to sell for $2 on RPGnow just for fun.

 

[JohnNephew]

But anyway, your analysis is interesting. Do you think that your experience is typical for most d20 publishers (I assume you get to chat with them more than I do), or do you think that perhaps there are some subcategories of publishers that do better or worse depending on what it is they're publishing?

Yes, I think it is typical, based on conversations I've had with publishers over the years, based on financial data I've reviewed as part of the due diligence process in providing loans/financing to other publishers, based on communication with fulfillment houses and distributors who handle multiple publishers' lines, etc. I can't give you detailed information that I have received in confidence, but I think it's not any secret that most d20 publishers, large and small, have seen sharp declines in sales. Every time a thread on the topic comes up here or on RPGNet, someone pipes in with "Company X says times have never been better!" -- which perhaps is true, but again, the proof is in what they do, not what they say. (Maybe it's from spending a few years intensively engaging in studying troubled/failing companies and short selling their stock, but I've seen a lot of companies putting on a happy face while the foundation of their business is crumbling...and I've seen disbelieving investors willing to buy shares of a company that has already declared its intention to liquidate in bankruptcy and leave common stock holders with nothing at all...)

Even in a category that is sharply declining, there are likely to be individual cases that buck the trend. Obviously Malhavoc continues to do very well, for example; but no one else has Monte Cook -- the closest thing to his name brand is WotC itself, which I am certain has done better than d20 in general. But look at other companies (including Malhavoc's publisher), and compare their current d20 release calendar with the past. Look at companies who existed before d20, published d20 books, and then went back to what they were doing before; look at the companies who have produced the most d20 books, and compare the type and number of their releases now to the past.

It could be that Atlas was producing something, as the earlier poster suggested, that was niche enough that it didn't have the staying power that WotC's generalist approach with the core books, Complete line, Races of line, well-established campaign settings, etc. did have.

This could be true. From conversations with distributors, for example, I knew that some of the generalist products were, back in the day, selling two or three times as much as niche products we were doing at the same time. (It was no problem to me, since our niche products were profitable enough at the time to justify doing them as it pleased us.) But from other conversations I know that the sales of those generalist products also declined (albeit from a higher starting level), so that a very successful generalist product in 2004, say, was probably selling half or less of what one of our niche products did in early 2001.

-John Nephew
President, Atlas Games

 

[Lonely Tylenol]

Yes, I think it is typical, based on conversations I've had with publishers over the years[...]

Okay, I'll take your word for it that the hobby, in general, is in decline at the moment. Now, is there any evidence that piracy has anything to do with this? Or is it something else--pendulum swinging back from the boom of a few years back? People just getting sick of buying more supplements after all this time? People happy with the game they're playing and not interested in modifying it further? New people coming into the market only buy the core books, so there's no growth for any other parts of the industry? Supplements actually getting worse? People quitting RPG to go play MMORPGs? People having less money to spend on luxury items (like RPGs) than they used to? Anything else I can come up with off the top of my head?

I'm not against the idea that piracy hurts the industry. But I have these standards of proof that I'd like to see met before I decide my opinions on the subject.

 

[Bagpuss]

Similarly, if you squat in peoples' cabins or vacation homes while they're away, they still have it -- you're just putting it to good use when they're not. As long as you clean up your messes before they get back, I'm sure it's perfectly OK, whatever the law says.

Guess you aren't familiar with squatters rights then?