Gabe Newell’s keynote from DICE 2009
G4TV’s Bryan Leahy live-blogged the keynote that Valve founder and director Gabe Newell gave at DICE 2009 today. The theme of the speech was “Entertainment as a Service.”
Newell had many interesting things to say. The central point of the keynote was that, through Steam, Valve is selling Team Fortress 2 as a service rather than a product, using frequent updates (bug fixes, achievements, and new content) to create more value for customers.
But of most interest to TeleReaders will be the part of Newell’s talk that dealt with his feelings toward DRM and piracy.
Gabe doesn’t believe that pirates are really seeking to get things for free. They are people that spend thousands on their PC’s and internet service. He believes that pirates are beating companies on service. He cites TV shows not available in certain parts of the world. Pirates have TV shows up on the web minutes after they are finished airing.
DRM decreases service value for customers. It also makes pirated copies of games look more appealing. Anecdotal evidence appears to suggest that DRM is increasing and not decreasing piracy.
Newell believes that since it is not possible to outcompete pirates on price, businesses must instead outcompete them on service—which is what they are doing with Team Fortress 2. As Leahy puts it, “Valve aims to touch their customers in some way every three weeks, not every three years when a new game is shipped.” Certainly their Steam download service makes it easier for them to maintain close relationships with and market directly to their customers.
By an odd coincidence, I returned to Team Fortress 2 today (for the first time in several months) well before hearing about Newell’s keynote, and was pleased to notice that the Engineer class (my favorite) had received some newly upgraded abilities. This is exactly what Newell meant when he talked about “touching their customers.”
February 19th, 2009 at 6:28 am
I’m kind of excited about the potential behind a “service” for games myself. Though it goes both ways. Great we could get easy, fast and frequent updates. Bad that it could help further the whole mico-billing crap and motivate developers to hold features and game elements back even more so they can charge by the piece and nickly-dime us to death.
I don’t mind paying for extra songs in Rock Band if it already comes with hundreds. But I’d be pissed off if it came with 3 songs then you had to pay for each new song you wanted to play…and that is what I fear as we move closer and closer to streaming/download marketplaces.
But yeah, I had to jump on Team Fortress 2 today as well and was happy to see some changes (for the better)
Ron (AKA GameCridick.com)
February 19th, 2009 at 10:24 am
It’s totally true that pirate sites win on service. Oh if only I could find a legitimate source that offered the same service! I’d happily pay say $20, or $1 per show or something reasonable. Every time I put in a DVD and have to sit through the stupid “It’s illegal to copy this” screen (in English AND in French), unable to FFWD through I think to myself - wow, I could have downloaded this and not have to waste my time. Why is the free version better than the one I paid $20 for? When I toured the city looking for the King Kong DVD and stuck out in store after store I thought, why am I working so hard to spend $30? I could have spent 2 mins finding the download from the comfort of my couch. Well, I did it because I want Peter Jackson to make more films. But sheesh… why create such a barrier to my efforts? Yeah, I could also have bought it online, but even that would take longer than uTorrent, what will filling out visa and shipping info, and then waiting a week for delivery. The Pirates still win on service over Amazon.
With most ISPs creating download caps, I have no idea why they have not also created an all you want TV/movie download package for say $15 a month on top of your basic broadband fee. I’m sure in Canada Rogers is loosing cable TV money to people who just use their cable Internet to download shows. For a reasonable charge why not give them a legitimate option? A Rogers licensed uTorrent server if you will. Might need some government legislation, but set up something like they have with music, where all music downloads and copying is legal, and the govt collects a hardware levy and distributes money to artists. Have Rogers charge a fee they split with the govt, and the govt distributes the money to media companies. That saves Rogers or Bell or whoever from having to sign an agreement with every media producer out there. Acknowledge the fact that you can’t stop uTorrent, and still get content creators compensated. Broadcasters or whoever can still create value add services on top of torrents, kind of like iTunes. People in Canada can download music for free, but many still buy from iTunes, as I guess they get some added service there? Mainly I suppose iTunes is a bit easier to use than uTorrent for the non-tech savvy. Also I know many Canadians are unaware that torrent or Limewire etc. downloads are legal, so they pay for music twice when they buy from iTunes. Ahh, the price of ignorance
Anyway, music, TV, movies, BOOKS - the business world must acknowledge that the cost of duplication and distributions is (virtually) free and adjust their business models or loose out to the free/black market. Books are the last medium to move to digital, and won’t really make the full transition until there are good cheap portable eReader devices available, much like with music and mp3 players. Once the devices are ubiquitous (I’m thinking about by 2012) book piracy will start to hit it’s peak. Actually, that might also be about when movie piracy hits a peak also, as more people have media PCs connected to their home theatre setups. At the moment for most of North America, it’s still a fair bit of work to move a movie from the web onto your bigscreen TV.