DLC is a thorn in the side of modern games

Aceedwin · Mar 17, 2011 9:38 PM

riverhippo wrote:

Aceedwin wrote:
riverhippo wrote:
Gaming companies can sometimes attempt to overprice things, but you guys act like they're as bad as oil companies.
And what would be wrong with oil companies? You don't like your electricity? You know, the stuff you're using to power your computer as you read this.
Well, I don't know how old you have to be to get a driving permit in London, but it's safe to say you're not actually paying for gas to fill up your car. And until you do, it's not fair for you to make such an argument. Oil companies are indeed going to hell.

Lol, I can't make an argument because I'm not in a position of bias?

You do realise they have a good reason. Or rather, several good reasons. Civil unrest in countries that supply a lot of oil, China's new ravenous hunger for oil (thanks to their new love of cars (thanks to the growth in their economy)), and electricity's spread.

Neotyguy40 · Mar 18, 2011 12:35 AM

Aceedwin wrote:

riverhippo wrote:
Aceedwin wrote:
And what would be wrong with oil companies? You don't like your electricity? You know, the stuff you're using to power your computer as you read this.
Well, I don't know how old you have to be to get a driving permit in London, but it's safe to say you're not actually paying for gas to fill up your car. And until you do, it's not fair for you to make such an argument. Oil companies are indeed going to hell.
Lol, I can't make an argument because I'm not in a position of bias?
You do realise they have a good reason. Or rather, several good reasons. Civil unrest in countries that supply a lot of oil, China's new ravenous hunger for oil (thanks to their new love of cars (thanks to the growth in their economy)), and electricity's spread.

I'm putting 1,500 gems on River Hippo winning. And another 1,000 on Clock-la getting banned without even being in the conversation.

riverhippo · Mar 18, 2011 4:03 AM

Well the Supply and Demand theory is a load of bull in this situation.

If you're selling muffins at $1 a piece and you have a dozen to sell, a proper marketing strategy would be to sell all 12 muffins at full price before the next batch is ready. The target price is matched when the supply meets the demand in the allotted time.

Now if people think $1 is too expensive, you could simply decrease the price to 50 cents to sell muffins faster. And you could increase the price if the muffins are irresistible and people are buying them faster than you can make them.

This law of economics is all good and smart. But it doesn't work for products like oil. It also doesn't work for things like software, electricity, and water.

If you created a really good computer program that improves your computer speed, let's say, you would eventually be inclined to sell it online. If all of the sudden, more and more people bought your program, you might consider increasing the price not because you are 'running out of programs' but because it will allow you to make more money. Just because demand increases doesn't mean supply decreases. If an electric company who sells electricity to homes and business has more clients to serve, the price does not usually increase. Productivity will increase. Efficiency must increase. The money the company makes increases. The decline in product may initially occur, but it is made up overwhelmingly by the extra money that is made. If this was not true, then random homes would suddenly not have power because "there isn't enough energy." This only really happens though during natural disasters and unexpected failures.

Now oil, as we learned in 4th grade, is a non-renewable resource, which means that eventually the Earth will be emptied of all it's crude oil due to drilling. But we are not anywhere close to that. I know this because there are about 800 million gas-powered vehicles in the world that use those non-renewable resources everyday.

Lets say before oil was needed to power cars and other things, oil was priced at $0/gal, because it was worthless. But now, today, the U.S. uses over 20 million barrels a day, more than any other country, and so the price sky-rockets to about $0.89 a gallon. Yikes. But it's ok, right? But now the second oil consumer in the world, China, consumes 7.5 million gallons a day. Now the price skyrockets to $2.50 a gallon. Yikes, um wait a minute... ...doesn't really make a whole lot of sense.

So the "China using more" argument is dumb. You might as well say, "the oil companies have to increase the price because they are making more money." It doesn't make any sense.

As for the civil unrest, I can slightly agree with that. However, if any moment would pass where the United States stopped buying oil from the middleast, those countries would probably have a different perspective on the whole thing. People think Saudi Arabia, Iran, and Iraq have the U.S. by the balls just because they have oil that we "need." The fact is, Canada competes very well with them and drills about 13% of the oil in the world. So the country competition is there. Some politicians call it an 'oil reserve.' I like to call it 'shopping around.'

When I watched the tragedy hit Japan on the news that one morning, I was sad, then angry. Because one of the reporters singled out a situation at one of Japan's oil refineries being affect by the elements. Are we really supposed to believe that oil prices will go up just because of an accident. THIS IS A POLITICAL PLOY!!!

Long story short, the oil companies can increase the price for one reason:

1. Because they can.

Swaffy · Mar 18, 2011 6:14 AM

Neo, it's not a flame war. It's an informal debate.

riverhippo · Mar 18, 2011 6:24 AM

Swaffy wrote:

Neo, it's not a flame war. It's an informal debate.

Swaffy, it's not an argument. It's an observation.

Swaffy · Mar 18, 2011 6:48 AM

Informal Debate ≠ Argurment
Debate ≠ Informal Debate
Debate ≠ Arguement

Aceedwin · Mar 18, 2011 7:19 AM

riverhippo wrote:

Well the Supply and Demand theory is a load of bull in this situation.
If you're selling muffins at $1 a piece and you have a dozen to sell, a proper marketing strategy would be to sell all 12 muffins at full price before the next batch is ready. The target price is matched when the supply meets the demand in the allotted time.
Now if people think $1 is too expensive, you could simply decrease the price to 50 cents to sell muffins faster. And you could increase the price if the muffins are irresistible and people are buying them faster than you can make them.
This law of economics is all good and smart. But it doesn't work for products like oil. It also doesn't work for things like software, electricity, and water.
If you created a really good computer program that improves your computer speed, let's say, you would eventually be inclined to sell it online. If all of the sudden, more and more people bought your program, you might consider increasing the price not because you are 'running out of programs' but because it will allow you to make more money. Just because demand increases doesn't mean supply decreases. If an electric company who sells electricity to homes and business has more clients to serve, the price does not usually increase. Productivity will increase. Efficiency must increase. The money the company makes increases. The decline in product may initially occur, but it is made up overwhelmingly by the extra money that is made. If this was not true, then random homes would suddenly not have power because "there isn't enough energy." This only really happens though during natural disasters and unexpected failures.
Now oil, as we learned in 4th grade, is a non-renewable resource, which means that eventually the Earth will be emptied of all it's crude oil due to drilling. But we are not anywhere close to that. I know this because there are about 800 million gas-powered vehicles in the world that use those non-renewable resources everyday.
Lets say before oil was needed to power cars and other things, oil was priced at $0/gal, because it was worthless. But now, today, the U.S. uses over 20 million barrels a day, more than any other country, and so the price sky-rockets to about $0.89 a gallon. Yikes. But it's ok, right? But now the second oil consumer in the world, China, consumes 7.5 million gallons a day. Now the price skyrockets to $2.50 a gallon. Yikes, um wait a minute... ...doesn't really make a whole lot of sense.
So the "China using more" argument is dumb. You might as well say, "the oil companies have to increase the price because they are making more money." It doesn't make any sense.
As for the civil unrest, I can slightly agree with that. However, if any moment would pass where the United States stopped buying oil from the middleast, those countries would probably have a different perspective on the whole thing. People think Saudi Arabia, Iran, and Iraq have the U.S. by the balls just because they have oil that we "need." The fact is, Canada competes very well with them and drills about 13% of the oil in the world. So the country competition is there. Some politicians call it an 'oil reserve.' I like to call it 'shopping around.'
When I watched the tragedy hit Japan on the news that one morning, I was sad, then angry. Because one of the reporters singled out a situation at one of Japan's oil refineries being affect by the elements. Are we really supposed to believe that oil prices will go up just because of an accident. THIS IS A POLITICAL PLOY!!!
Long story short, the oil companies can increase the price for one reason:
1. Because they can.

Okay, you seem to be missing the point. We have indeed only recently got to the halfway mark of drilling all the oil on Earth. But the part you appear to be missing is that oil companies cannot simply get the oil. Oil drilling is a lengthy process, and responding to more demand is difficult. So the oil companies were supplying, say, 40 million barrels a day. But then China and India, and all the other rising third-world countries bump it up to 50 million, maybe. Do you think the oil companies can just magic up an extra 10 million barrels per day? No they cannot.

So, there is more demand than supply, and this drives prices up, as a basic law of economics. Because people are willing to pay more to get the oil that there is. So, you know, supply and demand, still kinda holding up there, regardless of your refusal of its existence in a huge part of world economics.

Canada is all well and good, but 13%? You think that because 13% of the world's oil is stable, it'll all be well and good? Do you think that Canada could supply all our oil, because that's what you're implying?

Oil will probably go up in price in that area, because now the area has to buy from other refiniries. But I'm slightly at a loss as to why you think that anecdote is relevant.

riverhippo · Mar 18, 2011 7:27 AM

OK, but what you don't understand is that if gas is $3.00 a gallon in the states, the US will use 20 million barrels a day. If gas goes up to $4.00 a gallon, the US will use 20 million barrels a day. The demand will not go down, it just wont. So, despite all of these efforts to slow the drilling of oil because they "can't do it," demand will simply stay the same.

Neotyguy40 · Mar 18, 2011 11:47 AM

The POINT River Hippo is making is that DLC is not a product that they can 'run out of'. Therefore, there is an unlimited amount of supply.

The law of Supply and Demand does not apply here because that would mean DLC would be completely free.

I personally think it should be called the law of Productivity costs and Demand. That would make more sense. However, consider the publishers barely have to pay at all for publishing their game...

Aceedwin · Mar 18, 2011 5:12 PM

River: All right, oil companies are not all united under one banner. They are competitors. That's why they won't all just raise the price by a dollar. Because if they did, their competitors would not, and they'd get all the business. It's a similar story with production. Why would they want to try to slow production? They'd only benefit their competitors. Unless they want to downsize. If any given oil company reduced their production or increased their price, they'd only lose out, unless everyone did it, and they won't.

Have you learnt about decision theory? Try applying it to this situation.

Neo: Actually, we seem to be arguing about oil companies as the central theme now, rather than an analogy. Who knew?

What you're saying though, Neo, makes sense. But that is because the DLC is not "goods". Or at least, not in the conventional economic sense.

Interestingly, when one has infinite supply, but still a one-time cost (I'm ignoring the minor server costs it must take to put these things in a downloads store), the law is reversed. The more people who buy it, the less they need to charge. After all, if it costs $3 million to make a DLC (just as an example), and only a million people are predicted to buy it, the company has to put the price at $3. But if 2 million people buy it, they can afford to charge $1.50. Interesting that.

ontels · Mar 18, 2011 6:35 PM

I stop reading debates once the posts become more than two paragraphs....unless I'm involved ofcourse.

riverhippo · Mar 18, 2011 7:10 PM

Aceedwin wrote:

River: All right, oil companies are not all united under one banner. They are competitors. That's why they won't all just raise the price by a dollar. Because if they did, their competitors would not, and they'd get all the business. It's a similar story with production. Why would they want to try to slow production? They'd only benefit their competitors. Unless they want to downsize. If any given oil company reduced their production or increased their price, they'd only lose out, unless everyone did it, and they won't.

Unfortunately, that's not how it works either. Oil companies agree in unison the increase of a price altogether, so that everyone makes more money. It's highly immoral. And while OPEC is doing a lot of thing to prevent those kinds of things from happening, some of it still does.

Aceedwin · Mar 18, 2011 7:19 PM

Huh, I did not know that. Citation needed?

But if that's true, I wouldn't call it immoral. Just good business.

Neotyguy40 · Mar 18, 2011 8:33 PM

Aceedwin wrote:

River: All right, oil companies are not all united under one banner. They are competitors. That's why they won't all just raise the price by a dollar. Because if they did, their competitors would not, and they'd get all the business. It's a similar story with production. Why would they want to try to slow production? They'd only benefit their competitors. Unless they want to downsize. If any given oil company reduced their production or increased their price, they'd only lose out, unless everyone did it, and they won't.
Have you learnt about decision theory? Try applying it to this situation.
Neo: Actually, we seem to be arguing about oil companies as the central theme now, rather than an analogy. Who knew?
What you're saying though, Neo, makes sense. But that is because the DLC is not "goods". Or at least, not in the conventional economic sense.
Interestingly, when one has infinite supply, but still a one-time cost (I'm ignoring the minor server costs it must take to put these things in a downloads store), the law is reversed. The more people who buy it, the less they need to charge. After all, if it costs $3 million to make a DLC (just as an example), and only a million people are predicted to buy it, the company has to put the price at $3. But if 2 million people buy it, they can afford to charge $1.50. Interesting that.

So why do downloadable games cost more if more people buy it? Because the same law applies, not reversed. Would you rather have 1 million people buy a $3 game? Or 2 million people buy a $3 game? They don't decrease the amount the game costs just 'to make ends meet'. They do that because they want money. Publishers are greedy, and we should just cut out the middleman and allow game developers to sell directly to the customer. Game studios get payed a fixed wage and get no royalties for each game sold. This makes it so game designers have no incentive, which requires more man-power to get done what a smaller group could get done. Ergo, why many small team $1 million games can match and in many cases outperform $50 million games.

Aceedwin wrote:

Huh, I did not know that. Citation needed?
But if that's true, I wouldn't call it immoral. Just good business.

It's called an informal trust agreement. They're actually illegal, but congress gets payed by lobbyists of the oil companies who don't do anything about it. It's not good business, it's called monopolization and it is relying on money to get and keep hold of more money.

A couple years ago, there was a patent of an engine that allowed cars to go almost 50 miles per gallon. A company was made to develop the engines, but the oil companies didn't want that, so they decided to buy out the company and make it illegal for anyone else to use the patent.

Aceedwin · Mar 18, 2011 8:42 PM

Well, you can go hang with the Chinese if you don't like capitalism, right?

Ah well, looks like I'm wrong. But very interesting how infinite supply reverses the law in theory. I wonder what infinite demand would do.

Neotyguy40 · Mar 18, 2011 8:49 PM

Aceedwin wrote:

Well, you can go hang with the Chinese if you don't like capitalism, right?

I like freedom, but that doesn't make me an anarchist, does it?

There is a special balance between the left (communist) side and the right (anarchist) side. It's called democracy. You are confusing Capitalism with Free-market economy.

Aceedwin wrote:

Ah well, looks like I'm wrong. But very interesting how infinite supply reverses the law in theory. I wonder what infinite demand would do.

Unfortunately, theories in economics don't tend to work out very well, because if they did we would never have a recession again. You can find out about unlimited demand when the world starts running out of water though. :-P

riverhippo · Mar 18, 2011 11:03 PM

Oil companies, oil companies, blah... blah... blah.... <insert off-topic argument here>. And that's where babies comes from.

The moral of the story is, if oil companies weren't so greedy, DLC would be more enjoyable, somehow.

#26 Mar 17, 2011 9:38 PM

Re: DLC is a thorn in the side of modern games

#27 Mar 18, 2011 12:35 AM

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#28 Mar 18, 2011 4:03 AM

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#29 Mar 18, 2011 6:14 AM

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#30 Mar 18, 2011 6:24 AM

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#31 Mar 18, 2011 6:48 AM

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#32 Mar 18, 2011 7:19 AM

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#33 Mar 18, 2011 7:27 AM

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#34 Mar 18, 2011 11:47 AM

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#35 Mar 18, 2011 5:12 PM

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#36 Mar 18, 2011 6:35 PM

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#37 Mar 18, 2011 7:10 PM

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#38 Mar 18, 2011 7:19 PM

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#39 Mar 18, 2011 8:33 PM

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#40 Mar 18, 2011 8:42 PM

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#41 Mar 18, 2011 8:49 PM

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