Archive for October, 2011

Weekly News Roundup (30 October 2011)

Sunday, October 30th, 2011

Welcome to this Halloween-eve edition of the Weekly News Roundup, where you’ll read scary stories that will send chills down your spine, give you nightmares night after night, and bring forth the disturbing thoughts from the deepest and darkest part of your soul. Stories like, um, a new proposed copyright bill, and I guess something about a new jailbreak device for the PS3. Okay, not quite as scary as I first thought, perhaps.

Copyright

Starting with the copyright news as has been the custom, Halloween eve or otherwise, and we have a scary thing to report, and that’s the US House of Representative’s newly produced copyright bill, dubbed the Stop Online Piracy Act (SOPA).

Roll of money

What a typical US voter looks like, judging by what/who the politicians really listen to

First off, the title of the bill is misleading, because online piracy cannot be stopped, as history has shown us, through legislation or technical measures – people will just find a way around it as usual. But the “people’s representatives”, you know, the guy with only 9% approval these days, are trying their best to ensure the good money lobbyist have spent produce something worthy of the $$$, and so we have SOPA. SOPA is similar to the stalled PROTECT IP Act, which was stalled after one Senator with common sense (there had to be one, after all) decided that sacrificing the tenets of democracy to appease the movie industry wasn’t the right thing to do. SOPA will give the government the power to seize the assets of one industry at the behest of the most powerful members of another competing industry, namely the members represented by the RIAA and MPAA, all because of the stronger lobbying power of that industry. That’s democracy at work, folks.

And the bill extends not only to websites and domain names in the US (I think this bill will kill US jobs as webmasters and businesses mitigate the risk of domain seizures by moving their business elsewhere), it also applies to foreign websites (they might as well just write “The Pirate Bay” into the bill, if they haven’t already). And in the spirit of shifting responsibility of copyright enforcement away from the actual copyright holders towards the government, as the bill will allow the US government to lead the charge overseas and file injunctions against “bad” websites on behalf of studios like Sony and Fox. Because as you know, these small businesses don’t really have the financial resources, nor teams of lawyers, that can handle this sort of stuff, so tax payers will have to do the right thing and help out of course.

But while SOPA will make the US government the public face of copyright enforcement, the government is already doing plenty behind the scenes, specifically, in Russia. Russia’s application to join the WTO faces many hurdles, but if they are seen as friendly copyright enforcement, it will make the MPAA/RIAA happy, and then they will stop whispering bad things about Russia (which has already helped to put the country onto the “notorious piracy market” list) to the US government, which will then drop (some) opposition to Russia’s application. And so the Russia government is now making an example of two admins of the defunct BitTorrent tracker, Interfilm. The married couple now faces up to 6 years in a Russian prison, as the MPAA claims the trackers has caused as much as $1.25 billion in damages (although under Russian law, the couple may only be liable for $16,000). International diplomacy and politics in action, comrades.

Righthaven R.I.P.

This gravestone picture detailing Righthaven's possible demise is appropriate given it's Halloween-eve and all, despite having being used only last month. Plus Righthaven sort of sounds like Raven, which is very Halloween-y

But it’s not all bad news this week. With the threat of bankruptcy looming, Righthaven has somehow gotten themselves into more trouble this week, as a judge has ruled against the firm in the biggest ruling yet – $120,000 in costs that Righthaven will have to pay to Thomas DiBiase, a former prosecutor that Righthaven tried to sue for the use of an article by the Las Vegas Review-Journal. Remember that Righthaven has already said they are having trouble paying just the $35,000 ruled against them, to the point where they may have to declare bankruptcy, so $120,000 is going to be a bit more difficult. At this point, and I know I shouldn’t, I almost feel sorry for Righthaven. While what they’re trying to do is despicable, in my opinion, the way they have done is, really, just stupid. And I have a soft spot for stupid people, or law firms. The key to settlement-for-profit is to find the right marks, I mean, defendants. You pick the ones that are less likely to put up a fight, and more likely to pay up. So it’s a no go suing poor people, people with knowledge of the law (like, for example, a former prosecutor), people who have the connections to mount a good defence (for example, a former prosecutor), and people or groups that are not part of a charity, non profit, or public service organisation (for example, a former prosecutor who runs a non profit websites providing details about unsolved murder cases as a public service). Other law firms have been selecting defendants carefully and wisely, so it’s no secret. But the biggest problem with Righthaven’s approach is that, copying newspaper articles is not in the same league as copying music or movies. The people who download music and movies illegally, and their motives for doing so, are very much different to people who copy/paste newspaper articles for discussion, public discourse, or information sharing, usually without any financial benefit to themselves.

Over here in Australia, opposition to our local variety of  “copyright trolling” seems to be growing, as the boss of an ISP has signalled the company’s intention to fight the “scum” (he’s words, not mine) who are trying to profit from allegations of copyright infringement. John Linton, chief of ISP Exetel says the ISP is now taking measures and investing $200,000 in the process to do some unspecified work to make it harder for the “blackmailing scum” to target their customers. It will be interesting to see if other ISPs follow suit.

And to add to the growing movement against draconian anti-piracy measure, whether it’s legal or technical, Valve’s Gabe Newell is once again highlighting that the only way to prevent online piracy may very well mean that publishers have to compete with pirates, by doing the controversial thing of actually improving services. Once again, Newell highlighted the success Valve’s Steam platform has had in the pirate haven known as Russia, a country that publishers have said would be impossible to make money from due to rampant piracy, but is now Steam’s second largest continental European market. Apart from more reasonable pricing, the key was localisation, according to Newell, to provide Russian translated games to gamers before the pirates do, as opposed to the publisher’s tradition of waiting 6 months or more to bring out a local version. Publishers want to eliminate piracy, but they don’t really want to do the hard work of making a better (or in Russia’s case, a usuable) product. It seems you can’t have your cake and still eat it (even if the cake is a lie).

And even in the area of pricing, it seems publisher may be able to compete with pirates too. Competing with “free” isn’t impossible it seems, as Newell says their pricing experiment with the now “free-to-play” Team Fortress 2 has paid off big time, with 20% to 30% of those playing it (for free) paying for in-game stuff. Mostly hats, I guess. Just goes to show that people are willing to pay for anything if they decide, and not publishers, if there’s value in it. A variation on “free-to-play” may very well be “pay-what-you-want”, and I would love to see Steam try this one out.

High Definition

In HD/3D news, there’s not much going on, although Blu-ray market share remains suitably high and above the 30% level that, a few weeks ago, would have set new records.

However, I do have a story about Zediva’s ongoing battle with the MPAA. Zediva offered a service where people rent physical DVDs, but the company streams the DVD to users via the web, as opposed to sending them the disc.  This week, a judge ruled that what Zediva is doing is not legal and has granted the MPAA a permanent injunction, as it’s just a (not so clever) way to avoid having to pay web streaming licensing fees to movie studios, as no licensing is needed for physical disc rental. This story is only HD related because of the company’s plans (former plans now, perhaps) to stream Blu-ray movies in the future too. Zediva also has to pay the MPAA $1.8 million in damages.

Hulu

Hulu is not available in Australia and many other countries due to the lack of a global licensing scheme, which sucks for us Australians

Licensing is an interesting issue that I wanted to talk about for a while, but not about what Zediva was trying to do, which was a bit too obvious an attempt to avoid paying the fees, and offered users no real benefits compared to traditional web streaming at all  (with all of the benefits belong to Zediva). But licensing right now, I feel, is holding back innovation. The lack of a truly “global” licensing scheme means that companies like Netflix can’t truly call themselves global giants, and the likes of Amazon can’t offer overseas customers the same experience with their Kindles, even though they allow overseas buyers to buy the devices. The greed of copyright holders, wanting to eke out as much as possible from each market individually, is even hurting  some of their own initiatives, such as the recently rolled out UltraViolet cloud based digital copy scheme, which is yet again a geo-limited (AKA US and, maybe if you’re lucky, Canada, only) service. And here in Australia, we don’t have Netflix, barely a Kindle presence, no Hulu or Spotify, and UltraViolet won’t really help us (yet), and with most of these services actually making money for studios in the US, it’s a huge opportunity they’re missing out on, just so they can get a couple of thousands more from putting pressure on local distributors (which then forces prices up for local content, and pushes people towards grey imports, or even piracy).

GamingAnd finally in gaming, it appears another jailbreak device has been released for the PS3 which circumvents Sony’s latest attempts to lock down the console.

PS3 gamers with consoles still using firmware 3.55 or older can grab the $50 Jailbreak 2 device, and play games released after firmware 3.60, which feature security fixes that prevented the use of the original jailbreak device. And so the cat and mouse game between Sony and hackers continues (although maybe Sony are the mice in this analogy).

That’s it for this week. I’m really tired after a bad night’s sleep, so most likely, I will have no recollection of ever writing any of the above by tomorrow.

Weekly News Roundup (23 October 2011)

Sunday, October 23rd, 2011

Welcome to yet another edition of the WNR, as we approach the final straight of 2011. I’m going to have to squeeze this one out in quick fashion, because I’m currently having a bit of bother with one of my servers (the one that hosts the forum), and so my attention is needed elsewhere. I really really really hate server management. I really do.

Copyright

Let’s get started with the copyright news for the week. It’s a well known fact that the current White House is very much a friend to the copyright lobby, then again, it’s hard to find a politician in Washington that isn’t, considering the fair and balanced way the RIAA/MPAA spreads their lobbying efforts.

Joe Biden and Victoria Espinel

Biden and Copyright Czar Victoria Espinel were instrumental in getting the copyright lobby their ISP 'graduated response' deal, new emails reveal

But a freedom of information request by a curious Internet security researcher has revealed just how much work the Obama administration is actually doing on behalf of the copyright lobby, helping them to get a good deal against America’s largest ISPs in the recent ‘graduated response’ deal. It appears that the newly appointed Copyright Czar, Victoria Espinel, was not only on perhaps too friendly terms with the RIAA/MPAA, but may have also neglected to involve other interested parties in the negotiations, such as consumer rights groups, until it was too late. Vice President Biden’s office has also been revealed as working hard to help the music and movie industries get the best deal, but this is no surprise because Biden’s pro-copyright views were well known before he teamed up with Obama.

So once again, we have a government elected by the people that is only looking out for the interests of private corporations, because in the end, lobbyists are more important than voters in Washington, it appears. And the most depressing thing about it all is that a change of administration won’t change things, and may actually make things worse, as the RIAA/MPAA have been clever in their lobbying, much like how Wall Street does it, by giving all major parties a piece of the pie. It’s precisely things like this that make people want to occupy streets, squares, and other public venues.

While not strictly copyright related, but you can’t rule it out, but Google’s decision this week to ban FrostWire from the Android Market has people talking. Well everyone, except Google themselves, as they still refuse to release the reason why file sharing app FrostWire was given the boot. It could be related to the recent troubles FrostWire had with the FTC, in which the FTC sued the makers of FrostWire for possible privacy violations – the crux of which is that FrostWire shares downloaded files by default, and while most people don’t mind or don’t care, the FTC thought it was problematic enough to take action. But the case has since been settled, with FrostWire long ago making the required changes to its software, including the Android version, and so Google’s recent decision is a strange one, especially as it comes almost immediately *after* the settlement of the FTC case.

But once again, the biggest criticism of Google is its lack of transparency and even basic communication. Anyone that has actually tried to reach a real person who works for Google will know how hard it is, and sometimes it’s just downright impossible. App makers are also not too unfamiliar with Google bans that defy explanation, and the only information they receive (if they receive anything at all) is some vague message about violation of the terms and conditions.

For now, the FrostWire app is still available on their website, but without a listing on Android Market, all those that purchased the app will find it difficult to update to the latest version, so the Google ban is also unfair to the more than million end users who have downloaded FrostWire so far.

Google G2 Android Phone

Steve Jobs accused Android of "stealing" from iOS, a new biography reveals

And while we’re talking about Android, did you hear about the latest revelations about what Steve Jobs thought of Google’s Android? In the authorized biography that is released this week, Jobs apparently went crazy when HTC released an Android phone that Jobs thought copied too much from the iPhone. Apparently, Jobs threatened to go “thermonuclear” to “right this wrong”, even if it meant spending “last dying breath” to do so. Fortunately, from what I read, Jobs made peace with Google towards the end, and so hopefully, he didn’t spend too much time thinking about the “stolen product” Android during his last days.

This isn’t the normal sort of copyright issue I post about here though, but it just goes to shows how trivial allegations of non commercial, home user copyright abuse is, when compared to what a corporation can get up to, at least according to Steve Jobs. I don’t know if Google really is guilty in this, but I think the smartphone market is better having someone like Android competing with iOS, and it forces Apple to make iOS better as well. And with Apple’s policy of not allowing others to use iOS, someone was always going to come up with an operating system that’s  “iOS for non Apple devices”, because it’s such a huge market segment to ignore.

Getting back on track again, we also have a brewing story this week that involves the Anonymous, AiPlex and WNR. Yes, this WNR. Last week, I received an email from AiPlex asking us to remove this particular WNR edition, because AiPlex weren’t happy at the way they were portrayed in the article. But if you read the article, all it did was report on then recent events, particularly quotes published in a TorrentFreak article that appears to show AiPlex engaged in some fairly illegal denial-of-service activity against torrent websites, as part of their anti-piracy strategy. AiPlex later denied either making the quotes or alleged they were misquoted, but it was too late, and then Anonymous decided to take matters in their own hands and launched the first in a series of attacks that still continues today. Of course, most people have forgotten about AiPlex, but their latest effort to “erase history” may very well re-ignite people’s interest in the company, as apparently, a lot of bloggers also received similar messages, reports TorrentFreak.

On my part, I’ve offered AiPlex space on the WNR and in our (currently down) forum to post their version of what happened, but I’ve not heard back from them since.

High Definition

In HD/3D news, it’s been a historic week for Blu-ray (well, the history was actually made a couple of weeks ago, but we’ve only just got the data now), as Blu-ray’s weekly market share went over the 40% mark for the first time ever.

The Lion King Blu-ray

The Lion King Blu-ray was released in four separate Blu-ray+DVD combo packs, and all sales are counted as "Blu-ray only"

It was down to a bit of statistical manipulation, but it’s still a significant milestone for the format. The statistical manipulation comes from counting Blu-ray + DVD combos as Blu-ray only, and with Disney’s policy of timed exclusives for the combo version (with no Blu-ray only version, and the DVD only version coming more than a month later), all it takes is a classic re-release to push Blu-ray market share to record levels. This time, it was The Lion King that was responsible, which was released with no less than 4 distinct editions, none of which was actually Blu-ray or DVD only. The release of Fast Five also helped greatly to take Blu-ray above 40%.

Will Blu-ray push through the 50% mark this year? It could in the next few weeks, but once the real holiday season starts in December, it will be more difficult as DVD sales are high as well during this period. Blu-ray revenue, for sure, should reach record levels towards the last few weeks of December, and will probably go over the $150 million mark for weekly sales.

But the biggest threat to Blu-ray is not DVD, but perhaps web based content, as a new survey shows that 20% in the US are already enjoying web content on their primary television sets, as opposed to just on the computer. And it’s largely thanks to Blu-ray that this is the case, since Internet connected Blu-ray players have helped the likes of Netflix expand their coverage. Game consoles are probably primarily responsible, but the PS3, which is also a Blu-ray player, has been key as well. So overall, Blu-ray has been the needed Trojan Horse to get web streaming into people’s homes, and the survey conducted by Boston’s Strategy Analytics seems to show it has worked. What I found interesting was that the rate of viewing web content on TVs in Europe was much lower, 10%, and I think that has a lot to do with the lack of available free content such as that offered by Hulu, and the lack of an almost ubiquitous service like Netflix being available.

The most attractive thing about web content is probably the on-demand nature of it, as you can choose what to watch and when. And if the right content is available at the right price, stats show that people are willing to pay, and this could help fight the online piracy problem as well. And with TVs now integrating online streaming support directly, web streaming should grow considerably.

But for cinema quality HD, Blu-ray is still the king at the moment, and will be until 100 Mbps fibre connections become more common.

Not much going on in gaming, and I really need to take care of the server situation, so this is as good a place to end this week’s WNR. See you next week.

Weekly News Roundup (16 October 2011)

Sunday, October 16th, 2011

Welcome to yet another edition of the WNR. Another rather quiet week news wise, so this would otherwise be a short WNR, except I might spend a bit of time talking about the latest NPD results later on in the gaming section.

Copyright

We start with copyright news as we usually do, and we start with a quite unusual story, one that I still don’t really know what to make of.

PC gaming piracy is a big problem, I think everyone can at least acknowledge this fact (whether ever more intrusive DRM is the solution to the problem, I think, is where the debate is at the moment), but if the goal of anti-piracy is to increase revenue, and intrusive DRM doesn’t seem to be producing, why not try something else?

Vigilant Defender Questionnaire

A sample result from the Vigilant Defender questionnaire, which shows that DRM not only does not really help encourage pirates to buy games, it may even drive them to pirate in the first place

Except, I probably wouldn’t try what startup anti-piracy firm, Vigilant Defender, has tried – to actually help the spread of pirated content. Yes, you heard right, the first step in Vigilant Defender’s experiment is to actually help seed a leaked beta version of the hit game, Deus Ex Human Revolution. The second step is slightly tricky, as the version of the beta they seeded was slightly modified to drop out of the game after the first few levels, and direct users to an online questionnaire, in which they were asked questions about why they decided to pirate the game. While data collection is essential to solving the piracy problem, especially given the industry’s often biased “research” on the matter, the key question asked of gamers was “what would you be willing to pay for this game”. Not only will the answer to this particular question prove useful in finding out just why people pirate, and what price point can influence the same people to go legit, Vigilant took this one step further and proceeded to offer downloaders the opportunity to buy the full game at a price determined by average answer to this particular question. And amazingly, 8% of all those who downloaded the modified leaked beta actually went on to buy the game, at the user voted average price of $24.99 (half of the retail price) and that’s actually quite a high rate of return for games, especially when the target demographic is often described by the industry as “criminals” and “freeloaders”.

In my opinion, what Vigilant Defender tried to do was very clever, even if they went about it perhaps in too much of a roundabout way. What they’re actually advocating is a system where users vote for the price they want to play, and where pirated versions of games actually become demos of sorts. The gaming industry may not want to believe it, but a lot of gamers do use pirated games as an extended demo, and many, I’m not saying all (or even anything close to a majority), to end up buying the full version if they like the game. Game publishers, on the other than, would rather prefer people buy games they don’t like by making sure they can’t test it fully before they buy it, and perhaps that’s how it used to work before Internet piracy became ubiquitous, this kind of business model no longer works. But on the other hand, by offering downloaders cheaper version of games, it’s perhaps encouraging downloads, and this kind of distribution model would be a hard sell for game publishers. But there’s definitely something here, and perhaps a little bit of tweaking could bring us a new distribution model that takes advantage of P2P networks such as BitTorrent to not only distribute the games, but to promote them. Imagine if games came with a thin layer of unobtrusive DRM that simply nagged users to buy the game from time to time, a DRM so not annoying that release groups don’t even bother to have it (so it remains in the pirated versions floating around the net). Users would then be given an offer to “upgrade” their pirated version to the full legit version for a discounted price, but the caveat is that their save games/profiles would no longer be compatible with the full version unless they pay the full price, or some kind of incentive that still makes buying games at full price an attractive proposition. And if you want pirates to help you sell games, then let them join some kind of commission based affiliate program, where for each downloader that “upgrades”, the seeder would get a small commission for their “help”.

The even easier alternative is to lower game prices and improve services for legitimate customers, so that piracy becomes more trouble than its worth.

For Vigilant Defender though, they have a slight problem on their hands at the moment since this Deux Ex experiment was not actually approved by the publishers of the game, Square Enix, which could land the anti-piracy company in a bit of bother with anti-piracy laws.

Bad news for Australians lately on the copyright front. Only a couple of weeks ago, we got our first taste of mass copyright lawsuits, and this week, our government signalled changes to our existing copyright law which would make it even easier for mass copyright lawsuits to happen. Namely, the Attorney-General wants to make it easier for rights holders (or agents of them) to match IP addresses to real identifies, by “streamlining” the legal process. In other words, due process has to go out the window to make Hollywood and the RIAA happy. Even the idea of a ‘graduated response’ system was mentioned, at a conference sponsored by the copyright lobby, of course. Still, there were some other proposed changes that were positive, such as extending “safe harbour” to protect more types of Internet businesses, rather than just ISPs – search engines like Google and Bing will benefit the most with this proposed change. But as long as politicians still continue to believe that a single IP address is evidence enough of a “crime”, and that the “crime” itself is costing the creative industries insane amounts of money and jobs, then politicians will always be on the side of the copyright lobby, made more likely by the uneven spreading around of lobbying cash from both sides of the issue.

High Definition

In HD/3D news, this week could prove an important one for advocates of managed copy, who want legal alternatives to “ripping”. UltraViolet has been talked about quite a lot, and this week, we finally get our first taste of this “in the cloud” based managed copy system. Unfortunately, the taste is not quite palatable.

Green Lantern UltraViolet via Flixster

UltraViolet from Warner Bros. is being distributed via Flixster, and it isn't a very convenient user experience

Warner Bros. released Horrible Bosses and Green Lantern with UltraViolet digital copy included, but the way Warner has decided to deploy UltraViolet is the biggest problem at the moment. The current WB process requires users to enter in a 12-digit redemption code online, which in itself is annoying, and then users will have to sign up to Flixster, and then install the Flixster app on the device they wish to view the UltraViolet copy. And it’s all wrapped up in various layers of DRM, as you would expect.

And as WB owns Flixster, and to add to the problem, when other studios release their version of UltraViolet, they will use their own distribution network. So right now, if you asked me on which devices an UltraViolet digital copy works on, I can’t tell you, because it will depend on each studio, and this is absolutely the wrong way to go about it. For UltraViolet to be viable, I think it really has to either tie in with iTunes, NetFlix, Amazon or one of the existing players in video distribution, or all the studios have to come together and come up with a single distribution method, with all of the major devices supported (the iDevices, Android system, game consoles and Blu-ray players, at least). And then, streamline the process so it’s as simple as scanning a QR code, or just a matter of inserting the UltraViolet Blu-ray or DVD into a UV compatible player – none of this 12 digit code nonsense, or having to figure out each studio’s UltraViolet system and having to have an account for each.

A two parter Sony related story, the first part goes here in the HD section I suppose. Sony has had to issue a massive recall/repair for 1.6 million LCD TVs they produced since 2008, apparently due to a fire risk in a faulty component. It’s not exactly what the company needs at the moment, but the “good” news so far is that there haven’t been any reports of actual injuries, and that the damage so far has been restricted to the TV set itself.

GamingLess costly for Sony, financial wise, but perhaps more costly in terms of image is the news that a further 93,000 Sony online network accounts have been “hacked”, in the latest security breach.

Fortunately for Sony, the breach which led to hackers gaining access to 93,000 accounts on the Sony Entertainment Network (SEN), PlayStation Network (PSN) and Sony Online Entertainment (SOE) networks appears to have originated elsewhere. According to Sony, hackers managed to source the email/password combinations for an unspecified (non Sony) online service, and proceeded to use the same login combination to try their luck on the PSN, and managed to get access to the 93,000 accounts. Sony have disabled 33,000 SOE accounts, while have forced password changes for the rest. Sony says that credit card info was not accessed during this attack, but personal information may have been.

While Sony is right that the data breach occurred elsewhere, the security issue here still lies with Sony, because allowing hackers to launch this type of massive attack can easily be prevented. Simply limiting failed login attempts from any individual IP address or range, which is standard practice, could have prevented the 93,000 accounts from being accessed. And some kind of “CAPTCHA” system, or human verification, would have prevented the hacker’s bot based login attempts. Both of these are common techniques used to prevent dictionary based attacks. And once again, it took Sony days to spot the unusual activity on their networks, when it really should be a matter of hours if not minutes.

NPD Game Console Total US Sales Figures (as of September 2011)

Life to date Xbox 360 sales in the US (in green) is catching up to Wii sales (in blue), but the PS3 (red) languishes in third place

But while Sony’s security problems have been highlighted recently, it doesn’t seem to have seriously affected the fortunes of the PS3, as price, as always, seems to be the main driving factor behind sales. So Sony’s $50 price cut to the PS3 in the middle of August has seen PS3 sales rise, although as the September 2011 NPD US video games sales analysis shows, the rise was not big enough to really endanger the Xbox 360’s position as the best selling console in the US. The gap has closed, however, between the PS3 and the Xbox 360, while the gap between the Wii and every other console seems to be widening. If the gap remains as big as it was during September, the Xbox 360 is set to overtake the Wii as the best selling home based console of this generation (in the US) within 39 month – but it will be well after the Wii U is introduced, so that’s what Nintendo are holding on to at the moment.

Alright, that’s enough for this week I think. Hopefully more of a newsworthy week this next one, and I have a feeling it will. Have a good one.

Game Consoles – September 2011 NPD Sales Figure Analysis

Saturday, October 15th, 2011

Welcome to the September 2011 edition of our regular NPD US video game sales analysis, by my calculation, the 53rd edition of this feature. In this feature, we look at video game sales, both hardware and software, for the month of September 2011 based on data collected by the NPD. The PS3 price cut took place half way through August, but in the September data, we now having a full month worth of PS3 sales at the now $50 lower price point, so we can finally see if it was able to beat the Xbox 360, which it might have done in August if the price cut had taken place a bit earlier. But the Xbox 360 has an ace up its sleeve this month, as we see a new version of one of its major exclusive franchises, Gears of War. Read on to find out who wins September.

As NPD no longer releases full hardware sales figures, this feature is reliant on the game companies, namely Microsoft, Nintendo and Sony, to release their set of figures and based on “statement math” (that is, arithmetically calculate missing figures based on statements made). For September 2011, these are the statements made by the gaming companies:

  • Nintendo reveals the Wii sold 240,000 units, with 260,000 3DS consoles, and 145,000 DS (via PR email)
  • Microsoft revealed 438,000 Xbox 360 hardware units sold, with 42% of the home based console market share (source)
  • Sony did not reveal exact figures, but said that the PS3 hardware sale increase 20% year-on-year (Sony statement, via Senior Director of Corporate Communications at SCEA, Patrick Seybold)

Unfortunately for this month, Microsoft and Sony’s statements do conflict with each other a bit. Using Microsoft’s statement, PS3 sales can be deduced to be 364,857 units, but according to Sony’s own statement, the figure is more like 374,400 (20% more than September 2010’s 312,000). Obviously, there are rounding errors from all the company’s statements, so giving Sony the benefit of the doubt, we’ll presume the PS3 sales figure for September 2011 is the higher 374,400.

And so the figures for US sales in September 2011 are below, ranked in order of number of sales (September 2010 figures also shown, including percentage change):

  • Xbox 360: 438,000 (Total: 28.8 million; September 2010: 483,989 – down 9.5%)
  • PS3: 374,400 (Total: 17.7 million; September 2010: 312,000 – up 20%)
  • Wii: 240,000 (Total: 36.6 million; September 2010: 254,000 – down 5.5%)
NPD September 2011 Game Console US Sales Figures

NPD September 2011 Game Console US Sales Figures

NPD Game Console Total US Sales Figures (as of September 2011)

NPD Game Console Total US Sales Figures (as of September 2011)

My prediction from last month was:

I think the Xbox 360 will still come out as the top selling console for September 2011, mainly due to ‘Gear of War 3′, but the PS3 will definitely come closer than it did this month, and with ‘Resistance 3′, it too might benefit from a platform exclusive. The Wii will be third. Games wise, ‘Gear of War 3′ looks set to be a top seller, despite being a platform exclusive release. ‘Resistance 3′, on the other hand, doesn’t look to have the same effect, although it will still sell well. Combined platforms sales may even push ‘Dead Island’ to the top of the charts.

I got the hardware ordering spot on, although it really wasn’t that hard to predict what was going to happen. The PS3 did get closer to the Xbox 360 sales, but it’s clear now that the 360 is now the dominant console in the US, and not even a PS3 price cut can affect its status it seems (unless that price cut was a more substantial $100, for example). For the game predictions, Madden was actually the top selling title, followed by Gears of War 3. And ‘Dead Island’ did manage to put its way high up in the charts, in 3rd place. Resistance 3, on the other hand, only finished 7th, not the worst result, but the average critical response to the game may have had some effect.

So the Xbox 360 continues its winning streak, by not only becoming the dominant home based console, but it’s also the best selling console for September, period. Looking at the life to date sales numbers, the Xbox 360 continues to pull ahead of the PS3, and continues to get closer to the Wii, to the point where the difference between the Wii and 360 numbers is actually less now than the difference between the 360 and PS3 numbers. Because of the Xbox 360’s dominance with multi-platform releases in North America, namely that if the same game is on multiple platforms, the Xbox 360 version is usually the most popular, the hit releases planned for the next few month starting with Batman: Arkham City and Battlefield 3 next month, and MW3 and Elder Scrolls V: Skyrim in November, will all benefit the Xbox 360 more. The it appears that the 360’s exclusives, such as Halo and Gears of War, appear to be far more popular than the PS3’s line up, including ‘Resistance’ this month.

But you cannot say the PS3 performed badly for September – after all, it was the only console to see year-on-year growth, but just like how the other consoles found it difficult to compete with the PS2 in the last generation, the PS3 is having a hard time trying to catch up to the Xbox 360 (and Wii, for the early parts anyway) in this generation (although the gap between the consoles is much less pronounced than the last generation). Taking off my fanboy hat for a moment, the truth is that both the PS3 and Xbox 360 are excellent game consoles with excellent game line ups and fantastic multimedia capabilities. Each console has their own pros and cons, and thanks to the Xbox 360’s head-start, the Wii’s (then) innovative control system, and the PS3’s Blu-ray drive, we now have a much more balanced set of competitors, and that can only be good for gamers, who should consider themselves lucky to be able to enjoy so many great games in the last few years.

The Wii, right now, is the only loser, but it’s not something Nintendo are unaware of, and the Wii-U will set to address many of the shortcomings of the Wii console, but also maintain Nintendo’s reputation for producing fun, family based games.

For game sales, Madden’s delay from August to September allowed it to rule the roost for the month, but Gears of War 3 would be considered the best selling Xbox 360 game for the month, the Madden ranking includes all platform sales. Dead Island was the only original franchise in the top 10, and it did well to come in 3rd, but it also shows that, unlike movies, gaming sequels are actually welcomed by gamers, and usually are huge improvements on the original, not just an opportunity to cash-in (take note Hollywood). FIFA’s high ranking highlights the growing popularity of “soccer” games, beating NHL 11, something it didn’t do last year this time. And a 10th place for Warhammer 40,000: Space Marine is a good result for the franchise. Electronic Arts are the real winners, with 3 of the top 10 titles belonging to them, and the all important first place too. Here’s the full software sales chart for September:

  1. Madden NFL 12 (EA, Xbox 360, PS3, Wii, PS2, PSP)
  2. Gears of War 3 (Microsoft, Xbox 360)
  3. Dead Island (Deep Silver, Xbox 360, PS3, PC)
  4. FIFA 12 (EA, Xbox 360, PS3, Wii, PS2, PSP, 3DS)
  5. NHL 12 (EA, Xbox 360, PS3)
  6. Deus Ex: Human Revolution (Square Enix, Xbox 360, PS3, PC)
  7. Resistance 3 (Sony, PS3)
  8. Lego Star Wars III: The Clone Wars (LucasArts, Wii, NDS, Xbox 360, 3DS, PS3, PSP, PC)
  9. Call of Duty: Black Ops (Activision Blizzard, Xbox 360, PS3, Wii, NDS,PC)
  10. Warhammer 40,000: Space Marine (THQ, Xbox 360, PS3, PC)

Time to make my usual prediction. I think the hardware situation will remain largely the same. Games wise, Batman: Arkham City and Battlefield 3 go head to head, with Forza 4 on the Xbox 360 possible making the top 10 as well as a platform exclusive.

See you next month.

Weekly News Roundup (9 October 2011)

Sunday, October 9th, 2011
ImgBurn 2.5.6.0

ImgBurn 2.5.6.0 has just been released

A pretty quiet week in terms of news, with one big news story. I am of course talking about the premature death of Steve Jobs. But since then, on almost every web forum that I visit, there has been discussions on the reactions to his death. For me, Jobs was a brilliant business man that shaped the many industries he was part of – you can say that he didn’t invent digital music players, smart-phones or tablets, but you can’t deny that he made them devices that everyone wanted, which is perhaps the hardest task of all. And that’s why he will be a great loss to the IT and consumer electronic industries.

As for other news, as mentioned earlier, it was a pretty quiet week. I want to mention that a new version of the ever useful ImgBurn software has been released this week as well (and you can download the latest version here). Digital Digest helps to host the official website and download links for ImgBurn, and combined with some networking issues (which has just been resolved, thanks to a concerted effort by me and the tech support team at my web host, SoftLayer), there might have been some interruptions to parts of our website in the last few days, and so I would like to apologise for any inconveniences caused. It’s all good now though, so let’s get started with the WNR.

Copyright

And as usual, we start with copyright news. In fact, copyright news is all we have this week actually, so this will be a pretty short WNR. We start with possibly good news for those “named” in the original ‘The Hurt Locker’ mass copyright lawsuit, as more than 22,000 defendants has been voluntarily dismissed by the people behind the lawsuit, the producer of the film, Voltage Pictures (represented by everyone’s favourite law firm, the US Copyright Group).

Of course, many of the 22,000 might have already paid up to settle the case, and so perhaps, it’s not such great news, or even news. Unfortunately, more than 2,300 IP addresses, and some named defendants, are still part of the lawsuit. I don’t even like to use the term “defendant”, because an IP address is not enough to link a person to the alleged crime. But until the legal establishment clue up to just how the Internet works, and the copyright lobby continue to mislead those in charge about the technical aspects of copyright infringement, we’ll just have to put up with the likes of Voltage and USCG.

Kill the Irishman - Movie Poster

An Australian firm is following the footsteps of firms in the UK and US by using downloaders of the film 'Kill the Irishman'

Even those not in the United States, it seems. The big news here in Australia this week was that mass copyright lawsuits have reached their way down under, and up to 9,000 IP addresses have been found to have downloaded the film, ‘Kill the Irishman’. The firm Movie Rights Group (MRG) is Australia’s answer to the USCG, and they are pursuing the case for the producers of the film, and have already contacted ISPs to get the contact details of subscribers. But MRG appears to want to do things a bit different, have deliberately avoided including IP addresses in the lawsuit that appears to be from public Wi-Fi networks, or basically anything that could cause them trouble in court, and that’s probably a smart move (Righthaven take note). I don’t think we have a statutory damages system in Australia for copyright infringement, and so MRG will have to be a bit creative with their warnings of just how much people could be fined if they do not settle the case by paying the required settlement fee. And MRG will have to be careful, as the judges here aren’t always as friendly to the copyright lobby as judges in the US, not that I think MRG will even try to take a single case to court anyway (not really worth the risk or the financial expenditure, again, Righthaven take note). Unfortunately, ISPs here seem to be more than willing to pass on user details, and I think the verdict from the AFACT vs iiNet trial might be influencing their decision here – a trial that ISP iiNet won, but there were enough decisions in there to allow MRG’s operation to move forward.

Now, some have already questioned the motives of firms like the USCG and MRG, in that many believe they don’t really care about stopping piracy, and that their operations are nothing more than ones designed to generate revenue. But even if their motives are purely about stopping piracy, is piracy a big enough problem to warrant such a response? And would you not expect film distributors Miramax would be the first to argue that, yes, piracy is indeed the biggest problem facing the film industry. But apparently, that’s not so, says Miramax CEO Mike Lang. Instead, Lang says, in a keynote discussion session at the MIPCOM conference with Netflix’s content officer Ted Sarandos, that market monopolies, such as the one that Apple enjoys in the the music business, is the biggest danger. One might say that Netflix is quickly developing a monopoly of their own, if they don’t have one already, but Lang does point out that Miramax made deals with both Netflix and Hulu, in the hope that increased competition would help prevent an Apple iTunes like monopoly forming for the movie industry as well. On the issue of piracy, both men agreed that, it’s not as big an issue as others in Hollywood believes (or wants others to believe). Both men identified innovation, or the lack of it, as one of the driving factors behind web piracy, and that increased innovation should help fight the piracy problem. Sarandos interestingly noted that most people don’t actually want to pirate content (except for maybe college students, he joked), and that they’ve been, in some ways, forced to do so due to the industry not being able to respond to their needs quickly enough. If there’s prove of wisdom in Sarandos’ words, then all you have to do is to look at the growing strength of Netflix to see that, if there is a legitimate service at a good price, people will pay that price.

But it appears that the only real innovations that Hollywood has come up recently has been one form of DRM or another, or great services crippled by DRM. And new research show that the use of DRM could actually increase piracy rates. Professors from Rice and Duke University have released a paper arguing that if content holders stopped using DRM, this will actually lead to a drop in piracy rates. This might seem counter-intuitive, but as I’ve spoken about many times before in the WNR, DRM only really affects paying customers, since other than the selected few hackers that have to deal with it and try to remove it, the majority of the pirating population never have to even think about DRM (and many paying customers also resort to piracy so they don’t have to think about DRM as well). And so you have a technology that doesn’t work to stop piracy, and only affects paying customers, and this makes pirated products more attractive than legitimate buys, and how does this not help to increase the popularity piracy? The marketing professors also noted, from their own research, that decreasing piracy does always lead to increased revenue, and that in some cases, the reverse is true – lower piracy equals lower sales! Again, this doesn’t surprise me, because piracy allows people to test products and content before they buy, and while many won’t bother to pay for it, some will, and will do it with confidence.

So if DRM may actually cause piracy, why not ban it? Which is what the European Greens and the European Free Alliance, of which the Pirate Party is a member of, thinks should be done in Europe. The Greens have released a new position paper on copyright reform, and in it, they call for the ban of DRM. Their argument is slightly different to that of the University professors’, in that the Greens believe that DRM allows corporations to overrule existing copyright laws, especially in the area of fair use, and that is a threat to government wishing to provide a fair and balanced copyright platform. But the most interesting change the Greens have proposed is the complete legalisation of file sharing of copyrighted content, but only if the file sharing is personal,non commercial. Basically, if the Greens’ proposal becomes law, it would be legal to download music, movies and games from file sharing networks such as BitTorrent, as long as money did not exchange hands. Yeah, I can just see the RIAA, MPAA embracing these changes. The fact is that tougher copyright laws have not worked to stop piracy, and it has only allowed the likes of the USCG and MRG to take advantage, sucking money out of both consumers and the creative industries, while piracy continues to climb. As the Greens see it, the only way to solve the piracy problem is to increase competition, force content holders to compete with pirates by taking away their technical and legal solutions (none of which has worked, BTW), and so force content holders to start innovating, force them to offer a superior service and superior products, as opposed to punishing legitimate consumer, the innocent people who get caught up in mass copyright lawsuits, and investing in expensive DRM solutions that don’t even work. The net effect is to force companies to learn from the likes of Apple and Netflix, and let go of their ageing and dying business models, and I don’t think that can be a bad thing.

Not much happening that’s interesting enough in the other topics, so this brings us to the end of this fairly short WNR. See you next week.