Posted by on August 16th, 2010 in Articles

Digital download services like GamersGate and Steam are quickly becoming the dominant platform for PC game sales. And with a constant stream of interesting deals and publicity, there doesn’t seem to be an end in sight for their growth.

I’ve already covered how this is a positive development and highlighted some of the advantages of purchasing a digital copy over a physical one. But there are downsides to these new services as well and most employ highly antiquated business practices like regional restrictions and retail pricing.

With the immense growth of digital distribution the failings of these platforms also become ever more pronounced. There is still a long way to go making these distribution services into the useful tools that gamers expect and much of its potential seems to be held back by antiquated or downright ruthless business practices.

The pricing of downloadable games is the most disconcerting aspect of the current digital download platforms. New games that cost 50 euro in retail carry the same price tag on Direct2Drive, GamersGate, Impulse and Steam despite cutting out manufacturing, material and shipping costs on their end. The end product is less valuable to the customer due to the lack of physical goods and also much less expensive to produce, which should result in a significant price drop. It doesn’t.

It’s been stated that pressure from the retail sector is the cause of this, because they threaten not to shelf PC games that have cheap online counterparts. But this seems highly unlikely, given the severe drops in both sales and revenue in that sector. In fact, according to the PCGA retail only accounted for 30% of all PC gaming revenue in 2007. Back then DLC was an up-and-coming thing, Steam had just 13 million users (now 25 million), and both Impulse and Good Old Games (the exception to these crazy pricing schemes) didn’t even exist yet.

And as if that wasn’t enough, now NPD states that 48% of all PC game sales in the US are in digital form. Factor in revenue from advertising, DLC, micro-transactions and subscription fees and it becomes quite clear that the PC games industry is not at all reliant on retail sales. It’s much more likely then that publishers simply want to milk digital distribution for all its worth without offering fair value. It’s understandable from a business perspective, but it’s also the main factor that’s holding digital distribution back from all that it could be.

Impulse is almost notorious for its excessive region restrictions

Region restrictions are also an antiquated concept on digital distribution platforms that span the globe. Gamers from all over the world connect to these services, but the availability of games in all regions of the world is not guaranteed. This is understandable when local law bans a game, but not in the case of games like Singularity, which are available worldwide in retail, but only in North America on Steam.

This also extends to game pricing, which curiously differs between regions on nearly every digital distribution service. The likes of Direct2Drive and Steam tend to offer games at a 20-30% premium to Europeans over the price standards for American and English customers. This is far greater than the difference in taxation and local spending power is only minimally taken into account. Is Batman: Arkham’s Asylum really worth 18,79 euro more if you buy it in Europe instead of Sydney or New York?

These kinds of regional restrictions serve no purpose but to alienate European customers and reduce the potential of these digital distribution platforms. A lot of Europeans could be lured in by a more uniform, fair and realistic pricing structure and the full games catalogue.

Is Batman: Arkham’s Asylum really worth 18,79 more if you buy it in Europe instead of Sydney or New York?

Digital download platforms are often misleading in their product descriptions, especially the system requirements. Many older games offered for sale on these services simply do not work on computers running Windows XP, Vista or 7. Some even take this shady business practice a step further and offer incomplete games for sale, such as Jedi Knight 1 on Steam which has no music.

This problem is compounded by the fact that none of these platforms have money back systems in place in case a game doesn’t work. Steam is particularly nasty as its client does not support Windows 98, but numerous of its games (e.g.: Commandos) have major issues with later operating systems. Rather than making the game compatible with modern operating systems, Valve seems content in raking in cash for games that do not work (properly). The same can also be applied to other platforms like Direct2Drive and GamersGate.

There is one exception to all of the above complaints and that’s Good Old Games. Their catalogue may be rather small, but all of their games are fully compatible with modern systems. Better yet, their games carry the same price in every region across the globe! This makes GoG easily the most competently executed digital distribution platform of the bunch, but even they still suffer from one flaw.

Digital download platforms are often misleading in their product descriptions.

All current digital distribution platforms are account-based and feature simple login systems consisting of a user name and password. That’s a very vulnerable system which can easily lead to account theft and that’s certainly not something you want if you’ve just purchased a few dozen games on GamersGate, for example.

Blizzard’s is already using account authenticators that can be downloaded to mobile phones or purchased as physical devices. This would be an ideal security system for digital distribution sites like Direct2Drive, GamersGate or Good Old Games. It might be a tad more expensive to maintain for actual applications like Impulse or Steam, but surely if Blizzard can make it work then Stardock and Valve can too?

This also leads to a final complaint, which is that there’s no future-proofing your purchases on digital distribution platforms. Any of these services may go belly up in the future and take your purchased games down with it. That’s not too much of an issue with sites like Direct2Drive, GamersGate and Good Old Games that allow for download the actual setup files and CD Keys to make your own backups, but it’s much more problematic with integrated systems like Impulse and Steam.

Admittedly, it does seem highly unlikely that Steam will go belly up anytime in the next decade. They’ve got the largest user base and the most profitable digital distribution system on their hands and that certainly doesn’t seem to be changing. But it’s a possibility and one that doesn’t carry nearly as many guarantees as owning an actual physical copy of the game.

GamersGate hosts massive promotional sales each week

Despite all these horror stories I still prefer digital downloads over physical copies. There’s little to no risk of incompatibility by sticking with Good Old Games for any truly older titles and these systems are all so much more accessible, instant and simple than scouring webshops and local stores for good games.

There are still plenty of ways to improve upon these digital download platforms and I sincerely hope that all these concerns are addressed in the future. I see digital distribution growing regardless of said concerns, but I don’t think it’ll have quite the same reach and influence if the ridiculous pricing, region restrictions, account vulnerability and compatibility issues aren’t resolved in the near future.

But that’s just my take on the state of game distribution. What’s yours?

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