I gotta go with Sacretis on this one. It seems this discussion crops up ever year or two on the boards here and the same ultimate consensus is arrived at every time. Most people are of the opinion that DRM costs more effort for the seller, delays releases, and engenders potential ill-will, which might actually draw the attention of the pirate community.

I'm of the opinion that for every security system on the internet, there are 1000 people who will figure out how to break it, "just because."

Assuming that a company as small as WWG decides to spend the manpower in that direction, you also have to consider the law of diminishing returns. Is it worth it to burn the money and time to increase security at a cost of product development and production delays? Dunno. You have to reach a certain critical sales volume and company size for that to be a viable decision point, and that varies with every company.

Just thoughts and opinions for the grist mill.

Ganesha games seem to have neat way of putting your real name on stuff:



Doesn't help if it's a dodgy name (of course I think it was lifted from the receipt). Stick an email address there as well just to add a little more deterrent.

Of course this doesn't stop ppl simply stealing the file off of someone and then sharing it, something I'm sure happens more than we'd like to think ...I know I don't encrypt my stuff..or worse what if you send it for printing and they take a copy of the file and then share it...

Quantifying what people are paying for boils down to 4 things;

* Production and development infrastructure/support
* Server, associated bandwidth/web hosting costs and site maintenance.
* Customer service
* Accounting
* Supporting full-time and part-time professional designers, 5 days a week (mostly 7 in my case ), 12 hour days, with mortgages, kids...the usual.

Tracy Hickman is fond of saying "You get what you pay for" and in WWG's case, there's simply no way we could offer the attention to detail and the high quality bar we consistently set if we didn't do this full-time, full-throttle. If we did it causally or even part-time you simply wouldn't see the same result. It takes a surprising developmental effort behind the scenes that we don't often talk about.

Or to make a long story short; if we don't have consistent support for the entire infrastructure, we can't reliably devote realistic hours to product development.

The problem I have with piracy is that pirates/file-sharers paint their actions with a broad brush. There is no distinction between corporate, Billionaire software developer and a small, earnest business with responsible pricing and support. In our culture this type of theft is so common that it is rarely viewed as a crime or a destructive behaviour with real human consequences.

Anyway...I need a beer...lol.

Sorry, but I have to disagree with you on this one, Denny. What you have listed is not what your customers pay for!

What your customers pay for is WWG products. That it takes all the things you listed to produce and support these products is irrelevant to all but a small handful of your customers.

This is a subtle but very important distinction.
Without this distinction the automatic approach is to a) set your prices on a cost+ basis and b) assume that each illegal copy is a lost sale.
With this distinction you are free to a) focus on the market segments with the greatest revenue potential, and b) set your prices to whatever level may maximize the revenue you get from the market.

This is especially important for your digital media business, where the cost of copies is so low that products can still generate profitable revenue at a fraction of their starting price. The success of your recent RPGNow special is a great example of this.

This directly impacts how you approach the piracy market. When you let go of cost+ pricing and the assumption of lost sales, you can start to look objectively at the revenue potential of the people who pick up pirated copies of WWGs' products. You can start to explore what it will really take to get them to spend money at WWG, if it is worth the changes required, and what impact those changes would have on your other markets. You can also make an objective decision about whether the true revenue potential of that market segment is worth the time and attention required, or if you will generate more revenue by focusing on other areas.

Your approach of focussing on satisfying potentially lucrative markets has proved successful to date. Until you can be sure that the piracy market is likely to deliver more revenue than you'll get pursuing other markets, or until the technology comes along that makes piracy irrelevant, then continuing to focus on lucrative markets seems like the best idea.

Good point Zenguy. Haters gonna hate, pirates gonna pirate, and if you build it at least we will come. Screw the thieves - those who believe in sin or karma will tell you that they're just digging their own holes. Hopefully a few will feel guilty when they see the 'Piracy Kills' banner on the product. You never know, you might even get some exposure to people interested in buying after seeing one product. I'm not saying it's likely, but perhaps it's a silver lining...?

I agree with this. I avoid DRM'ed goods, because ime, they never run as easily as the non-DRM'ed stuff. Hell, I've had to "crack" a DRM before, because my CD player refused to play my legal, original CD.

I think the WWG way of pointing out that piracy does hurt, and that this is no huge, evil megacorp is really the only workable approach. The reason I'm not using pirated products is that I want to support those who publish stuff I like, be it movies, music or paper models. The technical question whether I could pirate if I wanted to is really irrelevant to me.

I do feel that it is hard if not impossible to quantify piracy.

Microsoft spent a ton of money trying to figure out how people stored files. After a few years research, they concluded that humans were just big information squirrels. We just stuff files around whether we need them or not, often never using them again.

So... do forgotten files sprout into trees?

Actually I came across a WWG pdf when downloading some papermodels (not knowing the WWG pdf was pirated - not all shared files are illegal) which led me to this site and I've been buying ever since.

The same happened with Dave's models, stumbled across his older free models (not any more), which made want more.

So I'm a loyal customer of both WWG and Dave's part thanks to pirated stuff, I might have stumbled into WWG anyway, but that's not sure.

cheers
BULL

Yeah but guess what happens when famine strikes? People use every shred of food that they can find. If there were a realistic means to protect digital publications, the value of said goods would magically return. There's a reason iTunes and Steam do so well for themselves. Not that they aren't cracked open but for the majority of people its a closed and protected system.

He's not saying that's what customers *want* to pay for. He's explaining *where* the money goes.



When you're the businessman, you HAVE to look at it in terms of development cost, expected revenue, and loss. You don't really have a choice, because fancy ways of explaining stuff doesn't impress the taxman or the bank. They understand the concepts of cost vs price and shrinkage, and if you want some love from them, you have to speak their language.

If you try to confuse bankers or humorless Men In Black with fancypants talk about subtle distinctions, you just end up looking like an idiot and annoying them by wasting their valuable time on what they perceive to be shifty circumlocutions or outright stupidity on your part. They're not interested in wowbabble--they're interested in how much your stuff cost to produce, how much you brought in from sales, and how much of it you had to write off. It's just easier and things just go more smoothly when you treat downloadables as tangibles that just happen to ship by wire instead of the post.

I'm not saying you're wrong or anything like that, I'm just telling you how it is. If you run a business, you gotta play by the rules of the game.

-Mel

As a fellow entrepreneur I agree, Mel.
(Except for the bit about confusing bankers - they understand this business concept very well. The first thing bankers and venture capitalists look for when evaluating an investment is a clear understanding of the market value and how that can be accessed. Only after they are satisfied with that do they look at the cost structure to confirm the business is liekyl to be profitable overall.)

The key is to take both points of view into account:
a) what your products/services cost to produce and sell; and
b) their value to your customers.
(NB: it would be pure fluke if the value to your customers exactly matches whatever cost + %profit calculation you've used to set your prices).

If the amount of money you can realistically get out of the market is below the cost of producing, selling and supporting your products/services, then get out and do something that will be profitable. As you indicated, this is the first thing you have to address when in business.

But in this market, once you're committed to delivering a product/service you want to pursue whatever sales and pricing strategies will maximize your revenue. The reason for this is the sales and distribution cost/unit of digital downloads is so trivial, that effectively all your revenue goes directly to your bottom line.

The implications of this can get a bit counter intuitive.
For example, one of the most challenging scenarios is when you produce a new set and it flops badly.
- Should you keep it on the shelves at the same price as all your other sets, even though it isn't selling at that price?
- Or should you lower the price until you find a level at which it will sell?
Cutting the price may seem defeatist. But if cutting the price is going to bring in more revenue overall, then that becomes the better business decision!

This can be one of the hardest concepts for practitioners who run their own businesses to get their head around, because most of their time and energy is spent on the cost end of delivering and supporting their product/service. But once they grasp the idea that their revenue potential is based on the market not their cost structure, then it opens up a whole range of opportunities for generating additional profit in their business.

No I think we get that, its just that there's a knee-jerk reaction out there that says digital products themselves have no real value because they are so easy and cost effective to distribute. That argument tends to undermine the very real costs of production and general infrastructure support that any digital businesses requires to stay afloat. And a digital business model is fundamentally a different thing from a Brick-and-mortar sales paradigm for a lot of different reasons. Somewhere along the line they just don't compare. I think that's where we're having a challenge defining clear value lines.

All of that said; you are absolutely right in terms of finding the right value point from the consumer end. The problem is that the perceived value fluctuates dramatically because peoples attitudes about digital products does also. There is no magic ball that will tell you where the right balance is and experimenting too much with that sort of thing tends to piss people off

You haven't met the bankers and tax people around here. It took me several calls just to get a straight answer to the simple question of whether or not I had to collect and submit sales tax for my products. 6 calls, 6 different answers. (Turns out downloadables ARE tangibles as far as Texas is concerned, because down here, "tangible" means "can be perceived by any of the 5 senses".)

I didn't go to the bank for investment, just to look into opening a merchant account. They wanted chapter and verse in order to gauge how much of a risk I would have been, but they were struggling to grasp how paper models came out of computers. In the end, I stopped giving the detailed explanation and simply described my business as an Internet hobby retailer. They understood THAT. (In the end, we stayed with PayPal because their rates were better for our sales volume.)

Short form: in my own experience, simpler is usually MUCH better as far as discussing my business goes.



No argument there. I've only had maybe 1-2 products that worked out great in that regard. The rest of them needed either longer to recoup their development costs because I knew their perceived value would be too low to charge what I would normally have charged, or they paid themselves off in a very short time because their perceived value was much higher than it actually cost to develop them. It's amazing how sometimes "unimportant" or "uncool" things can be the hardest to develop, while sometimes the awesome-on-a-biscuit sellers get kicked out the door almost effortlessly.



No, this is another case where simpler is better. Consistent pricing is something customers can relate to. If your pricing is all over the place due to demand for sets of similar content load, all you really accomplish is make customers wonder why you're not selling ALL of your sets at the lowest price point that you established for the turkeys that weren't pulling their share of the sales load. After all, if you can afford to price the turkeys that low, surely you can price them all that low and still eat too? That's a slippery slope, and it's better to just leave the turkeys alone so you don't end up devaluing the rest of your products by making them look overpriced.

-Mel

I'd laugh if the system wasn't so damned annoying sometimes - correct that, most of the time.


Even though we're the customers we still have to speak their language before they'll help us. I've had over 20 years in commercial environments and I'm still learning the lingo.


Yes, and the challenge is to find/know which bits to say in the simple presentation.


I did say "if cutting the price is going to bring in more revenue overall"
The trap here is to assume that your customers view your sets equally. Yes, there is merit in setting consistent pricing expectations, especially when pre-announcing a new set. But equally a lot can be gained by having a range of pricing options especially for older/slower moving sets.
If you want to look at what the experts do, check out Games Workshop - they have far more variation in pricing for comparable sets than do you or Denny. Put another way, all sets are not made equal or viewed as equal; they don't need to be priced equal either.

Providing some sort of consistency in pricing helps. But if some sets get discounted after six months and some don't, well the customers will get used to that pretty fast.

When it comes to digital products for tabletop gaming there are clearly several different market segments with completely different views on the value of digital products:

1. Those that value the products for themselves. These guys have the potential to pay the highest prices.
   - Size = small
   - Overall revenue potential = low/med
2. Those that see digital media as comparable to physical products only with a different mix of convenience (e.g. easier to store and search, harder to read). This group will pay a price similar to the equivalent physical product, but adjusted downwards by the relative convenience of the digital product.
   - Size = medium
   - Overall revenue potential = med/high
3. Those that view digital media as a cheaper version of a physical product. This group expects to pay a sizable discount on the equivalent physical product.
   - Size = large
   - Overall revenue potential = high
4. Those that view digital media as free to copy and distribute. A subset of this group will pay 'small change' prices (e.g $1.99 or less), but only if it is more convenient than downloading elsewhere. Others are unlikely to pay anything.
   - Size = large
   - Overall revenue potential = low

About the only thing worth doing with the last group is change their perception of the value of downloadable digital products. Whoever figures out how to do that will make millions (however they do it, it's a safe bet it won't be by weight of argument).

In the meanwhile, the revenue opportunities are clearly in the first three groups.

Yeah where do we find more of those people? lol.

Quite honestly I've come to the conclusion that column 4 is easily 50% of our traffic. I'm not saying that to play violins, I think its an industry wide issue (in all digitally translatable industries). Its just a fact of life.

Our best an only real option for balance is the one we're currently pursuing, which is a digital market buffered with tangible products. TerraClips is part of our escape velocity plan as it is very difficult to copy/utilize in other formats. More to the point though its completely pointless to copy because we're able to offer it at a price potentially lower than building a badly copied version from scratch. There's little to no upside to copying it.

I consider myself to be Type 2a - those also view PDFs as compatible products, and who will pay a reasonable amount for having both print and PDF. (It would not surprise me if 50% of Paizo's PDF customers fall into this category. Not to mention it is the norm for their subscriptions....)

The other direction is to have such high volume that piracy can be ignored.

To use e-books as an example, most publishers rely on DRM to protect their IP, and charge as much for an e-book as for their paperbacks (more if the paperback is not yet available).

Baen on the other hand does not use DRM and charges less then they would for a paperback. (And has a sizable free library.)

Guess which publisher takes up the most space on my Kobo? And they have been in the e-book business since before there was an e-book business. They make it easy for me to want to give them money. They know that folks will pirate, but they have a robust enough stream that they can weather it.

One of my favorite lines of the late Mr. Baen - when asked on the Baen forums 'what is to prevent me from copying your Free Library to CD and giving it to all my friends' his reply was 'The Free Library is advertising. Copying it and giving it to all your friends makes it free advertising, costing us nothing. Go ahead and copy away, you have my blessing'.

Followed a few months later by the first Baen book to include the entire Library on CD, inside the book.... Like him or not, Baen was someone who stood by his opinions.

But Baen has the revenue stream to get away with that. World Works, on the other hand, is a small niche in what is already a niche market. There is no way to produce a stream that can make up for piracy. Part of the reason that I give World Works builds for Christmas and birthdays is to try and enlarge the customer base. (Okay, that and the fact that I really like the way they go 'Oooh! That looks great!' So, call me egocentric. ) So far only a few have gone on to purchase some of their own, but one of them is a shop owner....

The 'good(ish)' news is I don't think that any of them have pirated World Works material either, that making terrain is just something that they don't want to do.... (Trust me, I would love it if my players would help me make terrain.)

I am by no means certain that there is a real solution, though I did think of an amusing one - having a piece of terrain that actually has the buyer's name on it, say a tombstone, crypt, street sign, graffiti.... Make having your name as part of the protection be part of the fun. (Like my favorite piece of copy protection on a computer game - a secret decoder wheel for deciphering the mission briefings. One of them said to always drink your Ovaltine! Rocket Ranger, I think.)

The Auld Grump

Zenguy, In general I have to agree with your categorization but I think group four is a bit restrictive.

I think most people who pirate are actually catagory 5. They will never pay for the item itself, but are interested enought to pick it up if it's available for free.
These people differ from your category 4 as they would not consider distributing it out to anyone. They simply pick up free stuff where they can find it and collect it.


My guess is that your group 4 of hardcore pirates is actually not that large. But they enable the vast majority of people who think that they are not hurting anyone by simply pirating something they would never have purchased anyway.

Yeah, looking at the definition for group four it does read as if they are active pirates.
What I meant was those that have no qualms downloading digital media that has been pirated.

Roll on the day when there is some universally applicable DRM protection that is invisible to the customers, and painless for all concerned.

...and on that day, the lion shall lay down with the lamb, and every doorway will be a double rainbow...

I like the decoder wheel idea, but it'd be difficult to apply to, say, music (every CD would sound like Ke$ha before decoding!)

The whole conceptual problem with DRM is that its only purpose is to stop an activity (copying) that is done by the honest and dishonest alike. The honest buyer will copy a file to his desktop, laptop, phone, media drive, etc. The pirate will do the same thing for different reasons. DRM doesn't work as it's currently conceived because you can't legislate morality, and any attempt to do so hinders honest operation.
I don't mean to harsh your mellow, Zen, just to say that we need to find a new way.
Someone was toying with sourcing files again recently, but it turns out that pirates are one of the few groups among which pretty much everybody knows how to spoof an IP. Keep on thinkin' people.

This is wrong. There's no way most pirates even know what an IP address is. I think you're confusing "hackers" or even "script kiddies" with pirates. Most pirates are average internet users who don't feel like paying for what they can get for free (the conception that pirates must be clever, or that it's cool to pirate, certainly doesn't help).

To be effective, DRM doesn't need to stop all of the pirates (that would be impossible). Rather, DRM only needs to convert more would-be pirates to customers than the number of would-be customers that will be lost by implementing DRM.

For example, embedding order numbers into the PDF would deter the initial file sharing (not prevent, but deter), while being non-obnoxious to the honest consumer. The point is that the harder it is to find your sets on file-sharing networks, the more would-be pirates will "give up" and just buy the set from you (or not get it at all - so no loss).

This is probably the single most succinct post in this thread. I couldn't agree more.

I have to agree that I think something as simple as adding the buyer's username onto each .pdf page in an unused area would be fairly easy to do, fairly noninvasive, and still discourage buyers from posting those .pdfs online. That's what Paizo does with all of their .pdfs. One of my close gaming buddies has a subscription for all of their products and he's shared one or two with me so I could see the quality. I'm not willing to spread those around, though, because his email address is embedded at the bottom/top of each page.

You have my apologies Spoo; pretty much everyone I know knows what an IP address is, and 100% of the pirates I have known can change theirs at will. It seems my survey sample is nonrepresentational.
As to your point about DRM, I like Paizo's method quite a bit, as it is neither restrictive nor punitive. Other forms of DRM that I've seen only act as obstacles and frustrations to everyone, and when was the last time a company enticed potential buyers by slapping them around and obfuscating everything?

The benefits of securing content have to outweigh the negatives for the consumer. That's the only way to make something of that nature work and its the only way we'd even remotely consider that kind of move.

Perhaps something along the lines of an upgraded layout designer that lets you lay out walls and props as well and then prints up the pages you need. That plus the ability to purchase sets and print out individual components would give you a nice wrapped up, Steam-like application and at least some piracy prevention.

We would all love something like this. Although, I would assume that this would be a rather extensive workload to get released to users. Ideas like this are great and I would totally support a Steam-like approach to giving more usability to my terrain making process.

It would be too expensive to deliver that way. Valve has a team of programmers working on Steam. A goodly percentage from each game is paying for it.

I probably wouldn't sign up for that either. Its clearly DRM, and I'm not willing to rent games for a huge price. So, until the price dropped I avoided Portal and Team Fortress.

The essential issue here is that Adobe doesn't want to help provide document security, while at the same time they have provided the most universal distribution platform for information.

Elcomsoft got into a lot of trouble for explaining PDF security. Namely Adobe secure documents use a password that is ROT13 encrypted directly in the file. (In security circles, this is known as a 'joke'.)

Crack ROT13, and go to jail...

Also have to be careful not to lock the product down to much or the poor kitbashers wont be able to do much or it will be harder to do anything.

Instead of locking the products down why not try alternate income streams from the products.

Internal advertising, eg sell the billboard space inside mayhem to actual companies, I'd have thought other gaming companies might be receptive to this... A Mayhem sized billboard saying Reaper Miniatures or a coffee shop labeled starbucks or whatever. It would add realism to the sets and might add an income stream for wwg I'd imagine you wouldn't be able to charge a heap but even something might help and at least it could help offset initial production costs. Of course you'd need to be careful that you didn't over do it but I have faith WWG could pull it off.

Not sure what you do for Hinterland .

just more random probably useless thoughts

While I'm not entirely sure about the legal issues (I'm not sure there are any!) water marking the buyers name and address at the top of every page would deter distribution of files I reckon!