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Pay as you go
An article by Christopher Camz of UnfashionablyLateReviews.blogspot.com
We are living in a unique era. We are slowly, but surely leaving CDs and DVDs behind in favor of digital downloads and instant streaming services. As we make the conversion, however, companies are still learning the best ways to earn a profit from a purely digital product. This is why it's a perfect time to write about one of the more commonly used payment models for the new era: pay as you go.
The success of the digital era can largely be attributed to cloud storage. While nothing especially mind-bending or new, cloud storage remains an excellent way to store the purchases you make on popular websites and online retailers. Excellent, that is, until the servers are compromised, but that has yet to happen on any major site. Additionally, people have begun backing up images and videos saved onto their computers to off-site, secure servers, or "clouds," owned by larger companies for monthly protection fees. And, while it seems like cloud storage is the answer to all the problems, and it very well may be, it has one major obstacle that needs to be overcome: The pay-as-you-go model.
More commonly known as the monthly subscription, this is commonly used by a number of digital services, such as: Music Unlimited, Netflix, and even online-games, like World of Warcraft. The subscription system is unique in such that it is best used in certain situations, as sometimes it can be a great asset, while other times it is enough to ward off potential customers. I will begin the breakdown with working situations.
The best way to utilize the pay-as-you go option is to use it for things that can be enjoyed once for best results. The typical, lasting appeal of a movie or TV episode is about as long as the video remains on the screen, and in some cases up to an hour afterwards. This is largely why Netflix has become so successful using the system. No matter how many times someone watches a movie or episode of "The Office," the video will always continue the same way. Nothing in the story will change, which is why, all but a few people will just watch the video once, and retain crucial plot points in their minds.
This means that the pay-as-you-go model is perfect for movies and TV episodes, as Netflix offers access to thousands of movies and TV episodes for only $7.99 a month, a value that would cost hundreds to thousands of dollars on instant stream or download sites that charge per episode or movie. Given that videos need only be experienced once, Netflix's use of the pay-as-you-go system is genius and saves people (especially movie buffs) hundreds of dollars. This is why Netflix works, and this is why they are rich.
What Could Work
Music streaming services, such as Music Unlimited, offer instant streaming of gargantuan libraries, for a nominal, monthly fee. For comparison, Music Unlimited offers their services for a mere $3-10 depending on the plan you subscribe to. While it is far from a threat to Netflix, Music Unlimited has a lot to offer, especially to music lovers, such as myself. That is why it fits into the category of what could work. For people who adore music from a select few artists, this would be a poor investment, as they could just buy that CD online or in a store, and eventually save money by not having to continue paying for the same few songs. People who listen to a certain genre could just stick to free online radios, such as Last.fm or Pandora, and they too would save money.
That said, for those of us that have dozens to hundreds of favorite bands spanning many, or every, genre (such as myself), would save considerable money with this $30 annual subscription. As someone who typically loses $30 a month on fresh CDs, I would have a decent amount of success with this model, as would anyone who cannot get dressed in the morning without hitting the shuffle button on an iPod or computer. By paying $30-120, one can access all the music he or she wants for a simple fee, and enjoy that selection on a number of devices. This would prevent the individual from needing to continually add to their personal library, as new songs could simply be added to the MU library at no additional fee. That is why the pay-as-you-go system works well based on the person when streaming music, which can be enjoyed for years.
What Doesn't Work
The Third classification is that which doesn't work. The pay-as-you-go model, as we have seen, can work based on what media it offers. For something that is only experienced once, and never carries quite the same weight afterwards, the pay-as-you-go option is fantastic, and for media that can be continually enjoyed, the pay-as-you-go model can be good depending on how frequently you plan to use it. However, for media with extensive usage, such as videogames, the pay-as-you-go model can be a deal breaker for many customers.
Videogames are a unique medium in that they can be played anywhere from 10-100 hours and even beyond. Many PC games, typically massively multiplayer titles (or MMOs) such as World of Warcraft, Star Wars: The Old Republic, and APB use the pay-as-you-go model to squeeze money out of their customers every month. The problem with this is that the mechanics and key points of the game remain the same. So allow me to break this down for you using World of Warcraft as an example. First, you buy the game ($20) and install it on your computer. You may think you are ready to go, but to access the online portion of the game, the game prompts you to break out your credit card again and sign up for a monthly fee to play ($15 monthly- $80 for 6 months). You decide against it and search for a single-player mode, but there isn't one, so, you begrudgingly buy a 3-month plan for $42. After a few months you have explored the greater part of the land, and you start to get bored, however Blizzard (the developer) isn't done with you quite yet. They have, to date released 3 expansion packs (Burning Crusade, Wrath of the Lich King, and Cataclysm). Now each of these will run you additional $30, bringing your World of Warcraft experience to a total of $122, but wait, there's more. It seems your 3 months are almost up, time for another $42. This brings you to $164, for a single game. Blizzard, however is still not done however, as you will have to continue paying that $42 or even $80 to continue playing, for as long as you want to use the game, and the second your payment is late, you lose access to the game you spent so much money on. This also means that, as the game has no single-player option, you lose the WHOLE game when you stop paying for it. They don't care if you spent 60 dollars or 1000 dollars, you lose the entire product that you were paying for.
Now, I don't claim to be a nice person. I probably fall somewhere between a taxi driver who overcharges and a person who goes to the dollar tree for Christmas gifts on the niceness scale, but this is just pure evil that has earned Blizzard millions of dollars. Not only are the keeping their own customers in a choke-hold, they are forcing them to continue paying for a single product infinitely, and demanding more money to ensure that their experience remains up to date, and the second anyone stops paying, they lose the entire game, as they aren't even allowed to continue accessing what they already paid for. Evil? Most definitely.
GameSTOP stealing from developers
An article by Christopher Camz of UnfashionablyLateReviews.blogspot.com
Well I think this article is way overdue, but better unfashionably late than never, I suppose. So for those who don't know about how Gamestop has become such a giant in videogame retail sales in the past few years, allow me to explain the marketing genius to you. It is a scheme that is just as brilliant as it is heartless. You see those games that they sell used? The ones that always come a few bucks cheaper than their brand-new counterparts? Well, let me tell you, they love it when you buy those discs instead of new versions. Why? Because it means 100% profit for Gamestop.
That's right, when you buy a game used from Gamestop, none of the money makes it back to the studios that put in the hours to bring that game to life. Used Call of Duty means no money returns to Infinity Ward or Activision, used Burnout means nothing for Criterion, and used Skate means no kickback for EA or Black Box. Now this is simply unfair, but Gamestop is doing nothing illegal in the process. As it turns out, once a game is bought new, a large cut of the money returns to the developer, while Gamestop gets a piece of the pie as the retailer. However, once that game is paid for, ownership of that particular disc shifts to you, the customer. This disc is 100% yours to do what you will with it. Now let's say you bought a crappy game you didn't enjoy. As most people would, you return to the store you bought it from after the return period, and you are offered to sell the game. You won't get back what you paid for it, but you will get some money back in the form of a giftcard. If you decide to sell, this means that you have become the seller and Gamestop is the customer. Once the transaction is over, the disc that was once 100% yours, is now 100% Gamestop's. This means that when the disc returns to the shelf and is sold to another smart shopper looking to save a few bucks, 100% of the price goes straight into Gamestop's pocket. Thus, the game developer is only able to make money off of the first purchase of every disc.
While this doesn't sound so terrible, it means that the company can only make as much money as discs they create. If they create 600,000 game discs, each sold at $60, this means they can make no more than $3.6 million on game copies. This may sound like an awful lot, but few companies are able to sell everything they make, and we are talking about games that often circulate to 2-3 different hands before they find a permanent home. For a new release sold at $54.95 used, this could add up to more than $100 in profit for Gamestop for each disc. This is pretty unfair considering that Gamestop had nothing to do with the 2-3 year development time to reach the finished project.
This model, again, is completely legal, but is something that many developers have been doing their best to break. Games purchased online including over XBL or PSN mean direct revenue for the company without the hassle of creating discs for a retail release, and the games are played straight off of the console's hard drive, and backed up through cloud storage. Another solution being frequently employed by Playstation and EA is the pass system, in which every retail release is given a code. Using this code, that disc is given a 'pass' which allows players to access certain portions of the game, often multiplayer. This means that shoppers who buy the game used are forced to purchase a $10 online pass to access the multiplayer portion of the game. While there has been considerable outcry against the pass system, it seems like a smart idea to allow the developer to gain some small amount of money back for games purchased used.
I admit that the pass system is somewhat unfair, but I firmly back it. Gamestop has been making money off of used sales for as long as I can remember, and it is a smart move for the developers to motivate players to buy games new, in order to continue making money to fund new, inventive projects. It is a bummer for those who prefer to buy used, but considering the amount of time it took for them to make a satisfactory product, it is more unfair to allow Gamestop make such crazy profit for simply being the mediator between buyer and seller.
An article by Chris Camz of UnfashionablyLateReviews.blogspot.com
I have come to the realization that I am, sadly, a fanboy, and a traitorous one at that. Last generation, I was a Nintendo fan. I had a GameCube and two Gameboy advances. Although I didn't quite understand the differences between the consoles, I was decidedly Nintendo's #1 fan, and I was proud enough to tell anyone who asked. When the Wii came out, however, I simply couldn't remain on Nintendo's side any longer. I was happy for them when the console was selling out everywhere for the first few years, and I respected that they were trying to reach a larger audience. I especially love the way they have brought many casual gamers into the world of proper videogames. I still have a Wii and a DS, and while the DS lives on solely to feed my unending desire to catch 'em all, the Wii is sitting dejectedly in the dorm room now that I have jumped into the Sony parade. I had an Xbox 360, hated it, and now, it too stands alone collecting dust due to monthly payments for online play, on which I may write an article later on. As I grew to become a more active participant in the gaming industry, I realized that Sony simply has the best offerings of all three parties. This is why I am currently a Sony fanboy.
Nevertheless, I don't wish harm on Nintendo (the same way that I do Microsoft). I had lost considerable respect for their systems and their gimmicks and failed attempts to hold the attention of the 'hardcore' audience, but I still respected their guts for employing such risky strategies. When the Wii was first shown to the world at E3, many called it the future, but more called it the end of the Japanese giant. The Wii became an overnight sensation that lasted for the first 3 years of its lifespan, but as it continued to receive first and third party support, its fad factor slowly faded. As the motion-controls slowly became less and less of a 'revolution,' it's numerous flaws became more and more apparent. It doesn't support HD, it doesn't have sufficient online play, the damn thing doesn't even play DVDs! Each of these is simply inexcusable for this time period, especially considering the power of its competition. And yes, Sony and Microsoft are its competition despite what many at Nintendo may say about the Wii being in a market of its own. I have burned Microsoft at the stake for their shoddy hardware that can't play Blu-ray discs and its tiny hard-drive space, but even that piece of crap looks like a deity standing next to Nintendo's kiddy toy.
Say what you will about its game library, Nintendo continues to struggle for proper third-party support, but as the Wii's lifespan draws to a close, even its first-party support has begun failing. I need only say Mario Galaxy 2 and Wii Sports Resort, and anyone's arguments will be hushed. And as the Wii's end draws nearer and nearer, the only 1 game approaching the system with a (somewhat) original concept is the new Zelda. Now all of this is enough to undermine even the most loyal of fanboys, but even the most stalwart of gamers are going to have a hard time defending the company next year.
That's right, next year we will officially be moving into the lifespan of the Wii's successor, the WiiU. No, you didn't misread that, Ninty is even keeping the name of their last console, of which interest has long since died out. But, wait, there's more. Let's take a look at the offerings of this new system, shall we? A tablet controller! This means that now you have two screens to play on, further dividing your attention whilst playing a game. The sad thing is though, from the looks of it, the system can only support one tablet controller at a time, which means that for split screen, the others will be using, get this, the **** WII REMOTES FROM THE PREVIOUS CONSOLE! Yes, that's right, ladies and gentlemen; all those who had Wii's will be using the same controls for this new, $250 system. If we look at this from a different perspective, it essentially means that we will be investing $250 in this horrible economy to upgrade the Wiis that nobody uses to use tablet controllers. Joke? No. The few upgrades that the new system offers are the ability to play in HD and the abandoning of friend codes. Both of which are long overdue anyway.
The future of the once-dominated handheld market is also bleak for Nintendo for the same reason: a lack of forward motion. The company had similar success with its inventive DS, which did a fantastic job with its many original games, and solid hardware. The next generation of handhelds, however, is nearly the same system with new control layout, and a 3D display. This could have easily been a continuation of the established DS family, but instead, Nintendo officially kills off the GBA support, and even prevents the system from being backwards compatible with the system it steals its namesake from, which still runs on a similar hardware scheme. As if there wasn't enough proof this was a mistake, the main incentive for dropping another $200 is the 3D display, which has been grilled for causing headaches from frequent playing with the 3D display on! Nintendo must have planned for this however, and smartly made the 3D display eat away at the battery at an absurdly high rate, to prevent anyone from using the 3D long enough to develop a headache at all. Many have reported the battery failed after a mere 5 hours of play using the 3D display. This is not good considering the point of handheld gaming is the portability, and not being shackled to a wall charger. The cherry on the cake is that the DS's only competition, the Sony PSP is being upgraded with the PSVita. A system that outpowers the PS3 (which happens to be the most powerful system on the market), contains 3G support for online play on the go, has full access to the PlayStation store anywhere on the AT&T network, AND boasts roughly 14 hours of play on a single charge! The system is estimated to be worth roughly $400, but is being sold at $250, a mere 50 bucks over the new price of the 3DS price.
As I am writing this, it occurs to me the Nintendo has royally screwed the pooch on this one. New systems that cut ties with the successful, previous iterations and bring barely anything to the table, being eons behind it's competition in terms of features, a lack of third-party support across it's platforms, and shoddy, uninspired first-party support makes the future of Nintendo extremely bleak. It has gotten to the point that it is nearly laughable to defend the company. I know I will be dropping support of the company. As sad as I am to lose touch with Pokémon, I will simply not buy a 3DS for one or two games. Even Nintendo, who worked a miracle with the Wii, will need an act of God to make its next venture into the market a successful one.
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