Market forces

When I first heard about this, I thought it was just another case of a company getting wise and doing the right thing. But as I thought more about it, I realized that this is a perfect example of how the market takes care of itself, if left alone.

There's a new computer game coming out called Call of Duty. It's yet another WWII first-person shooter but it looks promising. It's being published by Activision and, as with many computer games these days, they planned to release a free demo of the game. However, the decision was made to make the demo available initially only to people who subscribe to GameSpy's FilePlanet download service. After the exclusivity period was over, it would then be available to everyone.

For those not familiar with FilePlanet, if you pay a subscription you get access to reserved, high-speed servers and don't have to wait in line. If you don't subscribe, you can still download files from them, but you are subject to waiting in line if the free servers are full up. This way, instead of having everybody download at once, resulting in slow download speeds for everyone and possible timeouts, a limited number of people can download at once but they all get fast, reliable downloads. Every now and then some content is made available only to subscribers, though it's usually for a certain period of time after which it's put on the free servers as well.

Why did Activision decide to do this? It was almost certainly because of money. The agreement between Activision and GameSpy was probably that GameSpy would pay Activision to host the file provided Activision didn't let anyone else do so, and GameSpy would hopefully get more subscriptions from some of the people who wanted the file.

Then an interesting thing happened. The market reacted, and did so very strongly.

Several other gaming sites that host demos for games tried to get Activision to let them host the demo but Activision turned them down. As a result, these sites declared in an open letter to Activision that the would not host the demo even after the exclusivity period was over. I didn't read much of the online discussion but what I did read indicated that a lot of people might simply not buy the game at all because of this.

Activision got the message in a big way. Their response was to release the demo freely to everyone and also to release it two days early. Why the sudden turnaround? First of all, it's entirely possible that management realized it was "the right thing to do." After all, a free demo is supposed to be, well, free. It's the hook, the first taste that whets the appetite for the entire game when it ships. Obviously it works as a marketing tactic given how prevalent it is in the industry. Activision also must have realized that they could potentially lose a lot of sales of this game over this controversy, more than enough to make up for whatever income they were getting from their deal with GameSpy. So it was also a sound business decision. The upshot? Everybody wins. Well, except maybe GameSpy which won't get as many new FilePlanet subscriptions as it might have under the original deal. The important thing is that the market spoke and the company responded for all the right reasons. The market worked and no outside regulation or other interference (read: government) was involved.

And that's the way it's supposed to be.