Archive for the ‘NPD Analysis’ Category

Weekly News Roundup (1 March 2015)

Sunday, March 1st, 2015

Again, apologies for not having anything to talk about last week. And apologies for having too much to go through this week. No time to waste, so let’s get started …

Copyright

Net Neutrality

A big win for Net Neutrality, no surprises that ISPs didn’t like the FCC ruling, nor did Republicans

So while last week was super quiet, this week was anything but. The most exciting, and perhaps important news of the week came via a source you don’t usually associate with excitement – the FCC. This week, the FCC voted (3-2 on party lines, 3 Democrats vs 2 Republicans) to reclassify Internet access as an utility under Title II of the Communications Act. What this means is that, after the setback in the courts which seems to have doomed Net Neutrality, the new strategy by Net Neutrality proponents to seek a Title II reclassification appears to have worked. The FCC can now implement their Open Internet rules via regulation that’s designed to protect consumers, much like how the government does so in regards to electricity or water access.

What I found most interesting were the Republican responses, many slamming the ruling as “big government overreach”. But when it comes to protecting the free (more as in money, than freedom) flow of information on the Internet, I will side with big government any day of the week over big corporations and monopolies – corporations like Comcast and Verizon who want to toll up the Internet, relegating those who cannot pay to second class net citizens. The choice is not between regulation and no regulation, the choice is between government regulation designed to protect the consumer, or big business regulation designed to enrich themselves.

The funny thing was that many of these big business anti-regulation politicians took to social media platforms like Twitter to vent their outrage, the very same social media platforms, and indirectly free speech itself, that will be harmed if Net Neutrality is destroyed. The “market knows” mantra doesn’t work when in effect there is no market, just monopolies – in this instance, the only thing the market knows is how to line their pockets with money at the expense of everyone else.

The fact that most big Internet businesses, like Netflix and Microsoft and Twitter and Tumblr, are all hailing the ruling should be giving these so called pro free market politicians some pause for thought. Sometimes by being anti-regulation simply means you’re supporting one business or industry at the expense of another, and when free market politicians active campaign and legislate for this, aren’t they the ones, in government, doing all the regulating and altering the results of what was supposed to be a free market? Add in the fact that the market and its participants are often not rational at all, it all adds up to the idea that you sometimes cannot have a free, healthy market without strong regulation (designed not to stifle it, but to protect it).

Google DMCA Stats

Google removes so many results due to DMCA requests, but how many invalid requests do they receive?

Now I know the story above is less to do with copyright and more to do with the Internet in general (didn’t stop the MPAA from somehow tying the ruling to their anti-piracy crusade), but this next story definitely is a copyright story, and had it gone the wrong way, could have had an even bigger impact than Net Neutrality. The Internet was one bad DMCA takedown request away from having the world’s most popular downloads all being blocked on Google, if Google had been sleeping on the job. Everything from Java, to Skype, to WhatsApp, to Redhat/Apache/MySQL server software, could have been removed from Google’s index if the DMCA request from Total Wipes Music Group for an obscure music album would have been processed without intervention. Luckily, Google’s system is designed to prevent this type of false positives, although right now, there appear to be no punitive action for companies that continue to submit bad requests.

To be fair to Total Wipes Music Group, they accepted total responsibility and vowed to never let it happen again (apparently it was a software error that, instead of grabbing links related to the name of the music album, grabbed links related to the word “download” instead – no wonder then that the most popular downloads in the world were all listed).

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I suppose, being in Australia, I should talk about the new industry code of conduct to deal with the piracy problem here. The proposal calls for a three-strikes system, but one that appears to be full of loopholes and watered down actions. For example, those on business plans are exempt, while you can get away with two infringement notices every year without any sort of punitive action (the three-strikes counter resets every 12 month). And even when you do get that third strike, it’s up to Big Content to get a court order to compel the ISP to hand over customer details – whether Big Content wants to go down the “sue the downloader” route again, after already admitting that it was largely a mistake, I don’t really know.

What I do know is that our no good, universally despised and most likely to be voted out of office government has been putting a lot of pressure on ISPs and content owners to come up with an industry solution, with the threat of government intervention if talks fail. This is the same government that failed to consult ISPs and consumer groups, and instead, only talked to content owners before coming up with the idea that everything must be done to ensure US companies can continue to rip off Australian consumers by charging more for less. Why am I not surprised?

Gaming

In all my excitement last week about the, um, total lack of excitement, I actually forgot to talk about the January NPD results. But they weren’t that exciting though, with the PS4 once again back on top after the Xbox One sales event ($50 off) ended, before bringing the discount back half way through the month.

This week did yield something a bit more interesting, with Nielsen releasing the results of a survey that shows just exactly why people choose the console they choose.

PS4 with controller and PS Eye

“Better graphics” is the most common reason why people choose the PS4 over the Xbox One (and Wii U)

“Better graphics” was the number one reason behind PS4 buyers choosing to buy Sony’s latest console, while Xbox One buyers said that the Xbox brand was what attracted them the most.

And just to show how perception really is 90 per cent of reality, both PS4 and Xbox One owners cited “faster processing power” behind their choices (although I guess both could have been referring to their consoles of choice being faster the Wii U) – both Xbox One and Wii U owners also cited “exclusive game content” as a top reason.

Showing that Kinect isn’t the dead horse that many others believe it to be, the number two reason for Xbox One owners choosing Microsoft’s console was the console’s “innovative features”.

For Wii U owners, the “fun factor”, “better for kids” and better value nature of the console were key drivers, something that makes perfect sense.

Also very interesting was the question of which last-gen consoles the respondents owned. 59% of PS4 owners previously owned an Xbox 360, compared to only 43% of Xbox One owners who had owned a PS3 – the difference here perhaps explains the reversal of fortunes between Microsoft and Sony’s consoles in this generation. 86% of Wii U owners owned the Wii, showing Nintendo still has a group of loyal fans.

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All very interesting stuff. It’s just one of those things I guess, sometimes all the interesting stuff happen all at the same time. Sad stuff too. R.I.P. Leonard Nimoy. I’ll leave you with his very last tweet:

“A life is like a garden. Perfect moments can be had, but not preserved, except in memory. LLAP”

Dif-tor heh smusma, Spock.

Weekly News Roundup (30 November 2014)

Sunday, November 30th, 2014

Happy Thanksgiving to those in North America, and Black Friday to those that took part. Remember when I used to do a lot of coverage of Black Friday Blu-ray sales here? Back when Blu-ray deals were still rare on the ground, and that paying $12 for a movie was considered a great bargain. Black Friday isn’t as special any more though, and we should have the sales stats in a few weeks to see if others feel the same way as well.

Here’s the news from the week.

Copyright

Google may be taking a hard line stance against DMCA requests that are not specific enough. In a recent example, Google decided not to take action against home and category pages on potential “piracy” sites, despite these pages often providing list of links to copyrighted titles.

Traditionally, Google prefers each DMCA takedown request to contain one specific copyrighted title, and a URL that corresponds to that title. For category and homepages, these not only feature more than one title, they also often don’t offer direct downloads, and only link to another page that has the download. Google is more than willing to remove a page with a direct download link, but it seems they’re not too sure about category or homepages.

You can sort of see why the likes of the MPAA and RIAA feel frustrated in their dealings with Google, because for them, it would be a lot easier if they could simply get homepages and category pages deleted, as these pages are far more important to the site and are harder for the site admins to change URLs for. But you can also see why Google has drawn a line here, since technically, these pages aren’t “directly” offering any pirated content on them.

BayFiles

Bayfiles has disappeared, no reasons have been given …

But just because Google doesn’t think that a page is worthy of a DMCA removal, it doesn’t mean that Google won’t punish the page in its own way. This could be through piracy demotions, activated when a site receives too many DMCA removal requests and all pages on the site are demoted. Or it could be something else entirely, and unrelated to piracy at all. This is what appears to have happened to Bayfiles back in June, when most pages on the site were removed from Google’s index. What is more mysterious is that that Bayfiles appears to have disappeared entirely, shortly after its co-founder and former Pirate Bay operator, Fredrik Neij, was arrested in Thailand (unrelated to Bayfiles, but related to the sentenced handed to Neij in the Pirate Bay trial.

No reason has been given for the closure of the site, and for now, the site simply redirects to the main Pirate Bay website (which still links to Bayfiles). Some files on the site (for example: http://bayfiles.net/img/logo.png) still appear to work, but almost everything else has been redirected. Something strange is happening here, and we may hear more about it in the future.

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LG Android Wear

Digital watch face piracy is a thing now, apparently

Here’s a new form of piracy that’s only been possible recently – pirated digital watch faces. With the hype over smart-watches, there’s now a demand for digital watch faces from the most famous watch brands from around the world, including Rolex, Tag Heuer, Omega, Armani and Swatch. Users can download these faces to their watch, often for free, and they would instantly have a digital replica.

These luxury watch brands that have had their designs digitized, however, aren’t so happy. And according to TorrentFreak, several have started taking legal action against sites that offer watch face downloads.For now, the sites hosting watch face downloads, many of which are original and very creative works, are complying and have implemented ways to prevent future uploads of “stolen” designs.

While everyone involved seems to be taking appropriate action, I do wonder if this is also another example of a lost opportunity. If these luxury watch companies offered a way to purchase official watch faces (especially at a more than reasonable price), then perhaps there wouldn’t be a need for pirated downloads.

It’s all about anticipating demand, if you can anticipate where pirates will be doing next, then perhaps you can also anticipate the next business opportunity too.

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An update on a story from a couple of weeks ago, regarding the MPAA’s WhereToWatch.com website – enterprising hackers have made a browser script that adds torrent links to WhereToWatch movie and TV listings, turning the useful legal content search engine into also a torrent search engine.

The team that released the script, PopcornCab, says they’re actually big fans of the MPAA’s new site (even if they’re not big fans of the MPAA, normally), but that adding a torrent options will help users (even if the MPAA won’t be fans of their work either).

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Apple TV Movies

How we watch TV in 2030 might be far closer to Netflix than NBC

Is broadcast TV doomed? That’s what Netflix’s boss thinks, and he thinks that 2030 is when broadcast TV (that is traditional “linear” network and cable TV) will finally come off the air. His prediction isn’t entirely groundless – a recent study found that broadcast TV viewership dropped by more than 50% in the ten years between 2002 and 2012.

While I’m certainly a big fan of “on-demand” TV, there is still something quite reassuring about “linear” TV. Someones makes the decision for you regarding what to watch, and that’s a comfort sometimes. After a hard day’s work, the last thing I want to do is to spending an eternity flicking through Netflix, unable to decide on what to watch (until it’s too late to watch anything and I have to go to bed). And finding something interesting to watch while channel surfing is its own kind of reward.

And there will always be live sports, which so far only really works on a linear fashion, although I think more interactive viewing options (multi-angle, commentary, player cams …) might be welcomed.

So I hope that while on demand and Internet TV will take over as the dominant form of television by 2030, part of me still hopes that linear TV, and other “quaint” things like physical media, will still be around by then.

Meanwhile, have a look at this article to find out just how much Netflix’s subscribers are loving their original programming, and this one which looks at the tricky situation with second screen usage during TV viewing, looking at what works and what doesn’t work when it comes to user interaction, lost eyeballs and advertising.

Gaming

October’s NPD results did not provide any real surprises. The PS4 was still the top selling console, and the other gaming companies are still choosing not to be specific when it comes to releasing sales data.

What is interesting though is that if you look at the top selling games data, you’ll usually find that for the top selling franchises, the PS4 version will usually outsell the Xbox One version. For October, this was true for ‘NBA 2K15’, ‘The Evil Within’, ‘FIFA 15’, ‘Madden NFL 15’ and ‘Middle-earth: Shadow of Mordor’. The Xbox One was only ahead of the PS4 for ‘Destiny’ (and ‘Skylanders: Trap Team’).

This is a dangerous development for Microsoft, who had gotten used to the Xbox 360 beating the PS3 for multi-platformers. It’s dangerous because it means more and more developers will simply follow the money and make the PS4 their lead development platform for games – this could mean slightly better versions of the games on the PS4 than on the Xbox One, and it’s these “little” things that wins console wars.

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That’s the end of this week’s WNR. Hope you enjoyed this issue, see you next week.

Weekly News Roundup (19 October 2014)

Sunday, October 19th, 2014

I’ve recently become obsessed with a TV show called If You Are The One, a show that apparently has become a cult favourite here in Australia despite it being a Chinese dating show. It started airing on Saturday and Sunday nights here in 2013 (with subtitles), for the lonely hearts out there wanting to have fun at the expense of other lonely hearts (in China), and maybe learn a thing or two in the process too. Here’s hoping the show makes it to other English speaking markets, because it’s a real gem.

Copyright

Google is getting tougher on “piracy sites”, sites that have received too many DMCA takedown notices. In a whitepaper released this week, Google outlined changes to its algorithm and search features that will make pirated results less obvious, and also do better to promote legal alternatives at the same time. Sites that have been targeted by the likes of the MPAA and RIAA with DMCA notices will drop down further in the search rankings thanks to new tweaks introduced this month, and for certain search terms that are likely to lead to pirated content, Google will either include ads to legal platforms for the said content, or will more links to free listening/watching options (such Spotify) to make going to pirated sites less of a necessity.

The whitepaper also explains in detail Google’s anti-piracy policies with its non search products, such as AdSense, Blogger and YouTube, with Google pointing out that the latter’s Content ID “piracy monetization” program has paid out over a billion dollars already to content holders in the seven years it has been running.

All of this is to avoid actually having to remove entire sites at the behest of content holders (as opposed to individual URLs), something that content holders ultimately wants Google to do (Google’s reason for not doing it: that takedown URLs for even the biggest piracy sites are only a small fraction of the total URLs indexed for these sites – so it’s unfair to remove these sites entirely).

The Walking Dead: Season 5

Hordes of The Walking Dead pirates come out during the show’s season 5 premier

What Google may not be able to do much about is the increasing popularity of The Walking Dead among downloaders. The corker of a season 5 premier has attracted record ratings, but has also broken records when it comes to pirated downloads, according to piracy tracking firm Excipio.

While all of this may only prove that “popular TV show downloaded more”, what I found interesting is that Australia, for once, was not the piracy leader for this “let’s not say the Z word” series. It could be that Game of Thrones is more popular with Aussies than The Walking Dead (because if there’s one things us Australians are known for, its our love of dragons and medieval themed political intrigue), but one look at the legal options for both shows and it may become clear why one is downloaded a lot more than the other. One show is available on iTunes (albeit on a 2 day delayed release schedule compared to the US airing time) and available on a cheaper non premium cable channel. The other is only available on premium cable packages, with no standalone digital options like iTunes. Guess which is which, and which show is pirated more!

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HBO Go

A standalone HBO streaming service is coming in 2015

The Game of Thrones piracy, or more precisely, the HBO TV show piracy problem in Australia may be reduced dramatically next year, but not for a reason that will make content holders and distributors here happy at all. HBO will be offering a standalone streaming product in 2015, possibly at the price point of $15 per month. With the right geo-unblocker (assuming HBO takes the same laissez faire attitude towards geo-unblockers as Netflix, which might be a big assumption at this time), Australians could get access to the latest HBO shows for a price that’s quite affordable.

So while all the talk is about Netflix being the loser in this new deal, and its stock prices has reflected this sentiment in the wake of this announcement, I think the real losers are the traditional cable and satellite providers, in the US and overseas. HBO and their shows has been the jewel, the only jewel sometimes, in their crown, and the only reason why many still hold on to their subscriptions. A standalone HBO product will remove this reason. Hulu Plus and Netflix aren’t real competitors because they’re trying to do different things, even though they offer some of the same content – both service complement each other, especially for us overseas watchers who don’t have timely access to the latest TV episodes. For this same reason, HBO and Netflix shouldn’t be considered competitors, especially when the two services are unlikely to have any overlap in content – they complement each other, and complement each other quite well. All we need now is a movie streaming service that streams the latest movies at the same time as the film’s Blu-ray and DVD releases, and all three services could co-exist and prosper (at the expense of cable/satellite, discs and other outdated forms of distribution).

Early 4K adopters without Netflix is set to lose out as the company moves its 4K offering to its most expensive $12 “family plan”. The extra costs involved with distributing 4K content may account for this move, but the change only affects new members. Existing members will get to keep access to Netflix’s limited 4K library without having to move up to the family plan.

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Despite Michael Pachter predicting the Xbox One will outsell the PS4 in September, the well known gaming industry analyst was proved wrong once again with the NPD figures for September showing PS4 sales still topped that for the Xbox One despite Microsoft’s free games offer. The only glimmer of good news for Microsoft was that the hit game Destiny was more popular on the Xbox One than on the PS4, at least for standalone non digital copies of the game. The holiday period is just around the corner and sales will and Microsoft will hope that the recent discounting of the console plus game offers help to things turn around in time. If the PS4 wins these holidays, and right now it looks like the most likely outcome, then that’s this generation decided I think.

As for the Wii U, its sales grew by 50% compared to August sales, but with Microsoft and even Sony reluctant to release actual sales figures, we have no idea how far behind the Wii U is compared to the big two (and I assume it’s behind the Xbox One, since otherwise I’m sure Nintendo would have made a note of it in their PR releases).

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And on that note, we come to the end of another WNR. Hope you’ve enjoyed this one, see you next week.

Weekly News Roundup (21 September 2014)

Sunday, September 21st, 2014

If you’re sick of the iPhone 6 overload this week, then you’ve come to the right place. There’s only one paragraph in this WNR about Apple’s new phone, and it has to do with perhaps the most boring aspect of the phone. There’s also a rant in there about print media. Fun times!

Copyright

Downloading Communism

Time to bring out this classic poster again …

Piracy losses are translating to higher prices for consumers and is having a negative effect on the economy. This has been one of the major argument for a crackdown on piracy, but according to leading economists in Australia, the reverse might be true. This week we again turn our focus to Australia and the heated debate there over what to do about the piracy problem. A submission this week to the government from leading economist Henry Ergas and the former head of Australia’s peak consumer body Allan Fels argues that the government’s plan to make ISPs monitor user downloads is actually bad for the economy, and bad for consumers.

Their argument is that the high cost of running such a program, nearly $150 million a year, will not translate to anything close to this in terms of increased revenue and benefits to the economy, based on current evidence. And any increased revenue to rights holders are unlikely to be passed on to consumers. In the most optimistic scenario under the government’s proposals, where piracy is substantially reduced, the removal of the need for rights holders to “compete” with pirated downloads may actually bring about higher prices for consumers, and actually end up “incentivizing” piracy, the submission also warns.

If this “incentivizing” happens, then piracy rates will back up again and the only options left for rights holders would be to improve the value of their offerings, greatly improve the availability of legal content on services that consumers want to use, and also ensure things like release window delays are as short as possible. Basically all of the things that they should be doing right now to fight piracy instead of asking the government to intervene, argues the economists.

The most worrying thing about the Australian debate right now is that all of these same arguments have been heard before, and the practical actions suggested have already been tried, tested and shown to be largely ineffective. And yet, we still have rights holders asking for legislative action. It’s interesting that rights holders in the US have stopped asking for the same, at least not publicly, all because they fear the same kind of consumer backlash that occurred when SOPA/PIPA was being debated. Which is why the MPAA this week again re-iterated their lack of desire for legislative action. The MPAA’s Chris Dodd was saying all the right things too, about not “finger pointing at everyone” and “arresting 14 year-olds”, but instead to focus on “accessibility” and releasing content at “price points [consumers] can afford”. At the very least, it seems rights holders there have lost their appetite for new laws (publicly at least), just like how rights holders here in Australia have lost their appetite for legal action (having lost a major case a couple of years back). Well, at least they’re learning (in terms of what they say publicly, at least).

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I was going to write a full length news article on this story based on the attention grabbing headline of “NewsCorp: Google is a ‘platform for piracy'”. Ohh, I though, Murdoch is on one of his piracy rants against Google again, oh goodie. But then I read the article and it wasn’t really focusing on the piracy problem, or the kind of piracy that I usually talk about here. Rather, it was mainly about the dispute between NewsCorp and Google, and goes much deeper than who is downloading what via the search engine. In case you don’t know, newspapers have a love/hate relationship with search engines like Google. Mostly hate these days. They don’t like the fact that Google “aggressively aggregates” content (some of us webmasters don’t like it either), in which Google takes content from sites and sticks it in the search results (with credit and links, but done in a way that makes visiting the site unnecessary – do a search for “aggregation definition” on Google, and you’ll know what I mean). Which is why drastic measures such as blocking Google crawling have been employed in the past to try and stop Google’s content “stealing”, which unfortunately has the side effect of greatly reducing your visibility to users. Pay walls were then introduced to try and make news profitable again, but in my opinion, it only made aggregated content more valuable (as sometimes a headline and summary is enough, especially compared to the cost of paying for the full thing). Google’s argument is that it’s good for the end users, which it is, but it’s also easy to see why some content creators are not happy with what Google (and to be fair, the other search engine too) is doing.

Google News

Google’s news aggregation – good for users, bad for content creators?

While there are legitimate arguments to be made about the content aggregation issue; the lack of genuine competition in the search sector; and issues of anti-competitive behaviour with Google’s perceived favourable treatment of its own products over those from other companies (Google is both a partner, and a competitor, to content creators, in my opinion); on the flip side of the coin you could argue this is just another case of old media not being able to adapt quickly enough. In NewsCorp’s accusations against Google, this interesting passage caught my eye: “For example access to 75% of the Wall Street Journal demographic at 25% of the price, thus undermining the business model of the content creator”. Undermining, or just doing business in a more efficient way? Google could label the same accusation against more successful social media platform, which are offering even better targeting at even lower prices (with Google+ having failed to be as successful in doing the same). But isn’t this just progress and innovation?

As for the woes of the newspaper industry, I don’t know if it’s fair to blame Google, or even the Internet in general for their troubles. To me, if a product is worth paying for, people will pay for it. If people’s expectations of what something is worth has changed, and you can’t re-engage with people again to convince them that paying for news is worthwhile, then perhaps it’s time to re-think the whole business of news. Maybe it shouldn’t be a business at all, but a publicly funded, truly independent institution who’s goal is not profit, but the actual betterment of society and democracy. Then maybe we’ll get back true journalism that protects, not undermines, democracy (via the dumbification of news and the serving of vile populist garbage in the name of profit – the click-baiters of their time – tactics that NewsCorp should be very familar with).

High Definition

iPhone 6 Comparison

Obligatory iPhone 6 pic

I suppose I should mention the iPhone 6. Not that it has much to do with what I cover in the WNR, except for this slightly related story about the choice of codec being used for FaceTime over cellular 3G/4G. The use of HEVC/H.265 makes a lot of sense when combined with the iPhone 6’s more powerful processor (which is needed for realtime HEVC encoding/decoding) and the need to reduce bandwidth requirements, while increasing the quality of video calls. Would this be the first mass consumer product to feature built-in HEVC/H.265 support? Possibly, and it won’t hurt the format’s chances to become the next de facto standard for web video.

Which is why things are not looking great for Google’s VPx, their open source, royalty free alternative to HEVC/H.265. I’m sure Google’s Android will be pushing VP10 if/when it is released sometime next year, but apart from the lack of industry support for the format, technically, it just doesn’t seem to be quite there compared to the more polished and efficient HEVC. As one industry analyst said recently, “The industry has already selected HEVC,” and that, I’m afraid, is that for Google’s VPx.

Tests have shown that VP9, while perhaps better than H.264, cannot really compete at the moment with HEVC. Surprisingly, VP9 is in practical use to a much larger degree than HEVC at the moment, thanks to Google pushing the use of the codec for YouTube, and also superior native browser support due to the codec’s open-sourcedness. But with Netflix 4K choosing HEVC, Blu-ray 4K also choosing HEVC, and now Apple also going down the HEVC route, there’s not much room for VP9/VP10 to grow into. Nobody wants another format war, especially one as tame as this one, so the industry will choose one format and just go ahead with it – and right now, the choice is definitely HEVC.

Gaming

As promised last week, more on August’s NPD results right here. The PS4 was again the most popular console, 8 month in a row, but it appears that its lead has shrunk somewhat. Unconfirmed information suggests that the PS4’s 175,000 units sold was just ahead of Xbox One’s 150,000. Nothing official from either Microsoft or Nintendo though, so the difference could actually be much greater than that (especially for the Wii, as Mario Kart fell out of the top 10 games chart in August).

White Xbox One

Xbox One needs to be cheaper than the PS4

More worrying for Microsoft is that traditional Xbox 360 favourites like the Madden series are being won by Sony, with the PS4 version of Madden NFL 15 outselling the Xbox One and Xbox 360 version. In fact, the same trend is true for all of the top selling multiplatform games right now except for Call of Duty: Ghosts. The next Call of Duty game will be interesting, not only is it one of the biggest franchises around, this time, we may actually see the PlayStation become the top performing platform for the series’ next chapter. If this were to happen, it could have serious implications, in that developers will most likely make the PS4 their lead platform (if they haven’t done so already) and the Xbox One version of the same game will suffer, thus causing the sales/quality/value gap to grow even larger.

I bet Microsoft wishes now more than ever that they can have a do-over, so that they would have never bothered with all that DRM crap, and released the Xbox One without Kinect for cheaper than the PS4. It would have made the Xbox One a sure winner, but I guess they grew overconfident and felt they had room to experiment. The same kind of “arrogance” maybe that was responsible for the PS3’s relative failure. The good news for Microsoft is that their backflips have been fast and decisive, and so there’s still time to pull one out of the hat. But the Xbox One needs to be cheaper than the PS4 to have a real chance, and I’m not sure if Microsoft can afford to do it at the moment.

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A longer than expected WNR this week, and sorry for the incoherent ranting. See you in a week (for more incoherent ranting, no doubt)!

Weekly News Roundup (14 September 2014)

Sunday, September 14th, 2014

It’s going to be a short one this week, as I’ve got somewhere I need to be at shortly after pressing the “submit” button on this WNR. You might then question why, considering I’ve had an entire week to prepare and write this WNR, didn’t I just do it earlier? Because news waits for no man. Or rather, man has to wait for news to happen, and it again happened pretty late during this very quiet week. So quiet that, again, we only have to Australian oriented stories for you this week, although stories that do have global implications. Enjoy!

Copyright

Spotify Logo

Spotify has released research showing piracy rates dropping rapidly in Australia since Spotify’s introduction

After being challenged by those in Australian that believe tougher laws and technological solutions like DRM and censorship are the way forwards for the fight against piracy, Spotify has released data from its own research showing that introducing more affordable legal options is the way to go. According to Spotify’s data, music piracy download rates in Australia (based on calculating BitTorrent downloads) dropped by more than 20% only a year after Spotify’s introduction here in Australia.

The piracy rate has continued to steadily decline since then, proving that if you provide a service people are willing to pay for, they will. Of course, some people will simply never pay for music and will continue to download – but you can’t lose money from people that were never willing to spend it in the first place (the argument is that if the only options were legal options, then some of these people might eventually pay up – but this argument is not valid because it would require piracy to be completely prevented, which even the most optimistic industry person will agree is impossible).

There is this huge amount of resistance to change in the industry, and for them, it’s so much easier to simply blame everyone else for their problems. Piracy has become a convenient excuse, but it’s only just a symptom of a much larger problem the creative industries seems unwilling, or unable to address. It’s all good news for the IT industry though, since (without a sense of entitlement that people in the creative industries, particularly the movie and music industries, seem to have) they’re the ones that are coming up with the solutions at the moment, and bit by bit, they’re the ones inserting themselves into critical junctures of the creative industries.

Despite not wanting to admit the obvious, piracy is also providing competitive pressure for companies that have had it too easy for too long. This is particularly evident in Australia, where many of the major global players, like Netflix, have not been been able to, or willing to influence the market conditions here – very likely because our market is so small that it’s mostly an afterthought for many companies. This lack of competition, the “taking it for granted” nature of the companies that operate here, and our relatively high average salary has meant prices are exorbitant (up to 431% more for TV shows online) compared to almost any other place in the world. But with Netflix predicted to make its debut locally in 2015, and with 200,000 already signing up via various geo-unblocking methods (which is legal here in Australia, thanks to a court case in the 90’s that basically said region control is not acceptable), the pressure is finally on, and some companies have started to respond.

New Netflix UI

Australian companies sh*t scared about Netflix and actual competition

As mentioned last week, one such company, our only cable operator Foxtel, has decided to drop prices to prepare for the Netflix onslaught next year. This is despite the company raising prices annually for the past decade, including at the start of this year (just before rumours started circulating that Netflix was coming). The current debate over the poor value Australians get in terms of what they pay for, and Foxtel’s virtual monopolistic position, has also added to the price cut pressure.

In fact, the general trend recently has seen various companies scramble in full panic mode to try and deal with the arrival of Netflix. We’ve seen indirect competitors, like Foxtel, finally starting to be more competitive price wise, even if at the same time, they’re locking up content so Netflix can’t get their hands on it. It’s very likely that our local Netflix offering will be very much limited compared to overseas equivalents, which may mean that VPNs and geo-unblockers will still have their use. This is why there is still pressure from local companies, and also direct competitors to Netflix, on the government to ban the use of geo-unblockers (again, despite legal precedent ruling that busting geo-restrictions is perfectly legal here in Australia).

While all of this “discussion” is happening under the guise of a “debate” on solving the piracy issue, you can’t help but feel it’s more about local companies trying to protecting their privileged positions in our noncompetitive market – basically to get the government to bail them out now that some real competition is about the arrive. And that, perhaps, is what the piracy debate is all about, not just in Australia – industries that have grown too comfortable with the way they do business and will do everything in their lobbying power to keep the status quo, and prevent new forms of competition from succeeding, whether it’s piracy or Netflix.

Gaming

The early NPD stats for August 2014 are out, and no big surprise here. The PS4 outsold the Xbox One to claim the throne as the best selling console eight month in a row. It’s a still a bit early, and so I’m still waiting for other stuff to filter through. I’ll cover the NPD results in more detail next month.

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That’s it for this edition of the WNR. Not the most interesting, I know, but hopefully stuff will happen (and happen sooner than  Friday afternoon, thank-you very much) next week. Until then, have a great one!