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Chipped consoles cost games industry billions

The Association of UK Interactive Entertainment has decided that console piracy cost the British games industry £1.45 billion in lost sales last year.

The trade association, which says it speaks for the UK's digital entertainment creators, which we'll read as meaning its paying members, has been hammering away at its calculator and has come up with what it calls a 'conservative figure' for the damage done by UK pirates.

Formerly known as ELSPA, the UKIE offered little in the way of how it arrived at the figure, but we suspect it may have taken the number of downloads initiated from P2P sites and other dodgy sources and multiplied it by its shoe size.

The simple fact of the matter is that no amount of creative mathematics will ever be able to place an accurate, or even vaguely meaningful, value on the true cost of console piracy.

To assume every download translates directly into a lost sale, or even some arbitrary fraction of a lost sale, is naive to say the least.

The simple truth of the matter is that, for many prolific pirates - and we're talking about individuals here, not the organised crime outfits which sell multiple physical duplicates of game disks - pirating the game is more fun than actually playing it.

In our experience, most gamers who are willing to trawl the P2P sites and NZB trackers for new releases download so many games that they are highly unlikely to be able to play them all to completion in half a dozen lifetimes. Which is a lesson that should be learned by the gaming industry.

That the UK has a booming trade in second-hand games with which people have become bored and traded in is a testament to the fact that some games simply aren't good value for money.

UKIE director general Michael Rawlinson thinks otherwise, telling the BBC, "These big games, you get 20 to 50 hours game play, which is tremendous value for money."

One enthusiastic gamer told us, "I have brought maybe 40 or 50 legitimate games for my two current-generation consoles and my computer, shelling out between £30 and £50 for each, but I can honestly say I have only ever completed one or two of those. They just don't have enough variety in the gameplay to hold my interest for extended periods of time."

Which all brings us to one simple conclusion: if the games industry wants to survive and cut the level of piracy it has to rethink its entire model. No amount of DRM will ever stop the pirates, as the recent filleting of the previously impervious PS3 has shown.

And marching randomly-selected P2P pirate scapegoats through the courts just makes billion-dollar game and console companies look like horrible bullies.

With the Internet playing an increasing role in the way we both play and consume digital entertainment, it's time the gaming industry dragged itself out of the 20th century and made it easier, and cheaper, for legitimate gamers to get their hands on the latest titles.

If we ruled the world, we would make the first ten per cent of every game released available for free on the Internet. No cut-down demos... no unfinished products or hobbled on-line game-play. If the game has 100 levels, for instance, you give ten of them away for free. Using the tried-and-tested heroin model, you give everyone a free taste, and hook them in with quality products.

We reckon the level of piracy would drop through the floor almost immediately as the vast majority of downloaders only play a pirated game for a day or two before consigning most titles to the trashcan.

This would also weed out those games industry charlatans - who spend millions on marketing and movie tie-ins, and fourpence on game development - preventing them from delivering titles which your average four-year-old would find a bit disappointing and forcing you to pay £45 up front for them.

Online multiplayer gaming and digital content delivery, whether that be in the form of the original game, or additional paid-for game levels and add-ons, are the way forward for the apparently beleaguered UK games industry.

The days when shoddy games could be hidden behind the glossy sheen of fancy marketing are over, and the sooner the games industry realises it the better.

Organisations like UKIE also have to realise that the world is changing rapidly. People don't want to have to wait until they have the time to head to down to their local game store to buy the latest game, or to sit expectantly by the letter box waiting for the postman to arrive.

Today's gaming generation wants it now and it wants it cheap... if not free. Expecting people to pay £45 for an individual game they haven't seen or tested quite simply isn't a sustainable model in today's economic climate.

Giving people a free, undiluted introduction to an utterly immersive game, and then flogging them the next three instalments at ten or fifteen quid a pop, will not only put paid to much of the piracy, it will create more jobs and generate more revenue spread out over years rather than months.

Commerce in any form is a two-way street and keeping your customers satisfied is paramount for any business. Shelves groaning with hastily-traded-in titles in every game store are a damning testament to the lack of longevity in the vast majority of today's game titles, and until the games industry stops ripping off its punters, the rising tide of piracy will continue.

Only those companies which keep their heads above the water by moving with the times will survive, and they will only do that by giving their customers, rather than their shareholders, what they want.

And to those dinosaurs who continue to spend millions on the kind of infuriating DRM which punishes legitimate gamers and does little to deter increasingly sophisticated pirates, at the same time as banging on about lost revenues... good riddance. You won't be missed. monitors all leading technology stories and rounds them up to help you save time hunting them down.