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by crystalis
5254 days ago
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A hypothetical situation where this works out: Torrent site serves up 1000 pirated DVDs, making $20 in the process. Only 1 out of those 1000 pirates would pay the $10 required to buy a DVD [1]. Assuming as little as 2 cents of consumer value per pirated DVD, this scenario has generated $10 more income for 'businesses' and $10 more consumer surplus. Zynga copies a game that would have had 1000 customers otherwise. They're Zynga, so they get 1500 customers and the original creators get 100. Unfortunately, this makes the game unprofitable for the original creators and the development dollars Zynga had to spend copying the game are not offset by the 600 extra players they generated. Furthermore, this game is seen as a substitutable good- no real consumer value is generated when Coke is drunk instead of Pepsi. (Honestly, I think consumer surplus is the intuitive reason people support file lockers and not Zynga. They're probably right.) [1] This is the only conversion rate I've seen people give actual numbers for. Citation available if requested. |
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You imply Zynga is able to clone a game before the original even reaches 10% of its expected sales. Even mobile and facebook games tend to make most of their money early in their life. I don't think it's possible for Zynga to identify and clone a game this quickly.
You also imply that once Zynga enters the competition, it takes 90-100% of the sales away from the original. This is enormous. Zynga does add some value to games, and it cutens them up a bit too, but you claim it's mostly substitutable. So why are 90% of the people who would have found and played the original game now choosing the Zynga game?
And finally, you imply that Zynga only attracts a marginal number of players, despite the fact that Zynga spends most of its money on marketing to attract new players.
I don't think your numbers are anywhere near the ballpark.