Microsoft forcing fees? Marketplace Phil. 101 with Epic and Microsoft
by Alexander Sliwinski 
{ Apr 9th 2007 at 10:34AM }
In the most recent podcast of the 1UP Yours show Tim Sweeney and Mark Rein from Epic Games (Gears of War, Unreal Tournament) sat down and talked about Xbox Live Marketplace and a host of other topics. But the quote that stuck in people's heads was when Tim Sweeney implied Epic would like to give Gears of War maps away for free on Xbox Marketplace (like they did the original maps), but Microsoft won't let them.Sweeney said, "We already released two [maps] and we have four more maps that we've built. We've been wanting to give them away for a long time but actually Microsoft has been pushing back on us for that. They're trying to build this business model around selling additional content for games and that's a valid idea, but definitely we would like to release more stuff for free, and we haven't been able to do so -- yet. Which is unfortunate, there's a lot of good business reasons for releasing free content for a game."
This naturally sparked some heavy debate on the Evil Avatar forums. Joystiq spoke with Mark Rein over the weekend and he laughed at how out of context the conversation was taken. He asked people to listen to the podcast before they weighed in. He says there are simple business philosophies separating Epic and Microsoft.
After our conversation, Rein posted a statement on the Evil Avatar forum, sending a copy to Joystiq, which said in part, "Quite frankly Xbox Live Marketplace isn't our store. It's Microsoft's store. Like any retailer they have the right to figure out what goes on the shelves of their store and what price they sell it at. They spend the money to operate the store and deliver the content. They've also spent billions of dollars to create and build Xbox and subsidize it's the price so you can afford it and we can make games for it. As our publisher, they also invested tens of millions of dollars marketing Gears of War, and have done an awesome job for us, so they have a right to a good return on that investment."
Rein says both Epic and Microsoft want to make money, they just have different philosophies on how to do it. Epic believes in giving content away for free, building the user base of their product by adding value after initial purchase. A model they've learned extremely well from being involved in the PC market for years. Microsoft believes in charging up front, and in the case of Xbox Marketplace, they have a store to run and infrastructure to pay for -- this doesn't mean the GoW maps won't be given away for free later like the Halo 2 maps. Rein believes it's their job to advocate for their product to maximize users and profits. It's Microsoft's job to maximize their profits on Xbox Marketplace so that both companies benefit. Rein understands Microsoft has a store to run on their console, makes sure to say they "aren't evil" and can't fault them for trying to make money -- he likes money too.
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Reader Comments (Page 1 of 2)
sheppy @ Apr 9th 2007 10:46AM
*waits for it*
THIS IS WHY SONY/NINTENDO ARE SO MUCH BETTER! They never overcharge or force companies or punch hamsters.....
*starts fumbling through his eReader collection*
tituspullo @ Apr 9th 2007 10:49AM
hhhmmm hamster punching
PhrawzT @ Apr 9th 2007 10:55AM
"I'm sorry, you are not allowed to release content for free."
I seem to recall other developers complaing about this as well. There was an article a while ago that mentioned that Geometry Wars was intendeded to be free but Microsoft told them to charge for it, or it wouldn't be posted on Live Arcade.
Ian Von Porter @ Apr 9th 2007 10:52AM
Paying for new maps is fair game to me. Much better than EA asking for money for content that is already on the disc or for cheat codes.
J.Goodwin @ Apr 9th 2007 10:59AM
Microsoft is PUBLISHING the games in question.
Publishers determine prices, developers do not. Don't act surprised.
J.Goodwin @ Apr 9th 2007 11:00AM
Sorry if this is a double post, the email confirm links seem to be broken again.
Microsoft is PUBLISHING the games in question.
Publishers determine prices, developers do not. Don't act surprised.
CJ @ Apr 9th 2007 11:04AM
Typical MS. Milk us for every dollar they can get. I applaud Epic. Thier business model has worked for them in the past and why not offer maps and such for free? Sadly, I think Epic will lose the fight and that really pisses me off. Live already isnt free. We still have to pay for most the content that is on there, i.e. Arcade, TV, movies, ect. We fork out 60 bux a game as well. Things like maps should be free. Sure they are extra but when you lose out on online play because you dont have a particular map, that is bs. But people will actually pay for it. The only way we could send a strong message to MS that we arent lemmings and arent stupid is to have a boycott of the new material. Maybe when they see no one is willing to pay for it, then perhaps they will change thier view and offer more things for free. Of course, that wont happen. Too many people dont care where they throw thier money.
Jonathan Tran @ Apr 9th 2007 11:08AM
This is why you should play everything on a PC. The only thing ou ever get charged for is horse armor.
Paul @ Apr 9th 2007 11:29AM
Give one good reason why this content should be free? It costs resources to put this on Live, maintain the service, distribute it, etc. and even if it didnt they have something you want - supply and demand, free market economy all that jazz. If it made the product unusable then I would have an issue, but this is a bonus, nothing more. You guys must have gotten retard in your easter basket instead of chocolate.
Ken @ Apr 9th 2007 11:15AM
@8
HORSE ARMOR!!! WOOO!!!! GIVE IT AN 86!!!
...
Sorry, inside joke.
xix @ Apr 9th 2007 11:19AM
If good content is released for free, no one is going to buy the trashy content. And God only knows what happens when people stop buying shitty products. Way to go, Microsoft!
(I still want a 360... assholes)
Vidikron @ Apr 9th 2007 11:21AM
MS probably just doesn't want Epic to make them look bad since Bungie plans to charge for the Halo 1 maps they ported to Halo 2.
Mr Khan @ Apr 9th 2007 11:25AM
Well, last i heard LIVE was a financial black hole for Microsoft
This comes as no surprise, they need to comp that money somewhere, or exit the console biz...
polly @ Apr 9th 2007 11:34AM
"Give one good reason why this content should be free?"
Because the people that CREATED it WANT to give it away for free, and because the people that will be USING it (Gold subscribers) have already agreed to PAY MS $50 a year.
Neal @ Apr 9th 2007 11:34AM
There is free content on PCs, Wii, and PS3. Microsoft could not charge for toms of stuff that they do. They're simply trying to make more moeny, and people are allowing them to do it. I would too if I was them. Its shitty of them, but you think they give a shit?
They're already charging for the Xbox Live service, and now this shit? wow.
But XBL is the l33t!!!1oneone!!!111 You should have to pay for it!!!11!!!!11!
Jack of No Trades @ Apr 9th 2007 11:35AM
Mr Khan
I see you always talking shit on MS. If I say anything negative against Nintendo you get your panties worked up your ass.
heretrix @ Apr 9th 2007 12:02PM
I wish people would stop bitching about this. They already gave some free maps and the new game type "Annex" is going to be free. Microsoft put a shit load of cash into Gears and it's reasonable for them to want to make some of that money back. If you think that the 5 bucks a month that you pay for live pays for everything they provide your completely retarded.
jason w @ Apr 9th 2007 11:41AM
Wow the people who created it pay for the bandwith to down load it... NO! So shut up and buy it if you want and if you dont dont..
Matt @ Apr 9th 2007 11:43AM
I have no problem paying for additional content, especially new maps for GoW.
CJ @ Apr 9th 2007 12:15PM
"Give one good reason why this content should be free?"
Like someone else said, the creators of the content, Epic, want it to be free. They dont believe milking consumers (loyal returning customers) for every last drop is the best business practice. MS has got to be one of the most greediest companies out there. This is just another example about how little they care about its loyal fan base. Greed is a terrible thing. I have no problem with making money, but come the hell on! MS makes more per day than I would in ten years time im sure. And its probably the same case with most of you. To go out of your way to do this kind of crap to people who support you is just wrong. I really with someone would make a petition or just get enough people to NOT buy this content. Let MS know that we arent push overs. If enough people would not buy this content, then maybe MS would listen. I pay 50 bux a year just to PLAY on-line, 60 bux per game, spent over 700 for the console plus accessories, even purchased some lame Arcade games that I probably couldve played on my computer for free. So, we already pay enough. Not to mention they get money from the suckers that buy TV Shows and movies that they could probably watch on cable, TIVO, watch on the internet for free, ect. MS already gets thier money. TO go above and beyond to f@ck over us is just pathetic.
BloodyDuck @ Apr 9th 2007 3:38PM
Rein's partially right - charging for this stuff doesn't make them evil. But it doesn't make them right either.
It is Microsoft's store, but remember that it's gamers like us who ultimately determine whether or not that store's going to be successful. Vote with your wallets - don't buy content that doesn't seem worth it (or that seems like crippleware aimed just at pulling more microtransactions out of your pocket), and support any free releases out there by downloading and playing them. Then make sure Microsoft knows how you feel - if enough people do this, we'll see a lot more diversity on Live.
-Geoff
http://www.alinktothefuture.com
polly @ Apr 9th 2007 11:48AM
No, but the users do! $50 a year. That doesn't cover it? Not to mention the goodwill free content creates for your platform and for your developers.
It's not a question of me buying content or not and whether I feel it's worth it, it's a question of MS strong arming the devs to charge for content they want to give away.
Paul @ Apr 9th 2007 11:51AM
Polly -
"Because the people that CREATED it WANT to give it away for free"
Can the fry cook at BK give away fries for free just because he "created" them? No - it is up the the DISTRIBUTOR.
"and because the people that will be USING it (Gold subscribers) have already agreed to PAY MS $50 a year"
You pay for gold to USE it EXACTLY! You dont pay for gold to get STUFF.
still waiting on that good reason...
GJM @ Apr 9th 2007 11:55AM
Neal,
There is content for free on the 360 too. In addition, there is content you have to pay for on the PC, Wii, and PS3. How do I know? I own and use them all. According to Neal himself, he doesn't even play games anymore and just tries to stir up trouble in the comments section. Yet another bogus comment from Neal trying to get attention. Pathetic.
Bootes @ Apr 9th 2007 12:00PM
If this payment is for the bandwidth why are we paying for live? Live offers nothing that is not free on the PC and Epic's extras have always been free on the PC. MS has a great business model with the 360. Put a PC in a small case and limit what you can do with it and then charge for everything that is free on the PC.
I have a 360 and live. Live should be free and so should these extra maps. They should be there to encourage game sales.
WizarDru @ Apr 9th 2007 11:59AM
"Because the people that CREATED it WANT to give it away for free."
Because that's their model, sure....but they're not paying for the bandwidth to host it and actually give it away. Take a look at how it normally works in the PC world: you download such updates from commercial or advertiser supported sites such as gamespy, 1up, IGN, download.com or the like. That isn't going to work for the 360.
The $50 a year that I paid Microsoft wasn't for freebies, it was for infrastructure, support and development updates. There's certainly a debate that could be had over that topic...but indicating that something is free in the PC world makes it free elsewhere (when it really isn't free, you just aren't paying with money) is a different story.
sheppy @ Apr 9th 2007 11:57AM
"Give one good reason why this content should be free? It costs resources to put this on Live, maintain the service, distribute it, etc. and even if it didnt they have something you want - supply and demand, free market economy all that jazz. If it made the product unusable then I would have an issue, but this is a bonus, nothing more. You guys must have gotten retard in your easter basket instead of chocolate."
Paul, I have to wonder.... do you know why PC games have much longer play lives in general compared to console games? Do you think it's because they are better? Not really. It's because of developer support. Look up epics past and bonus packs. This is a constant theme for Epic, releasing new stuff for free to extend the shelf life of a product. Nothing unreasonable or stupid about this idea. After all, look at how much extra content Wipeout Pure owners got. They practically doubled the game for free. And Sony hosted the content, payed for the bandwidth, and pretty much said "Here, this is for our fans."
So if Psygnosis... erm, SCEL... wants to give content away for free and Sony says "Sure, go ahead," why can't Microsoft?
Vidikron @ Apr 9th 2007 12:00PM
@20
Your reasoning is faulty. The french fry example is no good because the fry cook never owned or created the fries, he just cooked them. In this case, Epic both created and owns the maps. And just what do you think the $50 fee goes toward? It allows you to play game online, yes, but it's paying for bandwidth and maintenance. Also, I'm fairly certain that MS already charges fees to content providers for the bandwidth and storage of said content, so why shouldn't the content owner be allowed to distrubute something for free to the end user?
IMO, this is a bad move by MS. If a developer is willing to front the distribution costs, they should be able to give away anything they want.
Mr Khan @ Apr 9th 2007 12:01PM
@ Jack
whoa, chill
I was just saying that Microsoft would probably LIKE to give this away too, but they need to make money somewhere (the features of LIVE cost money, and they're trying to break even so they can stay in the game, because they know they've got somewhat of a good thing going)
I mean, they're not adverse to giving free stuff away (see: 120 GB HDD bonuses), but they just have to make money somewhere...
Vidikron @ Apr 9th 2007 12:03PM
@24
Don't bother comparing Live with the PC side of things, they are completely different. Live offers a seamless environment with a global friend's list that is common to all games. The PS3 is more like a PC where every game is disjointed from one another... and it's free too. But this has been debated a thousand times already.
Mep @ Apr 9th 2007 12:04PM
Well, imo 360 is the only console offering a descent online experience. And I would much rather use my time and a little money on a descent service than a poor but free one. As far as pricing on content goes, free would be sweet. But if the content is good, I don't mind paying. And the others aren't any better in that aspect. Anyone else remember Gran Turismo 4 prologue or what it was called. They sold what was basically a demo, and everyone was so friggin delighted that Gran Turismo HD (was is basically a demo for Gran Turismo 5) was free. It's a damned demo for crying out loud.
Les Doodis @ Apr 9th 2007 12:03PM
I think everyone is forgetting Mark's point. It's Microsoft's store. In order for a store to stay in business it needs to make money.
Just like at the grocery store, they mark up the price of your Cocoa Puffs so that the store can stay in business. It's the way the economy works. Sure, it would be great if everything in the world were free, but that's just not reality.
Vidikron @ Apr 9th 2007 12:05PM
@27
What makes you think MS is in the hole on GoW??
copa @ Apr 9th 2007 12:06PM
Alex, you chose the wrong story from that podcast.
The interesting part was where they asked Sweeney whether he would be participating in the Live Anywhere infrastructure for the PC release of their games.
Unlike third-party developers, Tim's team has actually been given access to API's for Live Anywhere, and he was still leaning against participating.
As he discussed in the podcast, if they were Live Anywhere-enabled, they would be PROHIBITED from offering for free any features that could compete with the Live Anywhere Gold membership offerings. This is includes features such as friends lists and server browsing that have always been provided free to PC gamers.
This is much more outrageous than the Microsoft's decision to charge for map packs that they publish.
Of course, in the end it probably just means that you won't see Live Anywhere on any games other than first-party Microsoft titles, and possibly smaller casual games.
Paul @ Apr 9th 2007 12:07PM
Sheppy - I agree with your comments but those are all done out of the good will of their hearts - it is great they do that, and is a fine business model to some but it is still not a REASON why MS should go along with it - they have a different business model.
Vidikron- You are correct, my example doesnt really hold water - but the point stands. As soon as Epic releases content to their Publisher (which, is Microsoft by default for any content that makes its way across their network) it is up to their publisher how much to charge. A better example would be a band trying to give away their music for free on the web and their label saying "no." It happens all the time.
Just because it is a business model other people follow isnt a reason to compel microsoft to do the same.
Are they making a mistake? Probably not as they do market studies and such. Should it be free? Thats up to the publisher. Do I wish it was free? Of course - i probably wont buy it... but lil ol' fanboys are not the majority of consumers (no matter how much we like to pretend we are).
sheppy @ Apr 9th 2007 12:09PM
"I mean, they're not adverse to giving free stuff away (see: 120 GB HDD bonuses), but they just have to make money somewhere..."
Last time I checked, everything on the 120GB drive was demos. And Hexic HD was not listed meaning the one free game 360 owners got at launch disappears to the ethers.
gozer @ Apr 9th 2007 12:52PM
it's closer akin to a musician who wants to give away an ep at a concert that you've already payed to attend but the venue decides to charge for it.
they absolutely can, and they can totally justify it but it doesn't make it any less of a piss thing to do.
NintendoFanbot @ Apr 9th 2007 12:14PM
I know that Sheppy said this as a joke, but anyways...
"THIS IS WHY SONY/NINTENDO ARE SO MUCH BETTER! They never overcharge or force companies or punch hamsters....."
That's not true. I actually think it's honest of Microsoft to charge for what XBL offers. The bottom line is something a lot of gamers of all the companies and platforms need to be aware of.
Non-biter @ Apr 9th 2007 12:15PM
When it comes to a crossplatform title on PS3 and 360 and a developer wants to provide free content to gamers on both consoles, then I think Microsoft would not charge for content that would be free on the PS3. It's a no-brainer.
Raskawa @ Apr 9th 2007 12:27PM
Think about it. Would Best Buy let any publisher have shelf space to give away a free product? Heck no, they have employees and rent to pay.
I understand Epic's long term customer loyalty strategy - but I am guessing MS does not have guarantees it will be the publisher for GoW 2 (or whatever Epic game follows on this hit) -- So it is more interested in proceeds from this product and running it's "store".
I would love to pay for some more GoW maps. Does not change my opinion of Epic or MS. More Maps (and Weapons / Game Types.. oh, and fix the buggy net-code.. hiding lag sounds cool but is a terrible idea.. makes the game feel buggy / random as all get out.)
In the end as a consumer,
- I am interested in buying maps, additional levels, additional entertainment content for games.
- I am not interested in personally paying for demos or theme packs.
Joe Smith @ Apr 9th 2007 12:21PM
You know, if Epic wants to pay for the development and publishing of a game themselves, I am sure MS would let them give away content, but MS paid for Gears, paid to market Gears, and would be paying for any 'free' content (jsut for hte main game alone, I would guess at least $20M given the development duration and the size of Epic's team). Or do you think Epic is doing the extra stuff out of the goodness of its heart and not charging MS for it?
Paul @ Apr 9th 2007 12:24PM
With the number of socialists on here it is suprising it never took hold in the United States...
"Like someone else said, the creators of the content, Epic, want it to be free."
This argument is null and void as Epic may be the creator but they do not have the means to distribute it so what they want, doesnt matter.
Jake @ Apr 9th 2007 12:26PM
Live offers the most free content of the three consoles. PC's get more, but there is often advertisements and spyware that go along with it. MS wants to charge on a 4 map pack. The first two Gears maps were free.
I would rather get things for free, of course, but they have the right to sell things. And, if I don't think it is worth it, I have the right to not buy it. Personally, I'll buy it because I am a gears nut. That is, unless they get carried away with it. $2-5 for 4 maps would be reasonable imo. Anything more and I won't purchase it.
It is awesome, too, how nobody here seems to understand what businesses do. They try to make the most money possible. Stop trying to believe MS is more evil than another company for whatever reasons you conjure up. It is all in your head. The xbox department barely makes money, so they clearly aren't charging us that damn much for their stuff.
The bottom line is that Nintendo makes more money per user than any other console maker. They are charging you more compared to what it costs to provide than any other console BY FAR. But they offer fun games and are different, so many people, myself included, continue to buy their stuff without regret. The only Nintendo platform games I ever regret buying are 3rd party games. ;)
sheppy @ Apr 9th 2007 12:27PM
.. my joke.. is being.. argued.. with..
.. i ... even mentioned.. e-reader..
*brain explodes*
Vidikron @ Apr 9th 2007 12:33PM
@39
I wouldn't go as far as to say what they want doesn't matter. Live needs the content as much as Epic needs Live to distribute it. Also, Epic isn't owned by MS... I'm sure Sony would glady take GoW2 (or whatever Epic project) and allow free distribution of content via PSN.
Paul @ Apr 9th 2007 12:35PM
True - Microsoft does have to take Epic's view into account as in a sense they are a Microsoft customer as well.
But Microsoft has final say, and if it so decided, Epic's opinion would not matter.
Austin @ Apr 9th 2007 1:22PM
I stopped reading the posts but no one has discussed that this guy "Tim" just stuck it to MS, the publisher of there hit game, in a public forum because they were not happy about a negotiation in selling new content.
Tim might want to brush the dust off his resume.
Jake @ Apr 9th 2007 12:41PM
Let me try to break down the different business models for some of the crazy socialists here.
Nintendo Wii: Profit off the hardware, games, and downloadable games. Sell each thing individually for large (40% to 500%+) profit margins. Provide for free online channels to increase the value of the hardware itself. Charge on the high side for everything else. Successful thus far.
PS3: Incure huge losses on the hardware to ensure Blu-ray is a successful movie format. Just get by on the gaming side, online, first party, and 3rd party exclusives. Rely on loyalty to get you through the first year. By then, userbase is sufficient and blu-ray wins. Successful thus far.
360: Incure large losses on the hardware to get a userbase going. Launch first and secure the hardcores (i.e. HDTV owners). Provide excellent online, 1st party games, and lots of downloadable content, charging for much of it. Sell lots of 1st party accessories, games, and downloadable content to make back money off hardcores. Basically, break even with casual to fairly serious gamers and make a ton off of the types of people that own every periphreal and upgrade to Elite, etc. Hopefully one day have a solid IPTV/DVR platform. Then, take over the world and enslave all linux users. Successful so far.
PC: I don't understand this one that much. Some companies incorporate spyware and advertisements into their online priveledges. Some do not. I really don't understand how a good game is profitable on this platform. The game don't cost as much and there are free downloadables. Yet, the platform is half what it was 10 years ago as far as total revenue goes, despite many, many more people owning computers. ??? perhaps someone can help me out.
Pixelantes Anonymous @ Apr 9th 2007 12:45PM
"Would Best Buy let any publisher have shelf space to give away a free product?"
There is no shelf space with electronic downloads.
Bandwidth costs are minimal compared to the extra copies of GoW they'd sell and the goodwill they'd generate, if they made the maps free.
In the end, as a consumer I'm am not interested in paying $5 for goods I could've had for $0 if not for some jedi mind games by the marketing people at Microsoft.
Vidikron @ Apr 9th 2007 12:45PM
@44
But I don't really think most people are arguing that MS doesn't have the final say, they clearly do. The real debate is whether or not this is a smart decision. IMO, it's not. Content developers should be able to distribute their conent for free as along as they are willing to pay for the bandwidth. Everyone wins in this case.
I understand why MS wants to charge. They see an opportunity to turn a quick buck on the popularity of GoW. Epic wants to use the free maps to generate goodwill among their consumers (Live and MS would also benefit from this goodwill). Both has easy-to-see benefits, but MS really should allow the conent devs to decide if something like this is free as a news item like this only generates negative press for MS and Live.
I guess this is almost a win-win for Epic though. With this news being released they still benefit from the goodwill because no everyone now knows they wanted to do it for free, but the MS wouldn't let them... and they also benefit from the profits of the fee.