Just over a year ago the internet was the future, and investors were throwing money at the most hare-brained schemes. Then came the dot.com crash, shortly followed by a total collapse of the online advertising market in the second half of last year. Today most online companies are losing money hand-over-fist, and in the last few months this has started to effect the gaming community with a string of high profile websites, networks and service providers closing up shop.
And mostly it's your fault.
Can't Pay, Won't Pay
The problem is that most internet users have an unreasonable expectation that they should get everything for free. They won't pay their ISP, they won't pay their telco, they won't pay the company that runs the servers they play their Quake and Counter-Strike on, and they won't pay the websites that they read their news and reviews on every day. Some won't even pay the publishers and developers of the games that they play, preferring to get them from illegal "warez" sites.
Until last year this business model of giving everything away for free worked just fine, because companies could make money from their customers indirectly by selling advertising space. Unfortunately this is no longer the case, and unless the ad market picks up soon we are likely to see a large chunk of the internet imploding. Already the advertising crunch has taken its toll, with big corporate sites such as GameCenter, Daily Radar and the GameLoft network being forced to close, while hardcore community site ShackNews had to beg its readers for cash earlier this year after several overdue ad revenue cheques from UGO failed to materialise.
Meanwhile, here in the UK many of the leading gaming service providers have also collapsed. Gameplay laid off hundreds of workers earlier this year and are apparently now looking to dismantle the company, and Barrysworld had to sell itself to Electronics Boutique after declaring bankruptcy, having burnt its way through more than £1m of funding in under a year without ever showing a profit. Why? Because buying and running all of those game servers costs a lot of money, and you wouldn't pay for it.
We're Here To Make Money
The whole internet seems to be built on a philosophy that everything should be free. People will pay up to £5 a month for a single gaming magazine which is often poorly researched and inevitably a month or more out of date by the time it hits the news stands due to lead times, and yet most of them will refuse to pay to access a constantly updated website which they might visit dozens of times a month.
Recently ailing web company Snowball launched IGN Insider, a subscription-based service for their network of gaming sites which would give exclusive content in exchange for a small monthly fee. What happened? A group of self-righteous morons started up an online petition demanding that the gaming industry should refuse to support IGN until it ends its attempt "to extort money from its fan-base in order to compensate for its inability to run an effective business". Amusingly the petition's organisers are under the misguided impression that "gaming sites were, until this point, designed to collect information from game developers and share it with the gaming community", as if we were running some sort of welfare system for them. I'm sorry to disappoint you, but most gaming sites are designed to make money. Now that their advertising revenue has collapsed they need a new source of cash to pay the writers and editors who bring you that information, and charging subscription fees is the most obvious alternative.
And it's not just the hardcore gamers that have this delusional belief that we are here to serve them. A report by the Consumer Electronics Association a few months ago showed that a staggering 77% of people "believe they should get content online for free", while around half of those questioned thought that they shouldn't have to pay for any music or games that they downloaded from the internet. CEA president Gary Shapiro commented that "the challenge for our industry is to develop new business models .. and services which provide a balance between the legitimate interest of content owners and the desires expressed by consumers in this survey".
In other words, the customer is always right, and it's up to us to find new ways of paying for their god-given right to Free Stuff™. But in fact the customer is, in this case, quite clearly wrong. As the internet crash of last year has once again proven, "there's no such thing as a free lunch". Sooner or later people are going to have to start paying for services and content online, just as they have to pay for things in the real world. We've all been spoilt rotten for the last few years, but now it's time to wake up, grow up and pay up.
- This editorial is the personal opinion of the author, and does not necessarily represent the opinions of EuroGamer, the gaming industry at large, or our troupe of trained monkeys. Related Features -