Wednesday, December 03, 2008

FOSS business model for movies and games

tepples writes:

Movies are not FOSS, remembering that the last 'S' means software.

I mentioned movies because video games combine aspects of movies with aspects of non-game software. How does the purpose of free software as you describe it (to be productive) mesh with the purpose of video games?

Movies make more sense under a CC license if you want it to be that type of free, but that is something else entirely.

Can you think of any way that an organization could make money producing CC licensed movies?

This is actually a problem in a way for people that want FOSS to meet all their needs. The product needs to have intrinsic value to the person producing it. If 10 big companies need fancy expensive accounting software and are tired of poorly performing, slowly adapting, or whatever be wrong with some company that provides proprietary accounting software, there is motivation for those companies to work together to produce a FOSS solution. Also, if one company starts an FOSS project alone, there is hope that other people will join in to help improve the product, but it still never becomes the principle of the business. The threat is if the lost efficiency in producing the product in house (in theory big software companies could hire better programmers and are more in the business of hiring programmers) is greater than the total ownership cost of the proprietary solution + business lost from use of a product that does not meet your needs over time.

So this is the problem with Linux Gaming. There is little intrinsic value in producing a game. If, what you want is a great game to play with other people, again, where commercial games are not meeting your needs, then an FOSS product makes sense. Making accounting software to do good accounting makes sense. Making a video game to be able to play a video game doesn't have the same return on investment.

The most common example of an FOSS game as a business looking to make money is game engine and 3d video accelerator cards. Neither company is a "gaming" company, but they are trying to make a product profiting off of the gaming industry. Highly specialized cards having features that are not implemented in games. Look at the recent development in hardware accelerated physics. If you think you have a hardware feature or API that could make games a lot better, you need to demonstrate that to software developers and to customers to get them to produce for your card, and make the product of value to the consumer. So make an FOSS game. This is where proprietary would be VERY BAD. YOU know your product and what it can do, so YOU should be the one making sure that the real value of your card is demonstrated in the game. Are you really going to let some other company do that for you? I hope not! Further, you may only have time to demonstrate how great games made on your system COULD be without really making the game some all time best seller. But remember, that is not your business, your business is the card. Making the game open source gives other people the opportunity, if they like it, to build upon it and make it great. Any improvement, hack, fork, or just sharing of the product IS your objective and can only improve sales... assuming the card is actually worth buying and not vaporware. Your hardware is going to need to perform to be viable long term, but if you can build a community around your products, you will be golden.

Another example, World of Warcraft. They don't sell a piece of software, they sell an entire lifestyle and gaming solution :) Bit torrent drives their updates. Blizzard is invested in making bit torrent better. LUA is probably the best example, it drives the way people interact with the game. It lets you play the game you want to play it so long as it doesn't interfere with Blizzard's ends. Some work was necessary to ensure that the system could not be exploited, but it is perfectly reasonable to believe that one could have an entirely open source client (Like SecondLife, something with an open source client)... but Blizzard wants to protect certain parts of the experience. The server software is not given to the customer, so it is proprietary as much as any changes IBM makes to their own version of Red Hat, but I can assure you Blizzard doesn't host their games on Windows Servers :) However, if the source was leaked, or even given away or sold, Blizzard is successful because it provides an entire gaming experience. New content frequently comes out, the servers are very fast when you consider the number of players per server and such. It would be very expensive and difficult for someone to even grab a fraction of Blizzard's market share even if you had all the same equipment and their software, because there is so much more to WoW then selling a box. The best anyone can do is try to get copies of their content as fast as possible and hope people will want to play on your private server. The benefit is in managing a private server with your own rules and / or friends, but financial gain is unlikely unless you can provide something competitively different from Blizzard, and why should Blizzard care, they got their own thing that seems to work pretty well for them. By all right, the leak of the source code probably helped them cause it got people addicted, and then wanting more of a whole experience, better servers, more players and such.

As far as movies in games, again, is the game your product, or is the movie your product. CC the movies, and you will see people advertising your game everywhere for you as they add their personal touch. Fan art is one of the best things you can have that makes a community. Fans that don't share are not a community.

As for movies all by themselves, I am sure you can think of similar examples as above, but with movies you have boxed information. If we want to sell an experience or a service, what goes with movies that will make money with the distribution of the product without relying on a direct relationship between the number of times the movie is watched, and how much money you make? Well, with an CC-BY-NC-SA license ( I know technically NC isn't a Free Culture approved license, but bear with me ) Movies can be licensed to theaters. In the US, I think this would require much nicer theaters. I hear this is how things work in China. Either a producer pays to get the movie in the theater and gets a cut, or makes money licensing the movie to the theater. However, your movie has to be good enough that after it has been reviewed and watched by people all over the Internet that there is a motivation for people to come and watch it on the big screen, or whatever environment some venue provides. Of course that makes your business reliant in part on theaters providing a quality venue. The same is true for musicians. It is hard to make all your money off of concerts if there is no decent place to play.

Tell me what you think. These are the kinds of things I think of that would make piracy a joke and allow the benefits of information sharing to only empower the entire human race. I have been considering working on a business to provide consulting business on how they can be successful with open source models as part of their company considering if I am as critical as I have expressed of this article, I should really put my money where my mouth is. In such a model, I see free books, and very expensive on site consulting. No matter how good any book might possibly be, competitive edge is all about fine tuning your business to be ahead of the competition. The better the book and the better it works, the more I see such companies wanting to invest in some one on one help. And anyone wanting to steal this idea could only warm up the market place for such a service to be viable. :)

Did that more or less answer the question?

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