Tuesday, January 29, 2019

Emulation and Piracy and Independent Video Game Stores

I wrote last year about the reasons I don't bother emulating or pirating software anymore, but I didn't really reach the issue of why emulation and software piracy is a dead end from the business perspective, even if the store does not actually provide any infringing content (though some do).

I hope I don't have to teach my store-owning readers to stay the hell away from software piracy in the first place, right?  Like, I realize there are some businesses out there that just don't get the message, and actually sell goods or services tailored toward infringement, such as a store to the northeast of me that is (at the time of this writing) so legitimate it has no real web presence other than just social media links and Craigslist ads.  They'll sell you a jailbroken Amazon Fire Stick and shrug their shoulders when Cox Cable cracks down on you, or so claim their customers at the above link.  And they aren't the only ones; a cursory search will lead you to local sources for bootleg XXXX-in-1 video game players, modified original Xboxes with thousands of ROMs installed, "reproduction" counterfeit game cartridges, and so on.

Nintendo notices piracy at scale, but won't likely do anything against private home usage.  As my earlier article noted, emulation isn't even the superior experience anymore, but I grant that for ultra-rare titles you'll never find in an arcade or never locate an authentic copy for a console, running a ROM in an emulator is excusable to some extent.  That excuse doesn't wash for the vast majority of emulation usage, which is to play ultra-common content like Super Mario Bros or Castlevania, of course.  And let's be honest, nobody is going to use emulators just to play public domain (PD) ROMs or homebrew ROMs.  That has never been more than an ultra-niche use scenario.  And the "archival backup" fair-use exception to infringement is narrower than people realize.

But even if your video game store isn't going to come within ten miles of a ROM, it is still highly inadvisable to have anything to do with emulation, even tangentially enabling.  And I am making this argument purely on practical business grounds.  Look here.

The realistic realm of products that we could carry that cater to emulation are: USB "clone" controllers, Raspberry Pi hardware and related merch, and "MAME controller kits" -- basically arcade parts and kits that allow users to assemble them for ease of adaptation to emulation usage.

Each of those three has a fringe commercial application, and each of them has a fatal flaw that makes it worth staying away.

The USB clone controllers are the closest things to some veneer of legitimacy.  They are actual controllers, and you can use them on actual consoles that use USB controllers, or on Steam or Windows or MacOS, or what have you.  Some are shaped a lot like Nintendo 64 controllers or Gamecube controllers or others, and that may well be patent violating, but it's not the end user's problem when that happens.  It's up to Customs to stop imports when applicable.  I can entertain an argument that someone playing Axiom Verge on a PC might prefer the feel of a SNES-style USB controller for doing so.  And heck, wired controllers for the current generation of consoles (Switch, Xbox One, and Playstation 4) are all USB controllers, but are overwhelmingly acquired for use with their intended hardware platforms.

But let's be honest, the main reason to use a USB facsimile of the N64 Batarang is for verisimilitude when emulating that console and others like it.  Thus, the primary audience for such a controller is a gamer you don't want to cater to anyway.  We know this by understanding what he's not, and applying the process of elimination:

  • He's not a purist, because a purist would play N64 games on a real Nintendo 64, and would use a real Nintendo 64 controller.  
  • He's not a competitive gamer, because that gamer will use a real N64 with a CRT to avoid lag and a Smash stick modification to a real N64 controller, or a rare authentic Hori.  
  • He's not a collector, because the clone USB controllers have no aftermarket value.  
  • And he's not a casual gamer or parent buying for their kid to play; they generally won't set up an emulation rig in front of Junior (or at all).  They will buy used cartridges, or buy a digital download from the Virtual Console or Playstation Network or Xbox Live or Steam or the App Store or wherever their game is offered.  (Nintendo's first-party games won't appear on most of those other platforms, but publishers like Capcom, EA, Activision, Konami, and Sega are all over the place.)  

No, at the end of the day, the person who wants that USB controller is a gamer who goes out of his way to avoid paying for games.  A video game store can serve, in one way or another, a purist, a competitor, a collector, a casual, and a parent.  There's not much of a business case for serving a gamer who, by definition, doesn't want to have to buy anything.  And even if everything goes perfectly and you make that sale to that gamer, you know good and well they're never buying anything else.  That makes the product less attractive for us than products that lead people to further engagement, whether video games or tabletop.  We could have been serving a better customer, to put it bluntly, with that time and inventory budget.

What about the Raspberry Pi and related items?  It's all commodity hardware, so margins are going to be questionable, and commodity hardware is not the business we're in anyway, and to the extent that it overlaps into our business, it's the worst end of what a Pi could be used for (from our vantage point).  I can even be charitable and say that your typical Pi user might be very conscientious about legality and have no intention of infringing emulation (a supposition not supported in reality, but just suppose).  And that would leave us with that user as a hobbyist, and if we've learned one thing in this trade, it's that the hobbyist customer is typically far deeper into their niche of the market than what a local physical retail store is going to serve.  They scarcely have need of any store selling most Pi stuff; for their particular project they need 3-D printed custom assembly elements, customized code, and so on.  They dwell in /r/raspberry_pi and they delve deep as a Moria dwarf.  For the same reason most Warhammer stores don't stock a ton of Forge World, and most Magic stores don't offer alters on demand, and most board game stores don't spread an aisle full of Broken Token, most video game stores are smartest to leave Raspberry Pi alone.

Finally, MAME controller kits.  I will entertain an argument that arcade parts generally are a fine thing to sell, in that they are typically produced legitimately, and there exists real demand among arcade collectors for such parts.  Of course, once again, if you're running a video game store, you're not necessarily running an arcade video game store, because that market has a vastly different scope of needs.  It's fundamentally a hobby for geezers like me who buy antique electronics and restore them.  Actual controller parts end up being something of an afterthought, since a given cabinet only really needs to have the control panel fixed or rebuilt once, and the parts are dirt cheap straight from China or from the handful of existing focused resellers.  Instead, most days we're buying soldering supplies or electrical parts or carpentry stuff for working on the cabinet exteriors.  And that's without even pushing into the realm of pinball!

And oh, man, if you thought software pirates didn't want to pay for things, you haven't begun to interact with arcade collectors.  You'll never meet a bigger bunch of cheapskates.  These are guys who are used to getting things for free or next-to-free, often from the scrap heap.  They all haggle like their lives depend on it, simply for the ability to brag later about how little they paid for their "finds."  (Naturally, when they go to resell, their collection is suddenly valuable.)  These are the guys who literally will order online to save fifty cents on an $87 part because they don't care if it takes a week for the part to arrive in the mail.  They've been working on that dead Tempest in their garage for a few hours a week for the last three years, what do a few more days matter?

Suffice it to say most video game stores are unlikely to stock in breadth, and at prices attractive to the target audience, a viable inventory of arcade supplies.   That is, again, unless the plan is to cater to people building MAME boxes to run pirated arcade ROMs, because they will be unfamiliar with the economy of the arcade aftermarket, and will grudgingly pay some amount to get their box built so they can enjoy those thousands of illicitly acquired games.  So at that point you're kind of stretching the limits of plausible deniability, and you've also circled back to the problem of offering a product intended for an audience that doesn't want to pay for its video games.

At least the crusty old arcade collectors tend to be purists who want authentic hardware with real vintage market value, and their supply purchases are purpose-neutral to the likes of Mouser, Home Depot, Fry's Electronics, and the other vendors they utilize.  Not the case with emulation until you really squint and ignore that smell.  You've got an adjacent theory?  Maybe you run fighting game tournaments and you have a customer base who wants to build their own fight sticks?  Yeah, save it for the deposition.  The prospects are fatally marginal beyond what saturates the totality of the worldwide market for this stuff... and that market space is closed out already.

Ultimately, it is bad business to go to these lengths to bend over dollars to pick up dimes.  It is worse still to do it knowing the publishers despise it.  Suppose your video game store has developed to where you're getting substantial quantities of new front-list product day-and-date from the likes of Nintendo, Sony, Microsoft, Square Enix, Bethesda, EA, and so on.  I don't deal in new first-party merch for now because margins are tighter than I'd like, but suppose you're positioned in the market where it makes sense for you to do it.  How do you think those publishers are going to react when they get a tattle screenshot emailed from your competitor showing them that you cater to the emulation market, even indirectly?  Do you suppose that makes Nintendo eager to continue a business partnership with you?  They don't need independent stores, they get all the volume they want in the mass market.  Hot titles and consoles come out and we wish we could get enough to meet the demand of the phone calls and message inquiries that bombard us at release time.  If you carry Magic: the Gathering, would you sell supplies for making proxies and expect Wizards of the Coast to be in a supportive frame of mind?  Get real.

There it is.  Emulation and piracy are realities, they aren't going away for at least the time being, and though I've made the argument (link at start of article) that they aren't even as useful anymore as just paying for legitimate options, I know there are people who will continue to emulate for the purpose of playing pirated software.  If you run a game store, you have no excuse: You should now be able to recognize the necessity for your business to steer clear.  You want to screw around with it on your own time at home, who cares, be my guest, knock yourself out.  But keep it away from your business, your livelihood.

We are in a boom cycle for retro video game collecting and playing, thanks to a combination of great throwback products, inexpensive access to retro titles both via cloudware and physical console media, streamers and YouTubers plumbing the depths of yesterday's hidden gems, and high market efficiency made possible by mature e-commerce channels and maturing social media channels.  Jump on board the legitimate money train and don't waste your time with the pirate ships moored down at the docks.

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