But all business is based on greed, greed from the top. The business plan is to sell a service, item or belief to someone. You can make 10 million red hammers, in some places those hammers will sell like cold water on a hot day. In other places, their sales pale to the blue hammers.
What makes that change?
The consumer, the consumer has the power to end the business plan at any given time, by simply choosing not to buy into the concept of greed.
Our economy is based on a simple idea of credit/debt. The more credit you have the more debit you have and the more you pay to have both.
Places like Walmart do so well is simple, when some one makes just enough to get by they tend to find the bargains. Instead of paying $3 for a gallon of milk, they will buy it for less, even it is only a nickle, for every nickle adds up.
The true business idea is selling a quality item at a reasonable price for that market. If you have ever traveled from New York to California, all along the way you will notice how some things in some parts of the country are dramatically priced differently.
For example, electricity, gas, blue jeans and yes even video games. If the market can tolerate a $30 dollar game then it will sell, the trick is finding out how high you can sell it with out scaring away buyers.
AH is a prime example, everyone attempts to sell an item a few coppers less than the current price. But there is always a bottom line, where cost comes in to produce that item, that the price will not go below.
For some all that means is they need to go collect the items themselves to create the product and not buy the materials which increases the cost.
On one final note, I don't work in sales, but I have 26 plus years in manufacturing, I have seen first hand and personally what greed can do to the product and customer base.
CEO's seem to think that the majority of people who buy their products are dumb and prone to impulse buying. For the most part they are, those who can afford to pay seldom give a thought to what it costs. But when the pennies are being counted, those are the people who look for the bargains, not just a cheap rip off, but a good high quality product at a price that fits into their budgets.
During a recession, the people counting pennies out number the ones who aren't.
Would I pay more to continue playing the game? Probably not, as the game is a luxury entertainment for me, one that is already, by definition, susceptible to elimination.
Blizzard CEO Opens Mouth, All Hell Breaks Loose
The gaming community went nuts over a remark made by Robert Kotick, Activision-Blizzard's CEO...he'd gladly raise game prices if it was up to him.
Sometimes it's tough being blue. Blizzard, that is; or technically, Activision-Blizzard. It can be easy to forget that the developer/publisher that launched World of Warcraft a few years ago isn't quite the same company it is today. Except, that is, during times like these.
Because of a recent remark made by Activision-Blizzard CEO Robert Kotick about raising the price of video games (and, perhaps, the recent news that StarCraft II's release is being pushed back until 2010), some gamers and MMO fans are on the verge of an all-out, nerd-rage meltdown.
But is the anger really justified? Or is this just another example of the anonymous online collective banding together for a quick "screw the Man" tirade, only to dissipate and retreat to its usual consumer habits a few weeks later?
In a conference call between research analysts and Activision-Blizzard last week, one of the analysts—Tony Gikas—asked about the company's "comfort level" regarding its new, higher-priced games. (He was referring to games like Guitar Hero, which are bundled with special controllers or peripherals.)
Activision CEO Kotick replied, "You know if it was left to me, I would raise the prices even further," according to the transcription from the conference call (via vg247.com). As you can imagine, if you haven't already seen the resulting blowback from the community, a whirlwind of accusations and speculation ensued.
Some websites and blogs reported the story with a level-headed approach, while others pretty much demonized the CEO, accusing him of devaluing customer loyalty for the sake of pure greed. One guy,("James" of WeDoTech.net, even called for a boycott of all Activision properties in a video that's been making its way through the blog circuit. He claims Kotick and Activision-Blizzard are setting a harmful example within the industry, and placing us in danger of a gaming price-fixing fiasco reminiscent of the late 80s.
This isn't the first time Kotick has met opposition from the media and gaming communities; he's been quoted as saying that Activision-Blizzard doesn't consider a game worth publishing unless it has "the potential to be exploited every year on every platform with clear sequel potential and have the potential to become $100 million dollar franchises," according to MTV Multiplayer.
Another scathing—yet truthful?—commentary comes from a classic ArsTechnica editorial, written by Ben Kuchera back in January:
With Kotick, he's very brazen about his need to squeeze every last dollar he can out of every franchise under the Activision Blizzard label. He wants to exploit his games. He wants to make sure he has a sequel every year, and don't forget the Wii and DS ports. Why have one StarCraft game if you can have three? Just because people are used to Battle.net being free doesn't mean you can't find some way to make more money from the service.
World of Warcraft may look like it will go on forever, but the only thing greater than the loyalty of those players is Kotick's cash-lust. The only question is if the two will ever collide.
As an MMO fan, it's a bit easier to turn a blind eye when you're confronted with news and commentary like these, especially if you only play PC games and don't dabble in the console market. But don't mistake MMO or PC properties as inherently immune to the same issues and concerns that the console gaming community faces.
It used to be that the traditional, "living room gaming" market; i.e., console games, utterly decimated PC games, in terms of sales. In recent years, the gap between the two has significantly started to narrow. The whole Activision-Blizzard entity is, itself, a testament to that fact. Admittedly, Activision-Blizzard makes for an easier target to exemplify this concept, but the same is true with companies such as Electronic Arts, Atari and Sony; console and PC gaming have become bedfellows, both sharing a single publisher or developer.
That also means the successes or failures of each industry within a company like Activision-Blizzard aren't as insulated from each other as they were in the past. To illustrate that dynamic, consider the pushback of StarCraft II's release date. Activision-Blizzard explained the reason for the delay, claiming it needed to work on the Battle.net service before it launches the game. A portion of the official release:
Over the past couple of weeks, it has become clear that it will take longer than expected to prepare the new Battle.net for the launch of the game. The upgraded Battle.net is an integral part of the StarCraft II experience and will be an essential part of all of our games moving forward. This extra development time will be critical to help us realize our vision for the service.
According to Kotaku's coverage of the story, Activision-Blizzard is forecasting its global revenue in 2009 lower than it originally predicted—and partly due to StarCraft II's new release date. The upcoming StarCraft II trilogy will no doubt be a money-making cash cow, and it's no surprise that Activision-Blizzard wants to make sure Battle.net is working optimally by the time the game launches. You have to wonder, though—would things be different if the two industries weren't so intertwined as they now are, relying on each other's success and affected by each other's failure?
Sometimes it's difficult to remember that a video game publisher's sole reason for existence in this world is to make money, especially with the kind of media coverage we're privy to online. It can be tough for many gamers to see anything but the color red when they have honest issues and concerns as consumers, yet stumble upon an itemized report of Kotick's $15 million salary for 2008.