Hellraiser
Arcane
I'm not arguing with you that they could keep the profits, like I said they couldn't. The mismanagement was present in the aspect that Kodak ignored that digital cameras will kill off its profits and didn't prepare. The top level management expected that the core business will be a goldmine with those markups forever or at least for the next twenty years, that it wasn't a problem they had to deal with now, despite the fact that the technology which made all that high markup business obsolete was developed and pushed for by even Kodak itself, ironically enough. They failed to realize that which is why there now where they are under bankruptcy protection (or just coming out of it). If they scaled back costs in time this wouldn't happen, sure hindsight is always 20-20 but it is not like digital cameras which killed the core business suddenly materialized in stores out of thin air.
One of the basic things you learn about managing a business nowadays are Porter's five forces, among them is the threat of substitution which itself is a very old concept predating what porter created. The threat was in before their eyes and the managers ignored it thus failing business administration 101. Sorry but this is textbook mismanagement. If a meteorite fell on Rochester and they had no insurance from meteorite impact I would say they can't be blamed, but the problems are the results of managements stemming from the inability to notice certain things. Likewise the killer margins of overpriced CDs won't keep the RIAA labels afloat anymore but piracy is a convenient scapegoat they can use to justify lowering profits to stockholders. Frankly they would be foolish not to as otherwise the stock owners would kick them out so they're covering their asses.
Leaving that issue aside and back to piracy and gaming like I said the economics of the situation are such that piracy itself isn't a huge factor, as like I mentioned you wouldn't get every pirate to buy your game for full price. However considering that the margins off high-budget titles got lower its impact becomes more noticeable especially during the current era of cutthroat competition.
Nevertheless it merely sped up things which would already happen. DLC, "F2P" (pay to win), MMO and other money schemes would still be invented because the publishers would have to get money to cover those large AAA (ignoring the facts its a bullshit marketing buzzword that doesn't have any meaning by itself) costs from somewhere. Publishers would still bail from the PC market as consoles are an easier market, the userbase is bigger because they are more accessible. Like I said before as much as piracy is hurting them it is not the primary factor why the industry is in deep shit. The boom years are over, margins are low, costs and risks are high and competitors are many. Its a battle royal free for all and there will be blood. THQ already bit it and more will follow unless the suicidal AAA race comes to an end. If you ask me publishers aren't helping themselves when they dump money into restrictive and controversial measures like U-Play or Origin that don't really combat piracy. For one they're assuming the masses of consumers will be misinformed as always but even the dumbfucks know how to whine in comment sections and on twatter/derpbook nowadays. A waste of money and of reputation among consumers.
One of the basic things you learn about managing a business nowadays are Porter's five forces, among them is the threat of substitution which itself is a very old concept predating what porter created. The threat was in before their eyes and the managers ignored it thus failing business administration 101. Sorry but this is textbook mismanagement. If a meteorite fell on Rochester and they had no insurance from meteorite impact I would say they can't be blamed, but the problems are the results of managements stemming from the inability to notice certain things. Likewise the killer margins of overpriced CDs won't keep the RIAA labels afloat anymore but piracy is a convenient scapegoat they can use to justify lowering profits to stockholders. Frankly they would be foolish not to as otherwise the stock owners would kick them out so they're covering their asses.
Leaving that issue aside and back to piracy and gaming like I said the economics of the situation are such that piracy itself isn't a huge factor, as like I mentioned you wouldn't get every pirate to buy your game for full price. However considering that the margins off high-budget titles got lower its impact becomes more noticeable especially during the current era of cutthroat competition.
Nevertheless it merely sped up things which would already happen. DLC, "F2P" (pay to win), MMO and other money schemes would still be invented because the publishers would have to get money to cover those large AAA (ignoring the facts its a bullshit marketing buzzword that doesn't have any meaning by itself) costs from somewhere. Publishers would still bail from the PC market as consoles are an easier market, the userbase is bigger because they are more accessible. Like I said before as much as piracy is hurting them it is not the primary factor why the industry is in deep shit. The boom years are over, margins are low, costs and risks are high and competitors are many. Its a battle royal free for all and there will be blood. THQ already bit it and more will follow unless the suicidal AAA race comes to an end. If you ask me publishers aren't helping themselves when they dump money into restrictive and controversial measures like U-Play or Origin that don't really combat piracy. For one they're assuming the masses of consumers will be misinformed as always but even the dumbfucks know how to whine in comment sections and on twatter/derpbook nowadays. A waste of money and of reputation among consumers.