Hacking the entertainment industry

Escrito el 24 Julio 2005 por Ricardo Pérez Garrido en Entertainment

This week GTA San Andreas, a popular video game, saw its rating evolve from “M” to “Adults Only” in the USA. The Entertainment Software Rating Board (ESRB) decision forced Take 2 Interactive (owner of Rockstar Games, creators of the game) to announce that they will cease the production of the current version of the game, and provide a patch for the “hot coffee” modification that caused the re-rating. San Andreas, the last instalment of the GTA game series, has already sold 6 million copies, with the complete series, created in 2001, accounting for more than 21 million copies and more than $900 million in total revenue.

The controversy comes from a piece of code that independent programmers added to the pc game, uncovering sex-related scenes (called “hot coffee”) that, according to the company, where never meant to be seen.

Gaming companies have traditionally encouraged players to modify (mod) their games, to help enhance the user experience, and, more importantly, extend the life of the product and its online revenues. Now this decision casts some shadows in this “democratization” movements of the industry, forcing companies to add extra security to their games and prevent some forms of “modding”.

With the entertainment industry facing increasing risks over higher piracy rates and decreasing revenues from traditional distribution channels, encouraging customers to build a better experience with your products for the next customer in line (and for free) is probably a good strategy. Preventing it might cause problems difficult to foresee at this point.

Last week several retailers (Wal-Mart, Target) announced they will remove the game from their stores. Take 2 is changing its forecasts accordingly (source: company site):

“As a result of the re-rating of the game, Take-Two is lowering guidance for the third fiscal quarter ending July 31, 2005 to $160 to $170 million in net sales and a net loss per share of $(0.40) to $(0.45) to provide reserves for the value of the title’s current North American retail inventory. Accordingly, guidance for the fiscal year ending October 31, 2005 is also being lowered to $1.26 to $1.31 billion in net sales and $1.05 to $1.12 in diluted earnings per share”.


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