Post by leunas on Oct 12, 2006 11:55:38 GMT -5
So Gamespot announces its digital distribution offering, and GameDaily somewhat inanely muses, "It will be interesting to see what kind of publisher support the new GameStop service gets going forward."
The answer is: This is Try Media's 'white label' offering branded for Gamestop. It isn't "Gamestop's new service;" they've just made a deal with an existing digital distribution operation to brand it with their brand. Gamestop is passing off control over what games get on their online service to Try Media, abrogating their role as a product filter for gamers. Gamestop will have no role in negotiating with publishers, or even in determinining what product they will have available to offer; that will be up to Try Media.
Now, let's parse this a little.
Is this good for GameStop? In the short term, yes: with very little effort, they get a digital distribution site up and operating, with a deep inventory of product (mostly older titles from major publishers and casual games). In the long term, it means they are missing a bet--they're passing off a substantial piece of the consumer dollar to TryMedia, instead of building their own, competitive operation. Try Media must be cock-over-hoop about this; they've just sterilized one of the largest potential competitors, by getting in bed with them.
Is this good for TryMedia? Oh. OhGODyesYEsYESSSILOOVEEYOU...aaaGGHH!!
Is this good for developers? Hahahahah. Ahah. Heh.
Let us take a typical development deal; publisher gets everything they can scare up, less, say, 15% of net to the developer. In a brick-and-mortar retail environment, in an ideal world, that means retailer gets 20%, plus some MDF dollars that come off the top before the developer gets paid, so maybe more like 40%, so the developer actually gets 15% of 60% of the consumer dollar, so like 9%. (Recoupable against advance, of course.)
Now let's enter the brave new world of electronic commerce.
I am not, of course, privy to the details of the deal between Try Media and Gamsespot. But there really isn't an equivalent of MDF, so let's say Gamespot has negotiated a deal whereby they get 30% of the consumer dollar, with the rest going to TryMedia.
I would guess that TryMedia wants, oh, 40% of what's left over, so that means they pass on 60% of 70% to the publisher, so 42%.
Who passes on 15% of 42%, or 6.3% to the developer.
So the developer, who was being royally screwed at 9%, is now earning 6.3%
Oh brave new world, that has such deal terms in it!
www.costik.com/weblog/2006/10/gamespot-and-digital-distribution.html
The answer is: This is Try Media's 'white label' offering branded for Gamestop. It isn't "Gamestop's new service;" they've just made a deal with an existing digital distribution operation to brand it with their brand. Gamestop is passing off control over what games get on their online service to Try Media, abrogating their role as a product filter for gamers. Gamestop will have no role in negotiating with publishers, or even in determinining what product they will have available to offer; that will be up to Try Media.
Now, let's parse this a little.
Is this good for GameStop? In the short term, yes: with very little effort, they get a digital distribution site up and operating, with a deep inventory of product (mostly older titles from major publishers and casual games). In the long term, it means they are missing a bet--they're passing off a substantial piece of the consumer dollar to TryMedia, instead of building their own, competitive operation. Try Media must be cock-over-hoop about this; they've just sterilized one of the largest potential competitors, by getting in bed with them.
Is this good for TryMedia? Oh. OhGODyesYEsYESSSILOOVEEYOU...aaaGGHH!!
Is this good for developers? Hahahahah. Ahah. Heh.
Let us take a typical development deal; publisher gets everything they can scare up, less, say, 15% of net to the developer. In a brick-and-mortar retail environment, in an ideal world, that means retailer gets 20%, plus some MDF dollars that come off the top before the developer gets paid, so maybe more like 40%, so the developer actually gets 15% of 60% of the consumer dollar, so like 9%. (Recoupable against advance, of course.)
Now let's enter the brave new world of electronic commerce.
I am not, of course, privy to the details of the deal between Try Media and Gamsespot. But there really isn't an equivalent of MDF, so let's say Gamespot has negotiated a deal whereby they get 30% of the consumer dollar, with the rest going to TryMedia.
I would guess that TryMedia wants, oh, 40% of what's left over, so that means they pass on 60% of 70% to the publisher, so 42%.
Who passes on 15% of 42%, or 6.3% to the developer.
So the developer, who was being royally screwed at 9%, is now earning 6.3%
Oh brave new world, that has such deal terms in it!
www.costik.com/weblog/2006/10/gamespot-and-digital-distribution.html