Originally posted by: Eeezee
How is my economic logic flawed? None of those three points addressed my economic logic. When they use more DRM, more people pirate their software. DRM costs money. More DRM costs more money. More DRM causes more piracy, resulting in less revenue. Less revenue + more costs = less profit.
1) Fine, then let's ignore Stardock (even if you didn't provide a good reason for them not being in "the same ballpark"). Valve's DRM is unobtrusive. They're easily in the same ballpark. It is very rare to find a company that bothers with DRM that goes so far as to have a limited number of activations. Furthermore, EA's PC sales have been stagnant despite their efforts to ramp up DRM. If their people can't recognize a trend, then they deserve to fail. More DRM costs them sales, not the other way around.
2) In addition to Stardock, Valve's games go mostly unpirated despite pirated copies being readily available. Some people will always pirate. Most people won't, if given a reasonable alternative. Also, you're completely wrong when you say, "But let's be honest here; if people knew they could just grab a torrent and pirate away without fear of any kind of DRM would they? Oh hell yeah. Is DRM an effective means of stopping piracy? No, we all know that most (and eventually all) DRM is cracked." That is idiotic. The DRM is usually cracked by day three, if not day one. Thus, RIGHT NOW people can just grab a torrent and pirate away without fear of any kind of DRM. The people who are pirating games already have sufficient knowledge of how to DL/install a crack; all it requires is that you copy-paste a file. You don't even have to look for the crack, it will come with the pirated copy. A trained chimp can do it. If Joe Shmo doesn't know how to install a crack, then Joe Shmo also doesn't know how to start a torrent (or even what a torrent is). Thus, DRM is not doing anything.
3) Basic economics, pay attention because you failed to understand it the first time. EA pays out the ass for DRM, and what does DRM give them in return? DRM provides no increased revenue. If anything, DRM actually costs them additional revenue due to people who pirate their game out of principle.
DRM = higher costs (DRM costs money to implement)
DRM = lower revenue (DRM causes more people to pirate the games out of principle. If we ignore that group, the same number of people who would have pirated the game will pirate it anyway)
Higher costs + lower revenue (or even the same revenue) = less profit
Any moron can see this, which makes the guys in charge of EA lower than morons! No good business would adopt such a foolish strategy. The only reasonable DRM is a basic CD in drive check, because it effectively costs nothing to implement and prevents Joe Shmo from pirating easily. Even a server validation check like what Valve uses is reasonable, since those servers are also used for multiplayer, so it costs effectively nothing to implement this. SecuROM, however, costs considerably more than you might think.