The games conundrum

By Sarah Stokely

Cover feature, CRN (Computer Reseller News) 23 February 2005

Passing the censors is one of the last hurdles a new computer game needs to clear before hitting the market.

While a swirl of controversy and the suggestion that a new game might not scrape through the censors might be easy pre-release publicity, the product becomes worthless to its publisher if fails to clear the Office of Film and Literature Classification (OFLC).

Although receiving a classification is standard procedure, the fact that two games were banned from sale in Australia last year has highlighted the difficulties facing the publishers of adult-themed games in a country with a maximum game rating of MA 15 .

And with several major game studios currently working on games based on cult gangster movies, the bounds of our games classification system may be tested again this year.

Electronic Arts recently confirmed it will use Marlon Brando’s face and likeness in this year’s Godfather game, while one of Vivendi Universal’s key releases for the year will be Scarface, based on the 1983 Al Pacino film.

It is slated for release in Q4 this year. Both publishers are understood to be aiming for an MA or MA 15 rating, as no R category is available in Australia.

Apart from the lost sales if a game is deemed illegal for sale, once a title is banned, or refused classification, the game leaves the legitimate sales channel and moves underground, putting more pressure on an industry already fighting a piracy problem.

Piracy is the biggest threat facing the games industry, according to trade body the Interactive Entertainment Alliance of Australia (IEAA), which represents 15 of the top game platform holders and publishers, including Electronic Arts, Vivendi, Sony Computer Entertainment, Nintendo and recent joinee Nokia.

The IEAA estimates the local gaming industry was worth $796 million in retail sales in 2003, with games software representing $462 million.

According to research commissioned by the IEAA in 2002, the price tag on the cost of piracy was $100 million, and was set to grow with the industry.

While the games industry is taking a number of new technological and marketing steps to stop piracy, the recent spate of games being banned may be playing into the hands of pirates, according to several industry bodies.

In fact, the OFLC’s own Review Board has previously noted the connection between banned games and piracy. In 2001, in the report on its decision to refuse classification to Grand Theft Auto 3, the Review Board report noted that anecdotal evidence pointed to the banning of GTA 3 as leading to a flourishing black market for the game.

The report quotes a post made to a gaming website two days after the Review Board meeting that banned GTA 3, which asked: ‘Now that it’s been banned in Oz, could I play the European version on an Aussie PS2?’

The fact that the game had been briefly on shelves in Australia (because publisher Take 2 Interactive had jumped the gun and released the game anticipating an MA15 rating), along with the availability of CD burners, meant piracy of the game was likely, the report says.

The ‘forbidden fruit’ appeal of banned games has also been flagged by computer game researcher Dr Jeffrey Brand, the director of the Centre for New Media Research and Education at Bond University, and author of a review of Australia’s games classification system, commissioned by the OFLC.

The appeal of the ‘forbidden fruit’- and the fact that they have no competition from the legitimate sales channel – is why banned games are music to the ears of pirates.

‘Pirates are very commercially oriented,’ says Nic Foster, regional director of finance and operations for Sony Computer Entertainment A/NZ.

He is responsible for overseeing SCE’s anti-piracy campaign for its PlayStation consoles. So does banning a game actually increase piracy? ‘Obviously that increases a pirate’s market, so that’s definitely a fair assumption,’ says Foster.

When CRN investigated the availability of RC (refused classification) games in Australia, our reporter had the opportunity to buy imported retail copies of Manhunt, Leisure Suit Larry: Magna Cum Laude (both banned from sale in Australia) and Postal 2, which has not been classified by the OFLC.

A spokesperson for the OFLC says that although games that have been refused classification do have to be removed from sale, the specific laws varied from state to state.

‘In some states it’s illegal to sell them, in other states its illegal to possess them,’ he says. While some Australian retailers are risking up to two years in jail or fines up to $24,000 for selling imported copies of banned games, online stores are another avenue for people to obtain games that have been banned from sale in Australia.

‘The internet has made it easier for people to order these things inadvertently or on purpose,’ says an Australian Customs Service spokesman. ‘There’s a reasonable degree of people assuming that what they can buy on the net is legal to import’.

Computer games were but a ‘very small fraction’ of the media being seized by Customs, he says. ‘It tends to be DVDs – standard movies and soft porn.’ Commercial quantities were not tending to be imported either, he added.

‘The bulk of what we see is personal importation of one or two items, either mailed or in luggage.’ When an OFLC Review Board refused classification to Rockstar’s Manhunt game late last year, it released a guideline for retailers advising them that the game and all related advertising had to be withdrawn immediately. It also stipulated that the ban also applied to online stores.

However, some games stores that ship internationally may provide a loophole for Australian buyers. Leisure Suit Larry: Magna Cum Laude was also recently banned in Australia, but the online store for its publishers, Vivendi Universal, has shipping options to Australia.

The website advertises ‘full nudity and sex scene footage not seen in the original version’ to purchasers over 18 years of age. The online order form, which converts the currency into Australian dollars, is hosted by the Vivendi Universal Games store.

Vivendi Universal was unable to provide clarification on its policy about shipping the Leisure Suit Larry game to Australian buyers by the time CRN went to press.

One publisher that confirmed it will ship unclassified games to Australia is Running with Scissors, a small US game publisher whose game Postal was banned in Australia in 1997. The sequel, Postal 2, was not picked up by any local publishers and thus it was not submitted for a rating through the OFLC.

Commenting on the copies of Postal 2 that were being sold at retail in Australia, company managing director Vince Desi confirmed Running with Scissors does not have a licensed publishing partner in Australia. ‘I’m glad to hear at least one retailer is selling it, even if they are counterfeit copies.

‘Yes, we do sell [Postal 2] online and receive many orders from Australia, so we’re happy to ship there. It’s quite expensive and a real show of support when someone pays more for shipping than the actual cost of the product they’re buying.’

Popular web auction site eBay is another avenue in which buyers can obtain banned games, either domestically or from overseas.

eBay has explicitly banned the auctioning of mod chip items on its site. In addition, its guidelines on ‘Mature Audience Material’ warn that buyers may be committing an offence by buying or selling such items on eBay, and adds that ‘eBay members should consider whether items they intend to buy or sell are legal’.

Nevertheless, a quick search of items available to Australia returns 21 copies of the Manhunt game. Several openly advertised it as a ‘banned’ game. But one or two banned games making their way into Australia via illegal imports is but a small fraction of the overall games piracy problem.

According to the IEAA, the major sources of pirated games in Australia are small, local operators with limited distribution networks such as public markets and internet and classified ads, as w
ell as ‘backyard operators’ who might distribute on a small scale or even just to groups of friends.

The widespread availability and low cost of CD burners had clearly facilitated the growth of these sources of pirated product, the IEAA claims. The impact of computer markets on the games retail channel varied across Australia, according to retailers contacted by CRN.

While one Melbourne-based distributor says that the problem of pirated games being sold at local markets is rampant, retailers in regional NSW and Adelaide say their local markets are not as likely to have pirated games on offer.

Hot spots for the sale of pirated games and mod chipping in Sydney include Liverpool, Campbelltown and Flemington, says distributor Tech Pacific’s games category manager Nathan Dingle.

Chris Bryant, owner of Noeleledge Systems in Taree, has been monitoring local markets in his area for some time. ‘They tend to be mainly hardware, not software,’ he says.

Adelaide was also less of a target, according to Rob Beaumont of Berlin Wall Software. ‘With a smaller and tighter population here in Adelaide, we are the lucky ones that are not so affected by piracy in regard to fairs.’

Despite the ongoing piracy problem, recent developments in game technology have been a ray of light in the anti-piracy campaign.

The move to online game play, and online registration, has allowed game publishers to target piracy and mod chipping.

For example, players of Half-Life 2 must have an online player account through publisher Valve’s Steam network, in order to play.

Similarly, the new generation of MMORPG (massively multiplayer online role-playing games) has reduced the potential for users to share or pirate copies of the game.

‘Half-Life 2 is certainly leading the way in anti-piracy measures, with your MMORPGs (World of Warcraft, Everquest, Dark Age of Camelot) following closely due to the genre of the game requiring registration and credit card details,’ says Beaumont.

‘Like World of Warcraft, other games are coming out now where at one stage we would sell 20 to 30, now we sell in bulk like 250 to 300, a sure sign for us that what the distributors and publishers are doing is working.

Either you have to register or enable something that stops piracy,’ says Beaumont. Console makers have also had some wins against mod chipping, according to Dingle. The online Xbox Live service was helping Microsoft crack down on mod chipping, according Dingle. Xbox Live has the facility to detect and disable accounts using chipped Xboxes.

The release of Halo 2 has seen a lot of players with mod chipped Xboxes forced to buy unchipped Xboxes, Dingle claims.

‘The server went into your Xbox and if it was chipped it stopped playing within 48 hours,’ he claims. Sony is also making strides against piracy, he says. The new slimline PS2 has so far thwarted mod chippers, he says.

‘At this stage no-one’s worked out how to chip them,’ he says. ‘They’re too small.’ Sony’s new PSP (PlayStation Portable), due out mid year, will be another blow against piracy, says Dingle.

While Sony has been tight-lipped about the anti-piracy components of its future releases, Dingle says the UMD disk being used by the PSP is only manufactured by one company in the world.

Unlike the universally available CD or DVD media, it might be two or three years before PSP-compatible discs become commercially available, he says.

SCE spends easily three quarters of a million dollars combating Australian piracy every year, says Foster.

He believes that Sony’s high profile anti-piracy campaign, which includes legal action, investigation teams and the monitoring of computer fairs, has managed to stabilise the rate of PlayStation piracy, but adds that it has also potentially driven pirates to other platforms.

Foster estimates that PlayStation games are pirated at a rate of one pirated disc for each legitimate one sold. With pirated games selling for up to $7 each, losses could be equivalent to 10 percent of the games software market, he says. In the most recent case of PS2 piracy, a Coffs Harbour, NSW man was arrested after police raided his home and seized two computers, five DVD-R burners and nearly 2000 individual film and computer game titles.

It was alleged that the pirated goods were being advertised through ads in local papers. Sony had also sought to stem the flow of pirated goods through computer fairs by making agreements with around two-dozen markets across Australia, says Foster.

Although confidentiality agreements meant he could not name the specific markets, Foster says the operators had agreed to ‘proactively notify’ SCE if they became aware of traders selling pirated PlayStation goods. ‘We also do random checks,’ he says. ‘From the PlayStation platform perspective we’re doing a lot,’ says Foster. But further work was needed on the enforcement side, he added. ‘The biggest challenge is for state and federal police to be given appropriate resources.’


  1. greylock Said,

    February 25, 2005 @ 4:25 am

    “‘I’m glad to hear at least one retailer is selling it, even if they are counterfeit copies.”

    That’s a bizarre quote.

  2. thunderfoot23 Said,

    February 26, 2005 @ 7:51 am

    Not really… A lot of musicians have the same sentiment regarding music downloading in general. They want the exposure and consider any lost sales money as advertising costs.