The Fairy of Pirates and Purchases

With the recent revelation/rumor/report that hackers have made progress at cracking Nintendo’s 3DS, online debate begins anew over region locking and piracy. I’ll get the region lock question out of the way: I follow @EndRegionLock on Twitter. Enough said. (My account is here.)

Now we can concentrate on piracy. I won’t comment on the morality issue; in the early 2000s I enjoyed debating philosophy online, but in three years I don’t recall changing anyone’s mind or anyone changing mine. It was great fun, but “multiplayer” philosophy doesn’t accomplish anything “single-player” can’t, so no ethics discussion. This talk is about numbers.

In Nintendo’s seminal SNES classic The Legend of Zelda: A Link to the Past, throwing enough Rupees into a certain pond draws out Venus, a fairy who offers Link a choice of holding 5 more bombs (at least until the final upgrade) or 5 more arrows.

I’ve slowly been making a game in what spare time I have. Aside from the time investment, I’ve spent about $1023 on software tools and designing characters—pennies to a big publisher, certainly, but almost a full month’s after-tax, after-rent pay for me. Let’s say five years have passed, it’s the day before I launch my game, and I’m transported to Hyrule to meet with Venus. I don’t need bombs or arrows, so she offers me this proposal: a bonus of 10 purchases or 10 pirates. Obvious answer, right? 10 purchases. But after realizing the choice was too easy, she revises the options: 10 purchases or 1000 pirates. Equally obvious answer: 1000 pirates. If a mere 1.1% convert to buyers, I win with 11 purchases.

Her new counteroffer: 10 purchases or 500 pirates. Do I believe that at least 2% of pirates would buy, getting me to 10 sales? Without question. I have no statistics, but I believe it just as firmly as I believe that more than 30% of US drivers violate speed limits without studying that in any depth.

All of these are easy decisions because they’re based on sales that are known upfront or easily determined from conversion rate, but let’s complicate everything now. 10 purchases or 200 pirates. To keep things interesting, let’s say I don’t believe 5% of pirates will buy. However, I still feel confident that at least 2% will. On its sheer face, my choice is between 10 guaranteed purchases and 4 almost-certainly-guaranteed purchases.

…yet it’s not so simple. What about word of mouth? Time to get math-y.

    * With 200 pirates in tow, say 30% of them spread the word. On average my 60 pirates mention my game to 10 friends or family members each for a total of 600 others.
    * Of those 600, 90% don’t pay any attention but 10% at least look into my game, bringing me 60 new pairs of eyes.
    * Since they’re friends of pirates, we’ll highball and say that half of them are pirates too, so 30 people are left to potentially buy.
    * Of the 30, 80% don’t buy for varying reasons (no money, only buy physical games, don’t care for the genre, just don’t like its looks). That leaves 6 buyers in addition to my original 4 buyers out of 200 pirates.
    * Besides that, using the same rates as above, 9 of the 30 new pirates spread the word and successfully bring in 1 more buyer (0.9 to be exact).

In the original choice of 10 purchases vs. 200 pirates, the buyers would have also spread the word, but after running the math, this became a choice of 10.3 purchases vs 11. The 200 pirates won even though I didn’t make any extreme assumptions in their favor; if anything, I tilted the numbers against them. I don’t use Facebook and live anonymously online so my workplace doesn’t know what I’m doing, but even I can spread the word about a game to a few dozen Twitter followers—and one of them is McFunkypants, who has about 5,500 followers and tweets about nothing except games, mostly indie ones. In real life I wouldn’t be shocked if 1 pirate, not 60, spread the word to 600 people.

In reality, this is all a false dichotomy. Do you want more bombs or arrows? Link can go back and pay the fairy again—and again, and again, and again, until he maxes out his bombs and his arrows. Will I want purchases or pirates? My answer is “both.”

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