Wednesday, 19 September 2012

Crowdfunding - Its Many Unexpected Virtues

Many years ago there was a computer game, a quirky little number, that went by the name of Psychonauts. Psychonauts was well received by critics, and had an adoring fanbase, but it never actually sold that many units. It's not an unfamiliar story, of course. Sometimes it's just that quality and popularity don't quite go side by side, and sometimes it takes time for people to catch on to something new. We all remember Fox's cancellation of Firefly, and its subsequent massive DVD sales.

Well now a sequel to Psychonauts is being made, despite those early commercial hiccups, thanks to a kickstarter funding appeal. Kickstarter allows price discrimination, so that fans don't all pay the same price. Instead of paying say $40 per unit, some may pay $20, some $2,000. This allows consumers who really care about something to chip in and help get it made. It also changes the formula, from 'units sold' to 'general appreciation' of the product.

In the past this has often been achieved for games by collector editions and the like, but they were limited and offered very few tiers of discrimination. They also happened *after* the game was made, and so played no role in the decision to greenlight it. Kickstarters create serious long term accountability for companies, by making them reliant on goodwill, and they create a more dynamic relationship between supply and demand.

Crowdfunding offers up many questions: Will it create more or less of a buzz around products during development? Will there be more or less marketing money spent? And will it even begin to take over areas of the market? Could it even be extended to helping to fund newspapers?

Newspaper circulation has dipped year on year over the past few decades, it has mainly affected the tabloids while broadsheets with their low, if loyal base have suffered far less. Broadsheets however famously unprofitable, so the question arises, is that base loyal enough to pay more in exchange for certain types of additional content and possibly accountability? If there is a clear understanding that without extra help papers could not survive independently, it's not impossible. Perhaps new papers could even arise on the promise to adhere to certain values, or cover certain areas.

That's just one possibility, more obvious is the area of entertainment media: As camera equipment becomes cheaper, and editing software more readily available, will even film and TV become more susceptible to crowdfunding and even sourcing over time? With modding software independent games, such as the ever-famous DOTA (defence of the ancients, a game developed from blizzard's real time strategy games and their mod scene, particularly WC3),  have already begun to be develop with increasing frequency, many of them sold over steam for relatively low prices. Could this herald an explosion in content creation? World of Goo, another extremely well received game made by a tiny group had serious problems with piracy, but if it was funded before it was made, this problem might not exist.

(I've looked it up, and VAT is paid on donations made contingent on future benefits)

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