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July 11, 2007

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c&d

"If a game developer can write for the console free of royalties, the economics of the game console are broken."

I would say "broken" is a strong word. As it is now, console makers compete with each other in an environment where consumers are not completely rational, life-cycle-aware purchasers. In such a situation it makes sense to subsidize the initial purchase in order to get a greater marketshare and increase the network effects of being a popular console.

If a law were passed tomorrow requiring all manufactures to have open systems (or at least not allow them to use the law to restrict access to their systems), all consuls would increase in price and games would get cheaper. It is hardly evident that this would be harmful to consumers or break the market.

Doug Lay

> If a law were passed tomorrow requiring all manufactures to have open systems (or at least not allow them to use the law to restrict access to their systems), all consuls would increase in price and games would get cheaper. It is hardly evident that this would be harmful to consumers or break the market.

I agree with you, though in general I would rather see laws that protect reverse engineering, as opposed to laws that mandate open architectures.

We should see this debate play out in the upcoming 700 mhz spectrum auction. Commissioner Martin, apparently with the support of some members of Congress, is pushing a plan to reserve some of the spectrum for organizations that allow open access across their entire set of offerings. Existing carriers don't like this plan one bit, while Google is backing it strongly. Let's get ready to see some regulatory fireworks over the next few months!

wii

"If a law were passed tomorrow requiring all manufactures to have open systems (or at least not allow them to use the law to restrict access to their systems), all consuls would increase in price and games would get cheaper. It is hardly evident that this would be harmful to consumers or break the market."

I agree with this and actual think it would help the marketplace to have an open ended system for development. An initially high console purchase would in theory deter likely buyers but would be offset but the actual amount of cheaper games provided for the consumer

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