Games for Windows Head Says Microsoft 'Looking at Piracy Hard,' Hints at Digital Distribution

"There's been a lot of trend pieces about PC gaming is dying, and the decline of the PC, when that's absolutely not true. And in fact, it's not dying or declining, it's growing, and it's growing exponentially--and I think is on its way to growing even larger than the rest of the market."

As it turned out, the phrase "exponential growth" was used quite a bit during Games for Windows global director Kevin Unangst's speech, delivered Thursday on the upper floor of a posh studio in San Francisco. It became a sort of rhythmic meter, like the charted points on the many illuminated graphs behind him, all slowly marching upward to a triumphant rise of the PC gaming industry.

In theory.

Unangst quoted some big numbers--$11.3 billion worldwide for PC gaming, as compared to $14 billion worldwide for consoles, a closer comparison than one might imagine. More digits from DFC Intelligence suggest that the PC market will increase 73 percent from 2007 to 2013. All of these are figures that Microsoft wanted to see when it began the Games for Windows project in mid-2006.

But a year and a half later, it speaks to the metered, subtle approach of the program that Microsoft essentially held a meeting to remind people what the brand was actually doing.

Primarily the label is responsible for encouraging publishers to adhere to its list of 25 standard requirements, from easy installations to online connectivity. In return, third party games can be branded with the attractive Games for Windows banner, all free of charge.

But behind the scenes, Microsoft is also doing what the company arguably does best--spend money.

"We said we were going to invest a couple years ago," said Unangst. "We spent double-digit million dollars in US retail. Sure we saw that single digit percentage decline, but we spent a lot of money at US retail. I'm optimistic that we contributed to holding that decline to where it was in some way.

"But who else was going to do that? Microsoft spent that money. We wrote those checks to work with the retailers, to create branded and dedicated areas to bring PCs back, to put 2000 playable PCs in GameStop stores--nobody else was going to do that. We're the platform owner, those are the things we do. We're on our third round of advertising, print and online in the US and Europe, to promote titles that we don't directly make revenue from."

Games for Windows also runs its own subscription-based Live! Gold membership, a service which has caught some flack for its relative lack of features as compared to the Xbox 360 incarnation. Unangst acknowledged that his team was still learning, and were investing heavily in functionality that would flesh out the service.

The Microsoft exec also praised Orange Box developer Valve more than once for its strong PC presence, while at the same time hinting that it may offer a competing service for Valve's digital distribution network Steam.

"I think Steam has done a good job creating a distribution network. There were some rough edges early on, they took a beating, but they've done a good job. Our role I think is to focus on, how do we improve the game experience by adding connectivity to the community, achievements, all those things. And then where it makes sense to add commerce on--whether it's full game distribution, whether it's selling add-ons to games, et cetera.

"There are areas that we will play in that we're not ready to talk about yet, but you're going to see that that is a big, big investment for us. I think it'll be after E3 that we continue to talk about that. Don't take our silence as lack of investment."

As for piracy, the leading scapegoat of the PC gaming's ailments, Unangst assured us that Microsoft wants to do something about it. But like so many others in the field, he offered no immediate solution.

"I think Microsoft certainly is looking at [piracy] hard. It is a problem--it is easier, fundamentally, to pirate a game on the PC than on the console. I think we have seen some good sides, things like Sins of a Solar Empire, that has been on the top 10 list and has no anti-piracy whatsoever.

"I think we're not saying that [no anti-piracy] is the end-all, be-all answer, neither is us having a single service that we provide. It is an area we want to invest in."

And so Microsoft marches on in the PC gaming industry, not quite leading the way, but certainly not sitting on its haunches. We can only look forward to hearing what they have to announce later on in the year.