Thread by @Mortiel

@PixelTwitchTV @CristianCeo @TheRagingShadow @TimSweeneyEpic Now, we are starting to get into a lot of my professional experience here, so please bear that in mind when I say that it is demonstrably true that exclusivity commonly seen as the "Scorched Earth" strategy. Let me explain that... Bear with me, this is a bit complicated:

@PixelTwitchTV @CristianCeo @TheRagingShadow @TimSweeneyEpic So exclusivity, or vertical integration as I know it, ultimately sees one product/service lean on another product/service as a crutch. To keep the context relevant, Epic leans on exclusive games to get people to buy on the Epic Games Store. However, there are consequences...

@PixelTwitchTV @CristianCeo @TheRagingShadow @TimSweeneyEpic Vertical integration is expensive, especially as the subject of exclusivity gains more brand value. As a result, the integrator (Epic) has to apportion a large part of the budget to gaining and keeping exclusivity. Even a company as rich as Epic has finite resources...

@PixelTwitchTV @CristianCeo @TheRagingShadow @TimSweeneyEpic So, the integrator will divert strategic resources into integration. For example, this might mean hiring more sales/marketing/legal people instead or engineers, partnering with companies to improve the exclusive portfolio instead of the software portfolio. It shapes the company.

@PixelTwitchTV @CristianCeo @TheRagingShadow @TimSweeneyEpic In shaping the company in this manner, the integrator (Epic) then is focusing less on their own product/service (EGS), so it tends to fall behind competitors.

However, other products/services in the same market that have more attractive offerings can't compete...

@PixelTwitchTV @CristianCeo @TheRagingShadow @TimSweeneyEpic ...As easily because the integrator (Epic) has locked out competitors in their market (distribution) by integrating a number of products/services (games) competitors needs to do business at the same level.

So, as I always ask, how does this affect the consumer?

@PixelTwitchTV @CristianCeo @TheRagingShadow @TimSweeneyEpic Ultimately, the subject of integration (games) are not really impacted, positively or negatively. At least directly. More on that later.

What primarily is impacted is accessibility. In varying degrees, consumer accessibility is always and intentionally negatively impacted.

@PixelTwitchTV @CristianCeo @TheRagingShadow @TimSweeneyEpic Product/service inaccessibility, if done correctly, can be used to create artificial scarcity. Great example of this would be the iPhone when it launched. Because it was exclusive to AT&T, it felt like the iPhone was only for "special" customers, which definitely drove demand.

@PixelTwitchTV @CristianCeo @TheRagingShadow @TimSweeneyEpic If done incorrectly, however, it will create a "product black hole". All exclusivity creates some concerns of piracy. However, if this reaches a critical mass of piracy to start making the integrated product/service (games) an unsustainable business...

@PixelTwitchTV @CristianCeo @TheRagingShadow @TimSweeneyEpic That can cause both markets, the integrator (distribution) and integrated (games), to take a substantial downward turn. We saw this in the early years of digital music distribution, where the "primary" markets became the black market (e.g. Napster).

@PixelTwitchTV @CristianCeo @TheRagingShadow @TimSweeneyEpic While inaccessibility has the potential positive for a business of creating artificial scarcity, that doesn't directly benefit the consumer. It's manipulating consumers, in fact.

Seems like the downsides, in most cases, outweigh the positives, and never really benefit consumers.

@PixelTwitchTV @CristianCeo @TheRagingShadow @TimSweeneyEpic @threadreaderapp unroll