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As Recession Deepens, Used Games Get More Painful

December 8, 2008 Article Start Page 1 of 3 Next
 

[Gamasutra goes in-depth with analysts and developers alike on the used game controversy, with stats on top resale genres and Frontier's David Braben weighing in on why the resale market keeps game prices "artificially high".]

Was there ever a time when the video games industry and the resale market weren't at odds? Only now, with the economy circling the drain, developers and publishers are expressing their annoyance a little more loudly, a little more frequently. After all, as sales dip, it's painful to watch your brand new $60 game sell for just 50 bucks used one week after its release.

But that's the business model retailers like GameStop depend on. According to Michael Pachter, GameStop -- which, he says, holds about 90% of the used-game market in the U.S. -- took in approximately $2 billion on pre-owned games this year, which is about a third of its $6 billion revenue on games altogether. Pachter is senior VP, research, at LA-based Wedbush Morgan Securities.

Indeed, those numbers on resales are bound to head upward, says Nick Williams, as gamers -- like everyone else -- look to save a few bucks during the deepening recession.

According to his survey of 2,000 gamers earlier this year, one in four buyers who hadn't bought any used games in the past year says they plan to buy a pre-owned game in the next 12 months. Williams is director of entertainment and media insights at OTX Research in Los Angeles.

The survey went on to say that 49 million gamers bought at least one used game in the last year and 26 million sold at least one game -- with 61% of the buyers having done their shopping at GameStop.

However, the OTX survey was released in March, prior to the economic plunge, which means that actual 2009 numbers could go significantly higher as bargain hunters find the lower prices of used games more suitable to their budget-minded tastes. 

In a typical used-game transaction, says Pachter, a gamer will pay $60 for a new game, finish it in three weeks, and sell it back to a retailer like GameStop for $30 which then repackages it and puts it up for sale for $50.

"I remember when the first Grand Theft Auto came out," recalls Pachter. "You couldn't find a used copy for over a year. People were so amazed by the game, they played it forever. But now that cycle has accelerated and every game is available used after just a couple of weeks."

"You go into a GameStop intending to buy a new copy for $60 and the clerks are happy to tell you they can save you 10 bucks by selling you a used copy for $50. That's hard to resist. I mean, it's not like you're getting something that's dog-eared and unplayable. It's clean, looks the same, and has an instruction booklet."

If there's any doubt that the new-to-used cycle is now almost instantaneous, adds Pachter, "You ought to try it yourself. Call GameStop and ask them how much they're charging for Gears of War 2. They'll say $60."

"Then ask them if they have any used copies. I'll bet you anything they already have at least one. [Even if] the game's only been out for a week... You don't think that kind of thing gets the publishers pissed?"

Especially since the number and size of retailers in the user-game market are expanding. HMV recently announced that it is entering the used-game business in the UK, Dawdle.com is a new player, and a source within GameStop listed eBay, Amazon.com, and Play N Trade as its top competitors.


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Comments


Christopher McLaren
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Can't really see them able to stop this. It's not like the car industry could stop used cars being sold. It's a natural progression and mgith result in increased sales as those who quickly sell the game back use that money to buy another game.

E Zachary Knight
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I wish this article went more into why there are so many copies of games available only a week after release. They touched on it with GTA and limited replay ability. But they really didn't focus on it. They need to look more into that.



If Publishers really want to get more new sales and slow the influx of used copies of their game on the market, they need to make holding onto the game worth it. I like the idea of bonus content for new buyers. It gives them a benefit to buy new. But they shouldn't hurt a buyer or a used copy with it. That content should be 2 things, 1) No essential to completing the game, or 2) available for purchase at a reasonable price. If the bonus content is essential to completing the game, you are essentially selling only half a product. Can you imagine buying a book or movie and having to go to the author/publishers website and enter a one time use code to watch/read the climax of the story? Such a practice would kill the producer of such content.



Number two is not as essential to the plan as number one is. If the content is not essential, then it should not matter if it is available Yet, most buyers would feel cheated if they can't get it at all. So making it available for a fee would allow used buyers to get the content, and also bring in a little cash for the developer. A win/win situation if I should say so.



There are a lot of ways to make money off of games regardless of whether they are purchased used or new. The main hurdle in this is for publishers to stop thinking of their games as a one time blockbuster. They need to consider all the ways to make games more replay able and extendable. If a player can get more out of a game than a weeks worth of play, they will continue to play and will be less likely to sell it off. If someone does buy the game used, they will be able to buy content direct from the developer and the developer will make money off the used sale.



Finally, I agree with Gamestop's position. If you kill the used market, you have just destroyed a large part of the consumer's perceived value of your game. Believe it or not, but when people buy anything, one of the key things they look at is the investment potential of the product. Will they be able to get part of their investment back if they decide to get rid of it down the line. By telling that consumer that if they spend $60 on that game and won't be able to get any of that back later on, they will look elsewhere for the product.



Also, as a former employee of EB, I have seen it first hand where people would bring in half a dozen old games in order to buy the latest release. They do it and removing that option will directly and negatively effect their ability to purchase new games.

David Crooks
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There is a bit of a problem with the used car analogy, though. A used car has klicks on it, is less reliable, and is of a noticably lower quality than its brand spankin' new counterpart. With disc-based media, that's not the case. It's not like if I buy a used copy of Gears that all of the textures are down-res'd by a factor of 2; it's pretty much the exact same game I'd have bought new. Plus, used cars don't have that 1-day turnaround that games, apparently, now have.



One thing that could be interesting is if things like those online codes for things like free maps become a bigger force and start having greater incentives. I mean, not to the point of "This code will let you unlock the 2nd half of the game, or you can pay $20 bucks online for it", but what if the game was of a lower quality (in a non-critical) as a result of not entering the code? Like, lowering the res of all of the textures, or removing destructibility of cover.

Rory F.
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I agree with David, people need to stop using Used Cars as an analogy. A used disc (so long as it comes in the same box with the same manuals) is almost the same condition as a new disc.



I don't have any problem with the used game market in general, especially considering companies like Criterion and Epic are starting to intelligently capitalize on the new-purchase game with exclusive content and continuing DLC to make it worth holding onto a game. Also, small-charge DLC helps a developer/publisher in the long run, as they may ending up getting several DLC purchases from one sold title.



The problem I have with used-game retailers is the fact that their pricing is ridiculous - and artificially so. They are buying back pristine-condition games for half (at most!) the original cost, and then only discounting the item only 5$ off retail on the used rack. 55$ for a used copy of a 60$ game, when they probably paid 25$ for it is, in my mind, massive ripping off of the consumer.



Clearly, it works for them, as they are making record profit. Millions of gamers apparently don't care or think about the profit gamestop is making at their expense. Personally, it makes me sick, and I no longer use GameStop/EB and similar retailers. Some niche used-game stores offer better prices for turn-ins and sell used games at better prices, but craigslist, amazon, ebay and other work just as well for getting better deals. I hope the market matures to the point where Brick&Mortar retailers realize they need to cut their margins down to stay competitive. Because, as it stands, I get the same fury about it as when I hear Mobile making record profits when gas prices are at their highest.

Christopher McLaren
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Used car was to illustrate the point. Codes would be good but I think we are moving into downloadable content faster than most think, with the download locked to the address of the console. Does anyone remeber the free game that came with the MasterSystem?



I don't think that publishers can actively stop this but i see it as a good thing that anyone can buy old games. I still buy SNES, GameCube, N64 games when i can.

Andrew Heywood
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The car analogy is totally inapplicable, and in fact is a great illustration of why there is this problem, specific to games. Yes, with cars it is a natural progression, where people who don't have much money to spend can compromise on quality and pick up a second hand motor cheap. That's _not_ the problem with games, where the progression is distinctly un-natural.



The used car trade isn't particularly incentivised and driven by used car dealers, it's primarily driven by, as you say, people's natural desire for a bargain, and to earn some cash for something they no longer need/want. The used game trade is _now_ driven by games retailers, who artificially stimulate people's desire to trade in games, as they are able to push used games not as a bargain, but as a fractionally cheaper, otherwise identical alternative to a new one.



In fact buying/trading used games used to be a 'natural' process - I actually believe the DVD case has gone some way to exacerbating the problem :). A second hand game used to mean a boxless Megadrive cart with a tattered manual tied to it with a rubber band; or a grubby N64-cart in it's now-scruffy cardboard packaging, sans manual. A second hand game was truly 'used' (or at least tended to be a lot older), and therefore cost a lot less. At some point retailers realised that they could control the market by offering substantially better trade-in values for newer games - which are now easy to keep in pristine condition - and that they could push these games directly at customers who were planning on purchasing the new equivalent at full RRP.

Jake Romigh
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Not a lot of analogies will fit the same model as the video game industry relies on. We can look at the used car model and say that used cars get worse as they age, while used video games maintain the same quality (if properly taken care of, which is an iffy assumption to make in my opinion). Used DVDs are also very similar, where the quality stays the same from new to used, and the movie industry isn't doing all that poorly, and movies last even shorter than games (but are usually cheaper). Movies also share the piracy problem as well. (Whereas no one downloads cars...)



So why are the used video games hurting the video game developer so much? This article does a good job in summarizing possible problems the industry faces: piracy, replayability, and incentive to buy new.



I personally believe that replayability plays the biggest factor in the availability of used games. I believe that is what would explain the relative rarity of games like Fallout 3 and the huge amount of games like Bioshock. While both are great games, Fallout 3 is a huge world where you can do anything. This lends itself to being played longer and multiple times. Bioshock is a game of several choices and epic storyline. This kind of game can be played over again with different choices, but is still similar, reducing the amount of replays. Also, the value of trade-in is greatest when the game is newer, thereby increasing the value for the player to play through the game quicker if possible, to play the next big game. Since this is the case, of course you'll see used games the next week of a release: trade-in value drops drastically as the more weeks pass.



Players will often power through a linear game to get to the end for that kind of incentive. Since there is no incentive to go slower through the game or play it multiple times, the game will be turning up on shelves soon. Solution? If you can hold the player's attention longer by making the game longer, making the gameplay take longer to progress through (while not making the game completely frustrating and annoying), and entice the player to play through the game via a "New Game +" mode or just design a game to play differently the second time, the player will WANT to hold on to that game.



Of course, multiplayer will also draw the player online to play the game longer. If he/she has friends that play as well, through creative and well-designed social networking, the player will connect with friends and will not want to part with his/her friends and sell back the game; that is, until the next big game comes out! Even in that case, the game might not be sold as the players might still hold onto the game just in case they want to pick it up again. You can see this kind of game loyalties develop in games with great multiplayer abilities, such as Halo 3, TF2.



Long rant, but to make it short: add in incentive to make the gameplay last longer through gameplay or physical length means and add in multiplayer that actually connects friends and makes for a lasting nightly tradition. I'm sure there are other ways to add replayability, but I'm sure the fine folks on this board can write on those. I'm about down for my time.

Andrew Heywood
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No-one wants to stop people buying SNES and N64 games, or even year-old 360/PS3/Wii games (which cost say 50% of original RRP or thereabouts). Those games are truly second hand, and are purchased by people looking for a second hand game, with a second-hand budget.



It's the old-for-new syndrome - where a second hand sale is pushed by a retailer to directly, deliberately and cynically replace a new sale - that is the problem here.

Mark Cecere
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I don't think there are any analogies that fit.



Maybe they'll have to regulate the used game 'industry'. Keep records of buy backs/sales, cut the publishers/developers in on part of the action. A 20$ profit on each re-sale for offering this 'service'? Crazy. Shovel some of that to the game devs.

Conor McClain
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To heck with GameStop and the lot of the game resellers. What should be done is every developer simply begins inserting codes into every game they ship. The code gives access for your console and is one time use. End of story.

Jamie Mann
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It's interesting to see how the focus of this debate seems to be converging on the issue of "one day" trade-ins: the fact that games are being traded in while there is still a high demand for the title.



Personally, I think the game market *is* fairly similar to the used-car market: as soon as you've bought a game, it's monetary value drops dramatically (barring the odd thing in high demand, such as Wii Fit). The condition of the item generally declines in line with the age (i.e. scratches on the disk/lost manuals), which is factored into the calculation of its value. Finally, people tend to trade in their old games to buy new games - and the shops tend to offer higher value for "trade-in" as opposed to cash.



Finally, I don't think anyone can argue that the car industry would be able to survive without secondhand sales. I certainly couldn't justify buying a new car if it had a residual value of zero.



While the numbers are smaller, (and the turnaround time far quicker), I suspect the same is also true of the games industry - i.e. whether or not people actually make use of trade-in offers, the fact that a game has some residual value is a factor in choosing to buy it. It's the same principle as the rebate model: a sizable percentage of rebates are never claimed, despite their presence often being a major factor in choosing item A over item B.



An interesting point is that the Italian example Braben gave was around pirated media, not resold media. It's important to not confuse the two issues. Pirated media results in a complete loss of potential revenue; resold media results in both loss for the specific title being traded *and* gain for the industry, since the overall trend is for a percentage of the trade-in value being used to buy new games.



The question then becomes: how do individual developers mitigate the risk of their titles having a short turnaround time? Or, to put it another way: why are people abandoning their titles so quickly?



That's a question which touches on multiple subjects - not least the effectiveness of the various "longevity" strategies which are out there, such as unlockable features, multiple endings and downloadable content. There's also another factor: the three "most traded" games listed on page 2 were all heavily hyped prior to launch and/or achieved high review scores, which may have artificially inflated initial sales as people bought the "next big thing" before discovering that it's not actually something they enjoy. Rise of the Robots being the most infamous example of this...



Certainly, the current white-knight of online-only gaming isn't going to suddenly bring millions of extra revenue into developers: even the most optimistic quotes for the Xbox 360 only list half the userbase as having an XBL account (and matters may be worse for the PS3: with 44 million PSPs and 16 million PS3s, there's only 14 million PSN accounts across the two platforms). A smaller market and no trade-in or refund values: attempts to launch a high-cost blockbuster game via an online-only mechanism are liable to fail miserably...

Conor McClain
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^ except your forgetting that without resales, suddenly games get drastically cheaper

E Zachary Knight
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Conor,



And by doing so, completely destroy your company. People don't want to buy stuff they can only use once. IF their console breaks, they can no longer play the game. If your company goes under, who will be around to validate the codes. Those are two of the many many things that can go wrong.



Do you really want the games industry to fail?

Tom Krausse
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Ephraim,



I think that your second idea, the free DLC for new games, has a lot of merit. Of course, the trouble is getting it so that the DLC is non-critical, so that a person can by a used copy and still finish the game, but still making it non-trivial, so that people want to get it. For example, bonus costumes (such as LPB's God of War Skins, or the recent addition of alternate characters to XBox 360s Force Unleashed), would not work. However, a multiplayer map pack with a half-dozen extra maps would. Not having it would definately not cripple the game, but having it would be much more enjoyable, and thus add value.



Like I said, in order to matter, it does have to be something that people will care about, so I hope the developers remember that if they try and implement it.



Also, it could allow for retailer-specific bonuses, like the Target level in Shawn White Snowboarding. Again, the content should be made available by other means as well.

Tom Krausse
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Oh, and whoever commented on the fact that his example in Italy was pirated software, and not resales, I'd first like the two to be seperated. The company made profit off of selling 100 copies. While I doubt the full 10000 calls were from 100 legitimate copies, those 100 may have changed hands on numerous occasions, leading to a number much larger than 100 playing legitimate copies.



Now, figure that the company was paying to support some 9000 players that did not pay the company. Yes, this example is extreme, but the fact remains that doing stuff for free is a good way to go out of business. So while I can see the company wanting to support customers that paid them, they were also throwing money away to people who hadn't. After all, they had to pay the phone bill, and people to answer those 10000 calls, which couldn't have been cheap.

Peter Park
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Ephriam,



I disagree with your position.



If there's significantly smaller resale market, I think the industry will be actually way better off than now.



This is because game business is essentially based on selling *experiences*. This is not like cars, where the physical product and its condition represent the whole value of a product. Value of retaining a copy of a game drops significantly once its owner experiences most features a game has to offer. There's not much loss at selling the game to others, since the experience itself cannot be sold; it remains in the gamer.



IMO, the resale market in game industry should be really small, if not non-existent. I am completly for purchasing only the new copies, and keeping them. Same goes for movies; I watch them at theaters, rent DVD, and then if I like the movie, I purchase DVD to keep.

Frank Smith
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stop crying, every industry has to deal with second hand sale, cars, books, houses, everything. and don't no one give me that "you can't compare cars and house to games because the quality doesn't degrade in games." yes it does games get old, boring, and unpopular. you don't hear book publishers trying to screw secondhand buyers even though the printed wood doesn't degrade. ten or fifteen years ago no one cared about used sales, the only reason you care now is GREED, you all are going to drive this industry and your companies into the ground and say "current economic situations don't favor the game entertainment business...", when in reality your screwing customers by excusing bad games because of second hand sales, "we could have made it better, but no one was going to buy it new anyway, so screw it."



Make a game I'll want to keep. Done.



god this argument is so old, like we as a game industry are going to dissolve gamestop because we don't like their business model, when we ourselves have some of the shadiest, dodgiest business models around

E Zachary Knight
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Peter,



You are correct, the games industry does sell us on the experience, but that is not what is actually sold. You cannot sell an immaterial idea such as experience. That is just the promise of said product being sold. The Experience is part of the value equation, but not the product.



When people buy a product, it offers a number of features, both material and immaterial that make up the value of the product. People do by games because of the experience they get from said game, but once they have experienced that, there are fewer reasons for them to hold on to such products.



In your DVD example. You enjoyed the Theatre experience. You enjoyed the rental experience and thus you decided that the experience promised from purchasing a copy of your own was worth investing in and experiencing again and again. What happens when your purchased copy of that experience no longer provides the same for your? For most people, it sits on their shelves. But when it comes time to clean house or you need some money, the value of that copy of the movie will be used as you sell it on ebay, craigslist or some brick and mortar store that deals in used movies.



The same could be said of games.



Now let's say you have just experienced a game, but you do not feel so inspired to experience it again. What are your options under the world of publishers? Let it collect dust or throw it away. That is all they want you to be able to do once you have experienced all you can from it. But in the current market, although you have experienced it, the product that brought that experience still has residual value and you can sell it and get more money and free time to experience other games.



By limiting the used market and not focusing on ways to improve and extend the experience of games, you will be hurting the consumer. You may be making more money, but eventually, consumers will tire of buying games as tehy are finding fewer value increasing benefits.



Here I am, back at my original point of value vs. cost. Cost is easy to define and control. Value on the other hand is much harder to define and control. There are billions of people in the world. Each has tehir own tastes, cultures, norms, mores, ethics, etc that control their idea of value. Sure there are common themes throughout all mankind, but your idea of value or the publishers idea of value will not always be the same as the consumers.



Key factors that make up cost: Development, marketing, pressing, distribution, shelf space, etc.



Key factors that can make up value: Experience it promises, resale value, etc.



One final note before I end my long long rant: For those of you who think that games and cars are not comparable, think again. When was the last time you bought a car solely based on hard facts? When was the last time you saw a car ad that did not try to sell you on the experience the car provides? Just because a car physically degrades over time and you lose things like warranties, when was the last time you heard someone let that stop them from buying a 60' Corvette?

norb rozek
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Why own when you can rent? The fact that somebody will actually pay fifty bucks for a sixty dollar game they don't intend to keep for more than a week makes no fiscal sense whatsoever...

Jamie Mann
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@COnor:

Where's the evidence that the price will drop? Traditionally, monopoly markets (which is what will effectively happen) result in high prices and lack of innovation. XBLA provides one such example: there's no competition to drive prices down, which means that older titles have the same price as newer titles until/unless MS and the developer decide to go for a price drop (which, ironically, is likely to meet resistance from other developers worried about the cheaper games eating into profits for new titles). It could be argued that this is good for developers, but it's highly likely to kill off long-tail profits: why buy something old when something new is available for the same cost?



Equally, how far do the prices have to drop for games to be competitive when they have zero residual value? How much are you prepared to spend on something which you may not enjoy and cannot reuse, especially when there's dozens of alternatives (music, film, tv, books, cinema - and most of these offer residual value) competing for your money? $10? $20? $30?



(Admittedly, making demos available can help mitigate this issue: for instance, there's a lot of WiiWare games I'd love to check out, but Nintendo's "demos are optional" policy means I can't find out in advance if they're worth spending money on or not. Meanwhile, I've bought several dozen XBLA and Community games after playing the demos)



@Tom:

The point still holds true: an example of piracy was being used in a discussion about used games, which is somewhat misleading. It doesn't matter how many of the 100 copies had been resold:the issue is that over 99% of calls were from people who had pirated the game. Braben also doesn't state whether or not the support call system was being run for profit - and even if it wasn't, surely it wouldn't have taken too much to implement some form of piracy check: something as simple as asking for word X on page Y of the manual (assuming Frontier didn't utilise unique registration codes) would have scared off most support requests.



Free DLC is a nice concept - but as noted in the article, broadband penetration simply isn't at the point where this is a viable sales plan. It will become more viable in the future, but companies are far more likely to take the nickel-and-dime approach - EA have already dipped their toes into that pond, with gameplay-affecting DLC for Dead Space: you can buy powered up suits and weapons which then make the game a lot easier to play through.



@Peter:

Cars sell experience too: there's a reason a 3.0L Bentley costs far more (and attracts more attention) than a 1.2 litre Renault Clio. The value of both games and cars is based on age, the physical condition and demand - Panzer Dragoon Saga on the Saturn is worth more than a new copy of Dead Space on the X360, while a mint copy of Daikatana is best used as a doorstop.



However, unlike a car, most people only want to experience a game once: there's very few games which have a high replay value, unless there's significant unlockable extras or a multiplayer aspect. The problem here seems to be that the experience being offered is too short, and people are returning the game within days of having bought it.



Then again, it's likely to be impossible to extend the experience to the level needed: assuming the average player plays an hour a day, you need around 30 hours of good gameplay to keep the game out of the resale channel in high volumes during the initial sales push. Give or take the odd RPGs, there's very few games which can sustain a high quality experience over this length of time.



Also, you mention renting DVDs: surely this is the same issue as for trade-ins? I.e. the copyright holder only sees a single sale, while the media is used multiple times. If anything, it's worse: far less of the money from the rental goes back into new media.

Nikolaj Leischner
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The "used car analogy" illustrates that people are more likely to buy a new game if they know they can re-sell it. In that sense it does fit.



Actually, I suppose having no re-sale market wouldn't make much of a difference. Why should one assume people would spend more money on games? Maybe most people would simply prefer to buy games that have a high re-playability then. In turn the game industry as a whole wouldn't make more money but sales would shift more away from games without re-playability to those that have it.

Stephen Panagiotis
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I'm one of the few people who will ONLY turn in my games if I either A) need the purchasing cash or B) Really really really dont want the game anymore.



Which to say with the current economy, I've traded in a few more games then I typically would, but I honestly would rather pay the developers (purchase new) then buy used.



In all honestly I'd never go for a 55 used game, and spend the extra 5 bucks on one in its plastic wrapper and that new game smell :)

Micah Wright
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Used Games? Seriously? Anyone still debating this issue is a moron. I thought all the material had been wrung out of used-product sales back in 1994 when Garth Brooks decided he wasn't going to release his new CDs to stores which carried used CDs... and then rapidly climbed back down that ladder 3 months later when the big chains refused to carry his new CD in retaliation. We went through this ENTIRE string of recriminations and accusations and general stupidity back then as it applied to music... has no one learned anything? 14 years ago, people. 14 years ago.



You cannot control the downstream sale of a physical product, end of story. You just can't. It's not feasible given market realities and game prices. You get exactly ONE bite at the apple and that's when you set your retail price. What a consumer does with his copy of your product after that is legally NONE OF YOUR BUSINESS.



If the game companies want to dictate what their games cost and to destroy the used games market, then they need to move immediately to an all-digital-delivery model. Obviously they don't believe the marketplace is ready for that (and, frankly, I still don't believe most of the Publishers are either).



Used game sales will continue until such a time as physical media still exist. End of story. Go ask Garth Brooks how well fighting a cascading river of used product worked out for him. Used record, tape & cd sales have been around since the record first existed... and yet the music industry has somehow managed to survive. The games industry needs to stop fighting yesteryear's pointless and unwinnable fights and just concentrate on making better games.

Andrew Pellerano
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Games are already giving out specialized one-time redeem codes to pre-order customers. If these codes were instead put into the packaging next to the manual, wouldn't that provide a way to "decay" the quality of your product once it is passed along to the second owner?



Maybe put two codes in there, give Gamestop a new headache :D

Joshua McDonald
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Two lines in this article seemed contradictory to me:



"The used-game market may also be negatively affecting the quality of games [+ short explanation]"



and



"Because single-player and action games can be completed quickly by the gamer and then resold, he expects that fewer and fewer developers will choose to create those sorts of games"



While these statements aren't exactly opposites, I do find it interesting that the author does not consider longevity to be a component of quality.



As stated many times above, people are more willing to buy a game if they think that they can get part of their money back. This is particularly an issue with short game experiences, as publishers ask us to pay the same amount of money for a short, flashy 10 hour experience as we do for a deep and interesting game that offers hundreds of hours of enjoyment.



In a way, the used game market creates the price difference that ought to have been there anyway. Many people (myself included) are simply not willing to pay $60 (or even $30 most of the time) for a game that I'll be done with in 10 hours, and the used game market is the only reason that we ever experience those.



In this sense, I would think that the used game market raises the quality of games, as keeping the player wanting to play the game he bought becomes nearly as important as getting him to buy it in the first place.

Chris Jolly
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Although I agree that a deep and long game is better value than a short and flashy game, I don't think that's the choice developers are faced with.



The choice between a short game and a long game is far more along the lines of the difference between a tv show and a movie. One will be cheaper to make per hour, will have to have a lot of filler, and will last longer.

The other will be shorter, more effects intensive, likely have more highly paid actors, etc etc. Although both could cost similar amounts to make, one is longer and the other more intense (As a general rule, I know that there are bad movies and good TV shows!).



The choice developers are faced with is a long game with content spread out, proceduralised, or copied and pasted, or a short game that just gives you the content they actually produced, rather than artificially lengthening the game.



The cost of developing the long, "deep", copy and pasted game is the same as that of the short, distilled game, so why should the short game be cheaper? I know that I for one would rather spend less time playing a more concentrated game than trudging through the same environments over and over. Take Fallout 3, for example. It is possible to complete everything in this game in about 30 hours or so. However, a good 20 hours of this is spent in repeated content: Fighting the same enemies hundreds of times, walking through copy pasted metro tunnels or factories, and so on and so forth.

It is a classic example of a good 10 hour game inflated to add the impression of value and depth. This could keep it off the resale wrack for a period, but it certainly wastes a lot of the players time in doing so.

Lo Pan
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What amazing me about the used market is the double dipping of retailers. Gamestop makes a 30-50% profit on each used game.

Joshua McDonald
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Chris, while I understand your point, I think that you misinterpreted me.



When I used the word "deep," I actually meant deep. When you used it in response to me, you apparently meant "Marketed as deep, but actually quite shallow"



Just to give you an example of a deep game, examine Warcraft III. Four races, an enormous variety of tactics for each, tons of maps, tons more content through a large number of non-player units, a scenario that is widely considered to be one of the best in any game, Cinematics that still look better than most of those in current games, and some of the most robust and user-friendly mod tools to be had anywhere.



Even after hundreds of hours of gaming, I'm still finding new strategies or new, interesting mods (Blizzard does get partial credit for the mods, since they made such great tools to permit them, and the game has enough units to fill them with). And most of those hours were more enjoyable than those spent on short games as well.



Those are the kinds of games that I happily pay $60 for (and would even pay more if the price tag was higher): Games that get their length, not by forcing players to blow hours in boredom but by making a player want to keep coming back for more.

Mike Lopez
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If the publishers really wanted to stop used game sales they would drop the prices on the download distribution of their games to the $30 wholesale cost rather than keep the MSRP the same as the packaged goods. Right now there is almost no incentive to do a digital download because the cost is the same but the game has no resale value, which is total crap.

Heather Decker-Davis
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Some people get hyped up by GameStop's glimmering incentives for extra trade-in credit, so it's become a way of life for some gamers out there.

I personally enjoy having a variety of old titles around to play whenever I feel like. It's not worth trading off good games for a couple of dollars of in-store credit, anyhow.

Stephen McDonough
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DVDs present a better analogy as they are much more comparable in price to videogames than cars, and have the same resale quality. The difference is that if people only want to watch a movie once, they'll hire it at the video store. The only people who purchase a DVD movie are those who will likely want to hold on to it and watch it multiple times.



I posit that a lot of these used sales aren't representative of actual sales. 7 day return policies and high early trade in values like mean that gamers can essentially pick up a game, play it for a week or two, and return it for another at a nominal cost. Considering a new release game could only be rented overnight for a few dollars a night, it's a fairly comparable cost, with the convenience of not needing a membership and with the increased selection of a dedicated gaming store.



Gamestop and other retailers might be making a killing out of this, but unless the industry can come up with a solution for gamers who want to play a game for a week or two and move on, resale is going to remain the only viable option. Any attempt to get someone to hold on to their copy is going to be a hard sell indeed considering what they already put up with.

Christopher Plummer
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Until digital distribution can balance things out - Developers need to stop releasing so many games! They need to start releasing expansions instead. The car company analogy is perfect for the video game industry because we are at the same crossroads they were at. We can continue to release new models every year and build heavily marketed SUV type games that we know are killing the industry from the inside. Or we can release solid titles that are platforms in themselves and build off of them over a period of years (World of Warcraft / Rock Band / etc...)



I think SONY is in a position to help themselves out and wrote about one avenue they could take here: http://boardsus.playstation.com/playstation/board/message?board.i
d=ps3home&thread.id=417858

Bryan Jebavy
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Regardless of your personal like or dislike of game resale it has existed for decades and expecting consumers to willing give up something seen as a right is difficult at best. There is no good PR way to push for that, especially while complaining about seeing big titles showing up slightly marked down as used products within a 0-Week scenario. Consumers will not have a great deal of sympathy for publishers decrying the lost sales on GTA IV while hearing about GTA IV selling millions of copies. Nor will they feel the industry is collapsing with games seemingly rising in price again at the beginning of each console generation and the industry grossing somewhere in the $17b range as of the last published figures I recall offhand.



So working with the assumption that it isn't reasonable to expect consumers to willingly move away from this practice that huge game stop sales figure suggest they are quite fond of what other ways can it be addressed. Single use codes for bonuses and such are a theoretically decent way to ascribe extra value to the initial sale and make that more compelling, but as soon as you start to make the content more significant than minor cosmetic changes and actually add significant value to the game there will be the difficulty of spinning that as a bonus for first time purchasers vs a penalty for used purchasers and an anti-resale infringement on what the consumer expects their rights to be. After all that is intentionally devaluing the product's resale value that they are buying from you and many will likely not respond favorably to that. Working on adding a better replayability value to games is another valid way to achieve this goal. Increasing the replayability of a game and making it something that they will want to hold onto longer and continue playing seems to be the best way to address this. Offering up DLC for games (which should never be locked to the person who first purchases the game) which they can purchase to expand the life of the game is a positive idea. Right now a lot of DLC is slated for games several months after their initial release. If this avenue were being pursued as a means to combat early reentry into the used market then DLC would have to be more distinct release timeline planned and start earlier in the games lifecycle. As an example if the developer is planning to use that technique it would be reasonable to plan the DLC installments (because a 1 shot thing is not going to last all that long) and communicate those release intentions. If you shipped Uncharted and had a firm release date say a month from the day the game shipped to offer the first DLC possibly a new area with 4-5 extra artifacts to gather and a handful of associated achievements/trophies tied to that the customer now has a clear reason to wait and hold onto their game. While it's still fresh the customer's mind there will be new content for $2-10 that adds onto the experience they just enjoyed. You can then choose to make that the end of the DLC or keep a clear timetable that is well marketed so even the less in touch gamers know about it. Perhaps the back of the manual has an add for the upcoming DLC or the game menu features a trailer for it and there is a trailer attached to the DLC for the next installment.

The last option that I haven't seen discussed anywhere about how the developers and publishers can cut into the idea of resale hurting there figures is to butt in on Gamestop's marketshare. There is an added overhead associated with running your own mail order resale operation but that would theoretically be offset by reduced production costs. Why can't EA have a direct fulfillment used marketplace they operate themselves. Maybe it only takes EA games or they have an arrangement with other publishers as well to purchase and redistribute all used games. They could purchase the games back flat out at a rate reflecting the age and condition of the physical media. Games could be purchased back with cash at a reduced rate (50-80% buy back value) or with publisher credit at the 100% buyback value pushing further brand loyalty to the publisher. Now instead of Gamestop making a 50% profit each cycle of buyback/retail sale the publisher is participating in this profit. They are getting paid for each copy of the game that sells even if it's not at the full retail rate (Which they claimed could be reduced if the used sales weren't cutting into their sales in the first place without ever providing any real proof that they would do so.) It would not be hard for the publishers to push the benefits of their own specific used programs vs gamestop. They could have prepaid postage available to print out to ship their own games back to their distribution center and instructions in the manual on doing so. They could take the idea of single use DLC that has been tossed around and add in a new code for certified refurbished games from their distribution channel etc.

Christopher Plummer
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Bryan,



I don't know if you were looking for feedback or not, but you put it out there so I will comment.



I'm all for the customer keeping their right to sell their property to whoever they want. I disagree with your alternatives for the industry though. They all seem like they are encouraging developers to fight against their counterparts in retail instead of recognizing that the landscape has changed and that they are falling behind in their end of the bargain. GameStop has done a masterful job in selling games at retail and making a profit off of them. It is the publishers and developers job to rise to that level or push the bar higher at wholesale - not pull GameStop down.



Having DLC pushed closer to game launch will have a couple of negative effects:

1. Gamers will think that publishers are holding back content for DLC and in essence are giving a $50 game for $60 and then making customers pay $10 shortly afterwards for the full thing.

2. If everyone is constantly coming out with DLC then the market is going to become saturated with more crap, even more so than it currently is, and marketing budgets will have to get bigger in order to announce all of the new product.



I think that doing the opposite would benefit us greater. Less DLC with almost as much content as a new game being released within the gaps of the sequels. This way players get an entirely new, but not lesser, experience they are familiar with that can cost as much as a game. The difference is that developers have a reason to say you have to have a version of our previous one in order to play it. And then along with standalone $60 copies they release discounted bundled copies.



It also sounds like you are promoting us to follow the car makers model and allow people to trade-in their Publisher A game at a huge discount for a newer Publisher A game at full price, minus the credit. I think turning Game Publishers into retailers is a bad idea; one that our tax dollars will be bailing out soon. The lines get blurred and they will start trying to maximize profits in other areas besides making good games.



I think it serves Publishers and Developers better to put more effort into shopping their product to other distribution methods. This is what retailing has done and we need to get with the program. Becoming supporters of digital distribution and reinvigorating the rental model through profitable licensing agreements are the paths that I hope they take.

Andrew Heywood
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Stephen McDonough's point above is excellent.



It still makes my blood boil reading posts in this thread calling people "morons" and "greedy" because games are "just like everything else"...



When was the last time you went to HMV to get this month's hot new album, and as you got to the counter had a member of staff point out a used copy on the shelf which is 10% cheaper?



How about a DVD? How about a car? It does not happen. Games ARE different; they have a 'true' second hand market which no-one wants to abolish, but there is an artificial one too, I suppose for the reasons pointed out in Mr McDonough's post above. It's essentially big game retailers bypassing the rental system - it's a loophole, and it should be closed.

Christopher McLaren
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Basically the industry wins and looses. There are people who will buy a game with the intention of selling it back a week later, essentially renting a game for $10. However if they enjoy it they will probably keep it, hence a sale that would otherwise not have been. Or they may use the money to buy another game.



There are those who will only buy used games. I'm of the opinion that even if it's a used game it get's that product out to the market and maybe that person will show it to thier friends and the industry gets another sale.



Music has been copied for decades but it is still a huge thriving industry and has benefitted from "sharing" of music.

Jaakko Kemppainen
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I really don't want to pay 60-70 euros (standard price for new games in Finland) for a game I'll possibly play less than 20 hours. 30-40 euros is a maximum for a really good game, and 20 euros for a game I'd like to try but have no great ambitions for. Thus, I buy pre-owned games. If new games cost 20-40 euros, I (and really many others) would pay that easily. Since new games cost 60 euros, I just don't buy them. I'd rather use my coins to films and books, they are much cheaper.



Now I use my money on pre-owned games, which actually helps the games industry, since early adopters and ethusiasts can get at least some coins back from their 60 euros game. And they use that money on other new games. If they couldn't get anything back from their investment, they could afford to buy less games, since amount of money used on games by individual is somewhat limited, and they use that money on games anyway. So industry is not going to get any more money from gamers, they just sell less games nowdays and gamers focus only on certain hits and interesting games and that hurts the industry even more. We are getting only sequels and year updates for sport games and that really, really sucks.

Wyatt Epp
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A few things:

* Devaluing resold vehicles is common; I've never heard of them letting you keep the warranty on a used car that isn't from the dealer (Like the short turnaround for games, many cars are traded in after one or two years). Games don't have maintenance that can be performed and are not taken to the Title Bureau to register them, so the analogue becomes problematic with the current model. Why NOT devalue the product somewhat for resale? Maybe then they'll resale for a more-fair price. It was pointed out that this extra should be able to be acquired by other means for a price-- listen to that person.

* DLC shouldn't affect the game's overall ability to be completed? No problem; Bethesda can tell you all about that. They really seem to have come up with a good model for theirs; had they offered a code in the retail box for horse armour and some side quests (or NPC AI tweaks, more enemies, a buyable castle, whatever), they would have it pegged. To port this to any other single-player game, just add optional levels (maybe mark them as "optional,"or better yet, "bonus")-- New missions in GTA, new secondary objectives that change things later on in Crysis if completed, some extra planes in Ace Combat, the list is potentially infinite. If the content is of high quality it will be well liked. It is up to the implementer how to define that.

* I think people have been deprived of DLC for so long at this point, they've forgotten what it's like to have a developer actually support a game in any significant sense. Does no one remember Total Annihiliation? Remember how many extras that Cavedog put out (for free) in addition to releasing two expansions? Contrast with Supreme Commander. Even UT2004 had the XP Levels and Mega Bonus Pack. There was a time that people expected frequent updates and freebies-- a time when the game you paid for was supported beyond ten months of it's release (GPG, I'm looking at you. Again.).

* I'm personally of the mind that if I'm maintaining something, I'm not going to overload myself with new projects in the meantime. At some point, the industry at large seems to have forgotten how not to overextend itself and a lot of unmitigated crap and lower density of good experience seems to be the result of it.

* It's benefited my own perspective as a developer to adjust my thinking. Games, like art, are a service from which an intangible is gleaned (we call it "fun" with games); it's not about a product at all. That the service is tied to a particular item is unfortunate. People talk about wanting to "have it around to play again"-- for that person, the game's fun has yet to be exhausted. People say, "It's more convenient," or they, "just like having a solid product," when asked about digital distribution-- the solid object is like a trophy to which past fun is raised and future fun can be attributed; a reminder, if you will, that there is yet fun to be had (possibly with friends). When I began thinking like this, I found that I was better able to judge my own design decisions and shore up where they were at a detriment to the ability of fun to be had (bearing in mind the target audience).

* Someone suggested selling the digital versions at less than the cost of their solid object. This is a good idea; where ARE you guys on that?

* Expansions were posited as a worthwhile direction. I see benefits and drawbacks. The benefits are well known-- faster production, name recognition, cheap to make, can be sold for less to benefit consumer. The drawbacks are well known, too, however-- severely limits market, takes up extra retail space (reluctance to stock), can easily appear "dated" even with fresh gameplay, mentality of desirability of new things ("But I don't want to play that anymore...."). The trend of the past few years seems to have been sequels and sequels of sequels. But then, it's sold at full price, and aversion to paying again becomes refusal. One model that seems to have worked out rather well is Relic's: Dawn of War's expansions are standalone in that you can play the campaign. The benefits of having the previous iterations installed is compelling, however (play as previous games' factions in multiplay, etc), especially in Dark Crusade and that other one.

E Zachary Knight
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One final note before this gets pushed off the front page,



What if, rather than fight and rail against the used game market, we use it to our advantage. Why don't we work out an information deal with Gamestop. Make an agreement with them that would have them release to an independent group like NPD all numbers related to used game sales. They could release on a monthly basis, the titles and numbers of games traded in and the number of used copies sold by them.



Can you imagine what we could do with those numbers. It would make reprinting older copies of games so much easier when we have a better idea of their popularity after the initial 3 month retail push. We could get a better idea of when it is time to lower the price on new releases.



The possibilities are endless.

Vladimir Neskovic
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i would agree with those who see this as a purely natural process in the present economy. publishers, depending on their position vs. competition and their position vs. retailers, have some possibilities to affect the used games market. luckily publisher's positions is not nearly strong as it is opposed to the game development studios (their suppliers). And their "innovative" aproaches to affect the used games market will not last for long.

Michael Walbridge
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It seems like developers forget about Walmart, Target, Amazon, Toys R Us, Best Buy, and other retailers.



GameStop isn't the problem, it is a symptom, and not even the entirety of the symptom--Play N Trade, eBay, FYE (they pay more!), Craigslist, GameFly, Goozex, and local shops sell used as well.



Mind you, I'm not saying I love GameStop--I don't--but considering that its demographic is 10-35-year-olds and the parents who are turned onto it by kids and other parents: college students, families on a budget, guys who are losers, etc.--getting rid of used isn't going to necessarily make devs more money.



Imagine those many guys who buy only a few games a year and have very little money and carefully trade-in games to increase their library. How is attempting to stop that process going to make developers more money?



I really, really hope that the games industry doesn't turn into the music industry--the more they complain publicly about it (no matter how justified and no matter how lame GS is), the worse it will be for them. There are just about no stores that only sell new music anymore, and the same has happened with games. It's an inevitable turning point.

Adam Bishop
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Personally, I only buy a used copy of a game when it is significantly cheaper than the new version, and for one of three reasons:



1. The game is not available new any longer. Luckily, services like Steam are starting to alleviate this issue, and hopefully before too long it will be pretty easy to find older games that are currently rather difficult to track down physically.



2. Cost. I don't have the money to buy a lot of games. For big name games, this often means I can just wait a year or two until it becomes a greatest hits game and pick it up for significantly less, which I will do. I would rather pay a few dollars more and support the publisher. But if the choice is between an inexpensive used copy, which I can afford, and an expensive new copy, which I can't, then the decision becomes obvious.



3. If I'm not really sure whether a game is worth a $60 investment. Demos are the best way to get around this, but lots of games don't have demos, or the demos are too short or feature-locked to be useful to me as a means to gauge whether or not I'd like it. A ten minute demo tells me virtually nothing about whether I'll enjoy a game for ten or twenty hours. If a game sounds promising, but I have no real way to gauge that, I'd rather buy a used copy, where I'm not out $60 if it turns out the game gets boring after I've played it for an hour.



Eliminating the used game market will not make me buy more games. In fact, it will make me angry with publishers who think they have the right to push consumers around. I would simply spend my money on a different hobby whose companies respect me as a consumer.

Z Z
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If developers really want to see new games sell then they need to step up. What have they done so far? One time use codes for new games? In the hopes of making the used game buyer feel their copy is inferior. Instead of targeting the used game buyer as your nemesis or as a problem, why not target your game as the problem? I mean those used games had to have come from somewhere, people that did everything your game had to offer. The fact that someone saw a deal and bought it for cheaper isn't the problem.



So what should the companies do to keep their game in the hands of people longer? The answer is replayability. The new problem from this is that multiplayer mode doesn't magically introduce replayability, it has to be good too (better than what is on the market i.e. COD4/COD5/GoW any less and your game is going to be sold). Not all games can have multiple paths, some games aren't designed that way. So replayability in those respects aren't always possible. So what are you to do to extend that replaybility? Something we have been doing already, DLC. Here is where things get interesting though, FREE DLC is the answer. Yes, I did say free. I don't mean free only to those that bought it, I mean free to everyone. I mean episodic content that is free.



I have had multiple games that promised DLC in the future, but the problem is I know they'll charge more for it so I just say to myself that I'll pass on it, I'm not spending more on a game that is old and that I've beat. If instead I had a game that promised free DLC in the future I would be inclined to let it collect dust on my shelf until that free content arrived. Why not? The content would usually go for $20 or so in today's market so why go trade my game in for $20 to buy a new game when I can hold on to it and possible have it be worth $20+ in DLC. If the developer did this then they would be offering me that same deal GameStop offers (-$20 on video game content). And if you want to beat the competition then you have to beat their deals.



Make free episodic DLC and I would keep any game I bought and I'm sure many others would as well. I know some people will say "it takes money to make that DLC", and I realize that so each individual company would have to decide if it is worth it to try and curb used game sales of their particular game or to just release charged DLC and hope it makes up for lack of sales.

Moiz Merchant
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I find it amusing that the industry is still crying over the used game market. A lot of markets have this problem but the games industry seems to cry the hardest about it. I buy most my books used because paying $30 for a book is usually not worth it for me. I buy a lot of my games used as well. The only ones I buy full price are the ones I think are worth $60 and I really want to support the developer for making such a great product (ie Bioshock). Why should EA's sports iterations cost $60 every year? Most their games are pretty similar and they add a few features now and then every iteration. It is NOT worth $60 a year to buy every Madden game for an updated roster.



The example I think works best is Napster and the music industry. When Napster took off the music industry got pissed, shut it down, and then scrapped it. Now Apple has come along 5-10 years later and took over the digital music scene. The music industry just tried to fight the problem instead of embracing the problem. If the music industry had instead taken Napster and created a digital download service they would have stopped a lot of piracy as well as added more value for the consumer.



The key is to educate the consumers and give enough value to the games that it makes it worth while for the consumer buy new copies. The first would be to drop the price. And I blame both Sony and MS for the pricing problems. By releasing a console every 5 years they are putting a huge burden on the dev studios. Every console release means new tools, pipelines, engines. This extra cost goes strait to the consumer. Sell games for $20-$30 and that it self will help slow down both piracy and the used games market.



STOP blaming the consumers. STOP blaming the used market. STOP blaming piracy.



Only blame the industry itself for where it is. And I give a lot of props to Nintendo for being the only company that is doing anything to help move this industry forward. They are at least trying to expand the consumer base from the hardcode market to more casual gamers. And the Wii is proof that new people are giving the gaming industry a chance.

Nathan Strong
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Cry me a freaking river. Please hold while I call the WAAAAAmbulance.



You want GameStop to stop pushing used over new? Here's an idea. GIVE THEM A FREAKING MARGIN. The reason other retailers don't push used games as heavily is because they sell other high-margin products that can subsidize the insanely small margin of video games. GameStop doesn't have that luxury, so--SURPRISE--they push their only high-margin product: used games. Well, they push their other high-margin products too, i.e. strategy guides, but those are upsells and not drivers.



This whole thing stinks of immaturity. Publishers want top-dollar for their games, so they charge retailers 95% of the MSRP. These same publishers apparently think every other industry operates the same way and get shocked and offended when GameStop gets a measly (yes, measly) ~250% profit margins off their used sales, and can't imagine why GameStop would be more interested in a 250% margin than a 5% margin.



By contrast, clothing retailers enjoy a minimum 500% markup, usually much higher. And that's for new sales! Used clothing markup is likely similar, although I haven't sold used clothes to a store before so I don't know what the numbers are.



If GameStop was making $30 of the $60 for a new game instead of $3, I'm sure GameStop would be less aggressive about their used games (although not necessarily immediately, due to institutional inertia). This also means that if the used market disappeared tomorrow, game prices would skyrocket as retailers would be forced to apply a higher markup to make up for the missing profit of used sales. Welcome back to $80-100 games that we left behind in 1996!



Let's stop treating profit like a dirty word. GameStop takes the risk out of the used game market: buyers deal with a single, known entity and sellers sacrifice a portion of the resale value for security (Craigslist might get more cash, but might also get you mugged). To butcher Voltaire, if GameStop did not exist, it would be necessary to invent it.

Mariusz Szlanta
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Hello there,



So, chains like Gamestop realised there is a demand for used games on the market, calculated it will be profitable to respond to it and went for it. The whole business seems to be much bigger than expected, Gamestop is very happy while publishers/developers are very sad as they can't expect a penny from it.



The real question is why people decide to sell games within days (not even a week) after the purchase?

Maybe, just maybe, Bioshock, Assassin's Creed, GoW 2 and many others are not THAT good as every journalist thought while working on the review? How many GTA 4 copies appeared on resale in the first week of trade (as a percentage of the whole sales)?

Maybe people consider 60 bucks per product they enjoy several days a bit too much and given the option, happily get some money back?



Come on, the real problem is the actual quality of AAA games, which is much lower than one might think while reading the scores on metacritic. Typical gamer has no chance to evaluate a game before buying it. He does it in the first days after the sale.



It would be great to see a comparison of the genres present on resale market. I may guess it is dominated by action titles - short, very similar to each other, focused only on one type of client - youngster who owns X360.



Greetings,



Marius

John Capozzi
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I keep hearing the used-car analogy, but there's something major people are forgetting when making the comparison.



Used cars still generate income for the manufacturer. Parts, accessories, authorized service, diagnostic equipment and special tools to the third party shops, etc.



It's a very long tail.



Used games don't have that kind of tail, in fact they often are the reverse, as cited in the article about supporting not only the initial buyer but any later buyers of the software.



The used bookstore or record shop comparisons don't work either, for different reasons. A big one is that most carry a lot of out of print goods which don't hurt the publishers, whereas Gamestop and others game resellers concentrate on discounting titles in current catalogs, because that's where the big margins are.



I do think Gamestop and others will be the ultimate winner in this battle. Either they'll keep on keepin' on, or the publishers will start incentivising retailers that don't sell used games with better margins, OR they'll just raise wholesale prices to frontload game profits over the shorter term.



The "make fewer, better AAA titles" argument won't wash either, because after a certain amount of development shrinkage, you start getting into VERY risky territory by putting too many eggs in one big basket.



Say what you will about the recording, movie or publishing industries, but there's a reason that after decades they're still using the tried and true "throw as much against the wall as possible, hope some of it sticks" method of product development.



Sure, there's some science behind it, and marketing muscle to tip the scales a bit, but it's still a dice roll, so they make sure they have plenty of dice.

John Petersen
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Make more and better games. No one is ripping off the developers but themselves. They're acting like a $50 mil profit isn't good enough until they can ship the next 10 hr piece of crap.



There is so much working against them it's sickening. as an industry as a whole, most of it is their own doing.



Yer only gonna be able to optimize it so much.

john mc
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Most here are probably too young to remember...but the retail movie (consumer sales) biz was just like this. A new video (on VHS/Beta) would cost $70-$100 -- yes many years ago ;-) This was due to publisher expecting to earn more revenues by selling expensive movies to rental companies. At the time it seemed publishers were mad that rental companies could make money on the content owner's property w/o adding (in their minds) any value. This theoretical "lost" earnings from one segment stopped them for many years in offering a reasonable price on movies. Now, people collect movies, you can buy them in gas stations for 5 bucks, there is a large new market, used market, and resell market. Wow, tons more revenue by lowering the price, making the product accessible and 'yes' they stopped fighting against the "resale" market. The movie industry was first to adopt this as for many years you could buy first-run movies for less than a music CD (goodbye Tower Records and their $20.00 music CDs!)



If a consumer buys a product, they can sell it later. Look around your house, how many items can you not sell on craigslist? Now the game industry can DRMitize all of their content and stop this practice. They run the risk that consumers will balk and stop buying as many games, and take their entertainment dollars and go somewhere else. It has happened in the past, especially where an industry was at the top of their game and was looking to raise prices "because they can". Right now gaming is hot, content owners think they can't fail...they might be in for history repeating itself...



A poster above about talked about used cars generating income from parts, service, etc. Interesting comment, but the auto industry choose to offer this. The game industry could do this as well. They have not because they have calculated, that as of right now, they will make more money by not doing it. Would it cost $0.50 to put in an envelope to resell the disk back to the publisher for resale? The publisher could be the first choice for new and used content. Why not? Presumably not worth it yet...

Andrew Heywood
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@Nathan Strong



5% markup...? The typical high-street game retailer's markup is like 30%+. Why would a large, powerful games retailer settle for a 5% markup? You're talking as though they're completely impotent or something.

Brian Bailey
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Mark Cecere stated: "I don't think there are any analogies that fit."



The film and music industry is a good one. check out this 2002 article about the recording industry wanting to get royalties from used CD sales.



http://www.signonsandiego.com/news/business/20020614-9999_1b14use
dcds.html


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