Is the Used Game Market Damaging the Industry?

[AlNom]

You deem cutting out all retailers less dubious than threatening a few game-centric retailers. Whats more fantasy? Putting pressure on a few retailers or removing practically all retailers from the software sales' equation?

Again, where have I mentioned cutting out all retailers You're arguing a point that I didn't even make. I've tried to make this clear twice now.

The options of downloading a few games is no different than buying new games online when trying to combat used game sales. People will still work in to stores and be enticed by used games if given the choice.

It's different when you price it smartly. In-store, it's apparently a difference of $5. Online, they could price it smarter since they don't have to worry about shipping, packaging, or retailer's cut of the MSRP. I mentioned the concept in my original post.

I'm not trying to solve the problem outright. I'm suggesting something to alleviate the problem. Your all-or-nothing attitude is completely different.

Your fears and arguments against ODD seem to fly in the face of Steam's viability.

 

[I.S.T.]

The cost of 20-80 Gb harddrives in the 360 and the PS3 aren't trivial, so the adoption of 250Gb+ harddrives isn't going to be easy in terms of hardware costs.

I don't know about the X360, but the PS3 uses standard 2.5 inch HDs. here is a link for a 60 gig HD from newegg: http://www.newegg.com/Product/Product.aspx?Item=N82E16822149066

Now take into consideration the fact that any manufacturer would give Sony pretty big discounts to sell millions of HDs. OEMs for PCs get the same types of discount because of economy of scale.

HDs aren't that expensive.

Edit: fixed smiley. I'm used to how another board implements smiles... >.>

 

[AlNom]

If anything, larger HDDs would be cheaper than having a hard drive manufacturer keep production lines open for such outdated hard drive capacities. BOM or storage just do not seem to be that big of an issue if either Sony or MS go up to WD or Seagate and ask for a deal on 10M+ million 500GB-1TB hard drives.


edit: Anyways, I think I'm done here. So much for suggesting an alternative that seems to work with a number of ODD services such as Gametap, Steam, EA Link...

 

[I.S.T.]

If anything, larger HDDs would be cheaper than having a hard drive manufacturer keep production lines open for such outdated hard drive capacities. BOM or storage just do not seem to be that big of an issue if either Sony or MS go up to WD or Seagate and ask for a deal on 10M+ million 500GB-1TB hard drives.

Indeed. While I was on newegg looking for that drive, I found a more expensive 40 gig one that was obviously old as hell.

Edit: a question. What kind of HD does the X360 use, anyway? A standard SATA, a completely custom system or some custom packaged HD that uses a standard interface, ala the original X-Box's controller interface?

 

[dobwal]

Again, where have I mentioned cutting out all retailers You're arguing a point that I didn't even make.

It's different when you price it smartly. In-store, it's apparently a difference of $5. Online, they could price it smarter since they don't have to worry about shipping, packaging, or retailer's cut of the MSRP. I mentioned the concept in my original post.

Accept Sony and MS goes from just QAing and accepting licensing fees to housing thousand of titles and providing enough bandwidth to deal with it all. Knowing Sony and MS they will use the method to extract additional profits. Plus, GameStop and other will simply adjust by reducing pricing on the software creating bigger price differential between whats being sold new in store and used versions. At 50% margins, GameStop and others have plenty of room to play with in a price war, while only 15-20% of MSRP actually goes to retailers. You go from 59.99 versus $54.99 in store prices to $59.99 to $39.99 instore due to digital distribution pressure, which ultimately lead to your product on shelves being less competitive.

I'm not trying to solve the problem outright. I'm suggesting something to alleviate the problem. Your all-or-nothing attitude is completely different.

Your fears and arguments against ODD seem to fly in the face of Steam's viability.

Steam's model doesn't worry about hardware limitation because PCs have more than enough space to adequately deal software distributed digitally. HDD size is driven by a multitude of different areas while HDDs themselves present very little problems in terms of cost to the manufacturers. Thats totally opposite on the console front.

I don't have an all or nothing attitude as my solution deals strictly with a few retailers. A few choice strong words maybe is all its takes to make a drastic effect on the used game market.

While you push for what will take a major investment in both the hardware and software front by the manufacturer with minimium effect on the problem. Driving down the margins on used game sales while encouraging used game sales because of their lower price points will have little effect on problems caused by the used game market.

 

[AlphaWolf]

Used games fill a role. Just because someone bought a used game, or rented a game, it does not mean they would have paid full retail for the game.

IP holders have to learn if you're selling something to people that has value to them they should have the right to recoup some of that value when they are done with it. It works this way with any other product and there is no good reason software or music or whatever else should be an exception.

 

[dobwal]

Used games fill a role. Just because someone bought a used game, or rented a game, it does not mean they would have paid full retail for the game.

Problem is from MS or Sony point of view, there is some segment of used game buyers that would have paid full retail if there was no used version. And a person who would of only bought it at the used price contributes nothing to Sony, MS or Nintendo bottom line, so if they would have bought no game doesn't matter to the manufacturers.

IP holders have to learn if you're selling something to people that has value to them they should have the right to recoup some of that value when they are done with it. It works this way with any other product and there is no good reason software or music or whatever else should be an exception.

I agree except that normally products don't re-enter the market as fast as used software does and you don't have to worry about piracy to further inhibit profit potential.

 

[DuckThor Evil]

I'd be ok if games would be playable only on the machines that the buyer has "registered" to himself, if they cut the price of a new game in half. Killing the used games market would be a pretty big blow to games stores though... I wonder what sort of a plan these game stores have in place to deal with digital distribution anyways?

 

[scooby_dooby]

I'd be ok if games would be playable only on the machines that the buyer has "registered" to himself, if they cut the price of a new game in half. Killing the used games market would be a pretty big blow to games stores though... I wonder what sort of a plan these game stores have in place to deal with digital distribution anyways?

But what about rentals?

I don't see how the used game market could possibly impact the market as negatively as rentals do.

I mean, no disrespect to our resident developers, but if a game is anything less than 15 hours, I'm going to rent it 95% of the time, pay $10 and keep it for a few weeks until I'm done with the game. There's simply no reason to purchase most titles, the replayability is rarely there, and the initial playthrough is 95% of the enjoyment.

I really think that a much larger chunk of users do this, rather than buy used games at $5 or $10 off.

Does anyone know if publishers get a cut of rental fees??

 

[rekator]

I'd be ok if games would be playable only on the machines that the buyer has "registered" to himself, if they cut the price of a new game in half. Killing the used games market would be a pretty big blow to games stores though... I wonder what sort of a plan these game stores have in place to deal with digital distribution anyways?

Killing second hand games is killing first hand games…
Why?
A "New"game cost around 70€, retailers rebuy it around 40€ and so I only need to put 30€ for a "New" game… but if second hand market wasn't existing, I probably buy half of the "New" games I'm buying…
So second hand market is necessary for the growth of the "New" game market

 

[Scott_Arm]

The used game market has existed for a LONG time. It is a fair market and benefits the consumer. Publishers should understand that and it should affect the way they do their business. Saying the used game market is damaging the industry is looking at things backwards.

 

[DuckThor Evil]

Killing second hand games is killing first hand games…
Why?
A "New"game cost around 70€, retailers rebuy it around 40€ and so I only need to put 30€ for a "New" game… but if second hand market wasn't existing, I probably buy half of the "New" games I'm buying…
So second hand market is necessary for the growth of the "New" game market

Well if they drop the price of the games to say 35€ and sell them using the license method which I described in my previous post, then you would also have to pay only about 30€ for the new game and get to keep the old game as well.

 

[vazel]

I remember an interview I read once that made a big impression on me about a developer saying he would rather you warez his games than buy them second hand and instead put that money into buying a new game retail.

 

[Scott_Arm]

I remember an interview I read once that made a big impression on me about a developer saying he would rather you warez his games than buy them second hand and instead put that money into buying a new game retail.

I generally pass games around to my friends when I'm finished playing them. I have a stack of Wii games that are going to make it through my friends' hands when I'm finished with them. To me, that's completely reasonable and that type of behaviour has been happening forever. If these companies think that's unfair and view it as lost business, they're crazy. I can see the argument that it's money taken away from people purchasing new games, but I still think it's a stretch. The industry has to plan itself around the used game business, which is a completely fair and legitimate practice. If I can sell my car when I'm finished with it, I should be able to sell a videogame.

 

[dobwal]

Killing second hand games is killing first hand games…
Why?
A "New"game cost around 70€, retailers rebuy it around 40€ and so I only need to put 30€ for a "New" game… but if second hand market wasn't existing, I probably buy half of the "New" games I'm buying…
So second hand market is necessary for the growth of the "New" game market

10 used games + 10 new games = 1100€

1100€/70€ = general consumers would have bought between 10-16 news games if no second hand market existed.

 

[AlphaWolf]

Problem is from MS or Sony point of view, there is some segment of used game buyers that would have paid full retail if there was no used version. And a person who would of only bought it at the used price contributes nothing to Sony, MS or Nintendo bottom line, so if they would have bought no game doesn't matter to the manufacturers.

I'm sure its a problem for them that people aren't giving them all of the money they could be. It's a problem for me that I have to pay them any money at all, they'll just have to accept that compromise, as I have.

I agree except that normally products don't re-enter the market as fast as used software does and you don't have to worry about piracy to further inhibit profit potential.

I think piracy is a problem that is probably lessened somewhat by a used game market rather than furthered by it. A used game is used by 1 person, a pirated game gets used by anyone who wants to download it.

If developers want to cut down on used games, they should focus on making titles worth keeping not something flashy that is finished playing in 2 days.

 

[dobwal]

I think the only reason why manufacturers and pubs really tolerate used game sales is because trade ins help bolster sales of newly released software and consoles.

As long as new software and hardware sales trump used sales, there will little more than grumbling.

 

[ERP]

I'm not sure legally they have any recourse.
I'm sure they tollerate them because they have to.

 

[Squilliam]

This does get annoying sometimes! I went into EB the other day and I struggled to find the new games on the shelf! 70-80% of the game shelf space was devoted to 2nd hand games!!! They were in the bin out front, the walls and shelves. The xbox360 games were 2 feet on the wall whilst the used games beside it were like 7 feet with overflow at the bottom.

Over here it's illegal to sell pc games 2nd hand because of piracy concerns...

 

[PARANOiA]

Killing second hand games is killing first hand games…
Why?
A "New"game cost around 70€, retailers rebuy it around 40€ and so I only need to put 30€ for a "New" game… but if second hand market wasn't existing, I probably buy half of the "New" games I'm buying…
So second hand market is necessary for the growth of the "New" game market

This is exactly my justification. I don't buy used games but I trade most of my old games except for "keepers" (Bioshock, Mass Effect, a few others). I just picked up Eternal Sonata for $40 after trading Blue Dragon for $44. I wouldn't have paid full price for it, but basically I got to pick up an extra game thanks to the used game market. A very good deal for me.

I picked up about 20 games in 2007, though the number would have been half that if I couldn't make some extra money by trading my old games. Is this bad for the market? Not in my mind.