Sony to sell software "license" only, no pre-owned games

[NavNucST3]

Actually i think anyone on that machine can play an XBLA game where your gamertag resides. So if your gamertag in on xbox 360 #2314ag17, anyone else who logs in to that machine either anonymously or with a gamertag can play it.

Did you have to tell the whole FORUM i've been slacking on my gaming lately? Its embarrassing enough as it is....

Thats correct, as long as my NavNucST3 isn't logged in upstairs, then the downstairs 360 can play the Arcade games. But if I log-in upstairs with NavNucST3 instead of my other one, then they can only play the demos.

The last time I called you out, I was summarily beaten to a pulp in FNR3 and Takendown numerous times in Burnout, so I have no sympathy for outing you,

 

[Shifty Geezer]

Does anyone know the cost of traditional distribution per game in todays market? I'm trying to get an idea of how much could potentially be saved off retail game cost by going all download.

A lot. Not only do you save on printing, packaging and distribution, with their costs and the markup from the service providers, you also cut out the middleman at the sales point to the customer. I'd say (pie in the sky figure) some 25%, or $45 games instead of $60. Oh, and there's no need for publishers either, at least not in the traditional sense. They wouldn't publish a game but you'd need financiers. That'll be $10 fee to platform holder, maybe $5 for 'stuff', and $30 to the publisher/dev, depending on who's paid for the games creation. A successful dev house could become independant of financiers, funding their own work and choosing for themselves what to publish. That'd be soooo great and an absolute Godsend for an innovation-starved market.

 

[TheChefO]

A lot. Not only do you save on printing, packaging and distribution, with their costs and the markup from the service providers, you also cut out the middleman at the sales point to the customer. I'd say (pie in the sky figure) some 25%, or $45 games instead of $60. Oh, and there's no need for publishers either, at least not in the traditional sense. They wouldn't publish a game but you'd need financiers. That'll be $10 fee to platform holder, maybe $5 for 'stuff', and $30 to the publisher/dev, depending on who's paid for the games creation. A successful dev house could become independant of financiers, funding their own work and choosing for themselves what to publish. That'd be soooo great and an absolute Godsend for an innovation-starved market.

NOW we're talking!!! If realistically were looking at $40 AAA titles and $25-30 average titles then we can really get this industry out into the mainstream. Also cutting out the middleman (publisher) as you say could open the doors for more truly unique (financially risky) games! I didn't even think of the publisher aspect! Bring on the digital distribution!

 

[Titanio]

I wouldn't get too excited about cutting out publishers - they'd simply become financiers. And he who pays the piper calls the tune - they'd be no more likely to get "risky" as before, unfortunately.

But digital distribution would allow indies to distribute their games on (relatively) equal terms with the big boys, as long as they can fund development themselves. That's still a pretty big condition, though.

Also, call me cynical, but I do wonder how much of the savings would be passed on to the consumer :/

 

[scooby_dooby]

I see that point. But as is, these agreements seem to be enough to ward retailers off from potentially testing them in court. The practical situation is that I don't know of any store that sells used PC games. Maybe the CD-key situation is a further deterrent for them in that space, though.

It sure would be very interesting to see if there was a (legal) challenge made, in the event that Sony did push ahead with this.

Well the difference with a PC game is it's installed. So, theoretically you could keep the game, and re-sell the disc, repeatedly. Allowing dozen's of people to have the game, installed on their system, for the cost of a single disc. Same goes with any installable software.

Console software is not installed, you can not retain that software after you have relinquished the disc, there's a very large distinction between the two. You never have more than one user using the software at a time.

If I were looking for a parallel, I would look at DVD, or CD's, (non-installable intellectual property), and those aren't illegal to sell in used record dtores or on ebay.

 

[expletive]

Also, call me cynical, but I do wonder how much of the savings would be passed on to the consumer :/

I wont call you cynical but how's prophetic instead?

Why would they sell something for $40 that customers have been conditioned to happily pay $50 (or $60) for?

Theres an emerging market for cheaper games with stuff like table tennis and XBLA, but we wont see these AAA-title savings in our pockets.

A successful dev house could become independant of financiers, funding their own work and choosing for themselves what to publish. That'd be soooo great and an absolute Godsend for an innovation-starved market.

Companies like Sony and MS will still control this Dig Dist flow in the end though so i'm not sure that this model will really explode innovation the way we'd like.

Well the difference with a PC game is it's installed. So, theoretically you could keep the game, and re-sell the disc, repeatedly. Allowing dozen's of people to have the game, installed on their system, for the cost of a single disc. Same goes with any installable software.

If we're talking about a fantasy world where everyone is on the up and up, the vast majority of PC games do require CD checks to run, even after installed. But in reality, yeah your point is valid.

 

[NavNucST3]

To be honest if, them making more money, meant that they took more chances, then I don't mind not having the savings passed along to me. If it just means that the Madden team rakes in more money...well, pass me my $30 discount please.

 

[NavNucST3]

I think maybe the industry should try to work something out with non-traditional game retailers. In my case, I just bought two DS this year, so there is a back catalog of GBA and DS games that I have yet to hear about let alone play, and no traditional retailer is going to waste precious retail space on an allotment of "old" games. Where else can I find the Kung-Fu Chaos' (the game was a hit in my household) of this world, but a used game place.

So maybe the answer is, if a game is less than (some arbitrary number) 1 year old,from the date in the territory where it was launched, it cannot be purchased by a retailer or ebayer for resale. After such time has passed, it becomes a viable product for resale by any party. This allows the used market to still be profitable, as well as "trying" to secure profits for publishers and developers.

 

[Tap In]

Well the difference with a PC game is it's installed. So, theoretically you could keep the game, and re-sell the disc, repeatedly. Allowing dozen's of people to have the game, installed on their system, for the cost of a single disc. Same goes with any installable software.

Console software is not installed, you can not retain that software after you have relinquished the disc, there's a very large distinction between the two. You never have more than one user using the software at a time.

If I were looking for a parallel, I would look at DVD, or CD's, (non-installable intellectual property), and those aren't illegal to sell in used record dtores or on ebay.

Agreed

The reason that I've been given by retailers for not selling/trading used PC games is the piracy. Stealing games (installing/copying) and selling the discs. Basically it's worthless.

Books, music CDs and DVD movies are a much closer parallel to this scenario

 

[TheChefO]

To be honest if, them making more money, meant that they took more chances, then I don't mind not having the savings passed along to me. If it just means that the Madden team rakes in more money...well, pass me my $30 discount please.

I second, third and fourth that! - btw to those that don't think they will pass along SOME savings via the digi dist, I say they have to give you some insentive to switch initially at least. From that point they would then have to condition the market to higher pricing.

How else would you convince someone its better to wait for hours on end till their game downloaded instead of just getting it at the store?

 

[scooby_dooby]

How else would you convince someone its better to wait for hours on end till their game downloaded instead of just getting it at the store?

Agreed. There are many drawbacks to digital distribution, ease of use being a huge one. Spend hours downloading somehting, and you may need to spend hours re-downloading it in the future, much easier to have your own disc that you just pop in whenever you want.

As an upside, they need to present lower costs.

What I would really like to see is the merger of the two sales models, I could buy a retail copy, which would also give me rights to download the digital version if I wanted. Or, conversely, I could purchase the digital version, and that would give me the right to request a hard copy via mail from the publisher in the future.

 

[TheChefO]

Agreed. There are many drawbacks to digital distribution, ease of use being a huge one. Spend hours downloading somehting, and you may need to spend hours re-downloading it in the future, much easier to have your own disc that you just pop in whenever you want.

As an upside, they need to present lower costs.

What I would really like to see is the merger of the two sales models, I could buy a retail copy, which would also give me rights to download the digital version if I wanted. Or, conversely, I could purchase the digital version, and that would give me the right to request a hard copy via mail from the publisher in the future.

sounds good but theyd have to charge you something to send you the hardcopy right?

 

[Shifty Geezer]

I wouldn't get too excited about cutting out publishers - they'd simply become financiers. And he who pays the piper calls the tune - they'd be no more likely to get "risky" as before, unfortunately.

And this unfortunately leads into the Catch 22 situation that's so common. Getting finance often means signing over substantial earnings. It's like working for a company, have a company request a feature, you write the software in 14 hours at $50 ph, $700 total, and the company bills the client $20,000. That's $20,000 for the work, of which the person who did the work gets a tiddly cut. But then you get a wage/salary and some sort of security. You're not worrying about prodicing software with no idea if it'll sell or not while your mortgage and bills and making demands.

A best seller could make many millions, enough to finance more games. But funding the creation of that best seller is expensive, and at the end of the day the developers are going to approach publishers or financiers to put forward the costs, who will then take control of the finances and reduce the amount the developers make in profits, so for the next title they once again have to approach people to finance it.

There's really not much of a way out of this. I can see a couple of options

1) Company Growth : create a small cheap game, like a puzzler on Mobile, that does well. That'll make enough profit to fund a more ambitious game. If that does well, that'll fund an entry level console game. You could grow from a tiddly acorn - that's where all these companies came from, way back when, when a single guy at home could write a few thousand lines of code (or pages of Hex ) and produce a markettable product

2) Cooperative or Open Finance - If you take a popular game franchise, you might be able to convince fans of that franchise to pay an amount up front, say $10 out of $40. A million such fans, $10 million, that's that game created, and then the following $30+ million from sales is all profit to fund the next project. Quite how you convince people to upfront the cash though, and then how do you hold the company responsible? Basically it'd have to be run like shareholders I guess.

 

[TheChefO]

And this unfortunately leads into the Catch 22 situation that's so common. Getting finance often means signing over substantial earnings. It's like working for a company, have a company request a feature, you write the software in 14 hours at $50 ph, $700 total, and the company bills the client $20,000. That's $20,000 for the work, of which the person who did the work gets a tiddly cut. But then you get a wage/salary and some sort of security. You're not worrying about prodicing software with no idea if it'll sell or not while your mortgage and bills and making demands.

A best seller could make many millions, enough to finance more games. But funding the creation of that best seller is expensive, and at the end of the day the developers are going to approach publishers or financiers to put forward the costs, who will then take control of the finances and reduce the amount the developers make in profits, so for the next title they once again have to approach people to finance it.

There's really not much of a way out of this. I can see a couple of options

1) Company Growth : create a small cheap game, like a puzzler on Mobile, that does well. That'll make enough profit to fund a more ambitious game. If that does well, that'll fund an entry level console game. You could grow from a tiddly acorn - that's where all these companies came from, way back when, when a single guy at home could write a few thousand lines of code (or pages of Hex ) and produce a markettable product

2) Cooperative or Open Finance - If you take a popular game franchise, you might be able to convince fans of that franchise to pay an amount up front, say $10 out of $40. A million such fans, $10 million, that's that game created, and then the following $30+ million from sales is all profit to fund the next project. Quite how you convince people to upfront the cash though, and then how do you hold the company responsible? Basically it'd have to be run like shareholders I guess.

How does the movie industry work?

I know Sony movies are obviously publicly owned but what about the rest? Universal Paramount etc. Are they publicly owned or private companies?

 

[Shifty Geezer]

Publically owned financiers, as far as the developers are concerned. Same with music or books or any other creative endeavour in the main. I think some stage productions doa sort of share-holder system but i'm not sure. Basically any company large enough to be able to fund $millions for a game's development, publishing (fees to the console company are paid up front for each disk printed, so if you print 100,000 discs, you need $1 million then and there just to pay the console creator before even sold anything), advertising yada yada, is going to be publically traded.

 

[cthellis42]

You're missing the point. This would be a legal measure intended to prevent the re-sale of used games, it would primarily affect stores like EB games and Gamestop. It's not intended to prevent sharing among friends, nor could it prevent under the table resale of games.

I'm not missing the point, because I don't see ANY POINT for... um... that point.

How are aftermarket sales BAD for console developers? How would forbidding it in any way advantage Sony?

It wouldn't. Knowing you can sell your games makes users far less likely to care about spending full price up front, so while Sony-et-al may lose out on cash to be made later on, they're making more in faster, initially, as gamers aren't waiting for prices to drop. (Selling your games just turns things into an "extended rental.")

But MOST importantly, they would lose retail space in the GameStop/EB Games stores by not having walls of used titles available as well, while Nintendo and MS would simply fill in the gaps.


IMHO, such a move would be COMPLETELY retarded. And I need someone to explain a non-retarded business plan that would actually make them even REMOTELY consider it. Otherwise I have little choice but to assume the rumors and patents that show up are for side matters.

 

[TheChefO]

Publically owned financiers, as far as the developers are concerned. Same with music or books or any other creative endeavour in the main. I think some stage productions doa sort of share-holder system but i'm not sure. Basically any company large enough to be able to fund $millions for a game's development, publishing (fees to the console company are paid up front for each disk printed, so if you print 100,000 discs, you need $1 million then and there just to pay the console creator before even sold anything), advertising yada yada, is going to be publically traded.

So the majority of movie studios are publicly traded companies?

 

[scooby_dooby]

How are aftermarket sales BAD for console developers?

It's bad for both publishers and developers because instead of selling 10 games, they sell 1 game, and it's resold 9times, gamestop makes all the profit and and the publisher suffers.

If a person can go into an corner store, and purchase a used copy of a game for 50% of the cost of a new version, they will. This is obviously bad for developers (i can't believe you need this spelled out) becuase the money being spent on the games is not going to them, but rather a middleman.

As far as losing shelf space, used games take up very little shelf space in most video game stores I've ever seen, shelf space is reserved for the newest releases as always.

The incentive of this would be to increase profits for publishers, which would result in more 3rd party support for their platform.

 

[fearsomepirate]

Allow me to introduce an idea...

If your business model requires the force of law to make it successful, it is fundamentally broken and it is you that needs to change, not the law.

If publishers can't be profitable with used game sales occupying space on shelves, then the problem is their basic business model, not that we need the government to make used game sales illegal. I can buy used cars, clothing, books, movies, CDs, electronics, and sports equipment without Toyota, the Gap, Random House, Universal, Atlantic, Phillips, or Dunlop going out of business. There's nothing magical about video games that necessitates that the courts should somehow protect the manufacturers from their own inability to cope with the natural tendency of individuals to divest themselves of their unwanted goods in the marketplace rather than the garbage can. This has been a basic feature of human economy for thousands of years; if video game publishers are too stupid to work with such a trivially elemental factor of human behavior, they deserve to go banrkupt.

 

[Mefisutoferesu]

I'm curious, and yes I haven't read the entire thread out of laziness, so forgive me if it's been brought up, but isn't it possible that Sony could be doing this to pressure retailers into giving up a portion of their used sales profits to Sony/the pub? For instance, 2nd hand games are made illegal, but Sony issuses a license program where participant companies are allowed to resell games with a percentage of the profits returning to Sony. So for example, you can sell used games under this license, but have to pay a 10% royalty to both Sony (the hardware manufacturer) and another 10% to the publisher (whoever). Still not a pleasant aspect for the retailer, but probably more tolerable than a straight out ban.