The death of physical media

[Davros]

I value the physical product, I know a lot of people don't, they prefer convenience and I get it. I've bought digital copies of games just because I didn't want to go through the effort of trying to find and dig out my game disc.

 

[eastmen]

I respectfully disagree.
Gamestop, and the companies they absorbed (Babbages, Funcoland, EB Games, Software Etc, and so on) are part of the reasons we have video game preservation at all. Before that, we were burying Atari carts in the desert. And larger retailers like Walmart and Bestbuy are pulling out of the physical media market altogether. We need Gamestop now more than ever.

You know they are still doing that with games. Bunch of skylander and disney ifinity stuff ended up there and funko pops are ending up there.

Previous to Gamestop and even funcoland there were mom and pops stores reselling everything

Even during their worst period, in terms of public opinion, Gamestop still offered the public more choices for games than any of the big box retailers. Those same large retailers, Best Buy and Walmart, were carrying new releases, greatest hits, and best sellers only. The only place you were walking into a store and picking up non-hits like Lollipop Chainsaw, Neverdead, or Binary Domain 6 months after release anywhere but a Gamestop. And games that get delisted, the used market, which at retail is essentially Gamestop, is the only way those games stay in circulation.

They also ripped off the public by buying very low and selling high.

I know people complain about how much Gamestop wants to pay you for a used game. And I know people like to complain about how much they sell used games for. And I know people like to dunk on Gamestop when they lose money for years. But these points are contradictory. Of course they don't want to pay a lot for things is they aren't making money.

The problem for gamestop is their buy low sell high mentality drove people away from them and right into digital. Esp after they bought up all the other big chains that offered trade in. They also went in hard on magazine subscriptions and preorders which father turned people off.

The fact of the matter is that the physical media market is in shambles right now. But if you care about physical media, I think you should care about Gamestop. They have a business model that keeps physical games in your local economy, and sell them with a fair return policy and warranty. I will miss them greatly when they are gone.

I worked with for the company as did a lot of my friends. It was and is a really shit company. There is a youtuber that goes over more modern times

I worked there in the early 2000s and it was just as horrible. I was there for the funcoland purchase and left right before the eb purchase.


Digital can do much better for consumers than physical. I have had my steam account for like 20 years or so now. I can buy older games for a dollar and I still play games from my child hood. If I want to go buy a used ps1 game I need to find a ps1 system that still works to play it and the same with atari or nintendo. Those machines keep getting rarer and eventually I wont be able to play the physical copies on the hardware anyway. It be much better when one company figures out a way to make all these games work on a platform forever. Capcom and sega keep releasing collections

 

[see colon]

The problem for gamestop is their buy low sell high mentality drove people away from them and right into digital. Esp after they bought up all the other big chains that offered trade in. They also went in hard on magazine subscriptions and preorders which father turned people off.

Physical media, and video games in particular, are a low margin market when it comes to new product, though. The reason why those companies failed and got gobbled up by Gamestop is the same reason why Gamestop, and the companies they purchased, "buy low sell high", as you put it, with used merch is to make up for the slim margins on new product. You make it out as if they were and are making a mint doing this, and selling magazines, and preorders. You should probably buy their stock. Used car dealerships buy low and sell high as well. It's part of the business. Buying and selling used product has inherently more liability, and the margin must reflect that.

Oh no, magazines! Preorders! Buying stuff for less than they sell it for! The terrors of retail capitalism! Yeah, they were doing that stuff to make money so they could stay in business. I used to work at a restaurant that charged $1.50 for an 8 cent slice of cheese on a burger!

There's nothing wrong with having preorders. In fact, in the realm of physical video game media, it's almost a necessity at this point. New release games depreciate in value at a breakneck pace. Each year's best sellers are often $20-30 brand new, and the margins can be a slim at 10-20%. You want to lock in as many sales as you can ahead of time, and get an idea how many of each copies to get it.

There's also nothing wrong with a buy in rewards program that comes with a magazine subscription. Even if it reads a bit like state run media. Game Informer might have been one of the most subscribed to magazines at one point. Fun fact, Game Informer is 6 years older than Wifi.

I can confirm Gamestop isn't the best place to work, and that's 100% corporate's fault. I worked at EB Games before the buyout, and through it. I worked there for years, but I was seasonal, as I had a good summer job and worked at EB for a discount and something to do (my coworkers at my summer job made more than me collecting unemployment). Coming back each summer after the acquisition I saw the downhill slide. But just because Gamestop is a job that probably shouldn't be a career doesn't mean that I want them to be gone. I want them to be better, of course. But at the end of the day I think that their contribution to each local community's physical game market is immeasurable.

 

[eastmen]

Physical media, and video games in particular, are a low margin market when it comes to new product, though. The reason why those companies failed and got gobbled up by Gamestop is the same reason why Gamestop, and the companies they purchased, "buy low sell high", as you put it, with used merch is to make up for the slim margins on new product. You make it out as if they were and are making a mint doing this, and selling magazines, and preorders. You should probably buy their stock. Used car dealerships buy low and sell high as well. It's part of the business. Buying and selling used product has inherently more liability, and the margin must reflect that.

Those companies had the same problem as gamestop, they are extremely top heavy.

Oh no, magazines! Preorders! Buying stuff for less than they sell it for! The terrors of retail capitalism! Yeah, they were doing that stuff to make money so they could stay in business. I used to work at a restaurant that charged $1.50 for an 8 cent slice of cheese on a burger!

It became very annoying shopping there.

Customer" Can I buy the new madden"

Employee " How about buying a used copy you can save $5 "

Customer " No thank you, I want to buy it new"

Employee " Sure thing would you like a warranty on the disc for $3 ?

Customer " No thank you"

Employee " how about preordering x popular game "

Customer " No thank you"

Employee " How about subscribing to Game informer "

Customer " No thank you"

After that a customer decides to just buy the game online because there is none of that

That's also not to mention that sometimes you show up and its one employee processing a 50 game trade in where the kid is getting like $75 bucks.

There's nothing wrong with having preorders. In fact, in the realm of physical video game media, it's almost a necessity at this point. New release games depreciate in value at a breakneck pace. Each year's best sellers are often $20-30 brand new, and the margins can be a slim at 10-20%. You want to lock in as many sales as you can ahead of time, and get an idea how many of each copies to get it.

Pre orders are fine. But you don't have to include them in every single conversation.

There's also nothing wrong with a buy in rewards program that comes with a magazine subscription. Even if it reads a bit like state run media. Game Informer might have been one of the most subscribed to magazines at one point. Fun fact, Game Informer is 6 years older than Wifi.

Yes but of course a customer should be the one who asks about it. It's advertised in store , at the checkout counter and on the tv in the store.

I can confirm Gamestop isn't the best place to work, and that's 100% corporate's fault. I worked at EB Games before the buyout, and through it. I worked there for years, but I was seasonal, as I had a good summer job and worked at EB for a discount and something to do (my coworkers at my summer job made more than me collecting unemployment). Coming back each summer after the acquisition I saw the downhill slide. But just because Gamestop is a job that probably shouldn't be a career doesn't mean that I want them to be gone. I want them to be better, of course. But at the end of the day I think that their contribution to each local community's physical game market is immeasurable.

Gamestop was pretty good pre funcoland also. Once they got the funcoland mentality of the rewards card and then eb's mentality of game informer it was a terrible experience.

Couple that with the huge amount of money flooding out from the top and the continued tightening of the belt in the store made it a bad situation. People died because they pinched pennies.

 

[Seanspeed]

I respectfully disagree.
Gamestop, and the companies they absorbed (Babbages, Funcoland, EB Games, Software Etc, and so on) are part of the reasons we have video game preservation at all. Before that, we were burying Atari carts in the desert. And larger retailers like Walmart and Bestbuy are pulling out of the physical media market altogether. We need Gamestop now more than ever.

Even during their worst period, in terms of public opinion, Gamestop still offered the public more choices for games than any of the big box retailers. Those same large retailers, Best Buy and Walmart, were carrying new releases, greatest hits, and best sellers only. The only place you were walking into a store and picking up non-hits like Lollipop Chainsaw, Neverdead, or Binary Domain 6 months after release anywhere but a Gamestop. And games that get delisted, the used market, which at retail is essentially Gamestop, is the only way those games stay in circulation.

I know people complain about how much Gamestop wants to pay you for a used game. And I know people like to complain about how much they sell used games for. And I know people like to dunk on Gamestop when they lose money for years. But these points are contradictory. Of course they don't want to pay a lot for things is they aren't making money.

The fact of the matter is that the physical media market is in shambles right now. But if you care about physical media, I think you should care about Gamestop. They have a business model that keeps physical games in your local economy, and sell them with a fair return policy and warranty. I will miss them greatly when they are gone.

Gamestop offers nothing to the physical buyer that other retailers dont, and better. And it's worse, cuz Gamestop often doesn't even HAVE the stuff in stock anymore, cuz they've gone incredibly frugal when it comes to ordering inventory. Their customer service is also terrible and people regularly pre-order games only to go to the store and get told they have to go to some other stuff to actually fulfill their order, cuz they dont have the game on hand. That, or they'll just repackage some opened 'new' game and give it to you, possibly even without the original case!

I cannot overstate how awful Gamestop is. And I haven't even talked about their absurd pennies on the dollar used game buying/trade-in practices. Or how their one single employee per store is now more of a desperate used car salesman than a simple store clerk. You only need to read from Gamestop employees about the insane pressure they get put under to oversell stuff to every single possible customer. Gamestop was bad about this in the past, but they're outright pests about it now. All while the employees themselves have poor pay and their CEO has ripped away loads of benefits this past year all in order to eek out some pathetically meager level of profit.

It's a trash company and nobody needs them. Nobody. Walmart and Target offer everything Gamestop can in the way of games, and that's if you're still one of the very few people who still has some inkling to go buy games in-store instead of just ordering them online like almost everybody does nowadays.

I still like physical media and want it to stay around, but Gamestop is not what we need to preserve it. All that business can be transferred elsewhere. It's not like people are gonna throw their hands up if Gamestop ceases to exist and say, "Oh no, the one place I could buy physical games, I guess I'll have to give them up!" in the age of the freaking internet. lol

EDIT: Straight up, I'll even go as far to say that while I'd never normally cheer for people to lose their jobs, Gamestop going down would be the best thing that will happen to these employees in the long run. They get treated like dirt by management and you have a dollar store Elon Musk as CEO saying things like this:

https://twitter.com/x/status/1555676193071935489

and

https://twitter.com/x/status/1674573778196758528

Christ, these people will be better off in the long run when forced to find another job and get out from this toxic company. Even Walmart will offer better pay and benefits.

 

[Johnny Awesome]

Gamestop sucks. The short sellers had it right. They're going to zero at some point.

 

[eastmen]

I think gamestop should have gone over to more of an experience store. DnD/Tabletop games are really popular and gamestop should have been leaning into that. During the week when the stores are dead they should have had game nights and tournaments nights.

 

[Theeoo]

.

 

[Sonic]

Gamestop wanted to be the king of the physical games market by going the easy penny pinching route. They apparently also want to provide a horrible customer experience that makes people cherish the convenience of the buying digitally so they don't have to waste minutes of their lives in a crusty store without help but a guy begging you to buy unnecessary stuff. And they took out most of the mom and pops along their path of destruction.

Now I can appreciate the comparison to a used car shop. Because there are places like CarMax, drive time, etc. that are large used retail car shops with many locations. But there's still plenty of used mom and pop used car dealerships around. These corporate used car dealerships seem to provide a better customer experience than GameStop. And the extras they want to sell you can actually have some benefit.

Is it unintentional in GameStop's part that going to their store is a crap experience? Or do they just truly not care about staying in business?

 

[Nesh]

I don't know much about GameStop as a business, but GameStop shouldn't be an example to derive conclusions about the advantages/disadvantages of physical/digital.

I had wonderful experiences from dedicated game shops and toy shops in the past. It decoupled pricing from the price controls imposed by the platform holders in a digital ahop. What do I mean by that, is that, at some points, shops would create their own offers and bundles. I got amazing games with great prices back then.

In addition, these shops opened an opportunity for a real tangible gaming community, real communication, where people would meet and talk in person about games. It could have been with the person selling the games or with a gamer who you happen to meet at the shop

Exchanging and bringing your game to someone else's house also had it's charm. It was an excuse for connection. The anticipation of meeting with a friend at his house to try out his or my new game

Newer generations can't comprehend the value of this common tangible experience of connection but can understand the convenience of digital and "socializing" from a distance. But it will never be the same.

People are losing themselves in the convenience and digital worlds, but we are losing touch with the actual world and what it means to connect in real life.

People are more connected than ever from a distance with a lot more people. But the experience of loneliness and lack of connection has multiplied itself, especially in males. Psychiatrists and psychologists are observing more and more patients who suffer from depression and mental discomforts due to this. Social skills are deteriorating and social anxiety is over the roof.

 

[Johnny Awesome]

I don't love that physical is going to die, but I don't have a need for it anymore.

I'm curious about how new consoles are going to be sold. Why would Walmart sell PS6s if there aren't any games to make money on?

 

[Nesh]

That is one good question. The profit on hardware by retailers is minimal. Reserving thousands of cash to bring stock with minimal profit margin is a big risk that may not be worth it.

One of the reasons why retailers loved PS1 was that, Sony made an accidental "mistake" by allowing them a 25% margin which is the margins they had on other electronic devices. Little did they know their competitors back then, like Nintendo allowed only 10% for the console.

Now for a €500 console, retailers get only around 5%! They expect to profit from games sold, but going to shops, we see the available catalogues significantly shrunk.

Retailers were getting big profits from videogames, both in margins and quantities sold.

This is no longer the case

 

[Shifty Geezer]

I'm curious about how new consoles are going to be sold. Why would Walmart sell PS6s if there aren't any games to make money on?

Presumably with those prepaid store credit vouchers which take up nigh-zero inventory. Dunno what the margins are on them but the console companies would probably give them a good deal to incentivise stocking large-box hardware.

 

[Nesh]

Do you actually see a lot of these vouchers in shops? I barely see them in shops and it doesn't give much incentive when it's easy to top up within the digital shop. It sure makes more sense as a gift

 

[Shifty Geezer]

I see plenty in the UK. You get a wall of every flavour of voucher - Apply, Google, PS, retailers, etc.

 

[wco81]

The shelf space in stores, at least in the US, is a hotly contested piece of real estate.

Especially prominent locations in stores.

I don't know if that's still the case, with the decline of brick and mortar relative to online shopping.

But retailers would want products that's profitable to take up their limited shelf space. Without games to sell, the consoles alone would not be attractive to buy at retail.

Of course with the mess they had with launching this generation, with scarcity all over, maybe selling consoles and games wasn't as profitable as previous generations.

 

[Shifty Geezer]

But retailers would want products that's profitable to take up their limited shelf space. Without games to sell, the consoles alone would not be attractive to buy at retail.

Yes. That's where those voucher cards come in as they take up virtually no space. Profit per square/cubic foot inventory must be much higher than filling shelves with DVD cases.

 

[eastmen]

Gamestop wanted to be the king of the physical games market by going the easy penny pinching route. They apparently also want to provide a horrible customer experience that makes people cherish the convenience of the buying digitally so they don't have to waste minutes of their lives in a crusty store without help but a guy begging you to buy unnecessary stuff. And they took out most of the mom and pops along their path of destruction.

Now I can appreciate the comparison to a used car shop. Because there are places like CarMax, drive time, etc. that are large used retail car shops with many locations. But there's still plenty of used mom and pop used car dealerships around. These corporate used car dealerships seem to provide a better customer experience than GameStop. And the extras they want to sell you can actually have some benefit.

Is it unintentional in GameStop's part that going to their store is a crap experience? Or do they just truly not care about staying in business?

Isn't carmax or carvana in big trouble since they were selling cars and never sending anyone the titles so they couldn't register or insure them ?

I don't love that physical is going to die, but I don't have a need for it anymore.

I'm curious about how new consoles are going to be sold. Why would Walmart sell PS6s if there aren't any games to make money on?

Presumably with those prepaid store credit vouchers which take up nigh-zero inventory. Dunno what the margins are on them but the console companies would probably give them a good deal to incentivise stocking large-box hardware.

The shelf space in stores, at least in the US, is a hotly contested piece of real estate.

Especially prominent locations in stores.

I don't know if that's still the case, with the decline of brick and mortar relative to online shopping.

But retailers would want products that's profitable to take up their limited shelf space. Without games to sell, the consoles alone would not be attractive to buy at retail.

Of course with the mess they had with launching this generation, with scarcity all over, maybe selling consoles and games wasn't as profitable as previous generations.

Yes. That's where those voucher cards come in as they take up virtually no space. Profit per square/cubic foot inventory must be much higher than filling shelves with DVD cases.

For Walmart / Target / best buy and the like they would only make $5-10 per copy of a game. But you can fit a lot more plastic/cardboard game cards on the shelf than you can games. In the space of a ps5 disc box you can likely have a stack a of 20 or so cards in its place. The best thing is that if those cards get stolen you only loose a few cents a card. If the game is stolen you loose out on the cost of the game.

The money for those big stores is in accessories and consoles. Also MS/Sony/Nintendo would pay for shelf space. But if you go in to any of those stores the gaming sections get smaller every generation. MS/Sony/Nintendo will just have to offer a higher profit on selling the console to those stores and perhaps on the accessories and make it up on having a higher profit on the digital games.