Codemasters CEO Calls Pre-Owned Sales Model "Destructive"

[Andy Chalk]

Codemasters CEO Calls Pre-Owned Sales Model "Destructive"

Codemasters [http://www.codemasters.com/] CEO Rod Cousens says retailers and game publishers need to work together to figure out a way to bring the "ridiculous" confrontations over pre-owned game sales to a happy ending for everyone.

We've heard it all before. Retailers need the fat profit margins of pre-owned game sales but publishers feel cheated because they only see revenue from sales of brand new copies. Retail has been the big winner so far but publishers are doing what they can to turn things around with programs like EA's "Project Ten Dollar" and post-launch DLC releases that effectively shut the door on used game buyers. Cousens says both sides in the debate have valid points and that some kind of accommodation has to be reached to end the "destructive" system that's currently in place.

DLC could feature prominently in any compromise solution, he said, suggesting that Codemasters could release a six-track retail version of its GamesIndustry [http://www.amazon.com/F1-2010-Xbox-360/dp/B003UT9XII/ref=sr_1_3?s=videogames&ie=UTF8&qid=1289947611&sr=1-3]. "That, I think, would deal with a lot of it, and also address the pre-owned."

He said the confrontational attitudes shown by both retailers and publishers is "ridiculous" and could eventually have a negative impact on the games themselves. "The way it's structured today is destructive, and it's negative to creativity and innovation. I believe it has to be managed - there's an element of it which is acceptable, and there's an element that isn't," he explained. "If the content creators could participate in the secondary or subsequent exploitation, I think that's fair game. I think equally the retailer then has an argument that he should participate in some of the DLC, which they ordinarily wouldn't. By default, you manage the process."

His points are valid but convincing either side of the need to compromise will be a tough sell. Tightly-integrated DLC will likely play a part, but the devil is in the details. EA is playing with pay in advance [http://www.escapistmagazine.com/news/view/98497-Retailers-Warn-Project-Ten-Dollar-Will-Hurt-Consumers] for DLC that hasn't even been made.

Gamers, meanwhile, just want to pay as little as possible for most of what they play and given the quality of a lot of games that hit the market these days, who can blame them? Ridiculous and destructive it may be, but it's most definitely not a problem that's going to be sorted out quickly, if it ever gets sorted out at all.




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[The_root_of_all_evil]

Totally agree, but are you going to be the one to go up to Gamestop and say "We'd like you to stop making all that money off of us?"

 

[Bretty]

It just cannot be good, for the developers, that game sales (which they are) profits are not going to those taht make the game...

DLC is most definetly the way to keep re-sales down but everyone needs to figure out that those that buy pre owned, at this point, will keep doing it.

 

[mattaui]

On the one hand, I buy a lot of games on Steam, which I can never resell or even loan to someone, but I get plenty of utility out of it. Preloading games, not having to fight the masses at the local retail labyrinth and, what I appreciate more and more these days, not having to fish out a damn disc when I get the urge to fire up a game I haven't played and six months. On top of that, I absolutely love Steam's sales, and it's made me more hesitant to grab a game on release day unless I just really, really want it, since down the line I'll likely be able to grab it and all the DLC for a song.

I bring this up because Steam has already solved this question for PC gaming, totally obviating what little used gaming market there was for PCs (no major retailer even deals in them that I've seen), leaving console games the bread and butter, if not the very reason for existence for places like GameStop. I'm surprised there hasn't been more noise made for moving to all digital distribution for console systems, though I know that would bring cries of bloody murder and would involve icky things like installing games and having to store them somewhere. I imagine the sales of games via PSN and XBL are still pitifully small compared to the take at the retail trough.

I suppose it's largely an infrastructural issue and splitting the market, since I don't see consoles going all digital distribution anytime soon, so even when they do offer it, anyone wanting to trade in their games will just buy the disc, thus providing a continual supply of used discs for the secondary market.

This current pre-order bonus or one time code issue isn't going to do much to put a dent in used sales until they really start making it matter - as in, you buy the game used and you don't get access to a significant part of the game. So far, it's all just been interesting bits you could do with out, though the multiplayer restriction for used copies comes pretty close.

 

[Tipsy Giant]

If you want me to buy a game new instead of picking it up used, make the replay-ability of the campaign high enough so that people don't wanna sell their copy

 

[SnowyGamester]

I still fail to understand why game publishers deserve to get paid again for something they were already paid for...there is no other industry that expects this (is there?)

 

[thethingthatlurks]

I can't really fault the industry for wanting to make as high a profit as possible, but I also don't see why I should accept a half-finished product and be expected to complete it with DLCs (don't kid yourself, that is exactly what this is). How about lower prices across the board along with decreased development costs (nobody needs those "great" voice actors, right)? Or digital distribution, except then the retailers start bitching...

 

[Spencer Petersen]

The games industry needs to stop blaming retail outlets for a problem which they are solely responsible for at the core.
Stop selling and treating games like movies,
stop trying to sell games that most people will play once and never touch again,
stop abandoning support for your game after release,
stop refusing to lower prices over time,
stop packaging all your updates in shitty DLC,
stop releasing sequels that add nothing meaningful to the series,
stop blaming consumers,
stop releasing broken games,
stop including abusive DRM,
stop giving pre-order bonuses,
stop excluding modding tools,
stop releasing shallow games,
stop releasing shitty movie tie-ins,
stop making copies of popular games,
stop giving in to media outcry and censorship,
STOP BLAMING OTHERS,
and then maybe well consider holding on to your game rather than trade it in.

 

[Giest4life]

I have never, ever agreed with anything Codemasters have every done--except for Brian Lara Cricket, that was AWESOME!

 

[Andy Chalk]

Wait, is he saying you literally can't finish the game without paying for DLC? That you beat a track and it tells you "pay money for next track"? Is that what's he's saying?

Depends on what you mean by "finish the game." You'll have six (or whatever) tracks and you can race them and beat them all. But if you want to run a full season, win a championship, etc., then presumably no, you'd need to fork over for the DLC.

I think it's reasonable to assume that the six-track game he's positing would cost less than a full-season retail release, btw.

 

[Therumancer]

As I see things this is about greed. I can't take a "who can blame them" attitude when we're dealing with what amounts to a criminal industry that is worth billions of dollars. I might feel a bit more sympathy if they weren't engaging in things like price fixing, and arranging release schedules and such to avoid direct competition (cartel type behavior).

Right now used games are one of the only things that some people can afford to play because of the prices and economy. Not to mention the benefit of continuously trading in the games you finished towards other ones.

You'll notice that the game industry's solutions to the issue always involve ways to get the consumers to pay more money to "cover their losses". You don't see them doing things like say... lowering prices.

I mean look at it this way, a sale lost to a pre-owned game is not nessicarly going to be a sign that if that game wasn't availible used that it would have been purchused for full price. Also situations where people buy a used game for a mere $5 differant are pretty rare compared to people waiting for substantial decreases in a game's price. I'd imagine if game companies were to say halve their prices, that would get more people to engage in impulse spending instead of "I'll hold off until it's down in price before I give it a shot". Of course in doing this I don't think the industry would make any more money. The sales would probably double, but they wouldn't be seeing any more money.

I'll also be honest in saying that the game industry has been psyched over this "DLC" thing for a loooong time before we even saw it implemented. It's never been implemented as a way of giving us (the consumers) cheaper games due to easier distribution, but rather as a way of gouging more money out of us, and the platforms for it allowing for increasingly slapshod design due to the "we can always patch it later" mentality.

The Used Game market is just an excuse for them to toss onto the DLC gouging that they want to do. If there was no used game market I don't doubt for a second they would still be doing all the same stuff to get people to pay more money on already expensive products. They would just used another excuse to try and avoid saying "we're doing it because we're greedy".

I'll be honest if I play a game and get to a certain point where the game tells me to pay $10 to continue to the next stage or whatever, that game is going to the used bin in record time. It's also a guarantee that I won't be buying from that company again with that kind of a policy. When I purchuse a game I expect a complete product.

 

[JediMB]

To be fair, 5-10% of the money generated through a pre-owned game sale should go back to the publisher.

But I doubt GameStop cares enough about the game industry to do something like that.

 

[Blind Sight]

The games industry needs to stop blaming retail outlets for a problem which they are solely responsible for at the core.
Stop selling and treating games like movies,
stop trying to sell games that most people will play once and never touch again,
stop abandoning support for your game after release,
stop refusing to lower prices over time,
stop packaging all your updates in shitty DLC,
stop releasing sequels that add nothing meaningful to the series,
stop blaming consumers,
stop releasing broken games,
stop including abusive DRM,
stop giving pre-order bonuses,
stop excluding modding tools,
stop releasing shallow games,
stop releasing shitty movie tie-ins,
stop making copies of popular games,
stop giving in to media outcry and censorship,
STOP BLAMING OTHERS,
and then maybe well consider holding on to your game rather than trade it in.

Perfectly put, but I doubt the industry will change without severe consumer pressure.

 

[RollForInitiative]

The best way to cut down on used game sales is to develop games with greater longevity; something that players are going to want to keep on hand if not in the drive. Competitive or cooperative multiplayer elements can go a long way towards providing that level of replay value.

 

[Therumancer]

I can't really fault the industry for wanting to make as high a profit as possible, but I also don't see why I should accept a half-finished product and be expected to complete it with DLCs (don't kid yourself, that is exactly what this is). How about lower prices across the board along with decreased development costs (nobody needs those "great" voice actors, right)? Or digital distribution, except then the retailers start bitching...

You are more or less on the right track here to some extent.

As I have argued on these forums in the past (with many people) the bottom line is that the majority of the money going to make a game is going to human resources. The way things work is that a producer typically goes to a game developer as a sort of investment and pretty much says "I want you to make me a game that will make me more money than I invest". Perhaps he has an idea for a game, perhaps he wants to leave it to the discrestion of the developers to know their craft. The cost of making that game is their materials (computers and office space) and what they get paid. So pretty much by the time a game is done, all the developers have already been paid, and it's a question of whether the producer will more money from sales than he paid them to make it.

This means that if a developer team asked for say 60 million dollars to make a game over two years, that includes whatever salaries they decided to demand for themselves to make the game. As I point out with some frequency, I very much doubt these guys are paying themselves chump change. Games increasing in development cost is pretty much a fancy way of saying that the coders, graphics artists, and other people are demanding increasingly lavish paydays for their work.

There are other ways games can be financed as well, such as a developer borrowing money to make a game, which includes however much money they want to pay themselves. The question being whether or not they will make enough money to pay off their loan and make a profit. However the risks are actually fairly mimimal because those mega-millions in the loan include what they are paying themselves to develop it. The producer in this case is taking a risk on getting his money (and interest) back. In cases like "Duke Nukem Forever" and it's development saga, the pitfalls are well demonstrated. In that case it seems like the developer team took money (which they lived off of) while never actualy working on the game, and since the money was gone there was no way for those investing to get it back (which is one of the risks of investment, and why contract arguements are such a big deal because being a risky business the person loaning the money has to prove something criminal happened to avoid just taking a flat out loss when rolling the dice).

At any rate, I think game developers could definatly stand to tighten their belts, as they have gotten way too greedy looking at these budgets. Heck, developers like Squaresoft claim they couldn't afford to make a game like "Final Fantasy VII" anymore, which pretty much comes down to them being unable to pay themselves what they'd want to do the work.

It would also be nice if someone in the goverment (in the US at least) would wake up and smell the scamming. A bunch of allegedly competing businessmen getting together to set prices for products so they don't have to compete is illegal in the US. It's the same thing you see with all those federal investigations into gas and oil companies. The fact that we've seen coordinated industry-wide price hikes in the past (going from $50 to $60 a pop for games) with talk of it being done again is a sign of this. As is the simple fact that the development cost of a game has nothing to do with it's price. A game developed for $3 million and a game developed for $300 million both retail for the same price ($60). What's more when there are big releases being finished around the same time, companies choose to space out release schedules so as not to compete with each other. Such as when "Modern Warfare 2" came out and other big releases were pushed up so as not to have to go toe to toe with it. The way business in the US is supposed to work is that the companies are supposed to compete by releasing the best quality goods, for the lowest price. Rather than say seeing Modern Warfare 2 and Bioshock 2 lower their prices to the lowest possible level to try and compete with each other, Bioshock 2 simply chose to release at a differant time and they both kept the same pricing.

-

Oh and also, unless someone changed radically, I used to be a massive Anime fan, enough of a nerd where I actually listened to interviews with voice actors on a lot of the tapes and DVDs. Both ones from the US and Japan. Not to mention reading articles on the subject. To put it bluntly, they apparently do not seem to be making a fortune. A lot of the people doing it said it was something they did alongside another job (even if they had decent amounts of work) rather than something they could support themselves at.

As a result, I very much doubt that professional voice actors are getting paid huge amounts of money for doing video games, unless the gaming industry has been offering them much larger amounts of money "because we can afford it".

Now, I'd imagine the celebrity voices do come at a rather high cost. At the same time however the gamble is that being able to promote "featuring the voice of X" is going to sell extra copies in a case like that. Having a celebrity voice in the game shouldn't be raising the price just because they did voice work for it. Unless of course what we're actually seeing is a lot of game developers largely hiring these celebrity actors so they can meet the person, rather than any real nessecity for the project... which wouldn't surprise me given that it would hardly be the only excess leaking into the prices we pay.

 

[duchaked]

this isn't chewing gum, it's available for purchase used so...yeah

even better, recently I've decided that if I don't buy the game new (right now...none) I'll just rent it...boosh

 

[duchaked]

At any rate, I think game developers could definatly stand to tighten their belts, as they have gotten way too greedy looking at these budgets. Heck, developers like Squaresoft claim they couldn't afford to make a game like "Final Fantasy VII" anymore, which pretty much comes down to them being unable to pay themselves what they'd want to do the work.

lol meanwhile Final Fantasy XIV has been released......