Eidos Exec: Pre-Owned Sales Threaten Retailers
Eidos [http://www.eidos.com/] Life President Ian Livingstone says the popularity of pre-owned games will ultimately hurt retailers as game developers and publishers are forced away from conventional sales channels in order to maximize their revenues.
We all know by now that used videogame sales are one of the most pervasive evils facing the industry today, responsible for everything from reduced publisher revenues to global warming. And while sales of pre-owned games may be the only way retailers like EB Games [http://www.gamestop.com] can earn kind of decent profit in a business that is otherwise characterized by razor-thin margins, Livingstone says that conventional retailers will eventually end up hurting themselves by encouraging the market.
"You can't exactly claim that the [second-hand] practice is good for publishers or developers," he told MCV [http://www.mcvuk.com/news/36712/Livingstone-Pre-owned-threatens-boxed-market]. "Development costs continue to rise and content creators need to benefit from the sales of their goods wherever they occur. If no revenue share is offered by retail on sales of pre-owned titles, content owners will develop creative online ways to ensure consumers retain ownership of their games."
One recent example of a "creative online way" to encourage gamers to avoid the pre-owned market can be found in the new Dragon Age: Origins [http://www.bioware.com]. New copies of the game include a single-use code for a free download of "The Stone Prisoner" DLC, which adds a new NPC, quest, items and more; people who purchase a second-hand copy of the game and want the DLC will have to pay $15 for it. But Livingstone says that's only the beginning.
"In the short term this might be authorization codes, identification codes or essential online data necessary to play," he continued. "In the long term, there will be less boxed product."
It's an easy prediction to make, since it's all but certain that there will be less boxed product in the long term anyway. Aside from a few curmudgeonly hold-overs who enjoy their boxes, discs, manuals and not being tied down to any particular distribution service when they want to play their games, people enjoy the convenience of digital distribution and its continued growth is virtually guaranteed. That will no doubt help bring about a reduction in pre-owned game sales in the long run, yes, but is that necessarily going to translate into more money in the publisher's pockets? That's a different matter entirely, and I have my doubts.
(And no, I don't know what a "life president" is.)
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Eidos [http://www.eidos.com/] Life President Ian Livingstone says the popularity of pre-owned games will ultimately hurt retailers as game developers and publishers are forced away from conventional sales channels in order to maximize their revenues.
We all know by now that used videogame sales are one of the most pervasive evils facing the industry today, responsible for everything from reduced publisher revenues to global warming. And while sales of pre-owned games may be the only way retailers like EB Games [http://www.gamestop.com] can earn kind of decent profit in a business that is otherwise characterized by razor-thin margins, Livingstone says that conventional retailers will eventually end up hurting themselves by encouraging the market.
"You can't exactly claim that the [second-hand] practice is good for publishers or developers," he told MCV [http://www.mcvuk.com/news/36712/Livingstone-Pre-owned-threatens-boxed-market]. "Development costs continue to rise and content creators need to benefit from the sales of their goods wherever they occur. If no revenue share is offered by retail on sales of pre-owned titles, content owners will develop creative online ways to ensure consumers retain ownership of their games."
One recent example of a "creative online way" to encourage gamers to avoid the pre-owned market can be found in the new Dragon Age: Origins [http://www.bioware.com]. New copies of the game include a single-use code for a free download of "The Stone Prisoner" DLC, which adds a new NPC, quest, items and more; people who purchase a second-hand copy of the game and want the DLC will have to pay $15 for it. But Livingstone says that's only the beginning.
"In the short term this might be authorization codes, identification codes or essential online data necessary to play," he continued. "In the long term, there will be less boxed product."
It's an easy prediction to make, since it's all but certain that there will be less boxed product in the long term anyway. Aside from a few curmudgeonly hold-overs who enjoy their boxes, discs, manuals and not being tied down to any particular distribution service when they want to play their games, people enjoy the convenience of digital distribution and its continued growth is virtually guaranteed. That will no doubt help bring about a reduction in pre-owned game sales in the long run, yes, but is that necessarily going to translate into more money in the publisher's pockets? That's a different matter entirely, and I have my doubts.
(And no, I don't know what a "life president" is.)
Permalink
