Bargains Are for Cheaters

[Catalyst6]

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I imagine you don't understand what it's like to not have much of a budget. If there's no used game market, those people who bought the game used likely can't afford the game new, so it goes from Gamestop making money and the company losing none, to Gamestop not making money and the company losing none. The developer/publisher can't make hypothetical profits. If you take money from a publisher or they have to do a mass recall or something, sure, they lost money. But if their product just doesn't sell new copies, that's not a loss, that's a neutrality.
...

You have to factor in the "hypothetical profts", however. That's the entire principle of opportunity cost: yes, you might have made five bucks, but if you had done something different then you could have made ten. Thus, you lost five bucks. While that's not the exactly the same principle that's in play in the games market, it's the same idea.

OT: There's a big issue with the idea of dropping cost, however.

Many people say that the simplest solution is for the publishers to simply drop their prices to a point where they are competitive with GameStop and its brethren. However, there is a problem with that: the publishers could never be competitive. GameStop buys back games at a price that is blatant highway robbery. How can a developer/publisher compete with a company that buys back the game for five bucks, then turns around and sells it for forty? Yes, the publisher might cut back on GameStop's profit margins, but they could never truly compete.

Unfortunately, there's no good way out of this. GameStop isn't doing anything illegal or stupid, their business plans are actually quite brilliant in a slimy way. Yes, gamers might actively avoid buying from GameStop, but let's face it, those who self-identify as "gamers" are the minority. For every heroic defender of the developer you will have three coupon-clipping cheapskates that will simply look at the price tags, not what's behind them. The only real way to help with the problem is for the developers to push harder for "Buy new, get this in-game ____" prizes or bind-on-account games, a la Steam. Both are being implemented, although the former is being pushed hard by GameStop, a fact that I can't understand. Why would developers agree to give special prizes to people who bought the game from the leeches at GameStop? It seems silly.

 

[The_root_of_all_evil]

The less you care, the longer you wait and the less you pay. Games should have been doing this as a matter of standard procedure years ago.

Steam's been doing it for quite some time....

 

[Breaker deGodot]

You know the real cheaters? Those damn gamers who borrow stuff from the library! Both developers and Gamestop don't get a dime from them. Play all you like for free? Libraries are a threat to game developers, book sellers, the movie industry, and record labels! Burn 'em down!

Sorry for the hyperbole, but really. Why do you think no one raises a stink about free media from libraries?

You know, that's an interesting point. I've never heard anyone complain about this.

 

[Breaker deGodot]

This.

This what?

 

[Jared]

The less you care, the longer you wait and the less you pay. Games should have been doing this as a matter of standard procedure years ago.

Steam's been doing it for quite some time....

This is true, and plus STEAM hs it down to a great tea on how to work it

 

[Krakyn]

You know the real cheaters? Those damn gamers who borrow stuff from the library! Both developers and Gamestop don't get a dime from them. Play all you like for free? Libraries are a threat to game developers, book sellers, the movie industry, and record labels! Burn 'em down!

Sorry for the hyperbole, but really. Why do you think no one raises a stink about free media from libraries?

You know, that's an interesting point. I've never heard anyone complain about this.

You know why? Because it's ridiculous. That's why.

 

[RvLeshrac]

There's a big issue with the idea of dropping cost, however.

Many people say that the simplest solution is for the publishers to simply drop their prices to a point where they are competitive with GameStop and its brethren. However, there is a problem with that: the publishers could never be competitive. GameStop buys back games at a price that is blatant highway robbery. How can a developer/publisher compete with a company that buys back the game for five bucks, then turns around and sells it for forty? Yes, the publisher might cut back on GameStop's profit margins, but they could never truly compete.

Unfortunately, there's no good way out of this. GameStop isn't doing anything illegal or stupid, their business plans are actually quite brilliant in a slimy way. Yes, gamers might actively avoid buying from GameStop, but let's face it, those who self-identify as "gamers" are the minority. For every heroic defender of the developer you will have three coupon-clipping cheapskates that will simply look at the price tags, not what's behind them. The only real way to help with the problem is for the developers to push harder for "Buy new, get this in-game ____" prizes or bind-on-account games, a la Steam. Both are being implemented, although the former is being pushed hard by GameStop, a fact that I can't understand. Why would developers agree to give special prizes to people who bought the game from the leeches at GameStop? It seems silly.

And if Gamestop was only making $8 from a used game, instead of $30, they'd stop. There's not enough profit in the former to make it worth their while.

 

[aldowyn]

My question: WHY don't console games get marked down? (Note: PC games most definitely do. You can get Fallout 3, plus all expansions, for like $30.) If we can answer this, we might be able to solve the problem- and I would have a lot more games, and the developers would have sold a bunch of those copies they inevitably have just lying around.

 

[WanderingFool]

There's a big issue with the idea of dropping cost, however.

Many people say that the simplest solution is for the publishers to simply drop their prices to a point where they are competitive with GameStop and its brethren. However, there is a problem with that: the publishers could never be competitive. GameStop buys back games at a price that is blatant highway robbery. How can a developer/publisher compete with a company that buys back the game for five bucks, then turns around and sells it for forty? Yes, the publisher might cut back on GameStop's profit margins, but they could never truly compete.

Unfortunately, there's no good way out of this. GameStop isn't doing anything illegal or stupid, their business plans are actually quite brilliant in a slimy way. Yes, gamers might actively avoid buying from GameStop, but let's face it, those who self-identify as "gamers" are the minority. For every heroic defender of the developer you will have three coupon-clipping cheapskates that will simply look at the price tags, not what's behind them. The only real way to help with the problem is for the developers to push harder for "Buy new, get this in-game ____" prizes or bind-on-account games, a la Steam. Both are being implemented, although the former is being pushed hard by GameStop, a fact that I can't understand. Why would developers agree to give special prizes to people who bought the game from the leeches at GameStop? It seems silly.

If you are talking about the pre-order things, I think the fact its talking about new games makes it acceptable evil to the publishers. But I completely agree with what you said first, Gamestop buys used games for so little, that unless developers giveaway their games, they'll never be able to compete. As much as I hate the bull Gamestop does, if I was to run a business like it, I would use the same thing if possible, cause I want money for my business, screw the gamers form of ethics.

*Edit*

My question: WHY don't console games get marked down? (Note: PC games most definitely do. You can get Fallout 3, plus all expansions, for like $30.) If we can answer this, we might be able to solve the problem- and I would have a lot more games, and the developers would have sold a bunch of those copies they inevitably have just lying around.

Hehe, funny you say Fallout 3, as I just baught that for PC for just $27.99 from Walmart today.

 

[Acalla]

Not sure how to start a slow clap that builds into a big one but that is what you need with this article. I would add in a paragraph about a little known service called Steam. I have a TON of games in my library that I have picked up when they have their incredible sales. These are new "copies" that both Value and the publisher and the developer got paid for. They might not have gotten as much as they would have for a new copy but they did get paid for it. I don't bother looking for these old games on ebay or at the used book store anymore (unless I want to collect the box). There is no reason too. Heck, a friend of mine even bought a new copy of Bioshock for the PC for 5 bucks instead of borrowing my Xbox 360 copy.

If the publishers/developers want to put a stop to used games, they should compete with them in the, oh I don't know, capitalist society that we tend to live in. If I see a game that I was kinda interested in for 10 to 20 bucks, I will probably pick it up, even if I don't have time to play it. But at 50 or 60 bucks, no way. I only buy new games that I really love (looking at you Fallout 3). But, I picked up Brutal Legend a couple of months back when it was on sale for 20 bucks new. Glad I did too, that game was great.

Anyhow, probably beating a dead horse now. Just wanted to say thanks for bringing the gradual pricing model up. Just don't hear the publishers/developers want to talk about having to compete in the marketplace.

Edited to fix some grammer...

 

[Korolev]

Brilliant article.

Simply put, as much as they complain, legally they can do nothing about it. When I buy that game, that DISC IS MINE! I can do WHATEVER I want with it. Use it as intended, throw it as a frisbee, use it as a coaster, even sell it to someone else for them to use. The license for using it gets transferred as well.

If game companies don't like used game sales, maybe they should try to figure out how to encourage people to buy new copies - like, I dunno, giving them free DLC like Mass Effect 2? That seemed to work.

And what are they complaining about anyway? Used games sales have existed since games have existed, and that's a fact. It didn't kill them 20, 10, 5 years ago, it ain't gonna kill them now. They are just whining over the fact that people will do what they legally can with what they legally own.

Used games sales aren't killing the industry. If they were, the industry would be dead long by now. They're annoyed that they only made 50 million in profits, when they wanted to make 70 million in profits, and I understand that they are annoyed at that, but you know what?

THEY
CAN
DO
NOTHING
ABOUT
IT.

So take that Cory.

 

[Catalyst6]

...

And if Gamestop was only making $8 from a used game, instead of $30, they'd stop. There's not enough profit in the former to make it worth their while.

Ah, but publishers couldn't drop their costs lower than what it took to make the game plus a little for profit. Thus, GameStop could always stay *just* below what they set it at. You have to remember that GameStop has almost zero overhead, except the stores and employees, of course.

 

[Blake Carper]

I wonder if Gamestop isn't setting themselves up for an epic fall...similar to what happened this week to Blockbuster http://www.bizjournals.com/charlotte/stories/2010/08/23/daily32.html

By turning themselves into retail pawn shops, they are antagonizing the publishers. In turn, the publishers are inovating how they sell their games. Hard drives are getting cheaper, the cloud is getting closer and bandwidth at home is goin up all the time. Sooner or later (and since I buy most games from Steam now, probably sooner) Gamestop is not going to be needed.

It would make more sense for them to cut the developers into the resale market and give developers a reason to keep using Gamestop as a retail outlet.

 

[Acalla]

Dear THQ,

I buy a lot of games a year! Many are new, some are used and I even do a little renting. I own a PS3, Xbox 360, a Wii and a PC. I am a customer of yours. You have called me a cheater because I decided what a game is worth and not what you tell me a game is worth. Because of this, I will either rent or buy used the next two to three games from you that interest me. I don't care if you somehow publish the next Bioshock game, you will not get a dime from me. Stop insulting potential customers. Stop whining.

Regards,
Acalla

 

[Blake Carper]

TL-DR version: You don't need to get the game on day 1 when it costs an arm & a leg.

Sorry if anyone feels insulted by anything in there, it's just a question baffled me for a while.

For me it comes down to a question of voting for good content with my wallet. Sequel and future original games are green lit largely on the initial sales of a game. Yes, I could save myself a few dollars by waiting a bit, but if everyone does this for the games I like, then I'll stop seeing the content I want to see in games.

I realize not everyone has the money to do this, I respect that. But I do, and I use my purchasing power in the market place to send a small message to the publishers...I like this, please make more.

 

[Zerbye]

You know the real cheaters? Those damn gamers who borrow stuff from the library! Both developers and Gamestop don't get a dime from them. Play all you like for free? Libraries are a threat to game developers, book sellers, the movie industry, and record labels! Burn 'em down!

Sorry for the hyperbole, but really. Why do you think no one raises a stink about free media from libraries?

You know, that's an interesting point. I've never heard anyone complain about this.

You know why? Because it's ridiculous. That's why.

In all earnestness, why is it ridiculous? I can get access to games legally without paying the developers a cent from used game sales and the library. What makes one ridiculous and the other not? Aside from making the developers look really bad, that is.

 

[Jaeger_CDN]

My question: WHY don't console games get marked down? (Note: PC games most definitely do. You can get Fallout 3, plus all expansions, for like $30.) If we can answer this, we might be able to solve the problem- and I would have a lot more games, and the developers would have sold a bunch of those copies they inevitably have just lying around.

My thought on this is that the PS3/XBox 360 base units really haven't changed their hardware all that much (or at all) since their release a few years back. Therefore the graphics have, for a lack of a better term, stagnated in comparison to the PC market. PC games have a more rapid shelf-life in comparison to the console game market so they need to drop their prices quicker for the developers to get their 'fair-share' of the cash. To compensate for this though, they started the nickel and diming for DLC since the resale market for PC games died 5 -10 years ago once they started linking games to user accounts.

Whee first post on the escapist boards

 

[mrverbal]

There's a simple solution. Charge less for games.

Charge less in online stores - where, lets face it, the unit price isn't zero but sure as heck doesn't show up on a balance sheet - where the number of people in the distribution channel is reduced and so even if the user pays less dollars for the game you make more profit.

And charge less for real games.

As Shamus says, if a game is 60 bucks new and 15 bucks used, it's a pretty easy decision.

What if it is 30 bucks new? Obviously their are points in the supply/demand curve where reducing price is madness. This may or may not be one of them. But there is a point at which used games stores can't sell a product for little enough to be worth it for people to (a) sell their games to them and (b) buy them from said stores.

But, games companies, like movie companies, are busy fighting wars they lost a decade ago and failing to learn from the music industry. So one day some company full of jerkwads (we call them apple during the daylight hours) will come up with igames and suddenly own the industry.

Oh wait, it exists and is called steam. Use steam, idiots. Make stuff on steam cheap enough that getting on pants to buy a physical copy is too damn hard to be bothered with. (Pants are hard, man!). If I don't have a physical copy, i can't sell it on, and so you should give me a damn discount!