tehweave said:
I need to know this. I buy used video games all the time. I have collections of old games from old systems, yet still I see developers getting mad about used video games and the fact that they're worse than piracy:
http://www.escapistmagazine.com/news/view/110171-Fable-3-Dev-Used-Games-Sales-are-More-Problematic-Than-Piracy
Is it just because people are buying and re-buying old copies of games? Do the developers want part of that cash? Are they that greedy that they sold the game once, now they want to sell the game again and again and again? I remember hearing that some game developers are thinking of inputting serial codes for old games that need to be re-purchased every time the game is re-sold at a used game store. Oh yeah, there's no way that can backfire.
No, seriously. What's the deal? Is it just a money thing?
Yes, its just a money thing. Its not all good or bad, but it is a money thing.
Mainly, its a money thing packaged with another money thing. Video game stores make significantly more profit off of used games than new games (we're talking something like 80% or more versus 10-20%. This could be an exaggeration or an understatement.) In making this profit, they also don't have to pay game companies any royalties for games sold this way (which I think only happens when they buy the stock new in the first place.) And because its (a little) cheaper, more customers would want to buy used games, so game stores don't see any downside really. But, the whole kit and caboodle falls apart for game companies, because they don't see any increase in profits from the deal, like they would with new game sales, direct sales, or direct download. Plus, unlike maybe piracy, or just borrowing the game from a friend, game companies see a little less "honest profit" (from honest players who like the game), because the honest players who bought the game used already paid only 5 dollars less than retail, so why should they buy it retail?
I say a little less, because as much as people like to present it as legitimization of piracy, there aren't really that many honest purchases following piracy I think. At least not as many as, say, from demos.
Here is a long, drawn out, overblown, and geeky analogy merely for poetic reasons. Lets say the world has replicator technology like in Star Trek, but that they all only come with the basics of food and water preloaded, and you have to buy expansion disks (or Culinary Packs) to increase different kinds of things you can eat or drink. But, like the replicators themselves, these Culinary Packs are expensive to make. After all, if you're not just copying based on the best examples you can find in real life, you're making new things or programming, or experimenting. And, each pack has to have a lot of different types, or it wouldn't sell very well, would it? So, while the replicators are pretty expensive to make at maybe $400, the Culinary Packs are not far behind at maybe $20-60, depending on the amount of food available or its quality. This gets marked up again, because the companies need to make money off of it (after paying their chefs and programmers and copiers and so on.) These Culinary Packs are a luxury, there's no denying that, but at the same time, the mighty dollar drives innovation, as companies that routinely produce good quality packs get more money to spend on good quality employees, but companies that don't have a good reputation or good quality product get very little return. And maybe this innovation leads to specialization, like a company that does Ingredient and Spice Packs for the home or professional chef, a company that does Sandwich Packs, another for International Cuisine Packs, another for Revolutionary Food Packs using food purely derived from programming, nothing copied, nothing cooked. Maybe some companies develop randomization protocols so that the food or ingredients replicated don't always look or taste exactly the same. Either way, there is one thing clear. This innovation, this constant change and flux that brings people new things, and a wider variety of specialties, its all driven by the competition for more money. And that competition rewards those who come up with a big hit.
But, lets go to the average consumer. Like I said, these Culinary Packs are expensive. Maybe people can only get one or two packs a year. Its not exactly only the fault of the companies and publishers, after all, they can sell directly for $20-60 a pack, but they usually have to go through retailers who mark it up between $10-50, usually depending on popularity, or how new it is. Let's say you, the consumer, have eaten all 370 different combinations from the Grilled Cheese and Tomato Soup Pack, only really liked maybe 20 of them, and you are now sick of Grilled Cheese and Tomato Soup. Even with pineapple and basil. So, you decide to try buying something new. You're just short on a little cash. So you just go to a store that says they will buy it, and you sell it for maybe $5. Its not much, but at least its better than nothing. So you sell it and then you spot a used copy of Cooked with Canned Tunafish for $5 less than the new copy. Hey, good on you. You're coming out of this deal $10 ahead, as you go home to see what is in the pack other than 50 types of Tuna Sandwich and 100 types of Tuna Casserole, including, improbably enough, Ural Mountain Tuna Casserole. The closest thought to your mind, in fact, is what exactly that is, while the closest thought to the store's mind is "Exactly how much are people willing to buy Grilled Cheese and Tomato Soup Pack for? I'll just sell it for a little less."
Let's go back to the companies. They are noticing that profits of their packs are dropping, even though according to all normal sources, the packs in question are still very popular. That doesn't change one fact... retailers are buying less and less packs. Consumers are less inclined to try the new, different, and experimental packs (at least, while they are brand new.) So, companies cut the new, and rely instead on the old standbys and favorites, the Tomato Soups and Tuna Casseroles, and Grilled Cheeses. They condense Ingredient Packs, or if they come with other Culinary Packs, cut them out completely. They focus on the International Packs that are most traditional or the most regular best-sellers, like the French and Italian Packs. The problem is, this leads to stagnation. While customers in general are satisfied with the favorites and such that are kept, there is a general melancholy over the repetitiveness of it all. But what can companies do? They aren't getting the money that allowed them to innovate before.
This then leads to the Publisher/Retailer war, where companies alternate between punishing everyone they think is cutting into their sales, and actually rewarding honest customers. Some install kill-codes, or require subscriptions. Some open up innovation to fan-recommendations. Some give people who buy new free recipe updates that people who buy used have to pay for. Some give free new recipes for every 100,000 or so sold (new). Some make it so a holodisk becomes imprinted with the first replicator that uses it so that only that replicator can use it in the future. Some lock features unless someone who buys used pays the company $10 (like maybe the Tomato Soup part of the Grilled Cheese and Tomato Soup Pack 3). Advantage is that companies get the money they need so they can start taking risks and innovating again. Disadvantage is that more often customers feel like they are being punished, even when they are rewarded.
Ok, analogy over. I think it can show very well how used games sales aren't exactly good or bad, (but often have inadvertent bad effects) and are all about money.
