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Buy Second-Hand Games, Stifle Creativity?

Thanks to GameSpot for its 'GameSpotting' editorial discussing why buying second-hand games could have a negative effect on videogame creators. The author points out: "You know, Nintendo, Sony, and Microsoft must have a real love/hate relationship with stores that stock used games alongside their new games [since buying used games doesn't give] the game developers, or the game publishers a thin, red cent. Instead, the retailer is enjoying a nice, fat profit margin, where the markup is in the neighborhood of 200 to 1000 percent." He goes on to argue: "Buying used is equivalent to the game not selling at all in the eyes of developers and publishers, and when games don't sell, they don't get sequels and excellent concepts and, therefore, opportunities are lost."

33 of 217 comments (clear)

  1. Maybe they should take a hint. by Mark_MF-WN · · Score: 5, Insightful
    Maybe game developers and publishers should take a hint about what the sweet spot for pricing is.

    Why are business-types so colossaly stupid? The success of used games should indicate that selling games for two thirds of what they cost now would dramatically increase their sales. Instead of complaining, they could just take advantage of that trend. Losing 33% of your per-game revenue is irrelevant if you double total sales -- and since per-unit production costs are negligble, that's a pretty reasonable scenario.

    1. Re:Maybe they should take a hint. by Anonymous Coward · · Score: 2, Insightful
      Over this side of the Atlantic one must typically shell out 60€/game. That's only one third of the price of the hardware ! Or to put it another way, you can buy a new game console for the price of every 3 games. Or to put it yet another way, the modchip only costs the price of a single game (two at most) and after that, count only 1€/DVD for a pir^H^H^Hbacked-up game.

      Sorry, but no sympathy here. If games were indeed in the 20€/piece I'd own a lot more originals that I do now.

      -AC

    2. Re:Maybe they should take a hint. by Tuvai · · Score: 4, Insightful

      If they sold the games for two-thirds of their original price, the price of second hand software would simply fall to even lower levels, and the cycle would repeat.

      True, more games will be bought brand new, but these will be purchases from the usual suspects, the ones with either the loyalty, lack of patience, or high amounts of cash to be able to go out and purchase software at release. The large numbers of those who hawk second hand software will simply shrug their shoulders and wait for the even cheaper castoffs to arrive. I severely doubt we shall see a sharp enough spike to cover the massive developmental costs of games these days.

      There is little the developers can do to stop this in this valued free market, except go for the big launch, as it is the sleeper hits that tend to be screwed over the most.

    3. Re:Maybe they should take a hint. by Anonymous Coward · · Score: 2, Insightful

      Where's your degree in business?
      Where's your fat wad of cash?

      You know, why should any CEO or any type of manager 'take a hint' from you? Before you go and spew total BS, maybe you should try and give us a reason to believe you.

      "The success of used games should indicate that selling games for two thirds of what they cost now would dramatically increase their sales."

      Why would it? What is the marginal costs of creating a more units? Is the demand for the game elastic? Inelastic? Let's not forget about R&D. How will we form a profit in a reasonable ammount of time? Is the market even large enough to accomodate "double total sales"?

      "business-types" aren't stupid. You're logic is just way out of wack. Fix it immediatly or prove you know what your talking about.

    4. Re:Maybe they should take a hint. by TeknoType · · Score: 3, Insightful

      True, but there comes a point where the price is JUST right - where the % increase in new customers is equal to the % decrease in price.

      Taking your assumption and the root comment numbers as an example:
      Let's say there are 30,000 people interested in the game but only 10,000 are willing to pay for the game at $60. The industry recognizes the used game industry is meeting the demand of the rest of the 20,000 and decide to cut the price by 33%. By doing so, purchases increase by 50% (according to the root post).

      Original Revenue = 10,000 * $60 = $300,000
      New Revenue1 = 15,000 * $40 = $600,000 (100% increase in revenue)

      Now, let's assume a smaller % of consumers will convert over with the same % change in price, 20% instead of 33%....

      New Revenue1 = $600,000
      New Revenue2 = 18,000 * $27 = $486,000 (19% DECREASE in revenue)

      Even though these are rough estimates, it turns out there will eventually be a point when it's best for companies to stop at a given price point than continue the 'cycle'.

    5. Re:Maybe they should take a hint. by Fizzl · · Score: 4, Insightful
      If they sold the games for two-thirds of their original price, the price of second hand software would simply fall to even lower levels, and the cycle would repeat.

      I disagree. There is just a spot where it is worthwhile to sell your used game instead of keeping it 'just for collection'. If the prices would dramatically drop, it would be much rarer ocassion that someone would want to part from their original game for miniscule payback. Also, the demand for second-hand games would decline if the games would be reasonably priced. Say, 20 euros for the latest hit game would make me buy games just for the heck of it.

      Currently I only play EverQuest and Americas Army. They have decent value for money (I buy EverQuest expansions when they hit the cheapo-bin at my local store). I'm not going to cough up 50 euros for yet-another-FPS.

    6. Re:Maybe they should take a hint. by Delphiki · · Score: 4, Insightful
      Wow, I always wonder all the greatest minds in business decide to spend all of their time reading slashdot. And you don't even work in business! What a horrible waste. You could revolutionize the gaming industry.

      Oh wait, maybe not. Maybe you just over simplified the situation and assumed everyone else is an idiot. Hey, you think if they dropped the price for games, then maybe people would start selling used games cheaper so it really wouldn't help their sales that much? No... that's crazy talk. Or gee, maybe they've done a little marketing research that suggests they wouldn't be able to double sales by cutting the price in half. Nah, "business-types" are colossoly stupid as you so aptly put it. They must have just not thought of it because they aren't smart like you.

      --

      Feel free to mod me "-1 - Angry Jerk".

    7. Re:Maybe they should take a hint. by DjMd · · Score: 2, Insightful

      Maybe they should take a hint and start making more games that are interesting and worth playing. (and heaven forbid, REplaying). I buy new games all the time. I buy them new from the store when price falls to $20 (USD).

      Rarely I buy a game new at ~ $50 (US) when it looks really good. (these are the games that stay at 40-50 for 6 months rather than dropping to $15 within 3 months of release...)

      --
      DJMD - The fourth man - Planetary
  2. This is stupid. by togofspookware · · Score: 5, Insightful

    Yeah, and when I buy a used couch, the couch manufacturing companies don't get my money either. So what? I wanted a couch, and the guy selling it didn't, so I bought it. That's how a free market works. Of *course* they'd rather I bought a new one!

    --
    Duct tape, XML, democracy: Not doing the job? Use more.
    1. Re:This is stupid. by Rick+the+Red · · Score: 2, Insightful
      Cripple games so they stop working after a certain amount of time, or only work on a single game console.
      If they think sales suck now, wait until they try this crap. I sure won't buy any DRM titles.
      --
      If all this should have a reason, we would be the last to know.
    2. Re:This is stupid. by Genom · · Score: 3, Insightful
      Cripple games so they stop working after a certain amount of time, or only work on a single game console. ...and I'd have to stop buying games completely. As it is, I generally tend to finish the games I buy 1-2 *years* after I actually buy them. Sometimes less, sometimes more (and sometimes never...)

      The cycle generally goes:
      • Buy new game
      • Play 30-60% of new game
      • Other things need attention
      • Forget about game for 3-6 months
      • Look at game shelf..."Oh yeah, I really ought to complete that sometime..."
      • Other things need attention
      • Forget about game agaun for 3-6 months
      • Eventually pop it in again, finish it, and move it to the "finished" pile


      If they only worked for 3 months or so, I'd hardly finish anything!
  3. You're problem is what exactly? by Torgo's+Pizza · · Score: 4, Insightful

    This was settled in court ages ago. What are you going to do? Put Ebay, Blockbuster, flea markets, Goodwill and used car lots out of business as well? It's pretty much a consumer's right to sell, trade in or do whatever he wants to his purchase. It's not like game publishers also don't get into this as well. How else do you explain the collector's editions, multiple covers, numbered boxes and special editions? Sorry, but the crying towel for this subject was used long, long ago.

  4. I buy used games... by wheresdrew · · Score: 5, Insightful
    ...because they're cheaper.

    That's the bottom line. Ebay, Gamestop, EB Games or local independent game shops, it's all good. Saves me money and allows me to buy more games. If they want to sell more copies of newer titles, I see two options:

    1. Make the game worth $50

    2. Make the game cost less than $50

    1. Re:I buy used games... by ConceptJunkie · · Score: 3, Insightful

      That's just a specific instance of #1.

      I buy used games all the time. At $5-$10/each I don't mind if I find myself spending much time with only one out of every 3 or 4 titles. Games are a funny thing, you often have to own them for a while before you know for sure if you really want them. If I drop $50 for a game, it better be something really special... and I'm no starving college student anymore. I can afford those games, but I just don't feel it's worth it. Most of the games I've spent the most time with lately I picked up in bargain bins, and I can never predict if something that gets me hooked will be one I picked up for $20 (or occasionally $30 or 40 or more), or some obscure or older bargain I get for $5.

      --
      You are in a maze of twisty little passages, all alike.
  5. What, and lose a mere 5-10% of the used margin? by Inoshiro · · Score: 3, Insightful

    When people trade in a game that at 5$, and the store sells it for 20$, they're making a healthy profit. Even if the game companies go ahead and decide to drop prices of their new games by 1/3rd, the used stores can still absorb that easily because they're paying about 60% to as low as 2% of the final price of a used game to take it in.

    What's worse, you've suddenly made used game trade ins more valuable because they can get more new games or used games for the same amount of trade ins!

    Natuarally, this is why providers are trying to move to a model where you don't own the content (online). I don't like that either. There are still game companies out there, though, that can make games that are worth enough that I'll hang on to them after I beat them, even if they have limited replayability (like Beyond Good and Evil, or Deus Ex: TIW).

    --
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    Internet Explorer (n): Another bug -- that is, a feature that can't be turned off -- in Windows.
    1. Re:What, and lose a mere 5-10% of the used margin? by MORTAR_COMBAT! · · Score: 1, Insightful

      yet another reason I went the the GameCube (aside from Zelda, Mario, Resident Evil, Metroid, etc). Microsoft and Sony have too much of my money already. Not that Nintendo is a bastion of freedom or anything.

      --
      MORTAR COMBAT!
    2. Re:What, and lose a mere 5-10% of the used margin? by MBraynard · · Score: 1, Insightful

      That is about the most lousy reason to decide what game system to buy EVER. I am glad not to be your kid having to listen to my nutcase parent explain to my why Santa can't bring me Halo2.

    3. Re:What, and lose a mere 5-10% of the used margin? by MORTAR_COMBAT! · · Score: 1, Insightful

      I didn't say it was "the" reason. I said it was "a" reason, along with a list of good game franchises which was the main reason.

      And I am glad not to be your parent, having to listen to my kid complain to me how they want Santa to bring them Halo 2.

      --
      MORTAR COMBAT!
  6. People don't get it.. by CashCarSTAR · · Score: 1, Insightful

    Isn't the term "vote with your pocketbook"..kinda negates that huh?

    In any case, there's no difference to the producer if you purchased a used game or stole/pirated it outright.

    There is absolutly no difference. Now, I'm the first to say that's the way our economy works, tough tiddles and all that...

    But at the same time, the sale of used media is a bigger problem for media producers than any amount of piracy could ever be. Personally, I don't think it's that much of a problem. But at the same time, if you're going to make a moral argument against one, you need to make a moral argument against the other.

    It's just a matter of different price-points, really.

    To say it again. It's not something that there SHOULD be anything done without..it's just I want to see producers of good things get rewarded.

    Actually, what I really resent is the companies like EB and GameSTOP that make money off this shit, but I digress.

  7. Used equivalence to not selling by chaosmage42 · · Score: 3, Insightful

    It is true that when someone buys a used game, the game company sees no money, but they saw money when the game was originally sold. Someone had to not like the game enough to sell it back so that it could appear on the used market. So the effect of the game appearing not to sell is partially true, the original owner would rather sie had not purchased the game. This means out of the 2 buyers of the game, only one would buy it if given a second chance. The company only receives one buyers money. This is fair {unlike the ridiculous markups on used games!}.

    If people are selling games after playing through them, it is usually long enough after the release that these purchases would not affect the company's income very much. {Another case is that the game has little-no replay value, and here the company is paying for it.}

    On the other hand, the author of the article makes good points and I do agree with him about supporting the companies {or local bands!} that one likes. Also, much of his arguements are about console games, which i feel have a larger used market than PC games {and I am almost entirely a PC gamer}.

    "Trigonometry is good for your soul"
    -The Mathematicians

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    done
  8. Re:Community support by KDR_11k · · Score: 2, Insightful

    Why do people take games back to stores and get 5 bucks if they could sell them on eBay for at least twice that? The seller gets more money which is likely invested ino video games and the buyer pays less and keeps more money which he can then spend on video games. With a store the seller gets little money and the buyer pays a lot while the profit from the sale goes to the store and will less likely be used for games.

    --
    Justice is the sheep getting arrested while an impartial judge declares the vote void.
  9. Re:Well, unless they license it otherwise. by sbryant · · Score: 2, Insightful

    Nintendo, Sony or Microsoft could always include in the license for all games, a clause that you may not resell the product.

    Except that that would be illegal in a lot of coutries. Microsoft tried to enforce reseller restrictions onto their OEM versions of Windows etc. The German courts decided that this practice (which forced bundling) was illegal. You can therefore buy (new or used) OEM Windows without being required to any hardware. I believe this is not so in the States.

    Some markets are absolutely dependant on customers selling off old items to be able to buy new ones. Take vehicles, for example.

    Having read the article, however, I do understand his point about watching where your money goes, and I think its a very valid point. He also talked about used games being very close in price to the new ones. The smaller the price difference between used and new, the more likely I am to just buy the new one! I think his store is ripping him off. It's a free market, and it isn't too hard to find alternative locations to buy used items, so stuff the store and its oversized markup - buy where it's cheaper!

    -- Steve

  10. One point... by nacturation · · Score: 2, Insightful
    I agree with what most people have written here, but one thing struck me from the article:
    Maybe it's the punk rock in me, but I firmly believe that if you're lucky enough to find art or entertainment that you really connect with--be it a music group, a movie, a video game, or whatever--the people responsible for bringing it to you deserve to be compensated for it.
    This is similar to the argument for donating to Open Source projects. Sure, if it's GPL you don't need to pay anything to be able to use the software. However, if it's something you find truly beneficial to you, it's nice to compensate the developer for their efforts. I do agree with the author though... if the difference is only $5 between new and used, I typically purchase new if only because being the first person to crack the seal on the game is psychologically satisfying.
    --
    Want to improve your Karma? Instead of "Post Anonymously", try the "Post Humously" option.
  11. Greased Up Jesus On A Pogo Stick! by limekiller4 · · Score: 4, Insightful

    When the fuck did it become the gamer's duty to subsidize a skewed pricing tier? This reeks of "if we don't rape you for $16 for every CD, you won't get to listen to the inspired strains of the Backstreet Boys, oh hell!" RIAA shill.

    First, creativity will always exist. If it flounders, an opportunity will emerge. There will always be people for whom the "work" is more akin to "love" and will do it not only cheaper but better than the competition. Linux*cough*linux.

    Second, if old games were $15 and new games were $25, would this problem exist?

    Believe it or not, I'm fairly tolerant of self-indulgent Slashdot posts. But this one takes the cake.

    --
    My .02,
    Limekiller
  12. Re: Sig. by Anonymous Coward · · Score: 1, Insightful

    Vote not Bush in 2004

    Not to be totally OT here, but isn't simply saying "not Bush" what went wrong in 2000? Don't get me wrong, I like the Libertarians and the Greens a lot, but if the real liberal-minded individuals, extreme or otherwise, want to free the country of Bush, shouldn't we all resolve to vote "Kerry"?

  13. How can I not? by WWWWolf · · Score: 2, Insightful

    You know, I'm a Poor Student. This is not an excuse to buy second hand games, but rather, the fact that I can't afford all games I want every month is. Why?

    The new games don't stay on store shelves long enough!

    The game retailing seems like an extremely cut-throat thing. There's zillions of new games coming out all the time and the stores just won't keep up long.

    I recently wanted to buy one (just released) game. It took a few months for me to scrape up the money for it. Went to the store. "Well, we had it a few weeks ago, not anymore..."

    If I find a game that's even slightly more marginal and not immediately mega-popular, I may as well forget trying to find it two months later from anything besides the very largest of the large shops. They do, however, sometimes show up in bargain bins and especially the second hand sections.

    So, a little bit of an advice: Make fewer games, and better; keep them on sale for a longer time.

  14. Who the hell are they trying to kid? by geminidomino · · Score: 3, Insightful

    when games don't sell, they don't get sequels and excellent concepts and, therefore, opportunities are lost.

    For every one "Deus Ex" (Not TIW), "Beyond Good & Evil", or "Castlevania: SotN", they bury us in steaming, greasy piles of rehashed "Starwars: Episode 3.14159 Racer", "Final Fantasy 34", "Super Mario Strip Poker", and the "[sport name] [year]" EA crap.

    Add to that underestimating demand for a game (Suikoden II, anyone?), a general "Screw the customers" attitude (That's right, SquareEnix, I'm talking to you, bitches), and you've got a right mess. Boo hoo. Stop trying to fleece me for $50 for a 10 hour game, and I'll stop buying it used.

  15. In other news by thefirelane · · Score: 3, Insightful

    The video game industry says not buying a game stifles creativity.

    Seriously, how does this stifle creativity? If X people want a game, and want to continue playing it then X people will do so.

    All resale prevents is from a game selling wildly upon high expectations, and not backing it up with long term playability. It sounds like it actually encourages creativity, because it makes them need to have an actually solid game

  16. Re:Community support by Gojira+Shipi-Taro · · Score: 2, Insightful

    Convenience.

    The extra $5 isn't worth the time it would take to package/ship a single item. Heck, the $5 isn't worth the time/hassle of just driving to the UPS store to ship.

    If I'm headed to Gamestop anyhow, and have a few clunkers to unload, might as well bring them.

    --
    "Oh my God. This is terrible. This is the end of my Presidency. I'm fucked."; ~ Donald J. Trump
  17. Re:bullshit. by EngineeringMarvel · · Score: 2, Insightful

    Every time I have ever sold my old games I end up buying new ones at the same time. The only reason I sell the new games is so I don't have to fork money out of my pocket to feed my gaming addiction. I could personally careless if the software companies only make 20 million off gamers this year instead of 22 million. If they cannot handle the fact that most of the gamers out there live in a free world economy (i.e. can sell and buy what they want) then they should do something about it. If it costs too much to develop such technology for their software, then they should prepare for the consequences that come with gamers that sell thier used games. In the end, the software companies will still make tons of money off all of us as long as they make a good product, just like every other good company in any field business.

    --
    I couldn't think of anything witty to say, so...you're stuck with this.
  18. Basic Economics says "nonsense." by Fished · · Score: 3, Insightful
    What this article ignores is that, at least in theory, the value of the first sale of the game is enhanced by the fact that I can resell it used. Simply, I am willing to pay more for it because I know that I can resell it for some fraction of that when I'm done. Yes, the publishers would make more if I never bought a game that wasn't new, but that's simply not the economic system we operate under.

    Instead of whining, publishers should work on making games that continue to be interesting after you've played them through once. Consider books, or movies, CD's. Although there is a used market for each, the market is not nearly as robust as the used games market. This is attributable to a couple of factors: first, the ridiculously high cost of games and, second, the fact that most games are worth playing only once if that. If games, like movies and books, were enjoyable to reuse and were not quite so expensive, people would be much less inclined to trade them in.

    --
    "He who would learn astronomy, and other recondite arts, let him go elsewhere. " -- John Calvin, commenting on Genesis 1
  19. Oh the humanity! by bigbigbison · · Score: 2, Insightful

    Even worse than used games is what is going on in the book industry! There's this building downtown that lets people borrow books for free! Just think of how many copies of books they could have sold if they would shut down these "libraries!"
    Seriously though, the outcry on used games and piracy often assumes that if these options to get a game/cd/book at lower or no cost did not exist, then people would pay full price, which is a fallacy. I know that when I buy a used game, it is almost always because it is cheap. If it was full price, I would not buy it. Maybe I'm just cheap, but if I really want a game, I'll buy it when it first comes out, otherwise, for 90% of the games I buy I just wait untill they are around $19.95. I imagine that I'm not entirely alone on this. So when I buy a used game, the manufacturers aren't losing out on anything because I wouldn't buy it at full price anyway.

    --
    http://www.popularculturegaming.com -- my blog about the culture of videogame players
  20. Re:Did you read the article? by Stray7Xi · · Score: 2, Insightful

    I disagree completely. You fail in a couple points.

    1. The money doesn't disappear in the retailer's hands. The retailer (at least the retailers that do used sales) has a vested interest in gaming. They aren't taking all the money and spending it on giving crack to children. They're investing much of it back in the company (more distribution, more stores, etc). With your reasoning you should try to bypass the publishers and reach right to the developers because there's no guarentee that the publishers cut will go back into gaming industry either.

    2. You completely ignore nonmonetary cost. eBay may be cheaper until you realize your time costs money. Customers will always seek the best value, but customers value different things differently. If I have to spend an hour with all the stuff involved with eBay it's already not worth buying a used game to me (because the new is cheaper in cost). Add in the factors of scams (unlikely on video games I'd guess), time delays and shipping then eBay becomes a pretty pointless place to buy video games or any other small product (granted I never did care for eBay).

    I've never sold my games but it's naive to say the retailer is somehow exploiting those people. It's merely an option. People only take it because they feel they're getting a better deal by it. I don't sell games but I do like to buy older used games. I don't look at it and see the profit and say "profit is evil", I look at the savings and say "savings are good". I don't have an obligation to buy retail, the way I see it as long as the game industry uses a product based system they should:
    A) Make the product worth keeping. They don't want this because they want throwaway games so you will buy the next release.
    B) Move to a service based model (subscriptions). This will eventually happen and it really is what should happen.