Sony Profits Conundrum

Alice, over at the Wonderland blog, has an interesting post wondering about the state of Sony's finances when put in contrast with their view on second-hand game sales, and new title prices. From the article: "Yet it turns out that discounting new releases also results in higher sales. MCV continues: 'BVG's The Chronicles of Narnia jumped ten places up the ChartTrack top 40 last week, thanks to a 16 per cent sales increase, following its slashing to £19.99 at most High Street retailers.' My question: what the hell are they complaining about? Why curtail the perfectly reasonable and legal second-hand market if they're making money hand-over-fist with the current situation?"

Comments

Re:Greed

[ClamIAm]

Getting a percentage of each used game sale is probably Sony's wet dream here, but they should look at other industries to see a perfectly reasonable and much better idea. Car manufacturers often have "certified" used cars, where they go through and perform maintenence and slap a warranty on the thing.

Games could work the same way. Work out a licensing scheme where used game retailers could buy a special console that checks for errors and disc scratches. They then make sure the manual and everything is there, and then give a new warranty. Ta daa.

Hi. Boycott

[Anonymous Coward]

Sony will get none of my pounds because of that rootkit bollocks they installed on my clue.*

* Cockney Rhyming Slang: The PC was introduced as a model by IBM, also known as "Big Blue." "Blue" rhymes with "Clue."

Re:Risk Analysis

[AKAImBatman]

It's a bit like the scene in Fight Club when the narrator explains how his company issues recalls. If the court settlements are less than the cost of a recall, they aren't going to fix those cars.

The first rule of Fight Club is, YOU DON'T TALK ABOUT FIGHT CLUB! ;-)

That being said, you need to remember that Fight Club is just a movie. Any sort of court settlement is likely to include a requirement that the defective vehicles get recalled. Thus it's usually cheaper and easier for a company to jump on the issue as soon as they learn about it, and pay for the $10 mass-produced replacement part + labor (the real expense).

From the department of duh

[MMaestro]

Yet it turns out that discounting new releases also results in higher sales.

Discounting new releases means higher sales? No, really? /sarcasm

Gamers have asked for new releases to come down in price sooner, rather than waiting for the company to think 'well gee, sales and hype have hit rock bottom lets try discounting games now that everyone already bought second-hand copies and hope we make some more sales.'

"Greed" is glib

[tengennewseditor]

Simply because a corporation seeks to maximize profits doesn't mean it shouldn't keep the customer's interest in mind. It's in Sony's interest to keep the secondary game market alive so that PS2 console owners remain happy and come back for the PS3. But yes, this also obviously hurts the primary game market. There's an obvious tradeoff here, which makes a console maker's decision whether or not to support or squash a secondary game market an interesting decision. Simply calling it "greed" marginalizes the whole conversation because it's obvious and insufficient at the same time.

Re:"Greed" is glib

[GregWebb]

OK, case study.

I'm 27 and I own a PS2 (though admittedly I was a late customer, only got it in late 2004).

I have 15 games for it (and a social life, and a girlfriend! really! she likes some of the games too :-)), of which only 7 were new.

Of those 7:
* 1 was bundled with the machine (GT3)
* 3 were seriously cheap anyway (original Codemasters Indycar, £10, WRC3, £10 and Stock Car Speedway, £7)
* 1 was in a sale, on a voucher and largely for my girlfriend anyway (Sonic Mega Collection, £20)
* 2 were games I 'just had to have' (GT4 and NASCAR 2006, both £30) and in my defence, both were discounted and NASCAR titles pre-2006 had been like hens' teeth for UK PS2 gamers so I was determined to get this one in case they pulled it from the market quickly

So I've never paid full retail, there's only 2 games where I've paid over 50% of what'd be the usual full retail price for PS2 games over here and all bar 3 of the games I've bought (so not really counting the bundle, can't remember what they were selling it at separately) have either been second hand or price competitive with the second hand games anyway.

Sony: I know you don't get much money from me but you get some and it stops me becoming an XBox 360 household and helping boost Microsoft's market. I will only buy a PS3 as and when it has compelling games (or services) I can't play on my PS2 and when the game availability is similar to what it is on the PS2 a the moment in the UK.

Re:No Technical Solution to Secondhand Sales

[Perseid]

Sony has said they won't use that patent(http://arstechnica.com/journals/thumbs.ars/ 2005/11/9/1779) on the PS3, and I beleive them. There is too much competition in this market for them to do something that obviously asinine.