Used game business is out of control and will kill our hobby

[Zing]

I love this perception. The movie studios promote this. They are a few percent behind the billions in profits they made last year (in theatres, not in DVD sales), and suddenly they are hurting. Walmart had a disapponting holiday season too. Maybe they should start closing a few stores. These industries are fixated on their numbers. They set a number that they wish to achieve and when they come up short they are struggling. Exxon/Mobil really struggled through the hurricane season also. They only annouced record profits for any US company ever...

This reminds me of when I worked at Fedex in 2001. There was this large poster on the wall in the lobby that proudly proclaimed the company had a 40% increase in profits since 1999. Guess what happened a couple months later? I got laid off along with thousands of others across the nation due to "hard times".

[sabre2922]

Respectfully I just want to know what it is that Anthony 1 smokes when he posts on this board and were can I get some

[Anthony1]

Respectfully I just want to know what it is that Anthony 1 smokes when he posts on this board and were can I get some

Well, I am in Northern California

[Tan]

how's this: we need to support the used game market to promote recycling to save the enviroment, it's the least we can do for the planet, because we can't afford to keep burying the crap under a landfill like E.T.

think of the children....for heaven sakes will someone please think of the children.....

[Diatribal Deity]

What keeps the industry going is new players. As long as there are new customers there will always be a percentage that buy new games. As soon as interest flatlines, economy tanks, etc. the industry takes a hit. This is what happened to an extent in Japan. Emerging economies like China and India will present additional potential for this industry as new markets can be penetrated. Business 101.

[Iron Draggon]

Years of used bookstores, used music stores, and used movie stores haven't killed off any of those industries yet, so used game stores aren't gonna be killing off the games industry either. On the contrary, they help to keep it alive.

[GameDeals.ca]

There are many valid points here... and I wanted to add my thoughts on the matter (as a used video game retailer myself).

The sales of Used video games DO affect the sales of new product... BUT they work the same way as rentals. Some people will NOT buy "generic game" at all for full retail price. This is why the rental market exists... so they can sell a few copies for a larger number of consumers. Used game sales are the same, except that the "renter" can keep the game until they're done with it and re-sell it. Without the used market, they would sell less new games, and probably fewer consoles because these people would not pay full price anyway. It's the same theory for "illegally downloaded music/movies"... the people who pirate stuff, are the people who would not have paid full price anyway... so no real loss in sales, but it establishes a larger customer base (that buys controllers & memory cards, etc.).

The bigger concern (as mentioned) is that a lot of new games are crap, and companies like Sony & Microsoft are banking on crap to make a profit (instead of being smart like Nintendo). Nintendo makes a console (that turns a profit on it's own), then releases a pile of good games with huge replayability (Mario Kart, Animal Crossing, Mario Party, etc. etc.) and makes even more money because people KEEP these games (thus no used market).

The end result, is that even if used game sales did hurt the industry, the industry is growing at such a high rate that it can handle it. Not to mention the additional revenue streams that they are generating with "Live", downloadable content & retro games, faceplates, etc. The industry is only getting bigger, it isn't going anywhere... but it is changing (especially in the "used classic games" market - but that's a whole other topic).

[Tron 2.0]

Years of used bookstores, used music stores, and used movie stores haven't killed off any of those industries yet, so used game stores aren't gonna be killing off the games industry either. On the contrary, they help to keep it alive.

Agreed beside i'm glad there is a.. used market for video games.

It let's me get "old system and games" that i use to own that i like to play again.

[Nature Boy]

There are many valid points here... and I wanted to add my thoughts on the matter (as a used video game retailer myself).

Well said. Although I think it's dangerous thinking "the people who pirate stuff, are the people who would not have paid full price anyway" - you can guarantee that a lot of them wouldn't pay the full price, but not *all* of them.

I suspect it gets glossed over because those in the latter category probably mean less revenue than the costs associated with stopping it altogether.

[Mayhem]

Nintendo makes a console (that turns a profit on it's own), then releases a pile of good games with huge replayability (Mario Kart, Animal Crossing, Mario Party, etc. etc.) and makes even more money because people KEEP these games (thus no used market).

It can also be argued, especially in the US, that some of these games have never made Player's Choice status (the Mario Party games, Mario Kart: DD, Paper Mario etc) and hence they keep their value even in the used market (try finding used Paper Mario less than $30 in a store!) because of this. People are willing to pay $30-35 for them used because it's still less than the $50 they are new.

[Ed Oscuro]

the people who pirate stuff, are the people who would not have paid full price anyway... so no real loss in sales, but it establishes a larger customer base (that buys controllers & memory cards, etc.).

Let's say I buy an Xbox 360, but only buy a handful of games full-price, and buy a lot of games used or secondhand, and either scrimp on controllers + memory cards or go third party. That pretty much describes my buying habits. Microsoft would be recovering their loss on the console very slowly with only one or two full-price games sold to me every year, and indeed I doubt they'd come close to recouping it if I bought all my games off Amazon or eBay (which I'm pretty close to doing, as even new $20 clearance games at local stores suck - bad selection, and still too pricey).

[Nature Boy]

Microsoft would be recovering their loss on the console very slowly with only one or two full-price games sold to me every year, and indeed I doubt they'd come close to recouping it if I bought all my games off Amazon or eBay

We're talking about the industry, not one specific console maker. By paying for 3rd party memory cards and controllers you're still supporting the industry.

It doesn't matter who you buy your games off of either - the license was paid and MicroSoft got their money right from the get go.

[goatdan]

the people who pirate stuff, are the people who would not have paid full price anyway... so no real loss in sales, but it establishes a larger customer base (that buys controllers & memory cards, etc.).

That's simply not true. If it was, the Dreamcast should've kicked everyone ass as people were buying it, buying controllers and memory cards and no games... but yet it died.

There is a real loss due to piracy, but that's a whole different conversation and one that it seems most people on these boards don't want to read through (kinda like a lot of this one...) as we've done it before and not really gotten anywhere with it.

Let's say I buy an Xbox 360, but only buy a handful of games full-price, and buy a lot of games used or secondhand, and either scrimp on controllers + memory cards or go third party. That pretty much describes my buying habits. Microsoft would be recovering their loss on the console very slowly with only one or two full-price games sold to me every year, and indeed I doubt they'd come close to recouping it if I bought all my games off Amazon or eBay (which I'm pretty close to doing, as even new $20 clearance games at local stores suck - bad selection, and still too pricey).

No, Microsoft would still recover their costs as long as you were keeping the games that you purchased. Remember one used game = one game that Microsoft already got paid for in licensing. Even if there are 5000 copies of a game on eBay that the original company and Microsoft aren't getting paid for, that's 5000 copies of the game that sold.

If a buyer purchases a Xbox 360 and 20 used games (and does not sell them), he or she takes 20 used copies off the market. It doesn't matter where they came from, they were originally paid for and that is what matters in the long run. I believe that a console on average sells like seven games to people during it's lifespan. That means that if one person gets a console and buys 35 new games for $50.00 and sells all but 7 of them to four other gamers at secondhand prices, the overall sales is evened out and Microsoft is happy to have moved the five consoles, even though four people never bought a game directly from them.

[GameDeals.ca]

the people who pirate stuff, are the people who would not have paid full price anyway... so no real loss in sales, but it establishes a larger customer base (that buys controllers & memory cards, etc.).

That's simply not true. If it was, the Dreamcast should've kicked everyone ass as people were buying it, buying controllers and memory cards and no games... but yet it died.

There is a real loss due to piracy, but that's a whole different conversation and one that it seems most people on these boards don't want to read through (kinda like a lot of this one...) as we've done it before and not really gotten anywhere with it.

I have to disagree. Look at how successful the first Playstation was and it was (arguably) the most pirated system. The dreamcast died because it was ahead of it's time and proved to be inferior in the long run... not to mention the lack of support from 3rd parties sick of Sega's console mistakes.

I would be wrong to say that there is NO loss due to piracy, I'm just saying that it's only a fraction and is made up for with other factors.

Some people who pirate, would buy legitimate if they couldn't pirate, but there are much fewer of them than there are people who pirate stuff that they would never buy anyway. The ones who cause a loss in sales, are compensated by the sales of accessories, the publicity of "consoles sold" numbers that generate other sales, the branding of game franchises that get these people to buy future games, etc. etc. It's building market share... here have PSX games for free... you like Playstation don't you... why not buy our shiny PS2... and let your friends try it... and talk about how much you like our games to others... and so it goes.

[goatdan]

I have to disagree. Look at how successful the first Playstation was and it was (arguably) the most pirated system.

You seem to be stating that the reason that a game system is popular is directly related to people's ability to pirate for it... and to put it frankly, that's horribly inaccurate. The Playstation could have been arguably the most pirated console ever, but not by percentage of people that owned it, just by sheer numbers. On the other hand, the Dreamcast which required zero modifications to pirate on other than a cheap CD burner -- no risking an expensive system, no needing an expensive (in 1995-8ish) CD burner, just download and burn and you're good to go -- was pirated on by a much higher percentage of people than the Playstation. There is proof of this out there, but people have to look it up themselves as I can't explain it beyond that...

Some people who pirate, would buy legitimate if they couldn't pirate, but there are much fewer of them than there are people who pirate stuff that they would never buy anyway. The ones who cause a loss in sales, are compensated by the sales of accessories, the publicity of "consoles sold" numbers that generate other sales, the branding of game franchises that get these people to buy future games, etc. etc. It's building market share... here have PSX games for free... you like Playstation don't you... why not buy our shiny PS2... and let your friends try it... and talk about how much you like our games to others... and so it goes.

Um, no. If Sony had sold 20 million consoles but only 40 million total software units overall, the console would be looked at as pretty damn unsuccessful. But the Playstation moved a record amount of consoles AND software, which meant that the vast majority of their gains came through software sales, not hardware which is a MUCH lower margin business than software.

[Ed Oscuro]

Microsoft would be recovering their loss on the console very slowly with only one or two full-price games sold to me every year, and indeed I doubt they'd come close to recouping it if I bought all my games off Amazon or eBay

We're talking about the industry, not one specific console maker. By paying for 3rd party memory cards and controllers you're still supporting the industry.

It doesn't matter who you buy your games off of either - the license was paid and MicroSoft got their money right from the get go.

They need to sell a number of games. You don't make $250 back from one game sale, and I think my current buying habits (i.e. get most anything used) wouldn't help that.

Yes, if I get a huge used/secondhand game collection, those games were originally sold to Microsoft...but to another person who had their own system which Microsoft was banking they would purchase original games for to pay off the debt. See what I'm getting at?

[Poofta!]

this is what happens when you let Anthony1 create a flash game:

http://uploads.ungrounded.net/158000/158631_decline.swf

[Nature Boy]

Yes, if I get a huge used/secondhand game collection, those games were originally sold to Microsoft...but to another person who had their own system which Microsoft was banking they would purchase original games for to pay off the debt. See what I'm getting at?

I see what you're getting at, but you're forgetting one thing - the original purchaser *probably* went out and bought more new games after trading in the ones you eventually bought.

Plus MS is a unique case in that (I believe) they're the only ones who still lose money on console sales for Xbox. Presumably they'll be a little wiser with the 360 and they won't lose money for it's entire life cycle, but that's something neither of us can know for sure.

[Diatribal Deity]

Yes, if I get a huge used/secondhand game collection, those games were originally sold to Microsoft...but to another person who had their own system which Microsoft was banking they would purchase original games for to pay off the debt. See what I'm getting at?

I see what you're getting at, but you're forgetting one thing - the original purchaser *probably* went out and bought more new games after trading in the ones you eventually bought.

Plus MS is a unique case in that (I believe) they're the only ones who still lose money on console sales for Xbox. Presumably they'll be a little wiser with the 360 and they won't lose money for it's entire life cycle, but that's something neither of us can know for sure.

Microsoft does not expect to be profitable with the 360 until 2007 at the earliest (they are losing app. $126 on each system sold). They will break even in 2006.

It is estimated Sony will lose at least $200 on each system sold initially. So it will take a few years for them to break even and start making a profit on the PS3 as well.

Difference being Microsoft can easily take the hit, where Sony as a whole...not so much. Bottom line---cheaper parts in subsequent models as is the norm.