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"Is The Second Hand/Rental Market Killing Gaming?"

Just watched this which I thought was very interesting.Arguments seem to stack up on all sides (Customer,Developer/Distributor & Retailer). Just wondered what you guys make of it, would you happily part with £40 of your hard earned cash for a game if there was no way to sell/trade it on when you were done with it? On the other side with games development costs constantly rising is it really fair that developers should not receive a penny from this part of the industry? (we've just witnessed the demise of Bizarre Creations could other developers be heading for a similar fate if things do not change?). As for EA's (and I believe now also THQ's) controversial online pass system, I think the fact that neither distributor seemed willing to comment on it proves that they must be only too aware how just unpopular it is with gamers. Perhaps games should be about £10 - £20 and any online features (mutliplayer,DLC) paid for on top of this? That way developers would get their share of the revenue, while people just wanting to play the basic game could do so without the need for waiting to buy a cheap used copy? One thing I felt this feature slightly overlooked was the plummeting cost of new titles, very often a game will be available for around half it's initial asking price and just a few weeks after it's release. What about rental?, apart from the revenue from the sale of each individual disc developers currently do not get any money from this. Then again you could argue if someone rents a game and likes it they may then buy it?, I know I have done that on quite a few occasions. There are many titles I own that I would definitely not have bought blind. While these mentioned practices may have become commonplace for many of us in recent years, could we pay for it in the not too distant future in the form of rushed substandard games? Be really interested to hear peoples comments on this.

I don;t know if you read MCV every (bi)week Garin, but the industry seems to be puttting a lot of blame in to the hands of the the bigger retailers, whilst more or less everyone blames supermarkets for cutting prices on major profit releases.

Retailers set the prices with GAME actually openly saying "screw cut prices" and "eventually they come to us anyway when the deals are done, so keep the prices high". That's from them and a job interview once where my sister was told that was why they don't drop prices.

Good news is retailers (and a lot of developers) seem to be steering more and more to the digital market, with even the larger developers begrudgingly agreeing it's the way forward. This will effectively stop this "second hand market thing" in reality if it really does kick off the way the industry mag believes.

Still on a more "OT" point: Retailers blame supermarkets, producers blame retailers and piracy, developers blame cost, the customer blames everyone (whilst normally downloading pirate copies).

Supermarkets blame no-one and cut prices left right and centre to get you in to buy bread that smells good.

Seem to be going around in circles really. You seem quite set on the idea that price drops must be the work of publishers as opposed to those people controlling the price (retailers). Not really sure theres any evidence that publishers have that much control. And if they did then why havent they used their influence to stop retailers exploiting the second hand market instead of new.

Yeah,at a quick glance sales do actually look pretty good for Dead Space 2 ,especially when compared to the original (which despite being very good didn't actually sell that well).However,when compared to other big titles such as Call Of Duty : Black Ops it's sales do not seem quite so impressive (less than a third).Other retailers such as Gamestation have now also moved to the £23 console,£15 PC price point on Dead Space 2 which still to me seems a bizarre business strategy for something which has was only released 2 weeks ago and has allegedly sold quite well? Maybe this has been done to attempt to kill the second hand market for this title?,if that is indeed the case there's little doubt the plan has succeeded (spotted used copies for £37.99 instore at GAME today,who the hell is going to buy those?) The question is though if this continues to happen on future titles just how many people will be fearful of buying full price titles on release date for fear of getting burned?

EA's business plan involves selling to retailers & distributors. The pricing strategy of retailers isnt theirs. If there is damage to second hand market, its the retailers doing it to themselves. And Deadspace 2 is/was a big seller so we dont have a case of price slashing to move stock here.

Garin wrote:
The bit of information we're missing is the pricing model they work to I suppose. My guess is that they dont work to a per unit model at all. Rather they are buying in bulk and judge profit against the shipment as a whole. Once they've reached certain margins then remaining stock can be discounted safe in the knowledge that they'll meet their targets.

No you're right,we do not have this information but I would be extremely surprised if EA's business plan was to start offloading a title as big as this so cheap so very soon after it's release.I suppose one theory is by doing this that they have in effect killed the second hand demand for this game leaving people who paid £40+ for it just a couple of weeks ago hardly too thrilled to find out their copies are now only worth about £15.Online retailer Gameplay (part of the GAME group) today had the console versions of Dead Space 2 for £22.99 and the PC version for £14.99 (unsurprisingly they have now sold out on all formats) so this price does not appear to be an Argos exclusive.I would imagine the game has not sold in the desired numbers and both retailers and distributors know at what price point these will start shifting and I would say the prices mentioned are now in the zone.The question I would ask is how many more people are going to be like me and simply wait? If I had bought Dead Space 2 on release I doubt that I would have have chance to play it all that much as I am a very casual gamer.All I do know is that my planned purchase would have depreciated to the tune of some £25 in just a fortnight.

The bit of information we're missing is the pricing model they work to I suppose. My guess is that they dont work to a per unit model at all. Rather they are buying in bulk and judge profit against the shipment as a whole. Once they've reached certain margins then remaining stock can be discounted safe in the knowledge that they'll meet their targets.

Garin wrote:
For those of you that favour price cuts as a solution to this problem, you might like this...

blog post about price & sales in the apple's appstore

Interesting reading Garin,thanks for posting that.

I did buy a (new) copy of EA's Dead Space 2 from Argos today for just £23.99 (details posted in Bargain Thread if anyone's interested).The game is only 2 weeks old and retailers are seemingly already dropping it to less than half it's RRP (£49.99).In reality most retailers were already selling at around £10 under this price but even so that seems to me to be a hell of a price drop in such a very short period of time.Be interested to know who's instigated such a drop so soon after release date?, was it Argos fearful of being stuck with a load of unsold copies or EA who suspect the game was never going to sell in desired numbers with their online pass system making it unattractive to buyers intending to sell/trade it on? Whichever it is I would imagine people will be extremely wary of paying £40 on day of release on future titles which may depreciate at this rate.

For those of you that favour price cuts as a solution to this problem, you might like this...

blog post about price & sales in the apple's appstore

pete_21 wrote:
Yeah,would be interested to give MOH another go if the issues I described have been sorted.I bought the new Black Op's map pack but none of the new maps ever seem to come up?.Played it for 2 hours one night last week and only had one game on one of the new maps :(

Evening pete..that's exactly what happened with PC MW2 1st map pack, never appeared for choice for weeks after release...on XBox, immediately available :¬(

Yeah,would be interested to give MOH another go if the issues I described have been sorted.I bought the new Black Op's map pack but none of the new maps ever seem to come up?.Played it for 2 hours one night last week and only had one game on one of the new maps :(