David Braben of Frontier Developments has recently spoken of measures his company is taking to combat what he refers to as the 'pre-owned problem' the UK games market is currently facing.
In the article, Braben refers to sales figures for US games retail giant Gamestop from 2008/09 which show that 42% of the company's profits made over that period were from pre-owned sales alone as well as gross profit on pre-owned alone coming to a little under $1 billion.
He continues to look at the ongoing issue from the POV of players and retailers, explaining that consumers like the existence of the pre-owned games market due to getting the titles they want at cheaper prices.
Regarding retailers, Braben explains that they were having a hard time before pre-owned sales became big business and that profit margins are still tight for even the biggest games retailers around the world. He also suggests that retailers have educated gamers into thinking that a lower retail price on titles is now expected.
Braben laments the inaction that has been taken in the games industry towards combating profits netted by games retailers from pre-owned sales without the original developers/publishers seeing a cut. He further suggests six actions that the industry could take towards the current situation (in brief):
Increasing the number of codes that are given out only with new games purchases, serial numbering of game discs by publishers/developers, industry participation in pre-owned sales, introducing 'not for resale' on new SKUs (games), selling data-only discs as an extended demo that would require online validation to access the full game and finally for the games retail market to become online-only (whoo!)
Braben concludes by suggesting that the industry takes further action soon rather than continuing to shout about what he calls an 'unjust iceberg' of an issue.
Be it retail, develop, publisher or player, do you agree with Braben's comments on the issue of who gets the profits from pre-owned game sales? Does he have any business pursuing the issue when no other industry seems to be following the same route regarding second-hand sales of items? Feel free to post your comments down below.
Source: Develop
In the article, Braben refers to sales figures for US games retail giant Gamestop from 2008/09 which show that 42% of the company's profits made over that period were from pre-owned sales alone as well as gross profit on pre-owned alone coming to a little under $1 billion.
He continues to look at the ongoing issue from the POV of players and retailers, explaining that consumers like the existence of the pre-owned games market due to getting the titles they want at cheaper prices.
Regarding retailers, Braben explains that they were having a hard time before pre-owned sales became big business and that profit margins are still tight for even the biggest games retailers around the world. He also suggests that retailers have educated gamers into thinking that a lower retail price on titles is now expected.
Braben laments the inaction that has been taken in the games industry towards combating profits netted by games retailers from pre-owned sales without the original developers/publishers seeing a cut. He further suggests six actions that the industry could take towards the current situation (in brief):
Increasing the number of codes that are given out only with new games purchases, serial numbering of game discs by publishers/developers, industry participation in pre-owned sales, introducing 'not for resale' on new SKUs (games), selling data-only discs as an extended demo that would require online validation to access the full game and finally for the games retail market to become online-only (whoo!)
Braben concludes by suggesting that the industry takes further action soon rather than continuing to shout about what he calls an 'unjust iceberg' of an issue.
Be it retail, develop, publisher or player, do you agree with Braben's comments on the issue of who gets the profits from pre-owned game sales? Does he have any business pursuing the issue when no other industry seems to be following the same route regarding second-hand sales of items? Feel free to post your comments down below.
Source: Develop
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Comments
realvictory 21 Oct 2010 12:57
1/6
Eliminating the sales of pre-owned games won't make developers richer; I refuse to believe it's "lost" sales.
Here are the two main solutions that I think there are:
1) Participate in pre-owned sales, e.g. do include new-only content, but make sure you aren't ripping off people who do buy pre-owned games.
2) Sell new games cheaper.
Remember, games aren't essential for anyone. Giving people who buy the games a bad deal is only going to make them buy fewer games.
What's more, the existence and success of retail gains recognition for the games industry. Removing that entirely, or even making it harder for high-street retailers, affects sales of your game.
Here are the two main solutions that I think there are:
1) Participate in pre-owned sales, e.g. do include new-only content, but make sure you aren't ripping off people who do buy pre-owned games.
2) Sell new games cheaper.
Remember, games aren't essential for anyone. Giving people who buy the games a bad deal is only going to make them buy fewer games.
What's more, the existence and success of retail gains recognition for the games industry. Removing that entirely, or even making it harder for high-street retailers, affects sales of your game.
PaulRayment 21 Oct 2010 15:59
2/6
While I didn't like the idea at first I tend to think EA's 'pass' idea works best. Their way I pay £6 or something to have access to the online element of the game which as far as I can see it is the only thing that costs them money once I've bought the game.
I could play the single player for 20 years and it wouldn't affect the balance sheet one bit so to put a levy on that is just rude.
What I don't understand is that idea that 2nd hand is a relativity recent phenomenon and it's contributing to the 'recent' hard times publishers are facing.
2nd hand has been around since the dawn of gaming and I don't recall this kind of fuss and cockyness before. It seems to me that it's only an issue now because it's easy to blame and easy for publishers to 'tax' thanks to online registrations.
I could play the single player for 20 years and it wouldn't affect the balance sheet one bit so to put a levy on that is just rude.
What I don't understand is that idea that 2nd hand is a relativity recent phenomenon and it's contributing to the 'recent' hard times publishers are facing.
2nd hand has been around since the dawn of gaming and I don't recall this kind of fuss and cockyness before. It seems to me that it's only an issue now because it's easy to blame and easy for publishers to 'tax' thanks to online registrations.
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Spinface 22 Oct 2010 08:31
3/6
@PaulRayment Yeah, you've got to wonder whether it's the fact that they can do something about it now that's prompting the whinging. You don't catch comics creators moaning about second-hand sales, and comics can fetch crazy money.
GeoThermal 22 Oct 2010 11:08
4/6
There's nothing unjust about it. Does Braben give a cut of the money he receives if he sells anything he owns? You buy the goods, they are yours. If you want to sell them on to a shop who then sells them again that is fair enough. It's business. Braben got his bit of the pie but doesn't want others to get their bit. If he's so worried about 2nd hand games sales why doesn't his company offer to buy their games back from consumers when they are finished with them? Then he can sell them 2nd hand.
MRXBOX n VAN BC 25 Oct 2010 02:03
5/6
Heres how you fix it . STOP MAKING CRAP GAMES THAT ARE BROKEN IN THE BOX . Can anyone say Javelin Glitch !!!!!!! I speak with my wallet and lately have have bought a thing . My MLG Buddies are selling Halo to buy Medal and grab a 1000 quick gamer score before . They " DUMP THIS TURD " for COD7 . So Perk Perk Shooters for everyone. Everyone but me . I still think being killed by LARS the Helicopter Pilot in COD 4 , well not even vidgaming . Sorry but I AM THE LAST TRUE RUN and GUN PLAYER OUT HERE !!!!
Joe Mac 25 Oct 2010 02:18
6/6
" introducing 'not for resale' on new SKUs (games) "
That's already been tried by the publishers and it didn't fly at court. The owner owns the game and also the media it's on. It can be sold on as often as they like. The publishers may try and use technology to prevent people passing it on, bu they can't use the law.
That's already been tried by the publishers and it didn't fly at court. The owner owns the game and also the media it's on. It can be sold on as often as they like. The publishers may try and use technology to prevent people passing it on, bu they can't use the law.