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Apr 17 2012
By: PapaWarlock PlayStation MVP 11171 posts
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What Impact Would Locking Out Used Games Have On Next Gen Systems?

11 replies 607 views Edited Apr 17, 2012

Used games. It’s a divisive factor in the gaming world. Next generation rumors are rife with used game theories. Both Microsoft and Sony have both been in the gaming news with their next generation projects and alleged quotes that these systems will not play used games. That games will be locked to your account or to your console. If this is true, it impacts not just the Used game market, but game rentals, households with multiple gamers, and loaning or borrowing games between friends and family.

So what is the reality of it all? Is it really coming next generation? Would it kill the used market? Would it make games cheaper? No. In all honesty the first company to do that would be committing suicide. Why?


To start with, we need to look at one of the largest portions of gamers that would be impacted. Families. Dad’s a gamer. Junior’s a gamer. Little Suzie’s a gamer. Even Fluffy is gaming now in her cat tree and Fido’s got a smart phone. In households with multiple gamers there tends to be a lot of game sharing.


Such as my house. My daughter and I both love the Ratchet series. My daughter and I shared the games, each of us had our own save files on the PS2. As for the PS3 versions we had our own PS3s. I did buy 2 copies of All 4 One, but buying 2 copies of 1 game gets expensive after a while. Can you imagine needing to buy 4 copies of one game? Or even buying 2 copies of 1 game time and time again? Or worse yet, try telling Johnny he has to share his gamer account with Suzie so that she can play the new CoD herself? Not. Happening.


While I have to say that odds are pretty good that even in a standard 2 child household with a total of 3 gamers (Dad and both children or even Mom, Dad and Junior, etc.) would be buying 3 copies of every single game, even buying two copies 3 or 4 times a year would add a lot to the average budget.


I know the aforementioned scene won’t have an impact on the single gamer dude or gal who’s working 2 jobs or going to college. Yet how many college students are borrowing games from their friends? A lot of college gamers are broke. That will have an immense impact on how many games a college person will be able to experience.

What about gamers who live in areas where broadband internet isn’t possible? Depending on where you do your research, roughly 30% of the US doesn’t have access to anything more than dial up connections, with many not having any access at all. There was a study done in 2010 that shows roughly 22% of PS3 owners , 27% of 360 owners and 46% of Wii owners have never connected to the internet. Is the gaming industry that greedy of a batch of executives that they’re willing to cut out a sizable portion of the gaming population based off of not having constant internet access? Well, actually that’s a possibility.


Let’s take a look at the Used Game market itself. It’s been reported that GameStop recently had over $2 billion in used game sales. While you will never get as much in trade for used games as you could selling on Ebay or other sites, it is one of the easiest ways to get money back on games you’re done with. Many people use trade in credit to pay on new games. I don’t know how much GameStop pays out in total as credit, but given recent promotions are offering 50% credit towards pre-orders, we’ll go with an average of 33% of their used game revenue goes back as consumer credit towards pre-orders and/or new game purchases. That’s about $666,666,667 of used game revenue is converted into new game sales. That’s a lot of new games.


But GameStop isn’t the only used game distributor. Game Fly wouldn’t exist without game rentals. Rentals are another form of used game in so far as the Publisher and Developer receive nothing for these sales. Then there are local Mom & Pop shops that deal with new & used games. Ebay is another method of selling your old games. You can usually get more for your used games when you sell direct to another player, but it’s still used. Fully killing the used game market would impact jobs for a lot of people, even killing many small businesses.


With the rumors of the next generation of Sony and Microsoft consoles locking out used games, how exactly will that be accomplished? No one knows yet beyond simple rumor. One such method that’s been bandied about requires gamers to have a constant connection to the internet so that the console can verify the disc is tied to the correct person. How that disc will be tied is unknown. Will the disc come with a small portion of free space for the console to burn a unique code onto the disc to tie it to either A) gamer ID or B) console ID. What happens if the gamer’s system crashes? Will s/he be required to purchase the same game yet again?


Will the new consoles come with some kind of ID specific code key that a gamer could use to transfer his content to a new system if for some reason her console dies? If not who wants to run the risk of buying their games multiple times through events that are often out of their control.


So far the infrastructure that’s needed to fully eliminate the used game market (and it’s derivatives) is not in place yet. Lack of consistent and universal broadband access is not in place. Slow download speeds and data caps also put a major strain on the process of used game elimination. I know more than a few people who’ve mentioned their ISPs are instituting data caps on their home usage. With games getting ever larger, how many games will a person be able to download in a month before they get cut off halfway through a download and have to wait another month to finish? If they don’t have to re-download the full file to start with.


Pricing in another part of that infrastructure that will have to change if the gaming industry expects gamers to give up their physical media plus resale rights. Fewer people will be willing to spend $60 on a brand new title that gives them 10 hours of game play.


So for the gaming industry, killing the used market would be very bad for business. While game publishers and developers will argue that the used market puts a dent in their profit margins (and they are correct) eliminating that market would likely be very disastrous for them. Families won’t be buying nearly as many games. People will balk at the standard price far more than they do now. It’ll put thousands of employees out of business. A good portion of the gaming community will be unable to game if they don’t have the constant internet connection that is currently rumored to be required. It will have a major impact on the new game market.

A full digital system is coming eventually. There’s no argument there. Is it coming any time soon, like with the next generation of consoles? Very very unlikely.

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Re: What Impact Would Locking Out Used Games Have On Next Gen Systems?

Apr 19, 2012

I'm going to play the devil's advocate a bit, here.

Will locking used games make games cheaper? I don't know, however, if this locking ever happened, I do think that we could end up with better quality games and smarter consumers, and here's why.

If a consumer has limited funds to continue buying games and is forced to decide which ones the money will get spent on vs just buying games willy-nilly no matter how good they are, then just rolling them over and trading them in because they weren't worth buying in the first place, then the consumer will start researching more often which games were really good. Less games will be bought, unless the quality is raised to the point of making them more desirable.

I can't predict if all consumers will do this, but if enough do, then it will affect sales numbers, either negatively because the games remain poor quality or they will stay healthy because games got better. Either way, consumers win.

How will developers and publishers respond to the shift in buying habits? Will they stay the course and still make mediocre games (you know which ones I mean...) or will they get to work and make better ones?

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Re: What Impact Would Locking Out Used Games Have On Next Gen Systems?

Apr 19, 2012

I had heard and mentioned this last year and I still think it's the dumbest idea since non-sliced bread. Rental, used and family-owned single copies are what has helped make the console gaming industry the large and profitable entity it is. Bloating is what has created the current crisis and this aberrant attempt to obtain more single purchases is a twisted idea that will only see overall sales decrease and reduce the budget AAA titles get. The industry's love of advertisement campaigns and useless pompousness (ie.Cirque du Solei on a gaming event and NY square launches) are a much better place to look for streamlining.

I'm still hopefull someone will see the light and establish account networking or some other sort of game sharing that enables household sharing across adult accounts and PSN store rentals. If you want to get rid of the middle man, offer what he does instead of demanding the public not use the service.

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Re: What Impact Would Locking Out Used Games Have On Next Gen Systems?

Apr 20, 2012

Fexelea wrote:

I had heard and mentioned this last year and I still think it's the dumbest idea since non-sliced bread. Rental, used and family-owned single copies are what has helped make the console gaming industry the large and profitable entity it is. Bloating is what has created the current crisis and this aberrant attempt to obtain more single purchases is a twisted idea that will only see overall sales decrease and reduce the budget AAA titles get. The industry's love of advertisement campaigns and useless pompousness (ie.Cirque du Solei on a gaming event and NY square launches) are a much better place to look for streamlining.

I'm still hopefull someone will see the light and establish account networking or some other sort of game sharing that enables household sharing across adult accounts and PSN store rentals. If you want to get rid of the middle man, offer what he does instead of demanding the public not use the service.

I'll agree that it's a dumb idea but I'll send you a PM about the analogy.

I used to rent games when I was a teenager. But I haven't rented them in about 15 years. Although I did try Gamefly for one month and will never use it again. Family gaming on the other hand is something I've used extensively. As a parent, I try to find a few games that my daughter and I can enjoy together. Over the years that's been Pokemon, Ratchet & Clank, and Mario. I've tried to get her into Final Fantasy and Zelda to no avail. She has expressed a bit of interest in Call of Duty because a friend of hers is into it. I downloaded the demo for Black Ops because that's the main one her friend likes. I have a feeling she won't like it just because of my daughter's personality and tastes.

My brother and I have borrowed games from each other all the time. God of War. Final Fantasy. Dragon Warrior. Etc... Even though we now live in different states I still occasionally send him games to borrow. He doesn't have a PS3 though so it's just been handheld games. I know others who do the same. Locking games to a console or ID would make that impossible and I don't know too many people who will be willing to support such a feature.

I can't say much for anyone else but I don't buy games based off of advertisement campaigns or events (like the Subway promotion of Uncharted 3.) In my opinion DLC is probably the best way to boost revenue especially from those who buy used, rent or borrow.

As it stands now this is nothing more than a rumor. I would hope that none of the console companies would ever be that stupid. I agree there are better ways. I wish that they would offer game rentals via the various online services. Basically allow publishers to offer timed rentals of their games. Say $2 a day to play Homefront or something similar.

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Re: What Impact Would Locking Out Used Games Have On Next Gen Systems?

Apr 24, 2012

New US retailer, EKGaming, intends to share 10% of pre-owned game sales with publishers and devs, by promoting what they call the "circle of life" of games and continuing to keep used games in circulation.

"Publishers are spending record amounts of cash on new game development. This increase in dev costs is steering them in directions that don't necessarily jive with gamers, causing them to take less risks on new and potentially exciting IP's or game mechanics and sticking with tried and true properties that are more of a guarantee," commented CEO Mike Kennedy.

"We want to share our used game revenue with them so they can continue investing in new gaming experiences without worrying about the negative effects used games could be having on their operations."

The retailer also said it intends to "guarantee" better trade-in credit for games compared to the High Street competition - up to 30 per cent - taking advantage of the low overheads of the online marketplace. It currently offers $40 trade-in credit for titles such as Call of Duty: Modern Warfare 3, The Witcher 2 and Assassin's Creed Revelations, and $30 for Kinect Star Wars and Mario Party 9."

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Re: What Impact Would Locking Out Used Games Have On Next Gen Systems?

May 25, 2012

Based on how aggressivly the big three and the major game publishers are in elimating used games, I'd say that we are looking at the end of used games sooner rather than later. We might still have some used game sales in the next-gen (the PS4), but I can see them gone completly by the time the PS5 is released. Because eventually, games will be all digital and disc based media will likely be elimintaed as obviously it's easier to distribute games online via a network. I think because of this, gamers will just have to get used to buying new games, not used games. The only good news is that all games eventually drop in price, so evemn new games will become as cheap as used games. So, it's not a total loss.

So my advice, just get used to buying newer games or cheaper new games a few months after release.

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Re: What Impact Would Locking Out Used Games Have On Next Gen Systems?

Jun 6, 2012

Honestly I'm not sure what I think.  There are so many points of view and I have conflicting opinions.  But to boil it down does it infringe on rights of onwer use and does it take away useability?  It does, but then so does downloading games digitally in many ways.  If you travel and want to play your game on a family or friends system since hauling a console is not realistic you can't do that if its a digital download as it is, its oftne locked to the system you can't just bring the disc and a USB stick of save files with you.  So in some ways poeple have already accepted the consequences of digital only since so many already buy their games that way.

That is just one example, then there is the aspect of not being able to lend games but we can't do that already with downloads.

I think this issue is hard to really see and understand because we are all coming from growing up with physical media, and a digital world is growing around us and the knowledge and infrastructure to support it isn't truly there.  Ideally we would all have our identity in a cloud and wherever we went there would our games and saves be.  Think Star trek basically.  It seems that is where we are going, but the transition isn't easy since we were not born of it and still have attachement and frankly an understanding of how things work now, not how things work without physical ownership.  I don't even know if the big companies really know how to handle all of this yet ranging from cable companies to software publishers.  Its all new, its all being worked out and I think many are jumping the gun and making rash decisions about how things should happen when we don't yet really know because of lack of experience and also lack of infrastructure. 

Should a company try to force used games to work as things are now?  No I think that would be catastrophic, same as having a download only device.  I mean just the fact that so many have bandwidth caps alone makes that not viable.  But also no one is ready because of how new it is. So to start forcing things that may work once we do live completely in the cloud while we barely have a cloud up floating around the world just can't work.

So basically I think things are moving a bit to fast in the wrong direction and we need to relax a bit, slow down, stop forcing and deciding on certain issues till we know more about how things will work and till we have the proper infrastructure up and until we can realize maybe we don't need the physical so much and maybe things are better and easier without the physical.  Who knows.  I love physical things myself, but yeah.    But doing all this reckless leaping such as discussing preventing used games, and I read Sony thought about then discarded the idea of not even having a physical disc drive in theh PS4, things like this to me would be leaping before looking. 

Yes the time will come, but it can't be forced before its ready.  And making silly decisions like preventing used games if it happens is making a rash decision before understanding what the situation is and just would be making a mess of things.  Like super restrictive DRM which rewards pirates but punishes honest paying customers.  Thats what that would essentialy be doing as well, rewarding pirates and punishing paying loyal honest customers.

Yes! No! wait...what was the question again?

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Re: What Impact Would Locking Out Used Games Have On Next Gen Systems?

Jul 21, 2012

Consoles also have new competition, games for tablets, that sell in their app stores for $1-5 a game.Android and iOS have been getting really popular lately. Consoles need to redo their pricing structure if games are going to be prevented from being resold as used games, and locked to accounts instead. Steam does a good job of this on PC, with all the sales they have, and with games eventually dropping in price (Portal 2 went from $60 on launch to $20 now, and $5 on the summer sale).

 

Also, in some countries you now have this:

 

http://arstechnica.com/tech-policy/2012/07/top-eu-court-upholds-right-to-resell-downloaded-software/

 

The EU equivalent of the Supreme Court rules that software must be transferrable to another owner, and digitally downloaded software entails the same rights as a physical disc, the owner of the disc must be able to transfer the software to a new owner by reselling it. I'm waiting to see how this will affect Steam users with European accounts. It should also affect Android and iOS app store users.

 

GameStop is essentially a pawn shop though, and people need to realize that is their business model. You're better off selling the used games yourself, directly to another user. They can get a better price from you than GameStop, and you can get more money for the item. Cut out the middleman taking their profit. Getting $6 for a game they are going to resell for $50-55? Sell it for $30 yourself. Heck, even some real pawn shops, that don't try to hide what they are, will give you a better price on some games.

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Re: What Impact Would Locking Out Used Games Have On Next Gen Systems?

Aug 9, 2012

MastrGT wrote:

I'm going to play the devil's advocate a bit, here.

 

Will locking used games make games cheaper? I don't know, however, if this locking ever happened, I do think that we could end up with better quality games and smarter consumers, and here's why.

 

If a consumer has limited funds to continue buying games and is forced to decide which ones the money will get spent on vs just buying games willy-nilly no matter how good they are, then just rolling them over and trading them in because they weren't worth buying in the first place, then the consumer will start researching more often which games were really good. Less games will be bought, unless the quality is raised to the point of making them more desirable.

 

I can't predict if all consumers will do this, but if enough do, then it will affect sales numbers, either negatively because the games remain poor quality or they will stay healthy because games got better. Either way, consumers win.

 

How will developers and publishers respond to the shift in buying habits? Will they stay the course and still make mediocre games (you know which ones I mean...) or will they get to work and make better ones?



The thing with that is:

 

It means that companies will be even less likely to try NEW THINGS.   If that happens and only the titles that "SELL THE MOST" (not necissarily the highest quality) will be available.

 

so we won't see things like say:
Skull Girls, or various PSN type titles. . . . but we will get call of duty 756

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Re: What Impact Would Locking Out Used Games Have On Next Gen Systems?

Aug 9, 2012

Hawkfan267 wrote:

Based on how aggressivly the big three and the major game publishers are in elimating used games, I'd say that we are looking at the end of used games sooner rather than later. We might still have some used game sales in the next-gen (the PS4), but I can see them gone completly by the time the PS5 is released. Because eventually, games will be all digital and disc based media will likely be elimintaed as obviously it's easier to distribute games online via a network. I think because of this, gamers will just have to get used to buying new games, not used games. The only good news is that all games eventually drop in price, so evemn new games will become as cheap as used games. So, it's not a total loss.

 

So my advice, just get used to buying newer games or cheaper new games a few months after release.



How is distributing online easier?   if anything its more difficult for the consumer and can take rediculous amounts of time.   Of course I guess the assumption is that everyone should have the big bucks to fork over for high speed internet.

 

Also, about price drops.   Physical games get excllent price drops.   Games on the PS Store. stay full price for MUCH longer, some never go down.

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