2nd hand games market

[loki]

Following on from Malc's thread about GameStation (Good luck btw matey ;) ) I'd like to get your thoughts on the second hand game market and if it actually stifles development within the games industry. Just for the record I am completely ambivalent to companies like GameStation and the second hand games market.

So on one side of the fence you have markets stalls, private traders eBay and now retail outlets who seem to prosper in second hand games and games exchanges. But what do they actually add to the games industry ?. None of their revenue goes into any development of games. For example, you could go into your local Game, GameStop, Cex or whatever and see one of the latest releases.

Let's use Call of Duty 5 as an example. £39.99 on release. Now if you wait a week you can go into one of the stores and either pay £39.99 for the brand new one or you could pay £35.00 or £29.99 for the traded version. Then go on a few months and for that one £39.99 piece of software, Game, GameStop etc etc have probably seen that traded 5-10 maybe 20 times. So given the maths of that and dumbing it down a £30.00 wholesale and making possibly £200-£300 maybe more of it's future resale value. You can see why second hand is very lucrative and the game developers are nervous about this market.

It's almost like they are leaching off others creativity. The difference in price on pre owned compared to new is negligble. Yet how much do they offer you when you trade a new title in, still peanuts.

Good article from Escapist Magazine (http://www.escapistmagazine.com/forums/read/7.71273)

Now on the other hand Game Developers cry fowl saying that all of the costs of marketing, development & distribution go into a one time sale. As they still license the product they should enjoy continued revenues or royalties that could be used to develop better titles that are either longer, more diverse or varied. They also argue that snd hand games don't and never will go into the overall sales figures of a title. So Crysis or COD 4 or GTA IV could potentially have sold hundreds of thousands more copies than they know about. Are they just crying wolf and being too greedy ?? Why should they be any different to the Film & Music industry.

So where do you stand on this given there is an obvious trade off for the money going to the developers and what a game is capable of making. Does the money lost to 2nd hand games and exchanges stifle creativity.

Personally I don't have much of an issue with it. I have had some good deals recently but I can certainly have some sympathy for some of the bigger developers. The irony is that some of the smaller guys always opt for smaller games and go for digital distribution as their main method of supply. For example Introversion sold a bucketfull of Defcon and Darwinia via their own digital distribution and Steam compared to traditional hard media.

Answers on a post card................

[Davey_Pitch]

It's not really a topic I've spent a whole lot of time thinking about to be honest, so I'm not really sure of how I feel about it. Two things instantly spring to mind though. Firstly, you are correct that the 2nd hand market can mean the games companies don't instantly see the money. For example, I was able to pick up Saints Row 2 and Mercenaries 2 for only a few quid after vouchers etc from Computer Exchange (purely a 2nd hand store), so no game company will see any revenue from that.

However, there is a flipside. Having a shop like Computer Exchange means I was able to sell a lot of old games I had no use for any more. That in turn gave me the cash to go out and pre-order 4 brand new games. These were games I would never have been able to afford otherwise. Having a 2nd hand market allowed me to give the game companies some more money.

I'm glad there is a 2nd hand market though. It's all about choice and we should be able to decide whether we want to buy new or wait until it's cheaper. If the game is good enough, people will generally buy it brand new when it's released, so that alone should be more incentive for game companies to make their games better.

[Matblack]

I think Microsoft are on to a bloody good thing with the 360. They've managed to create a platform which is pretty much free of piracy, if someone wants to play the game they have to have an orriginal disc. compare this to the PC market where most games can and will be pirated and moved across the internet with ease.

The games developers have no reason to profit from the resale of the games they produce and I honestly don't believe that if they made more profit from the product they would develop better longer games, in fact as far as length goes it will be a a positive disincentive as the shorter the game the sooner muggins is going to go and buy another.

Most of the time the hardware is going to limit the range of development and tech so theres little extra to put the money into and mmy suspicion is it would end up in the hands of shareholders not in R&D

If a game is resold it retains value, if it is pirated to has none eventually games reach such a low value that they sit on bookshelves and no longer take an active part in the market as people can't be bothered to trade them developers drop the prices to £9.99 and make another tranch of money off them before they become history.

Any argument that any player after the purchaser should contribute to the publisher just won't wash, if they want more money in the games industry then the solution is to spend the money they have got releasing better games and get the public to buy more copies, for a really good game people won't wait for the resale market they will want it NOW.

MB

[Pumpkinstew]

There are lots of things software houses can do. And lets be clear it's the distribution giants such as EA which are losing most from this. Indirectly this means less funding for development studios perhaps.

The obvious solutions are
- to lower the cost of the new releases thus making pre-owned trading less attractive.
- supply additional content to titles after release to encourage players to hang on to their copy
- make games good enough that people won't want to sell them on

In the end the pre-owned trade will probably encourage innovation rather than stifle it as software houses will have to change their buisness models and invest in novel ideas to try and stand out from the crowd.

From where I am the industry seems to be in the best shape it's ever been in. Loads of great titles, an ever growing number of gamers and plenty of competition to keep prices reasonable.

[Wyrdo]

I think Microsoft are on to a bloody good thing with the 360. They've managed to create a platform which is pretty much free of piracy, if someone wants to play the game they have to have an orriginal disc. compare this to the PC market where most games can and will be pirated and moved across the internet with ease.

Piracy is rife on the 360.

[Streeteh]

I think Microsoft are on to a bloody good thing with the 360. They've managed to create a platform which is pretty much free of piracy, if someone wants to play the game they have to have an orriginal disc. compare this to the PC market where most games can and will be pirated and moved across the internet with ease.

Slightly puzzled by this comment, while as a platform the PC is undoubtedly the most pirated, the 360 scene is rife with piracy. All a user needs to do is crack open their console, change the firmware on the DVD drive and hey presto, unhindered piracy with full access to xbox live (for now?). You only have to look at other forums (overclockers forum is a perfect example) and glance at the huge number of people with unreleased games in their gamertag signature (Fallout 3, Gears of War 2 and Fable 2 were all leaked well before release) to see how many people are actually pirating all of their games on the 360. At least with the PC you need a legitimate copy of the game to play online due to CD Keys so even pirates will buy the occasional game, on the 360 even online access is unhindered by piracy, giving modded 360 owners no incentive to buy any games ever. To top it all off it's apparently rather easy to remove the warranty tag and reattach it without damaging it, thus allowing people to mod their 360 as soon as they purchase it without voiding the warranty.

The only platform in this 'generation' that has managed to completely stave off piracy so far is the PS3.

Sorry for the huge off-topicness, now i'll jump right on to the issue. Second hand sales are a good thing in my eyes, mostly for the consumer but also for developers and publishers. I'll use myself as an example when i explain this. If a new game comes out and i'm not completely sure i'll like it, i sometimes still buy the game, the reason for this is i know i can typically sell it on elsewhere without making a huge loss if i don't like it. Other examples include games like Resistance: Fall of Man, with the sequel coming out soon and looking very promising i decided to buy it second hand for £10 to get a look at the franchise, I am now very much enjoying it and will certainly invest in the sequel; in this case me buying a second hand title has encouraged me to buy its sequel first hand when I normally might not have.

[divine]

The second hand games market is just as damaging to the games industry as piracy is, if not more so because it is a legitimate practice. They both result in the same thing for the publishers, someone is playing their game without giving them any money.

The only advantage it carries is perhaps propping up a higher rate of new game buying because getting back £20 each time, allows you to buy another new game sooner, however personally I don't believe this promotes a significantly higher number of sales than people pirating to try games out.

[Desmo]

Somebody mentioned the second hand market on another forum and I asked them if they felt the same about second hand cars. Should we all be forced to buy new cars?

[Matblack]

Somebody mentioned the second hand market on another forum and I asked them if they felt the same about second hand cars. Should we all be forced to buy new cars?

I was going to make this point too, if I buy a DVD or CD or car or in fact pretty much anything then I have the right to sell it on for as much as someone will pay for it, I don't see any reason why this shouldn't be the same for games.

As far as piracy is concerned I think that rife is a little OTT, it might be riife in the geek community but the 360 covers a lot more demographic bases than PC gaming and I doubt its as common in the mainstays of the 360s market. Its not something I for example have got involved in where I used to nab the odd game for the PC and bought a DSTT for my DS.

MB

[divine]

The car industry however, is not one that is complaining of lost revenue and financial troubles because people are cloning their cars for free :p

Whilst as an individual you have every right to sell on something that you no longer want, be that a car, a game, a cd or a sofa, it doesn't change the fact it is still damaging to the industry. Just as the second hand car market is damaging to the car industry, you can bet that Ford, GM, Toyota, VW, et al. would be a damn sight better off and much happier if everyone was buying new cars.

However, it is something both industries have grown up with and so by now, businesses are probably operating taking it into account, much as the game industry should be taking into account piracy, as it has always been and will always be a prevalent issue in the games industry.

[loki]

Somebody mentioned the second hand market on another forum and I asked them if they felt the same about second hand cars. Should we all be forced to buy new cars?

I think thats a good analogy to use. We still operate in a free market despite the governement buying up all sorts of business and institutions ;). When you take it back to the example of games though your not comparing apples for apples though. At least with second hand car sales they can contribute to the general motoring sector with after sales and servicing. I don't see that with games exchanges.

[Feek]

Piracy is rife on the 360.

It's about time that MS did another blat and booted all consoles that have had a firmware hack off of Live again.

[leowyatt]

Here here Feek, the only people who should be playing Gears 2 are the reviewers!! :angry:

[Haly]

Here here Feek, the only people who should be playing Gears 2 are the reviewers!! :angry:

I wish this reviewer was :(

[divine]

It's about time that MS did another blat and booted all consoles that have had a firmware hack off of Live again.

And give up £40 a year worth of Live subscriptions in return for potential game royalties from people that clearly don't want to pay for games?

Why would they do, it makes no sense :p

Unfortunately, I suspect they make far more money letting the pirates pay for Live year on year than they would if they forced them to buy games and businesses are financially driven beings, not ethically.

[leowyatt]

I wish this reviewer was :(

I don't ;D you wait like the rest of us missy!!! :p ;D

[Haly]

I don't ;D you wait like the rest of us missy!!! :p ;D
You're mean :p

[NokkonWud]

We've seen recently that new games get limited offers, Banjo Kazooie being the biggest tempter in offering the original game when buying new. There have also never been so many LE games being released, over this month we are having FarCry 2, Fable 2, Fallout 3 and Gears of War 2, all within 2 weeks of each other all with Limited Editions offering something.

Producing games on DVD also helps, it's cheap, so they don't take so much of a hit whereas publishing on Blu-Ray is much more costly. Of course, the flip side of this is that Blu-Rays have to be sold as Piracy isn't as of yet possible compared to DVD where many people won't even buy games.

There are 2 different routes, one is beneficial to us, the other is beneficial for the Publisher. It's up to the Publisher to make new games more appealing than second hand games.

For the record, I never buy 2nd hand from a shop, only from a forum friend, else I buy new.

[Daz]

The second hand games market is just as damaging to the games industry as piracy is, if not more so because it is a legitimate practice. They both result in the same thing for the publishers, someone is playing their game without giving them any money.
Having sat and stewed over this for a moment, I think I can understand the logic in what you're saying, but I dont think it can buy any sympathy for the gaming industry.

At the end of the day, businesses work for our money, so as much as possible that business should be done on our terms. What's happened in recent times is the gaming industry being exposed to second hand competition on the same level as the second hand car market (and by that I mean there are companies exclusively or heavily invested in the trade of second hand cars, you dont find that for, say, books or washing machines). This second hand market gives us power, a bargaining chip - and the business has to respond, to give us more value for that purchase. That's not us picking on the gaming industry, that's just an effect of the gaming industry growing - more people want more of the pie - generating competition.

You're comparison to piracy does have some logic as I said, but whether fighting piracy or fighting the second hand market, the answer is ultimately the same - they have to compete for our cash. A good article (http://www.gamesindustry.biz/articles/hated-and-broken_0) on GI.biz (talking about piracy but the point is still relevant), touching on Nokkons point:

There are ways to stop pirates in their tracks, but they're all business solutions, not technical solutions. World of Warcraft is correctly fingered by Riccitiello as a perfect example (although he inaccurately describes it as "DRM", which it isn't - in fact, WoW notably contains no DRM worth a damn, and you can happily copy the game client around, install it on multiple PCs, lend the discs to your friends and so on). Relying on subscriptions for your income, with upfront sales being little more than padding on the numbers, is a perfect business strategy to minimise piracy - although of course, it only works for very specific types of product.

You could also try increasing the value of your retail product to make it worthwhile to buy it, rather than stealing it. Include one-time use codes which download in-game extras, perhaps (although they'll get pirated too, you're now loading the dice in your own favour - pirates will have extra hassle to access the new content, your users will get it with ease). Create limited editions with genuinely worthwhile product in them, and watch your pre-orders soar. Hell, simply engage your community and build loyalty - consumers who like your brand and find your developers personable are a lot more likely to open their wallets than those who think you're the Evil Empire.
And a relevant thread (http://www.evilavatar.com/forums/showthread.php?t=65498) over on EVAV:

This, more than anything, is why publishers and developers are salivating over the prospect of digital distribution of games. Jonathan Blow doesn't have to worry that people are buying pre-owned copies of Braid instead of retail copies; with XBLA, Steam and PSN there is no reselling, and therefore no secondary market. How this sits with consumers, many of whom make great use of either Gamestop's trade in system, or even places like our own Trader Zone to swap games directly with one another, is another story.

[divine]

I wasn't trying to drum up sympathy for the games industry with the piracy comparison, I was just pointing out the end result for a publisher is largely the same, yet being a legitimate practice is probably more damaging because it's far more acceptable to do it yet the only real difference is your own moral conscience at the end of the day as to whether you broke the law or not :p

Games companies bring it on themselves, with constantly disillusioning the gamer and making them feel like they've wasted money buying a game. Take Far Cry 2 for example, on PC, this is getting a slating by and large from players from what i can see because it has amounted to nothing much more than a tech demo. There are console port bugs left everywhere, features don't work, they've not implemented things properly, there is no substance to the game, it's poorly finished as an actual game. Now what incentive has that left the end user to drop £45 on Ubisoft's next big PC title? None, at all. Yet, take a look at Valve and you see a company producing great quality games, with a good engine that everyone can play, that are fun and in general reasonably priced. I bought Half Life 2, I loved it, i'll be more than happy to buy from them again because they provided me with a quality product for my money.

The other thing is poorly implemented DRM, which is something Far Cry 2 can hold it's head up for again. Thousands of people who bought Far Cry 2 on release day must have been so glad Razor1911 had cracked it, because trying to register a serial key was a hit and miss affair, as Ubisoft hadn't bothered to finish updating the serial key database. Along with other recent favourites such as Spore and Bioshock, it's yet another reason not buy new games.

The games industry is killing itself with it's arrogant attitude and ignorant approach to the problems it faces and until they change that, more and more people are going to be turning to second hand games and piracy.

[cheets]

Rubbish, the 2nd hand game market has been around for decades, I could only afford to play N64 games by trading in 2nd hand copies for other 2nd hand copies plus £5/10. I remember saving up and getting Zelda OTT and saved up for PD and DK64 rest of the games I played where 2nd hand and swaps with my mates

It just weeds out the developers and publishers who cant run a tight ship and make games worth buying at full price. Gaming is still as good as its ever been.

[NokkonWud]

Games companies bring it on themselves, with constantly disillusioning the gamer and making them feel like they've wasted money buying a game. Take Far Cry 2 for example, on PC, this is getting a slating by and large from players from what i can see because it has amounted to nothing much more than a tech demo. There are console port bugs left everywhere, features don't work, they've not implemented things properly, there is no substance to the game, it's poorly finished as an actual game. Now what incentive has that left the end user to drop £45 on Ubisoft's next big PC title? None, at all. Yet, take a look at Valve and you see a company producing great quality games, with a good engine that everyone can play, that are fun and in general reasonably priced. I bought Half Life 2, I loved it, i'll be more than happy to buy from them again because they provided me with a quality product for my money.

The other thing is poorly implemented DRM, which is something Far Cry 2 can hold it's head up for again. Thousands of people who bought Far Cry 2 on release day must have been so glad Razor1911 had cracked it, because trying to register a serial key was a hit and miss affair, as Ubisoft hadn't bothered to finish updating the serial key database. Along with other recent favourites such as Spore and Bioshock, it's yet another reason not buy new games.

Both paragraphs seem more like reasons to buy games on console as opposed to not buying new.

[Streeteh]

Both paragraphs seem more like reasons to buy games on console as opposed to not buying new.

I wonder sometimes if you couldn't pirate on the PC how many people will still swear by it as a platform. It just costs so much to maintain, i know several people who spend all their money keeping their pc up to date for games but never actually spend a penny on the games themselves. If they had to fork out for the games would they be able to keep up with the hardware market as much as they'd like? Also with DRM issues becoming rather insane with some games only allowing themselves to be installed 5 times before having to ring the publishers for an activation key (ok there's only one game like that that i know of, but it's the new trend, there's several games that have a 5 install limit but refund one if you uninstall), I bought bioshock only to find i couldn't play the bugger for 2 days as their activation servers were down, i ended up cracking it!

Off topic again, sorry, i just wonder sometimes.

[divine]

It just costs so much to maintain

Only if you let it cost that much.

£800 has lasted me 3 years and that also provided me with a system that can do a whole host of other things besides just games.

If you feel the need to constantly spend £200 on a new graphics card that is 10% faster than the one you bought for £200 6 months ago, then yes it will cost, but that's not really a negative point to the PC as that is entirely optional.

[NokkonWud]

The other thing about PC's, you spend £300 on a console and £300 on a graphics card...

The day you get your graphics card, it's the best anything has ever looked, it's also the best any game will ever look on it.
The day you get your console games look great, but in 4 years time games look even better. In 4 years time you won't be able to touch the latest PC games.

[leowyatt]

The thing is Rich once you buy your console that is is, you don't need to spend a penny more upgrading or changing it to run the latest games.

[divine]

True but i've only had to buy a £45 graphics card and 1GB RAM in the last three years to stay being able to run the latest games, only now have I got to the point where my CPU is struggling a bit. I'd wager you've spent more on peripherals and live subs.

It's only as expensive as you make it.

[leowyatt]

but what did you spend in the beginning before you upgraded your graphics card and bought the ram??

[Streeteh]

Only if you let it cost that much.

£800 has lasted me 3 years and that also provided me with a system that can do a whole host of other things besides just games.

If you feel the need to constantly spend £200 on a new graphics card that is 10% faster than the one you bought for £200 6 months ago, then yes it will cost, but that's not really a negative point to the PC as that is entirely optional.

Oh i don't disagree, you don't have to upgrade every few months, i spent £1k on mine 3 years ago and, aside from a £100 graphics card upgrade, it still plays most things well. However, it is starting to show its age and cost me a hell of a lot more than my £300 PS3 that will still have games produced for it that run perfectly 4 years from now if not more. I reckon i can get another year out of it at the most before it becomes what i would consider unacceptable performance.

On the fenickety side, a £200 card bought 6 months after a £200 card of its time would blow the older one away, PC technology just moves so fast.

[leowyatt]

Since I originally bought my 360 I've spent £30 on a play & charge kit, chatpad and a VGA cable.

[Streeteh]

Since I originally bought my 360 I've spent £30 on a play & charge kit, chatpad and a VGA cable.

I've spent £30 on a new controller :D

When you think about it, once you've bought em, aside from games they are so damn cheap.

[leowyatt]

Aye, £10 on the cable, £8 on the chatpad and the rest on the charge kit.

[divine]

but what did you spend in the beginning before you upgraded your graphics card and bought the ram??

£800, 3 years ago, including monitor.

The trouble with trying to compare is that a PC is amalgamating the two things into one, where as you have a games console but you also need a PC anyway for all the other things. It's hard to quantify the amount spent on the 'gaming' part of the PC, compared to what it would be if you didn't play any games at all, if you see what I mean.

[NokkonWud]

I've spent £30 on a new controller :D

When you think about it, once you've bought em, aside from games they are so damn cheap.

That's a good point. PC went for ages without a decent exclusive where as consoles have been knocking them out for ages! Could have been cheaper to go PC after all... ;D;D