Used game industry could face profit loss

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With Nintendo’s new console, the Wii U, expected to launch this fall, along with E3 and the possible announcements of Microsoft’s and Sony’s new consoles, there has been massive speculation about the technology being included in these consoles. Yet, one rumor that circles above Microsoft’s and Sony’s new consoles, codenamed “Durango” and “Orbis” respectively, is that they will prevent consumers from playing used games in these new consoles. Along with this, the addition of online passes over the course of the last fiscal year has increased dramatically, as a means to prevent the trading and selling of used games. The general question then becomes, what is the future of used games in the video game industry?

The first part of this goes back to the mass inclusion of online passes required to play and unlock certain parts of a new game, namely multiplayer. Essentially, online passes keep one part of the game locked until the code that came packaged with the game is entered, unlocking content for that consumer’s console only. Once that code is used, however, it cannot be used again. This began as a means to encourage the sale of fresh copies of games, keeping people who purchase used copies of, for example, “Mass Effect 3” from accessing the series new multiplayer option. This was met with much backlash from consumers and journalists alike, as it creates this idea that developers and publishers are punishing consumers who purchase used games from retailers like GameStop. It has also been met with some backlash from other developers, such as THQ’s Richard Brown, who have said that online passes and the addition of multiplayer into strong single-player franchises, like “Ninja Gaiden,” have been hurting the single-player experiences of several games, with some developers and publishers tacking multiplayer on as a way of trying to extend its shelf life with consumers.

Everything could be taken a step further if the new consoles from Microsoft and Sony do include tech that blocks used games from being played.

This rumor began back in late 2011, with news about the capabilities of a next-gen Xbox and PlayStation. However, this was the one rumor that was met with a certain amount of resistance from many fans and retailers, like GameStop. Used game sales are where these video game retailers make a bulk of their profit, with people selling, trading and buying games regularly. Developers and publishers, on the other hand, do not see large profit from used game sales, but make their profit off new game sales. This lack of profit from used game sales are part of what led to the inclusion of online passes into new games. As the months passed, more rumors began circulating about this possibility, with some developers and publishers supporting this decision.

The increased use of online passes and the possibility of consoles that are not compatible with used games could, in the future, essentially kill part of the video game market. As national retailers like GameStop, along with local shops, make a large part of their profit from the trade, selling and buying of used games. With more and more games using online passes and non-compatible consoles, this would mean that most of the profit from game sales would go back to the developers and publishers. While several national retailers that may include game sections, like Target, Best Buy, or WalMart, will not be affected by this, local game stores and national chains, like GameStop, would start to take a massive hit in their profits. This would force massive cutbacks for GameStop and other national chains, while many local shops would be forced to close outright.

So with the use of online passes increasing and the possibility of Microsoft’s and Sony’s new consoles being non-compatible with used games becoming more likely, video game retailers and consumers have a bleak future ahead of them. Consumers may no longer be able to trade and sell old games for something new that they may not have been able to afford before, along with having to deal with disc locked content replacing downloadable content as regular DLC. And retailers will be forced to find new ways of making their profit, staying afloat and remaining part of the video game industry.

4 thoughts on “Used game industry could face profit loss

  1. This is why I plan to avoid Sony and Microsoft’s next consoles altogether and focus on Steam. If I’m going to have games locked to my account, I might as well get them at a good price.

    I might get a Wii U too. Ghost Recon Online looked kind of fun with the touch display. Kind of sad when the only title that has me pumped is a free to play that is already available for PC. Hey, I’d give it a go though.

  2. It’s a shame that actually publishers get all the dough and not even a single cent goes to the developer when you buy a game new.

    It’s also a shame that publishers did not see the option of selling used games themselves rather then screwing us over with these online passes.

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