Whenever I walk into a GameStop store, I often see people browsing through the used games section. I don’t blame them, why pay the full price when you can get $10 or perhaps $20 off the cost of an unopened copy?
Gamestop, Blockbuster & other retail stores have been selling used games for years. Half of GameStop’s revenue comes from used games, why wouldn’t they continue selling them? They surely sell more new copies than used games, so why is used games taking 1/2 of GameStop’s revenue?
Revenue for GameStop
Whenever GameStop sells a brand new copy, the money is usually split between GameStop & the publisher of the game. When I worked for a small game store a few years back, the store would buy a batch of the new game around $35-40 a piece from the distributor, then the store would sell the games at $60.
A minor portion of the money goes into the retail store (Game Stop), while the rest goes to the publisher (EA) who usually have a deal with the developer (Westwood Studios, never forget) earning a minor chunk of the money.
But what if Guy A sells a game he just finished to GameStop for $6-7 store value that he can use later, and GameStop sells the used game to Guy B for let’s say $24? Maybe a brand new game that came out a week ago, for $40?
Looking at it on paper, the game has already been sold to a customer, it’s gone from the world and will happily spend the rest of its days with the owner. A retail store saw the amount of revenue they could make by buying used games for in-store credit, afterwards selling the games at a lower price than the brand new copy of the game, yielding much more revenue because they don’t have to share the money with the publisher/developer who made the game.
Whenever I walk into a GameStop store in Denmark to buy a game, I often encounter the cashiers trying to sell me a used game instead of a brand new, unopened box.
Publishers & Developers
When the used games market in GameStop stores started to rise, serveral publishers reached out to the retail store, proposing a deal so the publisher and retail store could share the revenue. After all, GameStop is just a retail store being the middle man between the people who made the product and the customers, much like Wal-Mart.
GameStop had no plans to share the critical income from used games with publishers & developers. Serveral publishers have since then added a code inside the game box, the code is used to activate the multiplayer portion of the game, binding it to the account on the owner of the console. If the game is re-sold and the code is used, the guy who buys the used game will usually have to pay a small fee for unlocking the multiplayer portion of the game.
Used Games Market
The used games market is still rising, and publishers have been impacted slightly when it comes to revenue. A used game being sold is of course not a lost sale, but it’s a pretty hefty number in the long run. GameStop is a big reason as to why publishers lock out the multiplayer portion of the game with a code, the same goes for Xbox One requiring you to license the game on your profile. Steam does the same, why shouldn’t they get flak for it? The Xbox One isn’t backwards compatible with Xbox 360 games, while Steam will always be able to run on any computer and you will be able to install any Steam game, provided that you own it.
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What do you think of used games? Do you buy used games? What could the publishers do instead of giving a code to unlock a portion of the game? I’d love to hear your opinion on it!