Thursday, September 11, 2008

Re-treading the re-tread games argument

GamesIndustry.biz has a post up about Frontier's David Braben making some comments about the second hand games industry. I've commented on this issue before (e.g. here), but thought it worth adding a couple things.


First off, this idea that a rental games market could replace a second hand games market is a bit of a fantasy. The second hand games market IS a rental market, at least it can be looked at as such.

That aside, however, there's a basic math problem here that doesn't add up. Either you are going to charge consumers more for the same thing (which then won't replace the second hand market), or you are taking a portion of the retailer's money (which he isn't willing to give up). 

Put differently, the problem is that users are getting the same product, and they and the retailer are getting better value by cutting the developer/publisher out of the equation, and neither gives a damn.

So, what do you do? It seems there are two pieces to address. Here's the same sentence with a couple pieces highlighted:

the problem is that users are getting the same product, and they and the retailer are getting better value by cutting the developer/publisher out of the equation, and neither gives a damn.

Let's spend a bit of time thinking about each:

On the First front, the "new" has to be demonstrably better than the "used". People have done this by linking it to services (MMOs, Steam). There's also the personalize games idea. There's also the idea of shipping the game with something that doesn't transfer as well. Guitar Hero discs are worth less without the guitar, and people often want to keep the peripheral for sequels, etc. 

On the second item, getting people to give a damn, there's two pieces to that:

1) Getting retailers to give a damn. This is a tough one. They make a great amount more money on a second hand title, especially a hot one. In a case like that, a $60 game (from which they make maybe $15 or less) sells for $55 (of which they might make $25 - paying $30 to the consumer for the title). Nevertheless, I have to beleive there are some things that could be done to help incent them to curb the behavior:
  • Cut them off. Don't do business with them. Granted, this is cutting off your nose to spite your face, but if you are Rockstar, people will go find your title. 
  • Give exclusive release periods to retailers that don't sell second hand.
  • Give rebates/discounts/etc to retailers that don't sell second hand.
2) For consumers buying second hand titles, getting them to care, I beleive, doesn't come through their wallets but through their hearts.
  • They need to be educated where the money's going.
  • That needs to be PEOPLE, not COMPANIES. i.e. No one cares that some of Spore's proceeds are going to EA. They *might* care that it's going to Will Wright. 
  • They need to know that the people getting the money appreciate their support.
  • They need to know that its part of a relationship they have with those creators.
I know I find myself having to explain to EB employees, trying to get me to buy a second hand copy of a game for 
The music business has an element of this happening. Why can't we get the same thing in games? It seems like in a funny way this related to the whole game credits thing that the IGDA has been going on about for some time. But that's a discussion for another day.

I guess the point is that whining about not liking a business model isn't going to change it. You've got to go build something better.

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