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Melissia wrote:

LordofHats wrote:I can't imagine Microsoft or SOny are that stupid (there are rumors for the next Sony station as well). If something actually kills the games industry it will be the publishers and the hoops they keep making that consumers have to jump through just to play a game.

So the publishers aren't stupid ,but they are stupid?

I'll probably end up being wrong again (I've been saying "no one is that stupid" for years and I usually end up being wrong). Publishers and the console makers will do what they've always done and what GW has always done for that matter. Maximize short term profits while slowly killing their long term sustainability.

LordofHats wrote:

Melissia wrote:

LordofHats wrote:I can't imagine Microsoft or SOny are that stupid (there are rumors for the next Sony station as well). If something actually kills the games industry it will be the publishers and the hoops they keep making that consumers have to jump through just to play a game.

So the publishers aren't stupid ,but they are stupid?

I'll probably end up being wrong again (I've been saying "no one is that stupid" for years and I usually end up being wrong). Publishers and the console makers will do what they've always done and what GW has always done for that matter. Maximize short term profits while slowly killing their long term sustainability.

See: Origin?

Someone was asking for numbers earlier, and lo and behold...

The Penny Arcade Report actually has an article today about "A War on Used Games Is A War On Gamestop: Here Comes the Science"
These are the 2011 sales figures for Gamestop; which is from the company's 10k Form(no link provided--the link in the article only links to the Wikipedia entry for a 10k form).

These are the 2011 gross profit figures

I suppose I'll at least get to laugh in... I'll give the industry five to six years before the house of cards publishers are building for themselves comes tumbling down.

Unless something happens in the mean time, which I guess I'm optimistic enough to hope for that.

@Kan, nice chart find. EDIT: Though, like most things produced by Penny Arcade these days, their conclusions are laughably bad.

So, Gamestop sells more used games than new games, but they make the most money on used.

Basically, it's a win/win for everyone. Not seeing how the game industry can complain about lost profits for used games.

The only reason used games are such a high percentage of profit is the profit margin. Likely, the total $$$ brought in from new games is higher than from used, but for Game Stop the profit from used is much high because a new game might as well be worth half of a used game where they're concerned.

As some dumb math:

4048 x 60 = 242880
2629 x 55 =144595

They lose a lot of the new sales "profits" recapping the purchase and marketing, but used sales might as well be a complete gain for them.

Chowderhead wrote:Basically, it's a win/win for everyone.

Except the developers.

Gamestop usually buys games for ≥50% of the current new game price, then sells it for five dollars less than what the new copy is worth.

So they make about 45% profit from the price of the used game. If they can sell it, that is.

Melissia wrote:

Chowderhead wrote:Basically, it's a win/win for everyone.

Except the developers.

Please explain.

Melissia wrote:

Chowderhead wrote:Basically, it's a win/win for everyone.

Except the developers.

As someone who's not really up and up on economics, could you give me a quick lowdown on why this is a lose for developers?

Chowderhead wrote:

Melissia wrote:

Chowderhead wrote:Basically, it's a win/win for everyone.

Except the developers.

I'm not sure why. As someone who's not really up and up on economics, could you give me a quick lowdown on why not?

Every sold and resold used game is money that does not go to the developers. These players still expect the developers to patch the game (which requires man-hours put in to the game that isn't making money), to provide servers for game authentication (which costs money to run), to provide matchmaking and/or servers for the gameplay itself (in the case for multiplayer, which costs money to run), and to generally support the game (which costs money and hours to run, which could have been spent on the next project or a sequel), but they have not actually payed for the game itself in the eyes of the developer.

In truth, producers and developers don't just "not gain" money off of used game buyers, they actively LOSE money.

Now, if a developer made it so that noone could play multiplayer or get patch updates without either having a new game or paying the developer directly (Through DLC, a multiplayer unlock code, or other method), the producer/developer would have no reason to complain, this is true.

Ah. Makes much more sense.

Isn't the developer paid by the publisher?

Manchu wrote:

Melissia wrote:

Chowderhead wrote:Basically, it's a win/win for everyone.

Except the developers.

Please explain.

I don't even know. For most developers you can't even distinguish them from the publisher anymore. Bioware? They're all EA employees. What's good for EA is good for them. Same with DICE, 343, Relic, Take2, Blizzard etc. Most major developers have been absorbed into the corporate body of the publisher, a lot of what were indie developers have become self-publishers.

I could see an argument that the middle man developer might be getting hurt by the current system, but that's not a problem with used game sales its a problem with the strangle hold a publisher can hold over the actual maker of the game. Why Mel targets out used game sales I'm not really sure.

In truth, producers and developers don't just "not gain" money off of used game buyers, they actively LOSE money.

Money they might have made can't be qualified as a loss. Otherwise we'd have to account for every item purchased that doesn't give direct profit as a loss and then every company in the world is losing money.

Manchu wrote:Isn't the developer paid by the publisher?

Yes, but both are tied directly to the profitability of the developers' games.


Automatically Appended Next Post:

LordofHats wrote:Money they might have made can't be qualified as a loss.

I know reading is hard for you but you could actually try it.

Melissia wrote:]I know reading is hard for you but you could actually try it.

You could try reading your own words. SOmething that doesn't make sense doesn't make sense. Fundamentally there isn't a difference to a produce of an item between someone buying their product used and someone buying a similar product from another producer.

Money that might have been made is not a loss. If we expand losses that broadly then everyone in the corporate world is taking losses.

Melissia wrote:

Manchu wrote:Isn't the developer paid by the publisher?

Yes, but both are tied directly to the profitability of the developers' games.

As I understand it, it works something like this:

(1) developer makes game
(2) publisher pays the developer as game is made
(3) publisher performs QA, markets, distributes, and provides customer service for game

So how does the developer suffer from used games sales?

And remember, Mel. Every used game was once a new game that the game companies already made money on.

Melissia wrote:Every sold and resold used game is money that does not go to the developers. These players still expect the developers to patch the game (which requires man-hours put in to the game that isn't making money), to provide servers for game authentication (which costs money to run), to provide matchmaking and/or servers for the gameplay itself (in the case for multiplayer, which costs money to run), and to generally support the game (which costs money and hours to run, which could have been spent on the next project or a sequel), but they have not actually payed for the game itself in the eyes of the developer.

The developer has to provide these services to people who "buy" the game from the developer as well.

People who buy the game on the secondhand market are not freeriders (like pirates), they're actually taking one of the existing licenses.

If the developer sells 10 copies, they have to provide service for those 10 copies.

If 5 of those get sold through the secondhand market, the developer still has to provide service for 10 copies.

The only way the developer is "losing out" is that instead of selling 15 copies with 5 copies being (effectively) destroyed, they sell 10 copies and have to continue to service them.

Melissia wrote:In truth, producers and developers don't just "not gain" money off of used game buyers, they actively LOSE money.

See above. The secondhand market doesn't increase the supply of games in the market, it maintains the supply of games in the market.

This is actually a problem for developers who rely on continuing sales (the "tail" referred to in the OP) to pay for continued development.

Manchu wrote:

Melissia wrote:

Manchu wrote:Isn't the developer paid by the publisher?

Yes, but both are tied directly to the profitability of the developers' games.

As I understand it, it works something like this:

(1) developer makes game
(2) publisher pays the developer as game is made
(3) publisher performs QA, markets, distributes, and provides customer service for game

So how does the developer suffer from used games sales?

The publisher could punish the developer for not adding in anti-used features, such as online codes.

Just thinking out loud here.

Generally speaking, something like DRM is typically decided on the publishers end and then the developers implement it into the game code. I don't think refusing is an option.

biccat wrote:People who buy the game on the secondhand market are not freeriders (like pirates), they're actually taking one of the existing licenses.

That is a truly excellent point.

Okay, Lord of Hats, since you are either unable or unwilling to read my post, will read it for you.

Melissia wrote:Every sold and resold used game is money that does not go to the developers.

This is a statement that we both agree upon. This, however, is NOT the finality of my argument. Don't stop reading here, it's only the first sentence.

Melissia wrote:These players still expect the developers to patch the game (which requires man-hours put in to the game that isn't making money)

This is money and employee hours that is being used to support the game for people who have not paid for it. Ergo, it is money lost. If all people who were using the service had paid for it, then it would not be money lost. But used game buyers have not paid for it. I will repeat these lines several times, to be sure that you have read them. Yes, I know the argument will be made that they have paid for it, but none of that money went to the producer, therefor to the producer they have not.

Melissia wrote:to provide servers for game authentication (which costs money to run)

This is money and employee hours that is being used to support the game for people who have not paid for it. Ergo, it is money lost. If all people who were using the service had paid for it, then it would not be money lost. But used game buyers have not paid for it.

Melissia wrote:to provide matchmaking and/or servers for the gameplay itself (in the case for multiplayer, which costs money to run)

This is money and employee hours that is being used to support the game for people who have not paid for it. Ergo, it is money lost. If all people who were using the service had paid for it, then it would not be money lost. But used game buyers have not paid for it.

Melissia wrote:and to generally support the game (which costs money and hours to run, which could have been spent on the next project or a sequel)

This is money and employee hours that is being used to support the game for people who have not paid for it. Ergo, it is money lost. If all people who were using the service had paid for it, then it would not be money lost. But used game buyers have not paid for it.

Melissia wrote:but they have not actually payed for the game itself in the eyes of the developer.

This is reiterating the first point.

Melissia wrote:In truth, producers and developers don't just "not gain" money off of used game buyers, they actively LOSE money.

Now here is the only part of my post taht you actually bothered to read. If you skipped over the other parts of my post, go back and actually read them.

Melissia wrote:Now, if a developer made it so that noone could play multiplayer or get patch updates without either having a new game or paying the developer directly (Through DLC, a multiplayer unlock code, or other method), the producer/developer would have no reason to complain, this is true.

This is what would make your statement true. This is not the case for any developer on the market today.

Melissia wrote:This is money and employee hours that is being used to support the game for people who have not paid for it. Ergo, it is money lost. If all people who were using the service had paid for it, then it would not be money lost. But used game buyers have not paid for it.

As biccat pointed out, it does not matter who paid for it. Someone paid for X copies and only X copies are being serviced. It doesn't matter who paid, only that someone did pay.

Manchu wrote:As biccat pointed out, it does not matter who paid for it.

And yet, that's still money that's not being paid to the producer.

Therefor, it matters to them. It doesn't matter to you, I can tell that much (it doesn't matter to me using the same definition, but I still support the producers' actions as far as penalizing used game buyers in favor of new game buyers, because it is well justified both morally and economically, and a simple change to the EULA will make it legal anyway), but that doesn't mean it is irrelevant.

You will be seeing more and more of the game industry penalizing used game buyers as the years go on, because of this very fact-- they cost money while giving nothing in return.

To get a used game, it had to be new first.

The used game player has not payed for these services, but the person who bought the game new has already.

It's like Manchu said. If 10 people bought the game, returned it, and 10 people bought it used, then someone has already paid the developer for the game.

They're losing theoretical money. Not real dollars.

And anyway, if a server is overloaded, if it's laggy, if it gets damaged, then it's the Publisher's fault, not the consumer. It could not deal with the demand for the game, or the problems with their servers.


Automatically Appended Next Post:

Melissia wrote:

Manchu wrote:

Melissia wrote:This is money and employee hours that is being used to support the game for people who have not paid for it. Ergo, it is money lost. If all people who were using the service had paid for it, then it would not be money lost. But used game buyers have not paid for it.

As biccat pointed out, it does not matter who paid for it.

And yet, that's still money that's not being paid to the producer.

Therefor, it matters to them.

You will be seeing more and more of the game industry penalizing used game buyers as the years go on, because of this very fact-- they cost money while giving nothing in return.

But someone already paid for the game!

Melissia wrote:

Manchu wrote:As biccat pointed out, it does not matter who paid for it.

And yet, that's still money that's not being paid to the producer.

This is a different argument and why LoH is talking to you about the difference between losing money and not making all the money one could potentially make.


Automatically Appended Next Post:

Chowderhead wrote:It's like Manchu said.

Ah, biccat actually. Give credit where it's due.

Chowderhead wrote:But someone already paid for the game!

One person paid, but seven people used the service, six of which did not pay. All of them cost money to run the service, but six of them are being given a free ride.

Melissia wrote:This is a statement that we both agree upon. This, however, is NOT the finality of my argument. Don't stop reading here, it's only the first sentence.

Indeed we do, the problem is that there is no entitlement to profit from their work a second time.

Melissia wrote:This is money and employee hours that is being used to support the game for people who have not paid for it. Ergo, it is money lost.

If Bob sells his copy of Super Hat Land 64 to Frank, then the situation for the developer is no different than it was before. They are still only supporting a single user who holds a single copy of the game. Used copies do not magically produce new users who need support. The support of the original user practically transfers down the line. The situation for the developer does not change.

No money has been lost.

Melissia wrote:This is money and employee hours that is being used to support the game for people who have not paid for it. Ergo, it is money lost. If all people who were using the service had paid for it, then it would not be money lost. But used game buyers have not paid for it.

No the person who bought the game new paid for it. Again, no new users need to be supported. At most, the developer loses some miniscule amount storing the data of previous users who no longer play, but the charges of multi-player networks usually aren't on the developer they're paid for by the publisher.

Melissia wrote:This is money and employee hours that is being used to support the game for people who have not paid for it. Ergo, it is money lost. If all people who were using the service had paid for it, then it would not be money lost. But used game buyers have not paid for it.

If Bob sells his copy he is no longer playing. There's still just 1 person who is being supported.

All your example are mooted by the nature of how a used game is acquired. If I sell 500,000 copies of Super Hat Land 64: I Have Spoken Edition, then I'll only ever have to support 500,000 users. Used games cannot magically increase the number of people playing my game and needing my services. This is extremely simple logic.

Melissia wrote:... I still support the producers' actions as far as penalizing used game buyers in favor of new game buyers, because it is well justified ... morally ...

You definitely lost me there.