Sony Versus The Second-hand Market

The second-hand games market has been seen as something of a thorn in the side of developers for a while now. Whilst new releases divide their sale price up between various parties, including the retailer and the developer, second-hand sales see the money go almost entirely to the retailer.

Ideas such as the ‘season pass’ or a one time use code that allows access to, for example, multi-player content have been introduced by developers in the past couple of years to try to ‘combat’ the second-hand market and ensure some sort of secondary spend reaches the developers pocket as well as the retailers.

Things took a new twist last week when word spread that Sony had patented technology capable of ‘blocking’ second-hand games.

Whilst there are still few concrete facts about what this new technology means or how it will be used; the core idea behind this seems to revolve around permissions tags/IDs for a disc and a user account – essentially syncing up your PSN/SEN account and a new game the first time you play it; locking that game to your account from there onwards.

It’s worth stressing at this point that Sony have made no official comment and have dismissed the news as ‘rumours’ at this stage. So there is that possibility that this may be nothing…

…but…

In the current climate it wouldn’t make a great deal of sense to hammer down on the second-hand market when it is still such a large part of the industry’s business.

Pissing off the retailers won’t exactly help sales of future games if you pull the rug from under them in the lucrative pre-owned sector. The support of retailers is needed to promote and sell games after all, so it would be akin to shooting ones self in the foot to lose their support.

Combined with a tough economic climate at the moment, and you might say that both sides have a very strong interest in working together as best they can right now.

That said, second hand game offers are not at all popular with developers given how aggressive many of the retail marketing campaigns are and how little comes back to the developer from these sales, and there is a feeling that some sort of ‘balance’ needs to come back to this area of the industry

We already see some consideration of second-hand sales in many new games. The previously mentioned ‘one time use codes’ are an example of this, as developers make codes/passes available on-line for second-hand owners to enable locked content.

But this news has gamers raising concerns over how exactly things might work moving forward.

It may lead to an extension of the ‘one time use code’ idea; where a game is only ‘half unlocked’ from the disc and a code is required to unlock the full content; including the full campaign. An idea which might not be so ‘wild’ given the current set up and how ‘simple’ it would be to just extend that system.

But there are also some bigger issues at hand if this new technology does become more than just rumour and hear say.

Many Xbox gamers know only too well the pain of the Red Ring of Death saga, and I’ve seen several blog posts and forum comments querying how this technology would be implemented and what might happen in a ‘RRoD situation’ – are the games tied to your account? Or your console? What happens if your console goes *pop*? All legitimate questions I think we can agree.

There is also curiosity as to how far does this will extend in the industry. After all, Sony, Nintendo and Microsoft are all on opposite sides of the console war and the path one follows will not necessarily be that which the other follows. That said, it is hard to imagine Microsoft would not consider something similar for future gaming devices should Sony be crazy enough to implement this…

Of course you could imply this kind of ‘tied to one user’ system already exists via downloadable games; and I’ve even seen suggestions that Sony/Microsoft may use a shift in how game discs are controlled to push their download services further. Given how shocking Microsoft’s pricing is for the current crop of downloadable games, and living in a non-fibre broadband area, personally I hope that doesn’t come to fruition for a while yet…

The reality is though, this is still a massive grey area. It touches on a subject that has been hovering in the shadows for the games industry for a while and until something more concrete appears there will be a great deal of hyper bole and nervous shifting about as people take 2 and 2 and get 5

That said, the patent of such technology seems likely to only lead to a more restrictive games market in the future. Bad times.

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4 thoughts on “Sony Versus The Second-hand Market

  1. Nice blog.

    I for one would love to see an analysis of exactly when second hand sales for games start to kick in and how much buying second hand games is actually just an artifact of availability. I’m a conscious consumer and I want my money to be going to the people that make games but i find that unless you buy games in launch month you can’t find them ‘first’ hand for love nor money. Particularly if they happen to be decent games (how many of us have huge game collections?). Certainly not on the high street (even before high street game retailers collapsed). Also, you can’t buy games direct from most developers which is stupid so my money goes to CEX, Ebay or Amazon marketplace purely for my convenience rather than because I’m a cheapskate or don’t care.

    1. This is, in my opinion, the start of the new generation. Concerns over ‘all-digital’ machines and restrictive DRM have been commonplace for years and now we are starting to see them potentially becoming a reality – if speculation and rumour is to be accepted as possible.

      I shall be writing a blog post later from the point of view of a gamer who works in game retail. I have a slightly different, and maybe surprising line of thought on the matter.

      @Cunzy 11 – I will touch upon a localised example of game retail/resale in my piece. Obviously it won’t be exhaustive, but I’ll try to cover a few areas that you might find interesting.

    2. I think it would be a logistical nightmare for developers to start selling their own games direct – they’d need to be able to take and process orders and payment, keep stock, send out orders etc etc etc.

      They’d end up needing to create a whole new department, complete with overheads, to manage it – I guess for the giants like EA that is one thing, but for some of the smaller guys? Even a relatively successful one like Epic would struggle with that I think.

      Downloadable games are a possible way around it, but again it needs to be managed, maintained and have an infrastructure to deal with payments, problems etc

      Downloads also fall foul of the crappy internet speeds a lot of potential buyers have to suffer; so again I guess they go back to a physical copy

      Then you have to consider storage and access to these games – I can’t imagine I could install all the games I own to my 360 for example

      You’ve also got the same ‘issue’ as the music biz – some people will still want that physical item. The Skyrim map, the Fallout bobble head/lunch box – trivial items, but the consumer whore in me loves having them

      1. “I think it would be a logistical nightmare for developers to start selling their own games direct – they’d need to be able to take and process orders and payment, keep stock, send out orders etc etc etc.”

        True true also you missed that it would require developers being business minded which a lot of them clearly aren’t. I dunno I just figured that publishers and developers might occasionally pop down to their local store (still 50% of the consumers buy from stores) and question why their titles aren’t available. As for hard copy vs. virtual the demand for hard copy is still high across the whole market but the shit eater forumites have bought the developer and publisher schpiel and now talk about it as if it is a dead market. Really poor business sense out there in the industry that makes anyone with any experience in retail laugh/cry .

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