Dear Microsoft and Sony: Go Nuclear! Don't allow used games next generation

Both Microsoft and Sony have tested the waters on not allowing used games on their next generation consoles. Whether it’s right or not, Gamestop has been blamed by developers and publishers for ruining the industry with their aggressive used game sales tactics, and as a potential preventive measure, used games may soon be a thing of the past.

And I say, let them do it! Pick the nuclear option! Block used games from running on your console. I don’t say this as a former THQ executive trying to protect my bonus, or even as a lowly developer simply trying to protect my job. I say it as a consumer of the gaming industry who thinks there might actually be a huge benefit to gamers if this is pulled off correctly. I just don’t think it will be pulled off correctly.

Nuke em all

Some would say that PC gaming has been revitalized by its great exclusive titles such as Starcraft 2, World of Warcraft, or Civilization V, but I would argue that PC gaming is back because of its new buying platforms like Steam and GoG.

Gone are the days of going to the store to buy CD-ROMs or ordering multi-disc DVD games in the mail, now we can purchase the game we want in less than a dozen clicks and have it downloaded a few minutes later. Steam is even easier than piracy, and making a game readily and instantly available for a reasonable price is the only thing that’s ever going to defeat PC gaming piracy.

But the reasonable price is the catch. Since Steam’s success, both Sony and Microsoft have introduced digital copies of games available for buying on their respective platforms. I can go out to the Xbox Marketplace right now and buy Dance Central 2 for $49.99. That’s instant and readily available, right? But is it reasonably priced?

I would say no. Maybe five years ago I would have shrugged and said “sure”, but Dance Central 2 is over six months old, positively ancient on the Steam store. Last week I could buy Batman: Arkham City for $14.99 on Steam! Fifteen dollars! Ignoring the fact that it’s not even available to download on the Xbox Marketplace or PlayStation Network, can you imagine a six month old game such as this ever retailing for $15 on their stores? Never.

And that’s the problem with the nuclear option. There is no competition on the Xbox Marketplace or PlayStation Network. If I want a game right now, I have to pay Microsoft or Sony’s price. I can’t shop around at Steam, GoG, Amazon, and GamersGate to find a sale, I’m stuck. As far as I can tell, neither Xbox or PSN hardly ever even have sales, and if they do, they’re usually just knocking 20% off the price. Certainly not price slashing a $30 six month old AAA game in half to $15.

A few years ago I decided I didn’t want to buy digital games because I didn’t want to be locked into the platform and possibly lose access to the game I own. Heck, I went as far as buying a retail copy of World of Goo so I would never not have access to my game if download platforms disappeared. Well, guess what? I’ve since misplaced the disc, but my Steam copy of the game which I activated from an indie bundle is seconds away from being played at any time. Sure, Steam may very well disappear someday, but the convenience of quick and cheap access to the game has trumped my views on property ownership.

But I still don’t see the console marketplaces in such a light. I’ve never bought a full retail game on my Xbox 360 or PlayStation 3, and try to limit my Xbox Live Arcade purchases as much as possible. Unlike Steam, I can easily see Microsoft shutting down my access to the games I own in a few years when they’ve moved on to the next big thing. This is the kind of crappy move that's been pulled before and it will happen again if it meant saving them a few bucks in servers and hard drive space.

get Your Used Games Here

But my biggest problem with the console marketplaces is price. With no competition, there’s no incentive for them to price their games aggressively. Shadow Complex, an Xbox Live Arcade game I’ve been interested in playing since its release three years ago when it was priced at $15. What does it cost today, three years later? $15. This is the kind of game that would now be priced $5 to $10 on Steam with sales pushing it down around $3 if you timed it right.

I bought Braid on the Arcade near release for $15, less than a year later I could have picked it up for a penny in a Humble Indie Bundle. And gotten a bunch of other great games thrown in with it at the same time. It’s a joke even imagining a pay-what-you-want indie bundle happening on a console marketplace.

But back to the original issue: if Microsoft and Sony prohibited used games on their next generation platforms, and didn’t allow third party stores to sell downloadable games at the prices they want, they will fail. Hopefully they can patch in a firmware update that allows used games, because the tactic will bomb and gamers will flee to the PC or Wii U. I would never buy a console that didn’t allow used games...

...unless there was competition. If Steam and Amazon could receive game keys directly from the publishers, it would be a completely different story. If a new game fell in price 75% in six months we would be on to something. This is what happens in the PC world now and developers and publishers are both successful. Why couldn’t this happen on our consoles too?

The used game market on the PC is essentially non-existent. Outside a few people trying to sell games on Ebay or Craigslist with promises that the CD keys will activate and any DRM won’t blow up in your face, everyone buys PC games new. That’s the simple truth, and that’s how it has been for over a decade now. But we don’t mind! The games are cheap! I have hundreds of Steam games, more than I could ever play, but I never paid more than $10 for one.

So, Sony and Microsoft: go nuclear, but do it right. People will buy more games, you will make more money, developers and publishers will make more money, and GameStop can do whatever they want, even open their own download service if they think they can compete. Done right, you may actually better the industry.

And of course, there's no reason used games and multiple competing download services can't co-exist either.

Please leave a comment with your thoughts. Thanks to Paul at Grinding Down for the images.

Comments

Mini-Monopolies

I've been trying to preach about this for months if not years.

DLC falls into the same category and you can already use it as a model. The prices of games and DLC for consoles keep going up. Publishers would have me believe that used games and pirates are the reason. This simply isn't true. It's a bold face lie. Greed is the real reason, and combined with consumers too silly to understand the value of a dollar, I guess. When you compare XBox Live to Steam the whole notion explodes in your face. Steam competes with other online providers and thus has huge mark downs to make sales. XBox Live does not, so game prices almost never go down. What is the incentive to buy? Some games online are more expensive than (new) games at Gamestop. That doesn't even make sense. So yeah, I've been trying to sign people up on this agenda, too.

Blocking used games (your spin on it) could actually be a bold and smart move if it was done correctly, but my uneducated market analysis has shown me that Sony and Microsoft (in particular) just want more money going into their pockets, not to create an even and fair marketplace where games are reasonably priced. This will explode in their faces. No one will buy 1 year old games for full retail price. Gamestop (if they are smart) won't even stock their systems. No one will buy the consoles. Piracy will actually rise. Steam will sell more games that should have been console release. All that jazz. I have already predicted that I don't think any console producer is stupid enough to tread this path.

Yeah, I don't think they'd

Yeah, I don't think they'd ever allow other marketplaces, but I don't think they're going to block used games next generation, so whatever. I am extremely uninterested in any consoles next gen, so I'm not really concerned at this time.

Noticed today that MS is finally having some sales on downloading full games, but all of them are from like the first year of the Xbox 360 and can probably be found that cheap by walking into any local Gamestop.

http://majornelson.com/2012/06/14/june-19-25-games-on-demand-sale/

I've always been the type of

I've always been the type of guy to own every console I could afford (varied year to year) but like you I am similarly disinterested in any new console. The DS was one of the best investments I ever made (after much criticism against "two screens? why!?") and probably the most played system I've had in the last decade, unless you count playing SNES games on my otherwise dusty Wii. I forgot why I started that sentence. Ah yes - and although I somewhat want a 3DS nothing about the systems or the games I've seen for it have raised that "minor interest" to "must spend $170 RIGHT NOW." Maybe in the words of Sazh and Danny Glover and many others, "I'm getting too old for this..." or maybe I just don't like the dark road I foresee for console gaming. Steam has really won me over since their Summer Camp sales last year. I have traditionally always had a HUGE HUGE HUGE console game library and maybe 1-2 PC games here and there (Civ and Sims, my guilty pleasure). Now it's almost completely reversed. I'm playing old console games I've had lying around and buying new-ish Steam games as they come on sale.

This is dumb

How would pricing down their games make Sony more money? As it is, plenty of people pay 50 or more dollars to buy a game. Never mind a few do buy games used, they still make plenty. By allowing competetion, the implementation of which is nonsensical much like your opinions, and selling games at like 15$, they would not make money. This is stupid. You are dumb

You fail to consider...

You fail to consider the actual cost of getting a hard-copy to retail. You've got printing, certification, packaging, certification, shipping, more shipping, wholesaler, shipping, then retailer before it gets to the price it is. No developer walks away with 59.99, or even 29.99 of the new game you just purchased. It's all of the other assholes along the way that really roll in the dough. Not only would a consistent digital download service promote more revenues, but also give more ability to drop the status-quo pricing that video games enjoy today.

I have a whole lot of theories as to why the brick-and-mortar retail store is slowly going extinct, but to put this succinctly, Sony, Microsoft, Nintendo, or any developer doesn't run away with your doe - retail bureaucratic does.

A couple of things...

"If a new game fell in price 75% in six months we would be on to something. This is what happens in the PC world now and developers and publishers are both successful."

First, this relates directly to what I've been saying all along. The existence of a healthy used market helps keep new game prices high. PC game prices drop to almost nothing within 6 months because they have no resale value. Nobody wants to play $50 for a game that drops to $0 in value after they open it. So they simply won't buy them......unless the price is lower. Not being able to resell a game forces publishers to drop their price. I make my living selling used equipment. It pisses off the manufacturer. But they know that if their equipment didn't command high resale, that same gear wouldn't command high retail. It's simple economics. Which brand of car would you be willing to pay more for? The one with zero resale value or the one with great resale value? It's a no brainer. So, if they eliminate used game, you can guarantee the price of new will drop hard and fast.

Second. The PC developers and publishers "are successful"? This is kind of vague I think. We've seen more publishers and developers expanding to, or completing transitioning to consoles. Mostly due to piracy and price curves. Also, they've made pretty significant moves toward subscription and microtransaction models. If they remove the price curve advantage of consoles, I bet a lot will go back to PC.

Overall great post though. Glad to finally hear someone who agrees with me. Let them do it! I can't wait to see what happens.

Still....

I probably won't buy a next generation system if they make it not play used games. In that way, it would ruin renting, borrowing games, etc. Things that I've grown to EXPECT on my consoles, and NOT my PC. That's the big difference here. An educated review helps, like you've produced, but overall, people will still be upset.

Anything that I buy should be mine to do what I want with, as long as I don't break the law - - On Console games, because that's what I've grown to expect.

Now, what you're proposing is certainly interesting. To me, however, it's just an excuse to keep PC gaming. I won't have to upgrade my PC for awhile, and Steam just keeps churning out goodies. I don't think consoles will be able to catch up. The thing keeping them above water are people that started on consoles and literally hate the PC's peripherals.

Buuuut - maybe Billy Bob decides that Microsoft is full o' shiet and decides that he's already got a computer, so why doesn't he try the new Modern Warfare 4 on it? Billy Bob is surprised, as it's a different game, but the same game. It takes getting used to, but he gets used to it. He bought the game on the cheap, and the game runs, blah blah.

I have a 360 for my wife and I to play. If it weren't for my wife, I wouldn't own any consoles.

I honestly think that you have a good idea, Greg. I just think it's going to be too late.

Too late?

I really don't want used games blocked either, but it feels like a catchier/more trollish title to phrase it that way. But multiple download stores? Please.

What do you mean by too late though?

I love Steam

I agree with a lot of what you said here about used games and digital downloads. I have made a lot more impulse purchases on Steam because the price point is so low. Even though I haven't necessarily liked some of the games I ended up buying, this also made me take risks more often on games I ended up loving (such as Arkham Asylum/City) that I would have avoided otherwise. But if you're going to charge $50-60 for a game, I would definitely be much more cautious about purchasing something out on a limb. Considering that the cost of digital downloads is minimal, even compared to a super cheap medium like DVDs/CDs, as you say, everyone could make a lot more money. With such a business model, there's no need to harass your paying customers with annoying, useless, and expensive DRM. That, and like Steve, I hope never have to purchase a console again. (I only recently got an Xbox 360 but that's because they gave it to me for free when I bought a new PC a few months ago)

P.S. Speaking of World of Goo, I've actually been going camping over the last year with one of the guys who developed the game. I never realized it until last weekend when someone else mentioned it

I hope they disallow used

I hope they disallow used games. That way, they can fail along with Nintendo's never-ending supply of gimmicks and I won't be tempted to purchase a console ever again.

Yep

When I was devising the editorial in my head, I thought about using this as a reason. Would save me a lot of money if I didn't buy any more consoles in the future.

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