| Fayceless said: Guess what? Math time! The used game market is 10% of the new game market in the U.S. (according to NPD) Let's say that, between direct used sales (ebay, garage sales etc) and indirect (GameStop, Best Buy etc) gamers who buy games with the money end up with 1/3 of that. (it's probably a bit higher) Of that 1/3, perhaps 1/2 goes to buying new games. So around 1.5% of the NEW game market is a result of the used game market. That seems small, but it's important for later. Next, consider how much of used game sales go directly to, well, used game sales. Much of the rest of that 1/3. So we'll call 15% of the used game sales a direct result of used game sales (the industry fuels itself). Publishers can't have this money, because it doesn't exist if there's no used game market. (technically speaking, the "wealth" wouldn't exist, either way they can't have it) Now, let's assume that publishers receive all of the remaining money (that is, the money that gamers do not receive from sales), which is equivalent to 7% of the new game market. Adjusting for that 1.5% of the new market that would evaporate with the demise of used games, and publishers share of the market is...105.5% of the current-day market. Without taking into account other things (for example, how many new games do game store employees buy with the money that was spent on used games? another .5% could perhaps be taken off, but that's hard to figure) If we assume only a 5% increase in revenue(personally I think that's a bit high), you can be sure gamers, and developers for that matter, won't see any benefit of eliminating used game sales. In order for games to be $10 cheaper, (~83% of today's prices) revenue would have to increase by at least 20% (as 83.33 x 1.2 = 100). When the total value of the used game market is only at 10% of new games, you can see how this is entirely impossible. Some people believe, surely, that it's all in the unit numbers. If the number of used game sales translated to new game sales, profits would increase drastically. However, it's absurd to assume people will spend more money on games than they already do. It's not about how many people buy a game, it's about how much they spend on games. You can't create money from nowhere, people will simply buy fewer games. What WILL happen is this: People will play fewer games. People will be more reluctant to buy new games from un-established franchises or developers. Developers will ultimately be less willing to take risks, and gaming will stagnate without a drastic overhaul. (as PC gaming would be stagnant if not for services like Steam which changed the gaming landscape, and the arrival of flash and facebook games) |
1. "During the course of the year the company made $1.6 billion from sales of new hardware, and $113.6 million in gross profit; $4.04 billion from new game sales, of which $839 million was profit; and $2.6 billion from second-hand sales, of which $1.2 billion was profit"
Gamestop makes roughly 69% more profit on 65% smaller sales, meaning that adjusted, (1.968B) USED games are worth roughly 43% more than new games. ie; they pay you 43% less than your game is worth.
2. There will NEVER be NO USED GAMES. What there will be, is an "activation cost". This will result in a short term drop in value of used games market based on the largest used dealer, gamestop, as they try to defer lost profits by paying less. Gamers will gravitate toward ebay and craigslist. Then trade-in values will go back up. Prices for buying used games will instead go down, as the market shifts the price ratio to compensate for the "activation cost" and trade in restrengthening.
Your idea about used games only being 10% is extremely hopeful, and even so, if that 10% turns into new games, you're looking at a huge increase in developer revenue.
Additionally, the factor of digital distrubition only increases the profit margin of a game's sales.
