Friday, May 24, 2013

What Is the Fate of Used Games Going Forward?

When we look at the upcoming console generation, used games compatibility seems to be one of the hot topics.  In this article we will put the used games front and center and see what could come of this controversial topic.

Everyone likes a bargain.  Used games are a method for the thrifty gamer to find the most bang for their buck.  Is it possible that the used game market could disappear with the coming generation of hardware?  Not likely is what I say, but I think it will change the landscape.

Sony and Microsoft seem to have differing ideas when it comes to used games. 

Sony did not say anything on the topic out of the gate, but they did say at a later date that they would "do the right thing" in regards to used games, and then came out at an even later date saying that the PS4 would in fact support used games, but were vague in the details. 

Microsoft outlined their strategy for used games saying that when a consumer buys a new game and puts it into their system, the console would bind that disc to their XBOX LIVE Account.  To most people this sounds like the death of the used game.  However, Microsoft said that if someone else were to put that disc in their XBOX ONE, they would be able to play the game as long as they payed a license fee to do so.  Microsoft was not forthcoming on what the cost of the license fee will be, but I'll offer my thoughts on it in the next paragraph.  So used games are not quite dead on the 360 yet, but I think the pricing on those games will be dictated by Microsoft.

Here is what I think.  If you buy a brand new game that just came out today and bind it to your console then take the disc to a friends house and pop it in, your friend will have to pay full retail price for the license.  It does not make practical business sense for the license to only be a fraction of the retail price because then you would have to pay full price and your buddy would in effect get the game for cheaper than you did.

So how will the used games work at the retailers?  Say for instance you bought Halo 5 for $59.99 and want to trade it in.  As a game retailer I must take into account that Microsoft is going to charge you a $59.99 license fee so it really doesn't make it profitable for me to accept the trade.  If over time the value of the game drops, say a year out that copy of Halo 5 sells for $39.99 on XBOX Marketplace, then I could possibly be able to resell it as long as the license fee is less than the Marketplace charge.  If the license fee is still $39.99, I will not be able to resell the game because in order for me to make a profit I would have to sell the game used for more than it would cost to get a digital copy from Microsoft.

Example 1:  I sell you Halo 5 for $10.00 and it costs you $39.99 to license it.  You have just spent $49.99 on a game you could have bought for $39.99 from the Marketplace. 

The only way it could work is if the license fee was less than what Microsoft was charging for a copy from the Marketplace.

Example 2:  I sell you a copy of Halo 5 for $29.99 and you go home and put it in and are prompted to pay $10.00 for a license fee.  You have now spent $39.99 on the game either way (downloading it directly from Microsoft, or buying it from my retail establishment).

That begs a question at this point; Would it be worthwhile to jump in your car and drive to the retailer to buy a used copy or just buck up to buy it from the marketplace.  I guess the answer lies in whether or not you feel the need to have a physical disc or not.

Sony has not revealed whether they will have this kind of system in place, they just said "it will play used games".  The short answer for the XBOX ONE is the same.  It will play used games.  I feel that if Sony doesn't have a license fee for used games and their used games continue on just as the PS3 games are now, that they might end up gaining some momentum with the cost conscious gamer. 

Microsoft will have to respond to this if it ends up costing them significant market share, but Microsoft's positioning in this upcoming generation is an article forthcoming on its own.  I think that if it comes to pass that they lose ground in the market they may reevaluate their stance on it, but only time will tell.

In conclusion, the fate of the used game is hanging in the balance.  No one can say for sure what the future holds for them, but we will most certainly find out later this year.

Please leave your thoughts on this in the comments section below.  Thanks for reading and stay tuned to Big Ups Gaming for more articles like this one.

***EDIT***

The only way I can see this working is if you can reliquish the license of your game, meaning you can select an option that says "RELIQUISH LICENSE" and you would be required to pay full price if you wanted to be able to play the game again. This would end up being more complicated than it would be worth then because you would run into gamers that forget to reliquish their license or gamers that regret selling a game and email or call Microsoft with a sob story of how they "accidently reliquished their license". I say that option is unrealistic.

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