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MCV: Retail sources talk used Xbox One games, £35 for used game in UK [U2: Eurogamer]

People were saying that GAME shouldn't stock it as its anti consumer, the poor GAME staff member was even pushed to the floor in the middle of a scuffle between people sticking up for the X1 and Sony fanboys getting their digs in.

One thing i will say though is that when i passed GAME going into town, they had 'Pre Order Xbox One Now! billboards and posters all over the windows and outside but when i actually went into the store an hour later, all the posters and billboards were gone.
I don't think all this anti consumer stuff is going to effect sales with the masses, not until Christmas time when they open preseants etc and realise just what they can and can't do with the machine.
.

Sorry, I know it's mean but I couldn't help but laugh at the image of fanboys rioting over a goddamn video game system.

Video games serious business indeed.
 

A Human Becoming

More than a Member
So the updates haven't changed the policy of disallowing lending games without a fee and trading/selling games privately. Still won't support the Xbone.
 

ascii42

Member
That Square needed to sell 6M (or whatever) copies of TR to break even was fucking bad business. Whoever approved that budget, or approved the game going over budget, should be fired. Not because I'm a cold heartless bastard, but because in today's climate, REQUIRING 6M copies sold on a game is just a horrible business decision.

6M is what they expected, not necessarily what they needed to break even.
 
certainly you see that THEIR COST isn't OUR problem.

James Cameron went so ridiculously over budget on Titanic that he gave up his pay on the film for BACKEND royalties. He didn't say "well this shit costs money to make. Just charge $35 per ticket to see it!!" (of course that move ended up making him to the tun of over $100M.....)

You know you are going to charge $60 for a game. In today's climate a HIT is like 700K. A massive hit with serious legs is maybe 2M. CoD and Madden numbers or unrealistic unless you are CoD or Madden.

That Square needed to sell 6M (or whatever) copies of TR to break even was fucking bad business. Whoever approved that budget, or approved the game going over budget, should be fired. Not because I'm a cold heartless bastard, but because in today's climate, REQUIRING 6M copies sold on a game is just a horrible business decision.

totally this.

we shouldn't pay more for their mismanagement and misbegotten concepts
 

jetjevons

Bish loves my games!
So what's going to happen to Gamefly? That's the big question for me.

Gamefly is probably going to be screwed. However I really hope that game rentals as a form of temporarily accessing full game content don't disappear. I can see the decision being placed in the publishers hands. Since they can turn on and off access like a faucet maybe they simply charge for rentals directly?
 
I can understand how some are pissed about this but it doesn't really bother me too much seeing as I buy new and never trade my games.

Note: I don't mean to equate video games to racism and ethnic cleansing with this quote, it just fits too damn well:

First they came for the Socialists, and I did not speak out--
Because I was not a Socialist.

Then they came for the Trade Unionists, and I did not speak out--
Because I was not a Trade Unionist.

Then they came for the Jews, and I did not speak out--
Because I was not a Jew.

Then they came for me--and there was no one left to speak for me.

I haven't bought a single used game this generation and I want to see them collapse for this bullshit.
 

Con_Smith

Banned
You completely misunderstood what I am saying. I am saying Sony to do it because I do not believe they wont. Their hands are tied now by publishers who hate the used games market who are in the position of power, and Sony needs any extra profit they can get. Having their used system work this way is good for the companies bottom line, especially since they had to pony up for the ram upgrade and Kaz is promising big profits. I don't want sony to do this, but I don't think they have a choice and its just inevitable. I hope I am wrong.

I rather they take that hit and make a push to prove we as gamers/consumers/an industry don't need this. If this succeeds I don't think people will be interested in buying something interesting, only whats established and thus keep this cycle of bullshit gaming going. Why even try something new when you have to make something for the masses who will slow down their purchasing options? This tactic will leave many gamers on a budget high and dry and only the few here who say this doesn't effect to carry the slack. A lot of people cycle through games through selling/trading and this is gonna cause an effect on the industry one way or another.
 
What Gamestop's CEO is NOT telling you that reselling those used games is garnering them a 40%-60% margin versus their 20% margin for new ones.
Here is how it works:
When a game comes out for a retail of $59.99, the store buys it from the publisher for $48.
The consumer buys it for full price and the store makes 20%.
(Just to let you know, as I was a Manager for Electronics Boutique for almost 8 years and a buyer for 3 for them, the min margin for a store to stay profitable was about 35%)
From here on out the publisher made their $48 on the first purchase.

A month later, the consumer brings back the game to trade in toward a new game. he/she gets $25 for a game they will resell for $49.99 or $54.99 dependent on the popularity. This equates to a 50+% margin that the store makes. The publisher makes nothing.

When I was there as a buyer, it was discussed that each used copy was traded in an average of almost 4 times during the life of the game.(It may have gone up or down since then, but I will use 4 as an example)

Due to the declining price over the life of the used product, each game would make approx $50+ for the store in profit. It would take an additional 4 copies of that game to be sold new at the full price for the store to make that profit.

To a Publisher and Console Seller that is $192 in license fees and developer/publishing/marketing costs that are lost.

This is just to put in perspective what really is going on here. I'm not saying that I don't think you should have the right to sell the game on your own. I actually do think you should have the choice to. But please don't feel bad for stores like Gamestop or Best Buy. They have been exploiting and making far more money than anyone realizes. That over $1 billion dollars in sales of used product is more than 30% of their bottom line.
That is neither money left on the table by publishers nor exploitation.
 
You're sticking your head in the sand. This system is just a huge inconvenience. I buy 95% of my games new, but there have been times when I bought second hand games. Usually when I got a new system and missed out on a couple of games that had gone OOP and were only available used.

The same goes for the Always Conncted DRM. I've got a 50Mb internet connection, my consoles are online, but I still don't like how MS forces me to be online. Two months ago my internet connection failed and it two weeks and two visits by an engineer to get it fixed. But even though my internet connection was down, I was still able to play console games and even Steam games (in Offline Mode). In Microsoft's Brave New World, I wouldn't have been able to play a single game Xbox One I bought.

This thing doesn't benefit consumers at all, only big business. I'm astonished people give away their consumer rights without thinking through the ultimate consequences.

thank you.

Note: I don't mean to equate video games to racism and ethnic cleansing with this quote, it just fits too damn well:



I haven't bought a single used game this generation and I want to see them collapse for this bullshit.


and by the forum posts/media coverage,

people are okay with this.
 

RetroStu

Banned
Sorry, I know it's mean but I couldn't help but laugh at the image of fanboys rioting over a goddamn video game system.

Video games serious business indeed.

It wasn't a riot or anything lol, it was just a large group of people and fanboys laying out their feelings in a heated manner, the poor GAME staff member was stuck in the middle and his sticking up for the X1 didn't go down too well lol.
 

jet1911

Member
So if I get this right the stores(let's say EBGames) who sell used games will have a lower margin on Xbone used games but in a lot of places they'll also be the only store where users can sell their games?
 

Moobabe

Member
UK retail has games at £35 and less week two, this will kill the used market, GAME might as well shut up shop today.

If it puts my JT manager out of a job then I'd be ok with it. The narrow mindedness of some of the people at the company is staggering.
 

ajjow

Member
Thank god for Nintendo. I'm so pleased they didn't do this.

I have a very large extended family and we are always swapping and exchanging games between households.

I have lots of disposable income so buying games new Isnt a problem. But some in my wider family circle aren't as fortunate.

This policy and anything like it is downright disgusting and anyone who supports it needs to re-evaluate their thinking.


You are soooooooooo right! Im in the same position. I have a game that I cant take to my friends house??? Thats crazy. Its like I buy a movie and nobody else cant buy. A music that only I can hear!!! Wtf! Microsoft is so destroyed with civil actions. Lawyers, reunite!
 

gofreak

GAF's Bob Woodward
Couldn't you just deactivate the game from your profile to lend the game to your friend? Then, reactivate it when you get it back?

From what MS execs said, short answer is no.

I don't think deactivation will be exposed to the end user at all.

If you give a disc to a friend and he tries to use it on his account, and the game was previously installed and activated on another account (yours), it'll ask him to pay up. This is what they've said.

They've said you'll be able to do this in the context of selling a game to a friend too, in which case the license on your machine for the game will be deactivated automatically (via the 24 hr ping) and you'll presumably get a cut of the money your friend pays MS.
 

ttech10

Member
Couldn't you just deactivate the game from your profile to lend the game to your friend? Then, reactivate it when you get it back?

Once deactivated it can only be activated with a newly purchased activation code.

So you would be out $60 and your friend still couldn't play the game without also paying $60.

But does make it interesting, what happens when someone gets a hold of your account and deactivates your games, just to be a jerk. Or someone hacks and deactivates your games.

(That's if they let you deactivate it yourself.)
 

Woggerman

Banned
That is neither money left on the table by publishers nor exploitation.

I beg to differ. Gamestop is exploiting the fact that the System sellers and Publishers didn't have a system in place to keep it from happening. EB and Gamestop used it to their advantage. They wouldn't have grown as fast or maintained profitability without it. The ecosystem is now at the point where they will have that opportunity to control it.
 

ajjow

Member
I really cant believe this. If this happens, microsoft wont be able to sell the console in Brazil. Our law dont permit something crazy like this.
 

mjc

Member
I'm honestly not too bothered by this. We knew the industry was heading this way after this gen, it was inevitable. It also ensures that developers get a cut of used games sales...possibly ensuring that franchises which previously struggled can continue though decent enough sales next gen. It sucks that this takes away the private market, I'll definitely agree with that.
 

nib95

Banned
I'm honestly not too bothered by this. We knew the industry was heading this way after this gen, it was inevitable. It also ensures that developers get a cut of used games sales...possibly ensuring that franchises which previously struggled can continue though decent enough sales next gen. It sucks that this takes away the private market, I'll definitely agree with that.

Publishers and Microsoft get the extra cut, not necessarily the developers. I don't mind a cut going to devs, it's the Microsoft part I have an issue with. They will essentially control the scheme, and add to that, it eradicates borrowing and lending and the private selling market.
 

Socky

Member
How would that work without requiring online (which they said they would not do...due to outside markets)?

If I install the game, and then sell it/trade it and then that guy installs it, and maybe one more.

Basically 3 people get a game for the price of one. I doubt people would like that.

Unless the disc is required...and if thats the case...then what is the point?
If anything goes against my beliefs/hopes that Sony won't do this is that I can't think of a system that would do anything outside of online passes/activation codes...which are virtually the same thing minus the always online part.

How exactly Sony might implement this is hard to tell, but it is possible for them to have some kind of check on ownership with their RF tag patent, see gofreak's thread here:

http://www.neogaf.com/forum/showthread.php?t=506560

That doesn't mean they would implement it. My guess is they are still trying to decide that now and watching what is going on with Microsoft/dealing with publishers. I imagine there's quite a dance going on behind the scenes.
 

bakeray

Member
How is downloading your Xbox Live account and playing your disc at your friends house that hard? Why does everyone ignore that you can still do this, did they say you won't be able to play the game in this fashion as well? I've been an Xbox gamer since it's inception and this is pretty much standard procedure for me, or just taking my entire Xbox over there anyway for a LAN party. I had an Xbox memory card that I kept my Xbox Live profile on for when I would go to a friend's house so I could play Halo 2 on my own gamertag.

This system DOES eliminate lending and renting games, which I'll admit I don't really do so it doesn't effect me too much, but I would wager MS will create their own rental system with the way they're pushing DD/the cloud.

As someone else said, you guys must have way better friends than I do cus anytime in the past I would lend out a game it'd come back looking like it went through a blender so I quit doing that years ago.
 
Gamefly is probably going to be screwed. However I really hope that game rentals as a form of temporarily accessing full game content don't disappear. I can see the decision being placed in the publishers hands. Since they can turn on and off access like a faucet maybe they simply charge for rentals directly?

I doubt rentals will be killed. Redbox and Gamefly will probably have to agree to carry a specialized license form of their rental games.
 

RetroStu

Banned
I'm honestly not too bothered by this. We knew the industry was heading this way after this gen, it was inevitable.It also ensures that developers get a cut of used games sales...possibly ensuring that franchises which previously struggled can continue though decent enough sales next gen. It sucks that this ta kes away the private market, I'll definitely agree with that.

But why the hell should they?, they have already sold their game, why should they get paid twice and more for a game they have already been paid for?, what a ridiculous thing to say.

If developers are struggling then lower the ridiculous game budgets and sales expectations. Once developers sell their game then that should be it for them.

EDIT: Besides you would have to be weird in the head if you think the 'lowly' game developer would see any of this money, they have already been paid for their services, the money would go to the publishers and big wigs.
 

ajjow

Member
Books, music and movies. This crazy talk shit of used dont exist with this products. Only games.

If gamestop is the big villan here, publishers should stop selling games there and create contracts that obligate gamestop to pay a tax or a fee for every used game sold.

Microsoft is penalizing the consumer that dont like the game. Its your fault that the game you boight is boring.

Thats crazy!
 

Kunan

Member
That rumor can't be serious. 10% for the store?! How much does MS themselves get?

Exploiting fears in publishers for a new alternate revenue source. Goodness knows if any of the money going to MS will actually be re-invested into games.
 

TimeKillr

Member
What MS is doing is greedy as all hell.

While I *do* think that month-1 used games are a problem (they actually are a huge problem) and are actually worse than piracy (I'll explain), this method of doing things is certainly not the right way to go about it.

Essentially they're just attempting to own the market for used games so that they also make a cut. I hadn't thought of this before, strangely, but MS/Sony also lose when used game sales are made, because they get a cut of everything (through licences/etc). So it's only "normal" that MS is trying to make money off used sales, mostly because they are also losing money.

For the used games problem, here's my take on it (and this is from a developer point of view):

Most games are very top-heavy in sales. They'll sell most of their copies within the first month or so. Very few titles have legs - Nintendo's games being the huge exception here (casual games also have much longer legs than most titles but that's a different type of market).

A massive problem arises when GameStop (and others, I'm not pointing fingers) sells used games, within the first month, at 5$ off the price of the new copy. *THIS* is worse than piracy. Why?

When someone pirates a game, it's impossible to tell if it's a lost sale. Someone downloading a movie could have paid to see it, but also could have went without paying and seeing it. It's not 50/50 either. A lot of people download stuff compulsively. They pirate games for whatever reasons they want. They just want to see what the game is like, etc. This happens QUITE often. Pirated games are not lost sales in a lot of cases.

5$ off used games are, at a ratio exceeding 90%, a lost sale. Why? If you pick a used copy for 5$ off instead of paying full price, you were most likely willing to pay full price. Willingness to pay full price is what constitutes lost sales. It's a lost sale for the publisher/developer, not for the store, obviously (who make bank off it).

So there it is now - Microsoft and probably some of the world's biggest publishers have been complaining about it for a while. Their solution to combating used sales in the past have been online passes, which at least gives them an alternate revenue stream. So now they've probably managed to convince Microsoft that it would be good for them also to have some sort of system in place to control how much stuff gets into the used market and to make money off it.

One last thing I want to address is I seriously don't want to see more comparisons to the car industry, or the book industry, or the movie industry. (The movie industry is a bit closer, but also works very differently).

Used cars are not a problem because car companies make a lot of money off maintenance, parts, etc. Nobody can say "but cars!" because car companies have alternate revenue streams that are incredibly huge.

Books are a different beast altogether. The main difference is books don't have 12 million dollar budgets, so margins are much, MUCH higher on them. A book that sells for 40$ (and those exist quite a bit, especially when it's first-run hardcover versions) makes a ton of money for the book publisher (and hopefully the author). There is also the fact that there doesn't seem to be (in North America anyway - I know they exist in Japan) massive franchise stores that specialize in selling used books that came out the week before. The book industry also has an alternate revenue stream in the form of cheap softcover versions of the books, where they can still make money on the books when they come out on cheap paper, with really cheap covers, so the cost to produce the book is ridiculously low. Finally, books deteriorate much faster than digital media (disc-based media does deteriorate, but not that much) so it creates a need for new copies of books.

The movie industry is different in that it has 2 distinct products it offers: theater viewing and home viewing. Nobody complains about the fact that you pay to see a movie in a theater but can't resell the experience to someone else after the fact. These purchases are non refundable and non transferable. Home viewing has a used market that mostly deviates from video rental stores because the value of a movie on DVD or Blu-Ray really takes a massive nosedive after a short while, so it's not that worth it to sell them back to other people unless they're really rare stuff.

Every industry is unique, and comparing them is doing an apples to oranges comparison. It never really holds up.

All that being said, I do feel that MS is actually going WAY too far with this. Their whole system is centered around the concept of controlling the used market, then it looks like they tried to paint over it with features so that it wouldn't show too much. Bullshit like cloud processing (this is only actually useful for multiplayer stuff as they can now host game servers themselves, which is great because these can greatly scale - the problem before was that everything was P2P and not server-centric, so you had limits on how many players could be present in a game), TV stuff, etc. It's all a shiny coat of paint they hope will hide the nasty underneath.

Before people flame me to death, let it be known that I don't hate used games. I think that they are typically fantastic for lower income people, people on a budget, kids, whatever! Especially if you buy them once the game is no longer being produced (which happens quite fast!) and such it's really, REALLY not a problem. Person to person sales account for such low numbers that they don't count either - nobody cares about those. I personally try to always buy new, but that's because I prefer them new to used. It's personal preference really.
 
I doubt rentals will be killed. Redbox and Gamefly will probably have to agree to carry a specialized license form of their rental games.

That limits your playthrough somehow. What is to stop people from renting a game, beating it, and then returning? This would effectively allow people to go around the trouble of even having to purchase the game at all, which seems to be the purpose of the system that is being put in place.
 
The rumoured activation fee is £35 (pounds sterling), not $35. The dollar equivalent would be closer to $50.

I'm wondering if the £35 figure is the highest level they are considering for the fee, with lower fees possible, or some kind of sliding scale.

I'd also imagine that - as this is a fee they are charging the retailer for a 'service' - they can legally charge whatever they like.

If the activation fee was something like $50 for a $60 game, then how much would the trade in value be? $5 at most, since Gamestop has to make some money. This would effectively kill any and all used games sales.

It couldn't possibly be that high.
 
What Gamestop's CEO is NOT telling you that reselling those used games is garnering them a 40%-60% margin versus their 20% margin for new ones.
Here is how it works:
When a game comes out for a retail of $59.99, the store buys it from the publisher for $48.
The consumer buys it for full price and the store makes 20%.
(Just to let you know, as I was a Manager for Electronics Boutique for almost 8 years and a buyer for 3 for them, the min margin for a store to stay profitable was about 35%)
From here on out the publisher made their $48 on the first purchase.

A month later, the consumer brings back the game to trade in toward a new game. he/she gets $25 for a game they will resell for $49.99 or $54.99 dependent on the popularity. This equates to a 50+% margin that the store makes. The publisher makes nothing.

When I was there as a buyer, it was discussed that each used copy was traded in an average of almost 4 times during the life of the game.(It may have gone up or down since then, but I will use 4 as an example)

Due to the declining price over the life of the used product, each game would make approx $50+ for the store in profit. It would take an additional 4 copies of that game to be sold new at the full price for the store to make that profit.

To a Publisher and Console Seller that is $192 in license fees and developer/publishing/marketing costs that are lost.

This is just to put in perspective what really is going on here. I'm not saying that I don't think you should have the right to sell the game on your own. I actually do think you should have the choice to. But please don't feel bad for stores like Gamestop or Best Buy. They have been exploiting and making far more money than anyone realizes. That over $1 billion dollars in sales of used product is more than 30% of their bottom line.

I don't disagree that the Gamestops of this world make a large amount of money from used game sales, but this isn't about me having sympathy for them, it's about how the consumer pays for games and creates value for themselves. This system harms that, regardless of them getting in on the Gamestop pie.

We're obviously in agreement on consumer rights, but do you feel that people would buy as many new games as they do today without the ability to trade in?
 

Joni

Member
You really think that a company like MS would go this route if they were not sure it was legal? It's possible I guess, though unlikely.
Microsoft has shown an ongoing disregard for European law. They just got fined a second time for failing to give users a choice for their webbrowsers.
 

Socky

Member
That rumor can't be serious. 10% for the store?! How much does MS themselves get?

The EG story was altered slightly on that point:

The same report [did not say a shop's cut from that second-hand sale could be as low as 10 per cent -Bertie] said shops could be forced to sell second-hand games at a maximum discount of 10 per cent.

Combine that measly 10 per cent discount and the £35 activation fee and you have figures that add up to not much sense at all for the shopper.

So the suggestion there is that a £45 new title couldn't be sold used for less than £40.50? Not sure how that can be legally justified, but I'm sure there's ways and means...
 

Sean*O

Member
LOL at selling used games or renting them being "legalized piracy".

Some people have really been brainwashed. Are used car lots hardware pirates? What about car rental services like Herz?

I am about sick of the entitlement that exists in the video game, movie, and music businesses at the highest level.
 

1-D_FTW

Member
Then that means that they won't do it on other systems, so it's really a loss for MSFT...

Believe what you want. I'm saying I'd bet money and nothing Sony has said makes this impossible. It's optional and EA didn't drop Online Passes without a reason. Brace yourself.
 
- Even though we already knew this EA are a bunch of scum bags. "We are getting rid of online passes for the consumer!!" fuck off assholes.
- Don't know why Gamestop will play along. They will go from making a $20-$25 profit to $5 at most. I know this setup was a publishers wet dream but this is bullshit. Why should they receive money from the same copy over and over and over? They are treating used games as NEW and that's bullshit. I guarantee this will fudge NPD numbers as well. Unless all these sales count as a digital sale.
- There's no way possible the fee will be lower than full price. Lets say the fee is 30 bucks. Whats to stop my buddies and I passing the disc around to buy the game at a cheaper price? MS knows they have no other choice they want to damage control as much as possible. With that said what to stop them selling full price at Gamestop? Shit i'm starting to think gamestop will get even less than $5.

Plus does any else find it scary MS/gamestop will be fiddling around with your account over cloud? Sharing account information, remotely deactivating your games, etc Fuck that.
 
Living in a small country this kills any use games sales we have .
I also lend my game to friends very often and some of them don't go online .
So this system can Fuck off , i can sell back anything i want but i need MS permission to sell back a fucking game i bought .
This is so fucking stupid and i won't have any part of it and make sure the same thing goes for my friends .
 

Woggerman

Banned
I don't disagree that the Gamestops of this world don't make a large amount of money from used game sales, but this isn't about me having sympathy for them, it's about how the consumer pays for games and creates value for themselves. This system harms that, regardless of them getting in on the Gamestop pie.

We're obviously in agreement on consumer rights, but do you feel that people would buy as many new games as they do today without the ability to trade in?

No. Absolutely not. There would absolutely be less new copies sold. That's why a change needs to be made in the eyes of the game and console makers. That is why getting rid of used games is not going to happen. It is going to be interesting to see what the final policy worked out between all of the parties. You've got the game and console makers thinking they got screwed all of these years. You've got Game and console sellers who are going to see some of their profit taken away and you've got consumers who may receive less per game so those same game sellers get back some of their margin.
What's probably going to happen is a compromise between all of them.
 
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