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TF2's Heavy Weapons Guy Summarizes My Feelings on the Gaming Community this Week

There are weeks that pass when I'm proud to be a gamer. Proud to be on the forefront of a new entertainment medium, and even prouder to be working in that medium. Days pass where I look at some of the envelopes that developers push and I get a feeling of grand satisfaction that comes with being involved in new mediums and new ideas.

Then some days I wake up, read the news and feel ashamed, not because of the industry as a whole but because of it's consumer base. Now, if you've been a follower of my blog for some time you may have already seen a few of my articles on potential problems with the gaming industry. We, it would appear that one of these problems may be beginning to rise to its peak, and in the process the general outcry over it is making me almost ashamed to be associated with gamers. The point of conflict? So called "Online Pass" content. The crux of the issue? Used games. The embarrassment? Well, lets take a look....

Ever since Gamestop began intensely pushing used game sales the gaming industry has been in a flux. For Gamestop, the situation was win-win. They would purchase only two copies of a game from a distributor then sell them to a customer, emptying their stock (creating demand among those who for some reason only purchase their games there) while informing their customer that they would give them a crisp $5 dollar bill if they brought the game back used. Oddly enough, it worked, people apparently being incapable of handling the math to realize that spending $60 to play a game for two weeks and getting $5 dollars back at the end was a much worse deal than simply paying $10 to rent the game for those two weeks. Or $5 for one week, or less time. It worked incredibly well, with the average game turnaround, as told to me by some Gamestop employees, being less then two weeks. When these players came back, Gamestop would pay them $5 each, then put the games back on their shelf for $5 less then the new price, chortling all the while. For them, it's the perfect system. Rather then buy ten copies of a new release, making only $20 from each copy sold (while another $20-30 goes to the developer and the actual game maker nets only $10-20) they can buy two copies which they sell at a $20 profit, and then resell each of these copies after repurchasing them for $55 each, netting a total of $440 profit for ten games instead of a measly $200. Great plan, and everyone wins, as long as they work for Gamestop (fun fact: Gamestop so aggressively pushes used games that the games themselves are not even shelved separately, but together on the same shelf, with the single new copy on hand regulated to the back where shoppers will not see it). Nevermind that the developer of the game just went from making $100-200 on those ten sales to $20-40. It's not like those employees need to be paid right?

Sadly, this seems to be how many game consumers see the issue. Now to be fair, I don't think used games are a bad thing in concept (the current model is another issue), but I have been quite vocal about both the ridiculousness of gamers self-entitlement issues (why should I spend my money for a game I want to play?) as well as the eventual result of such aggressive undercutting of new games. Well the eventual result is here now, and despite consumers cries that used games are hurting no-one, not only has the actual data proven them wrong and lacking of common sense, but its become a harsh enough issue that, as I've state before, development houses are fighting back in a way that makes used games a less attractive option.

Before we go any further, let me just point out with some data how bad the used games issue has become. Last year, a study of the gaming industry and the money spent on it found that, like usual, the industry had grown annually by around 5-10%. Unfortunately, they also found that unlike previous years, almost half of the money spent was on used games. So even though the industry grew, the slice of the pie that developers and publishers receive actually shrank by around 45%. Now those of you who hold jobs currently, try to imagine what would happen if your employers revenue suddenly was cut by around 45%. Can you imagine that your employer will continue to run everything as he has always run it when half of his operating revenue is gone? No, unless your company has phenomenal overhead, which lets be clear here, almost no development studio does.

Faced with the prospect of generating additional cash or closing their doors, many studios have thrown their weight behind DLC, and what many industry insiders suggested would come if used game sales continued is now happening in the form of an "Online Pass." The idea here is simple, make a new game a more attractive purchase by bundling a one-time-use code with the game that allows the player to download or unlock additional content in the game as a reward for spending the extra five dollars to get the game new and choosing to support the developer. If a player buys the game used, then they'll need to spend at least $10 to unlock the same content, earning the developer the cash lost on the used sale and having the bonus of possibly driving the used cost of the game down further (which in turn, by an interesting twist of purchaser psychology, may actually make them less likely to buy it, I would love to see a study done in this regard).

The latest game to announce that it is launching with an online pass, Kingdoms of Amular: Reckoning, has recently been the target of extreme controversy from gamers over it's choice to include the online pass. Gamers have dedicated entire threads to accusing the games development house of everything from greed to stupidity (and I'm sure much worse) all in the act of decrying the online pass as the 'death of gaming' or even more amusing/saddening, a 'violation of gamers rights.'

I'll be frank, this behavior is not only embarrassing to the gaming community as a whole, but it is doing nothing to improve the perception of the non-gaming public in regards to the gaming community. The fact is, used games have hurt the industry, and no amount of name calling, accusations, wishful thinking or even willful ignorance will change that fact. In fact Kingdoms of Amular shows us how bad the situation has become by it's position on the subject. For those not in the know, Amular is the first game of 38 Studios, which was founded not so long ago by Curt Shilling, who happens to have been a pitcher for the Red Sox before deciding to jump into the games industry. Amular is his studios first game and when it came to talking about the games online pass, he had this to say (reached here, with thanks to Gamepolitics for this initial link):

DAY 1 DLC, to be extremely and VIVIDLY clear, is FREE, 100% totally FREE, to anyone that buys a new copy of Reckoning, ANYONE.

If you don't buy new games you buy them used, and in that case you will have to pay for the Day 1 free DLC content the new copy buyers got for free.

It's clear the intent right? To promote early adopters and MUCH MORE IMPORTANT TO ME, REWARD fans and gamers who commit to us with their time and money when it benefits the company.

Every single person on the planet could wait and not buy Reckoning, the game would hit the bargain bin at some point and you could get it cheaper. 38 Studios would likely go away.

That's just how business works. We MUST make a profit to become what we want to become. THE ONLY way we do that is to make games you CANNOT WAIT TO BUY! If we do that, and you do that, we want to reward you with some cool free stuff as a thank you.

You can TOTALLY disagree with this and I am sure many do, so we'll agree to disagree. This is not 38 trying to take more of your money, or EA in this case, this is us REWARDING people for HELPING US!

Now, let me make this clear. The industry has reached a point where used game sales are enough of a problem that a newcomer to the industry, in making his first game, can see that he won't be able to stay afloat without an incentive for people to buy new or somehow recoup the cost of a used sale. Compare that logic to a comment I saw online the other day where someone complained that now they would have to spend $65 for Amular, $55 for the game and $10 for the DLC, and you can see why perhaps I may be a little put-off by the gaming community at the moment, and not just for the reason that this player is so determined to buy used that he will actually spend more money to do so.

I can no longer understand the logic behind many of these people. Lets make it clear now: used games were going to hurt the industry, and both developers and news outlets warned everyone about where this was going. Then used games did hurt the industry, and whole development studios closed up as their income vanished. Now that game studios are fighting back, fighting to stay afloat and continue to produce games, the gaming public that should be supporting them is instead attempting to demonize them.

This is what the gaming world has become. Whining about it isn't going to help, especially when gamers (as the consumer) are partially responsible for creating the problem in the first place. I for one, support Curt Shillings decision to not only include Day One DLC for his customers, but to stand by it when called under question. It's not a tragedy or an offense to my "gaming rights" to support a publisher of a title that I enjoy by purchasing a game new.

Its been said before, it will be said again, and I'll say it now: Purchasing a used game helps no one but the seller and yourself. If you somehow think that by purchasing a game used you are supporting the studio that made it, you are entirely incorrect. You are not a customer of theirs. In fact, you're even worse then a competitor. All you are doing by saving that $5 is making sure that the studio you enjoyed is $10-20 poorer the next time they try to make a game, and $10-20 dollars closer to never being able to make another.

We gamers set the stage when we purchased used games heavily enough to shut down studios. Now, those of us that did are faced with the cold hard reality of Online Passes and Day One DLC. Complaining about it only makes us look foolish.


Anonymous said...

I have to disagree with your assessment. Take a look at this article in Forbes. http://www.forbes.com/2011/11/17/gamestop-posts-earnings-activision-reports-record-call-of-duty-sales-marketnewsvideo.html

"GameStop reported third quarter earnings today that slid to $53.9 million"

"Activision Blizzard ( ATVI - news - people ) shares are trading higher after the company reported record five-day sales of its Call of Duty: Modern Warfare 3 game. The game posted $775 million in sales in its first five days on the market, breaking the record set last year by Call of Duty: Black Ops."

Why should gamers get stuck with the purchase of a crappy game? I have been burned so many times buying a game that is bug ridden with horrible game play.

Thank you for your post, I just disagree with your conclusion.

Ross K. Wolfe said...

Anon, your argument isn't saying what you think it's saying. Just because a single game in a series that is known to sell well manages to sell well does not mean that all video games will sell well. Quite the opposite, in many cases. Lesser-known titles from smaller or indie developers/publishers tend to get overshadowed by huge releases like this and therefore fewer people hear about their games and subsequently fewer people buy their games.

As for buying crappy games, well, no one is forcing you to buy a game on day 1. If you're not sure, read reviews... a lot of reviews from different sources that you trust. If a game demo exists, play the demo first. If a friend bought the game or you can find it for rental, do that first. There are dozens of ways of finding out if a game is worth buying without actually buying it. You should try some of them sometime.

Anyway, I do appreciate you post, especially that it's at least attempts to make a reasoned argument. However I think you need to think your arguments through a bit more.