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The Industry vs Second-Hand - Destructoid




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"Used." It sounds so dirty. Be it napkins, games, or workers of the night, these terms all become taboo when preceded by that dreaded word, albeit for different reasons. And while essays could be written on the subject, I'll try to focus here on just one example: games.

If you've been keeping up with the debate, there seems to be a bit of a split on the issue of used games in terms of its impact on the games industry. Is it helpful or harmful? Both?

In black and white terms, there are those who see it as another legitimate market option to consumers akin to the used market in other industries (books, music, film) and those that see it as a tactic that specifically takes revenue out of the hands of developers; revenue that would have totally been theirs had the consumer been left with no other options.

And no. Future support of the company through the purchase of new games at launch is undoubtedly impossible to have been derived from the experiences with a used game, as that would be a positive for used games and therefore counter to the "used games are the devil" argument.


Now, if it's not clear by now, I stand firmly in the "more options for the consumer" camp, as I am opposed to monopolies both in board games and in practice. But that shouldn't really matter. What should matter is why I don't agree with the other side's argument that used games hurt the industry. And in effect, why they are wrong.

A sizable portion of the problems I have with "that side" can be attributed to the lack of justification for the arguments that support the elimination and/or regulation of the used games market. It is an issue that begins with scapegoating and quickly culminates in an entitled sense of justification in the disregarding of relevant arguments when something unrelated is deemed irrelevant.

For instance, a common argument in favor of used games calls attention to the lack of concern of the used market in comparable entertainment industries such as with books, music, or film. A common retort I see made is that while music and film (conveniently overlooking books) rely on other sources of income for the bulk of their revenue, poor old games rely only on the direct sale of new, $60 games.

They do not address why this disparity exists, only that its existence alone discounts the comparison.

Because used games present another option to consumers, and that option does not lead back directly to the publisher's pockets, the connection is then made that that money is therefore being taken from the publishers; making the consumer complicit in a form of theft.


It is the same argument against piracy, assuming that all who partake in it would have been full-paying customers without that ability, therefore stealing profit (as opposed to the game itself). You're basically saying that people who buy used games are as bad as pirates.

While it all seems like it leads to a quaint conclusion, this view is a logical fallacy.

It is incorrect to see the inherent value of resale as lecherous. It is a part of the mental gymnastics companies perform to convince themselves that the problem doesn't lie with them or their business practices, but instead lies with factors derived from the very essence of a competitive market, something intrinsic to pretty much all forms of capitalism.

And at the end of the day, if the ability to offer more options in a free market through second-hand sales (in any form) was such a problem in the first place, then it is a problem the games industry could have tried to circumvent before it got rolling. You know, before they started personally funneling business exclusively through Gamestop. Oops.


Back to alternate forms of revenue, however, while focusing on the term "alternate."

Besides the sales of CDs and DVDs, it is argued that movies also rely on the revenue from theaters and from Pay-per-view, before DVDs come into play; while music relies on CDs mostly as a way to encourage concert attendance and the subsequent purchase of overpriced merchandise. Calling out concert and theater revenue as proof that comparisons can't be made to games, however, is also misguided.

Instead of illustrating how games are at a fundamental disadvantage when it comes to making money, more importantly this shows why the games industry should attempt to evolve its approach to the market as opposed to archaically latching on to its "single source of revenue" established from the past.

Sure, games have attempted to adopt one of these examples, in the overpriced merchandise angle (which could arguably be extended to DLC), but it has done little else.

I'll try and offer some very (very) basic avenues for experimentation that don't necessarily lie in shifting the blame to the free market.

Pay-per-view

Up first, an equivalent to pay-per-view for the games industry. An "early experience" service set up directly by developers has only recently started being explored (in a loose capacity). This is mostly seen in instances of "ongoing betas" such as Dota 2 which are available ahead of time of its full release, albeit for free. This example is not so much seen with finished products, however, likely because when a company finishes a game, they don't want to sit on it.

For fear of a loss in revenue due to negative word of mouth, over-saturation, or just plain disinterest, who can say. But it's certainly something I've yet to really see taken advantage of.

Solution? Test the waters of new forms of revenue by offering early rental of games for a premium of $5 or $10 to have a few days with full access. See what happens.



Concerts

This is, of course, discounting actual concerts for game music (which are things that make money). How does one go about offering this? Would people be up for paying to watch developers play their own game for an audience? Maybe, but probably not enough people to justify the effort.

In a more realistic analogy, the Concert really boils down to just being music's personal form of the Theater: a public space for consumers that charges a lot in order to experience the media. For the sake of ease then, I'll just go ahead and combine the Concert equivalent for games with the Theater equivalent for games below.



Theater

In the case of the Theater, this example is a big one for proponents of the disparage in possibilities for revenue between the film and game industries. "There is no comparable equivalent for the latter!" says someone somewhere. "You are wrong!" I reply, twirling my Baton of Superiority™ gaily in the air. Dead wrong.

The Arcade, my friend!


Yes, the Arcade. It is indeed a public place one can go to and pay high prices to experience games before they are released for personal use (much like in the relationship between movies and the Theater).

This being the case, the conclusion is then that the problem does not lie in the lack of an equivalent to theaters for developers and publishers, but in the lack of support for said equivalent by developers and publishers.

As soon as the Arcade showed a decline in popularity in the late 90s, the bulk of the industry moved on to less brain-hurty methods of making money, leaving the arcade scene a shriveled husk.

Some forms of arcade gaming did manage to persevere, though. Fighting games for instance (at least in Japan) often release to Arcades while they refine the experience. After some time, the home consoles reap the benefits of this trial run with few (if none) of the "early adoption risks" that seem to often plague an industry obsessed with getting people to buy things as fast and as soon as possible. If fighting games (and a few other genres) can make arcades their theaters, then there is potential there for more.

Imagine for a moment that companies didn't abandon the Arcade. That instead, they reinvigorated it. Forcing people to the arcades to try crazy and experimental games fueled only by imagination. That the norm evolved to offer new ideas and sequels through public interaction with its audience; a mutually-beneficial relationship naturally emerging, like a butterfly from its cocoon.

Now come back to reality, where companies shifted their focus to putting all of their efforts into a retail strategy and banking all of their revenue solely off of those sales through homogenization and monopolization.

Where it has become a bitter fight to maintain a grip on an imagined, infinitely-growing line of profit, despite whatever irrelevant factors those companies need to throw under the bus. Rentals, piracy, used games; they all spell death for the industry. Not stubbornness. But when used games are no longer an issue, it will undoubtedly be something else.


That said, I only posit that instead of throwing their backs into newer and fancier forms of exploiting a single source of revenue, that that same effort be redirected into finding ways to creatively reach out and make those additional sources of revenue. There was an attempt with DLC, but that's not enough to counter all of the blame-shifting the upper-levels of the industry have done to explain away the diminishing mountains of profit they have come not only to expect, but demand.

So why not give something along these lines a shot? Or even something entirely new? At a certain point, publishers can only get so much profit from retail, even if the stars align and all sales projections are met due to the complete elimination of competing markets.

I mean, what do they have to lose? Money?



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