Reports of a “Nuclear Option” have been circulating about next gen consoles removing the ability to play used games. Industry analyst and managing director at Wedbush Securities, Michael Pachter believes these reports to be "so stupid as to be laughable" as it causes preference on competitors that have next gen consoles that allow used games.
The “Nuclear Option” is influenced by the pre-used game churn, a method in which companies like Gamestop and BestBuy permit gamers to trade in games for cash to then purchase more games. The practice then calls for gamers to have a preference of purchasing used games rather than the new. The trick is to trade in games at a super low price; about 1/3 of its original value. That same game is then marked up close to its new version price for resale. You will often find used games priced at about $5 below the new game price, leading to a significant amount of turnover that is profited from the used-game practice.
Among those whom do not get a cut of the practice are developers and publishers of the very same video games being traded and sold again. According to Frontier Development’s David Braben, “publishers who have stopped games in development [do so] because most shops won’t reorder stock after initial release, because they rely on the churn from the re-sales,” as a result, developers and publishers argue they need pre-used sales revenue to keep up with high production value goods. Industry Veteran Richard Brown states that “the real cost of used games has been the destruction of the mid-tier publisher and the elimination of many an independent development studio.” Few companies have resources like Sony and Naughty Dog to create huge production games and as a result many companies are forced to create games that will ensure new games to be purchased and the churn to be squeezed. One such type of genre of games is the multiplayer titles.
The used video game business has effectively depreciated the focus on single-player games and pressed multiplayer focused game with overstated price titles that require downloadable content to regain lost revenues. Veteran Journalist John Walker argues that “reselling a game has led to the death of variety, the loss of the AA market, and the refusal of publishers to take risks.” Although he has a valid point, it is impractical to say that publishers are not willing to take risks when it is difficult to guarantee those risks are going to produce the most amount of profits. For publishers to create a high production game at a risk to have it not reap the most amount of revenue to battle the dreaded game churn could send the gaming company into ruin. It is no wonder that publishers and developers want a cut of the profits from pre-used games. To think however that this is an attempt to prevent people from selling their own goods is preposterous. The only thing they want to control is how these middlemen, i.e. GameStop and Best Buy, sell pre-used games as a regurgitating means of revenue. Stores might tell you pre-owned games help new games sale, but like Browne states “if used game trading fueled new game sales then when used trade-ins became the new standard a few years ago new games sales should have spiked.” But they didn’t! As a matter of fact, they depreciated the value of games and marginalized profits to game companies that required the revenue to stay in business.
In regards to consumers who seek the cheaper side when purchasing video games, they are allowed to trade their games in order to collect the most gaming opportunities because games are becoming less and less affordable. Many people are unemployed, young, on a budget, or unsure of titles they may like to afford to purchase. Why do you think they trade games to begin with? So when purchasing new and used games become too expensive for the common gamer, there is a company that surface to end all anguish and combat the pre-used game churn: Waygoz.com.
Waygoz is a social media website that requires a Facebook login to access. The site is divided up into adults and younger gamers to protect them against potential predators by suggesting safe neutral meeting places with a strong preference of using real names to do exchanges of video games for free. The site lists members within your area providing a swap list to pick out which games you would like to swap. The members each acquire reputation resembling eBay’s rating to help swappers pick from quality people. Before meeting, the swappers discuss the game’s quality. The reputation is then based on the honesty of the swappers discussing the quality of the games before the trade, the timely manner of the transaction, and the respect provided. This service allows gamers to no longer need to sell their used games at an incalculably low price to pay-up on other games.
If Waygoz hopes to continue to be successful, they must be sure to avoid becoming the same middlemen that they had hoped to conquer. The rising issue is if they execute a transaction fee for swapping. It is important that the current level of swapping remain free, but without profits how is the company going to survive? Two strategies Waygoz can execute is a “membership” that includes a fee where members can drop their games off at a location that Waygoz owns and have the swapper pick it up at their earliest convenience, or Waygoz can provide the materials for the swappers to mail their games to the company and then to the designated swapper. That way the current system of swapping remains free for those willing to meet in person and for those that can’t, can pay a small fee to have Waygoz do it for them. I see a bright future for the issue at hand and with this method Waygoz can pursue the possibility for gamers to begin to purchase new games again.