Wally World Gives a Thumbs Up to Used Games

Walmart put out a press release to announce that they will soon be taking used video games in for store credit and refurbishing those games to make them “available for purchase in like-new condition at a great low price.”

WalMartLogo_450

This is no doubt a blow to those who like to frame the used game market as the moral equivalent to software piracy.  And it was always easy to vilify GameStop and its stereotyped raging gamer clientele in that argument, casting them as parasites and thieves respectively.

And while other companies, including Amazon, have dabbled in the use game market, when the largest retailer in the world steps up to the plate on used games… well… things get a bit ugly.

Not that it isn’t easy to vilify Walmart.  They were a customer at a past company I worked for, and they are every bit as difficult to deal with as they have been painted… though often in surprisingly stupid, shoot themselves in the foot sorts of ways.  But when their mind is set, they will get their way.  And if you think somebody is going to be able to pressure them to share a cut of used sales with game studios… something that was being suggested with GameStop… well, good luck with that.

Meanwhile, some companies, including EA, have grudgingly acknowledged in the past that the ability to trade in used games for store credit may, in fact, be propping up the sales of new games.

Using Used to sell New

Using Used to sell New

So one might wonder if this move by Walmart will prove a boon for the gaming companies, despite their grumbling.

Of course, this won’t be any sort of boon for GameStop, which lives in a tight little niche that depends heavily on being the only place close by to take your used games.  But now the big box on the edge of town, where your mom probably shops already, will take them as well.

Anyway, starting on March 26th you will be able to take used games to your local Walmart for store credit.  At some future, as yet unspecified date, Walmart will begin offering “Certified Pre-Owned” video games for sale, with the promise of them being refurbished to “like new” condition.

Side Notes About Used Games

There has been a bit of a controversial breeze blowing through the console news, with the rumor being that Microsoft will be putting an end to the used game market with their next generation console by simply not allowing it to play used games.

Used games and piracy are the two things that keep some big game publishing execs up at night building enormous castles in the sky with all the wealth that could be theirs if only they could be rid of these meddlesome practices.

Not that I am unsympathetic to people whose software is being pirated.  I work in software as well, and it irks.

But with the threat of a final solution to the used game problem potentially on the horizon, it was extremely refreshing to hear somebody from EA come out and say that the used games market is not 100% evil.

Basically, in their view, used games have helped prop up the traditional retail channel for the last few years, which is still an important source of game sales.

Oh, and the fact that people who buy new games can then turn around and trade them in for credit increases the likelihood that they will then buy another new game.  So the used games market might actually be boosting new game sales, at least in certain segments of the market.

Using Used to sell New

Using Used to sell New

But they still want to kill the used market because… despite the above… they still hate it and can’t stop telling themselves that every used game sale would have been a new game sale if not for that damn gray market.

At the other end of the equation there is GameStop, a company that pretty much depends on used games to stay open.  They are upset.

No surprise there.

And they have some numbers that say some gamers won’t buy Microsoft’s icky new console if it doesn’t support used games.  And while I cannot speak to the validity of their poll, they are probably right to be worried.  The end of the used game market probably means the end of GameStop in the medium-to-long term.

And GameFly too, while we’re at it.  All those game rentals would have been new game sales, right?

Microsoft dreams of having control over things in the way that Steam does.  And they have been headed that way with things like direct purchases through XBLA.  Of course, Steam itself is in a bit of a fix in Europe, where the European High Court ruled that digital content should be transferable.  The concept of used might not be going away… and Microsoft throwing in against used will probably just inflame the issue in Europe.  They like Microsoft even less than most people here do.

And I expect typical Microsoft avarice when it comes to pricing, at least initially, which will stoke people’s ire even more so.  Steam thrives in part because of their massive sales, which rope in the buyers who didn’t have to have a given game on day one for list price.  Will Microsoft relent on the $60 price tag for games when there is no used market?  I bet not.

My only solace in all of this is that it does not impact me for the most part.

While we have two consoles, a Wii and a PlayStation 3, but I doubt that we will be jumping on the next generation.  I have been a PC gamer since 1983… wow, 30 years… and will likely remain so.  Our PS3 is mostly used to play Blu-Ray movies and stream Netflix, and our Wii hasn’t been on in months.

And, even when we were playing consoles more, I was not a big spender in the used game market.

Once in a while I would buy a used game from GameStop.

But I do not buy used games to save money or to stick it to the publisher.  I buy them because a given game I want simple isn’t available new any more.

Quite a while back I wanted Tetris for the Nintendo DS.  However, it was no longer being published and so was simply not available new.  It was even hard to find used.  GameStop had a copy for me, for which I paid nearly list price.  And not a penny of that went to Nintendo.  But not because I wouldn’t have given them the money.  However, I am sure that would lump me in with those killing single player games in the eyes of some.

Likewise, I had to go looking for a copy of Civilization II in order to be able to play it on Windows 7 64-bit.  The used market was the only choice.  The same went for Mario Kart Double Dash, a Game Cube game my daughter and I wanted to play on the Wii.

Of course, with another aspect of the next console generation… doing away with backward compatibility… the out of print game issue won’t rear its head any time soon.  Still, at some point, unless we go completely to digital distribution, there will games that have had their production run and are no longer available.

So where do used games sit in your world view?

Piracy vs. Opportunity

There are always multiple ways of looking at a problem.  The entertainment software industry sees the used game market, embodied by GameStop, as a bad thing.  As THQ’s Cory Ledesma put it in an interview over at CVG:

We hope people understand that when the game’s bought used we get cheated

And Penny Arcade got in on the act and made the “used games = piracy” association.

I wrote 1,500 words on the subject, but tossed them because in my mind it all comes down to a simple choice.

You can say “screw you” to those who purchase the used version of your game, as THQ did in that interview:

I don’t think we really care whether used game buyers are upset because new game buyers get everything. So if used game buyers are upset they don’t get the online feature set I don’t really have much sympathy for them.

Or you can figure out how you can turn them into a customer.  Here is somebody who has an interest in your game.  Getting that far is most of the battle.

Couldn’t you just tell them that if they want to access the online content they need to enter the code that came with the box, but if that code has been used or missing, they will have to purchase a new code for, say, $10.

$10 seems like enough to keep from rewarding the market from buying used.

Sure, you’d want to tinker a bit with what people got.  Maybe the original code gave you a little something extra, some sign that you didn’t buy used.  But you would want the second-hand purchaser to have access to all the functionality.

But if you work that out, it makes that person your customer in fact.  You made a sale that had very little overhead, the customer having provided his own box, disk, and manual.  It gives your marketing department another name and email address.  And I am going to guess that a certain percentage of such buyers will feel invested enough to buy your next game new.

It isn’t that I think THQ’s point of view is not legitimate.  They do have a point.

But is their response necessarily the best one?