Braben: pre-owned is "damaging" market Comments by Robert Purchese

@Rizo

"Development costs have nothing to do with the price of games!"

What in the name of sweet JESUS are you talking about?

@ Malixu

Indeed!

Good post Bru-Man

"Maybe if companies didn't charge so fucking much for games in the first place people wouldn't buy used games so much."

Whatever the cost of a new item, the second hand market for that item will always exist. If new games cost half as much, second hand ones would probably cost half as much as they currently. Its more about relative cosat and getting a bargain that anything else.

Odd that Braben doesn't see downloads as a better solution to fight used game sales, which gives both the developer their correct cut and eliminates all the wastage from pointlessly shipping games.

One of the main problems I see is that on new games the retailers actually take more money from each game sale than the developer gets.
Most of the cash goes to the publisher, so if the developer is owned by a publisher, there isn't too much of a problem, but if you are an independent developer. It is a little unfair that the shop make more money by selling the game than the dev, then they go and sell it again for almost the same price.
Don't moan at the dev's for the price of the game, moan at the publishers and the retailers.

@Rizo:

Halo 3 cost $30mil to make: http://news.bbc.co.uk/1/hi/business/7151...
Assassin's Creed cost $15-20mil to make: http://www.msnbc.msn.com/id/22247827/

However, Halo 3 broke all sorts of sales records: http://www.informationweek.com/news/inte...
While Assassin's Creed's sale estimates we revised up from 3mil units to 5mil: http://www.msnbc.msn.com/id/22247827/

To put this into perspective, on its first day of sales,Halo 3 sold more copies as Assassin's Creed was expected to sell, EVER. So yes, they're priced the same because AC was never expected to sell anything like as many copies.

Yep, I've thought that myself, one of the two reasons why I don't normally deal in second hand games (unless I can't find a first hand copy, that is) the other being that, for the sake of €5 (which is always the price difference) I'd rather have a new copy.

The "simple" solution is to introduce a PC-like EULA to your games, a single user, non-transferable licence that pops up when you first use the game and "forbids" the game from being resold (possible legal challenges aside it works for PCs). That would cut the stores out of this loop (you'd still have people swapping games or reselling them on ebay but meh, that's small potatoes compared to the retail chains). I believe that the next gen of consoles will use that model.

If you were to knock five-ten bucks off the asking retail price then I reckon most people would be quite happy with that change, those that aren't happy, well, that'd be because they buy and sell second hand games anyway so no money or sales lost by the devs/publishers.

"Frontier Developments boss David Braben reckons the pre-owned games market is causing all sorts of problems for single-player titles or those with less replay value."

duh.
hows about you get with the times and spend more time making better games with more replay value then...
and less time being a whiney dick about your linear small minded games getting dumped into the pre-owned bins.


how about setting up your own mail order pre-owned service that bypasses Gamestop etc?
or work out a deal with a retail partner and offer attractive terms in order to get a slice of the pie?
Your procrastination isnt going to stop me trading in a bollox game with only 8 hours play with no reason to ever turn it on again after the credits roll...

But I still play Call of Duty - awesome online replay value. Still play gears of war and halo games - fun split screen co-op with the flat mate on 'beer-fridays' after the pub

Still play GTA, just because its a big fun sandbox - Crackdown too.

I love Bioshock, but ill never put it on my console again - sadly its reduced to the status of Shelf ornament (i got the collectors edition with the big daddy model ^^ ).

so in short.
wise up or fuck up.

Would GAME even continue to exist if they didn't have second hand games?

I haven't bought full-price from those robbing bar-stools for years.

Support your local indie - better prices (on new and used) , better staff, and they've got balls big enough to break those stupid draconian release dates.

So, you buy a game for £30 and about £10 goes to the developer of the game and £10 to the store.
Buy a 2nd hand version for £25 and £0 goes to the dev and £15 goes to the store (If they paid £10 for it).

So, ok, you save £5, awesome...

However, the dev loses £10 in sales every time a 2nd hand copy is sold which basically means millions of pounds going into retail and not going in to game development.

So, as long as you would rather have much nicer shops than better games to play, i guess it isn't a problem.

Just makes me sick that the people that work on a game for 3 years receive nothing, while the people who put the game on a shelf make it all.

And all those people who compare it to books, movies and music... How many of those kind of shops sell BOTH new and 2nd hand versions? very few...

And out of those, when you go to buy a new copy how many advise you to buy the 2nd hand copy instead?

And comparing this to cars or electrical equipment isn't fair as you generally get a warranty with a new car and a LOT more can go wrong.

I mean, when it comes down to it, i work for a games dev, so every time someone buys one of my games 2nd hand, i lose money. But of course, i buy 2nd hand games, because i'd be stupid not to. The industry as a whole needs to make sure Publishers/Devs get a cut of the money like they do at Blockbusters or ILoveFilm.

Pah...

(Yes i'm a hypocrite, but i'd be stupid not to be)

Something nobody's pointed out (unless I skimmed past) is that without a second hand market, the market for new games suffers.

What I mean is, if I pay £40 for a new game, part of my thought process is that if/when I get bored of it, I can recoup some of the cost by trading it, or selling it on eBay. Without that prospect, I probably wouldn't spend the £40 in the first place.

Shut Braben up and make Elite 4!!! :p

So they charge €70 per eight hour game (in Sweden), the games industry has surpassed the movie industry in revenue (being a billion dollar industry), but they're whining about the consumers wanting a second hand market..? Lovely.

@ukslim

Which why they should make all games 30 instead of 40 so you will buy all of them without trading them in? No, you probably would go through the same process because it saves you even more money. Full circle.

Oh, and sorry for saying this, but I actually prefer these single player one time through experiences. And so do many people.

@ MrChuckles


one simple and easy solution:
Digital distribution.

Fuck Game.
Fuck Gamestop.
Fuck Hmv etc...

when's the last time someone traded in a game on Steam?

small slice of the cake (I know there is no cake but bare with me :P) to Valve, the rest of the cake is yours Mr Developer.

No Publisher raping your profits, no disk or box manufacture, no smarmy Gamestop manager ripping off everyone involved with pre-owned sales.

Here we go again, a bunch of comments by people who have zero knowledge about how the industry works and seem to expect the right to get entertainment as cheaply as possible. Well bravo, keep on like this and see what games industry we have in 5 years time.

Heres a hint: there wont be any games on the high street, thats for sure. All games will be made by one of, what, 4 companies? You know, like the record industry is now? And everyone complains all modern music is shit, well lets see what future games will be, shall we?

@ practically everyone

If you compel a person that's purchased a product to lock it to one particular console, then that's a restrictive trading practice as you're denying the end user freedom of choice to do what they like with the product.

You'd need to get them to agree to a set of terms and conditions at the point of sale, that restricts the freedom of the user. They do that in mobile phone pay monthly contracts, whereby you don't own the handset (supplied as 'free') until you've paid to the end of the minimum term.

We also need to consider things like replacement units. Does your single unit DRM locked game no longer work if you get/buy a new console? How restrictive is that?

So. The game becomes your property when you buy it, with a proportion of the money going to the dev/publisher, but if you trade it at a retailer, then the dev/publisher get another cut?

Mmm, that would therefore mean that all stores selling games would essentially become tools of the devs etcetera as they cannot get permission to sell/resell the games without giving the developer a payment each time it is resold?

@mkreku: do you know the difference between revenue and profit?

@MGG

I don't know what kinda music you listen to but mines certainly not coming from one of the 4 big company's and is also not crap.

@evilfox

I'm the same.

I used to sell them, but stopped doing that since I can afford them on a normal basis.

@actionfitz

Digital distribution is definitely the way to go, but i can't see Johnny's mum buying him a voucher for an online game for xmas. She wants to go into a shop on her high street and pick up a box.

Of course, services like Xbox Live helps, but the hard drives on the current crop simply aren't big enough, you really want more like 500gb minimum if you are going to download all your games.

All these people complaining that they want to buy 2nd hand games because 'they are too expensive' won't have much of a point when Digital Distribution is working properly and the games prices will fall to R.R.Ps of £20-£30 rather than £30-£40.

Of course, the download services will start wanting premium returns (like shops do now), but it's much easier for a publisher to create their own download service than have a store in every town so it shouldn't be anywhere near as much of a problem.

Just remember, whenever you buy a new game, about £10 goes to the dev, £10 goes to the publisher (Upfront costs that the dev's can't manage and advertising) and a bit on tax, they are the only values that will (hopefully) exist in the future.

The other £25 is manufacturing, distribution and retail, and DRM doesn't have those.

Of course, my fear is that EA and other greedy publishers will realise people are happy to pay £40 for a game, and will make DRM titles cost as much as that so that they can take away £30 for themselves instead of £10.

Lets hope in the distant future all devs will sell their own games direct without publishers, dropping the price of games ANOTHER £5 to £15, as technically that is really the cost of making a game. (Although there won't be any advertising :(

Nobody loses money when a game is sold second-hand. However, devs + publisher MAKE 50 quid when a game is sold fresh and boxed.

Part of the reason WHY a new game sells for 50 pounds is BECAUSE it can be sold, and part of the cost reclaimed.

Solutions: Either make better games, selll them cheaper or MAKE IT EASIER TO PAY FOR THEM.

If I could just Paypal some money to David Braben, I'd do it in a heartbeat. However, he forces me to go to $STORE, buy a plastic brick and have a few middle men leech some money in the process.

In the end it only hurts game companies that churn out repetitive shite. I have both Bioshock and Assassin's Creed and I'll never trade them in. Years ago I sold my Megadrive, my Nintendo 64 and my Gamecube - I regret it now as sometimes I fancy a quick go on Ocarina of Time etc. and it's just not the same on an emulator.

I never buy used games but I occasionally trade them in, the main culprits being the Fifa games - what's the point in having Fifa 08 when you have Fifa 09? Those games are iterative in their releases and there's no point owning more than one at once. Others have a certain nostalgic value.

In summary: release better games, someone mentioned Mario Kart - that is still very playable now (SNES version).

Ok, some people don't seem to get it...

NEW GAME: £49.99 split into:

Dev: £10 (covering dev costs)
Publisher: £10 (Profit covering risk of funding dev costs + advertising)
Manufacturing: £5
Distribution: £2
Tax: £7.50
Retail: £15

2ND HAND GAME: £35 split into:

Retail: £35 (Minus the £10 they bought it for)

N.B. These are approximations, but from my experiences aren't far off.

@ MrChuckles
As far as I remember those numbers are about right. Dev does get less per game than retail.
Glad you put those up there, as I couldn't find the numbers anywhere.

No one is saying stop all trading in pre-owned, just remove it from full price shops, or pay the devs some cash on each sale.

I don't think anyone seriously thinks the 2nd hand market should be stopped, but if you want devs to continue giving you good/original games to buy 2nd hand then they need to be supported. Lots of devs are dying all the time. It's not a good environment for them to survive in.

People already moan about the un-originality of games nowadays, but when the dev makes such a small cut of the final price, why should they risk the company on doing things that have not been tried before and could fail drastically.

All that is really needed is for the retailers to cut the massive profit they make from the 2nd hand market, and give a little back to the devs. This way the 2nd hand market survives, the end users price is not raised, and the devs can actually get more money to develop better things for you to buy.

I think people are missing the point here. The games industry isn't against the second hand market, just the method in which retailers abuse it to avoid paying publishers. I don't think anybody in their right mind would demand that the publisher/developer receives money from a re-sale of a game that was released two years ago. That's just nuts.

But what IS a problem, is that a lot of the re-sale market for most games happens within the first few months of release. This is an important time, as it's when the most sales happen for a game. And when you realise that a retailer only pays for the stock it has actually sold, shipping the "excess" back to the publisher, you might start to see the problem.

So they encourage people to being back their copy of the game, so they can sell it on as a "new copy" to avoid having to pay the publisher for the copy they would have had in its place. I mean what's worse is that it's not as if the customer is paying any less for it...in fact, in most cases, they're paying the same price as a new copy. Do you guys enjoy being ripped off by your local game retailer?

It's not the "selling a second hand copy for 9 quid after 9 months" that Braben is complaining about. It's "selling a second hand copy instead of a new one in the first few weeks" is the problem. And quite rightly so too....the gamd retailers are ripping off the publishers, developers and customers.

Surely you guys don't like being ripped off, do you?

Sorry but i have to agree with the people that are saying that new games are far too expensive.
Risking £40 on something that may not be very good with my expendible cash is not something i am willing to do on a regular basis.

Forget everything else and look at the Movie Market films generally cost a massive amount of money to make but are still sold at around £15 (even with the one shot use of going to the cinema - okay this may be out of date at £7.50 * 2) if games were priced in the £15-£20 range then a lot more units would shift meaning either no loss in profit or even an increase in profit.

@MrChuckles
To say that the production of a game costs £5 a unit to manufacture is quite frankly rediculous.
Also what about the chunk that is paid to the Hardware owner as another significant cost.

@Davc4 - You shouldn't have to pay more for the 2nd hand games. Just cut the retails profits and pass some onto the devs.
Surely you want to support the devs that make the games you play don't you?

@davc4:

Forget everything else and look at the Movie Market films generally cost a massive amount of money to make but are still sold at around £15 (even with the one shot use of going to the cinema - okay this may be out of date at £7.50 * 2) if games were priced in the £15-£20 range then a lot more units would shift meaning either no loss in profit or even an increase in profit.

'the one shot use of going to the cinema'? How many thousands of people go to the cinema every week? A film can make millions at the cinema before it even goes to DVD!

Then, remember the market for a DVD (every household in the UK) compared to a console game (maybe half?)

Then consider the fact that some games take 4 years to make compared with films taking a year.

Then consider that a film is 2 hours entertainment and a game is somewhere between 10->40 hours.

Maybe compare it to a DVD boxed set of a recent tv series (40-50 quid) which gives you the same entertainment value and probably took as long to make.

"Maybe if companies didn't charge so fucking much for games in the first place people wouldn't buy used games so much. "

Don't be silly. 2nd-hand games would just be proportionately cheaper. Maybe the volume of sales would go up, but the profits would probably remain the same (or less) all around.

Anyway, anyone who buys second had might as well save some bucks and PIRATE the game. The effect on the games industry is the same.

@karstux

'Anyway, anyone who buys second had might as well save some bucks and PIRATE the game. The effect on the games industry is the same.'

Sadly true.

"Anyway, anyone who buys second had might as well save some bucks and PIRATE the game. The effect on the games industry is the same."

That's not really true, though. When I was a student, I bought (new) games because I knew I could trade them in when I was finished. Without the 2nd hand market, I would've bought fewer games, so less money would've gone to the games industry.

@firemonkey - i agree that paying the same rate for a 2nd hand game to a new game is scandolous but i alos think that £40 a game is also scandolous
I would have no problem with a dev getting a chunk of 2nd hand sales either.


@MrChuckles
"Then consider the fact that some games take 4 years to make compared with films taking a year.

Then consider that a film is 2 hours entertainment and a game is somewhere between 10->40 hours."

That is quite frankly irrelevant, length of development compared to actually value of product, Even actual development costs are irrelevant when comparing against rrp. What needs to happen is to look at what price would elicit most profit from the consumer base and £40 a game is quite frankly far to much. Tv Box sets are ireelevant as wel i bought one for my wife a couple of weeks ago for £17 another on preorder for £17.

If for example Assassins Creed came out at £20 then far more people (myself included) would of purchased it on the off chance i would of enjoyed it rather than only going for mass effect.
I would purchase more probably more than double the games at £20 than i purchase at £40 as £20 seems to me to be a reasonable value to take a punt on a game. £20 seems far more disposable than £40 quid does. Even though 2nd hand games would still be cheaper with the value of getting something new compared to something 2nd hand is more viable in this case (i almost told a GAME employee where to go when telling me i could get a 2nd hand copy of a game for £2 cheaper than at retail)

@davc4
'If for example Assassins Creed came out at £20 then far more people (myself included) would of purchased it on the off chance i would of enjoyed it rather than only going for mass effect. '

At £20, you'd probably get the following split:


Dev: £3 (covering dev costs)
Publisher: £3 (Profit covering risk of funding dev costs + advertising)
Manufacturing: £5
Distribution: £2
Tax: £4
Retail: £3

When lowering the price of the game, manufacturing and distribution prices won't drop too, so the cut is extra harsh.

So, for a start, the dev & publisher would have to sell 3 times the copies. Also retail would only make £5, something they'd definately not want at all as there is no profit margin at all. A 3x price drop would almost certainly not get 3x the buyers, the price is balanced by experts more intelligent than me to ensure that the maximum possible profit is reached.

'Tv Box sets are ireelevant as wel i bought one for my wife a couple of weeks ago for £17 another on preorder for £17.'

Was this a brand new set, or was it reduced?

I think we should stop using the word pirate. At the end of the day these people are criminals, not some dumb character from Peter bloody Pan, I for one buy games 2nd hand and I’m not a thief! The comparison is dumb!

MrChuckles £5 per unit manufactured is quite frankly a guestimate that is far to high, If so how can Movie companies such as WB offer old discs for £3, it cannot be the case that manufacturing each unit will cost that sort of value.
I actually understand about the profit margins and cost/demand profit curves but if 2nd hand purchases are such a concern then the industry has to look at the reason for purchasing 2nd hand and that is all purely down to cost.

I have sympathy for developers and the stake they get in overall scheme of things as a software developer myself (i devlop systems for other companies to use).
But the upshot is in todays market games are too expensive and although massive profits are made on the biggest games(Halo 3 for example) i am lead to believe that the smaller games tend to make a loss. As with your assumption that 1/2 ing the price will not at least double the sales i find to be a bit of a misconception take the teenager market for example how many teenagers do you know that have a spare £40 etc. .

There will always be pirates but you cannot compare this to the 2nd hand market as people are leagaly purchasing software at a price that they can afford.


'Tv Box sets are ireelevant as wel i bought one for my wife a couple of weeks ago for £17 another on preorder for £17.'

Was this a brand new set, or was it reduced?

Brand New no reduction except maybe a couple of quid for ordering over the web. via HMV ;)

See the other news article about the price of Wipeout HD for more food for thought on this topic.

£12.99 for a game for which many people would have paid full whack. And none of it will go to a retailer. Soon, companies like GAME will see their customer base reducing even though the industry is booming, and it's up to them to make the most of this shifting distribution paradigm.

Perhaps the whole second hand market is just a stop-gap anyway.

read over some of the comments and you will see especially why this will work lots of people saying wow impulse buy, what the games industry needs is for this to happen to all games, Digital distribution is the way of the future as long as publishers don't get too greedy and as long as ISP's allow us to download gigs of data every month.

"When I was a student, I bought (new) games because I knew I could trade them in when I was finished. Without the 2nd hand market, I would've bought fewer games, so less money would've gone to the games industry."

And then they lost the sale to the dude who bought the game you traded in. Had you bought fewer games, without trading them back, the industry would likely have earned more.

"I think we should stop using the word pirate. At the end of the day these people are criminals, not some dumb character from Peter bloody Pan, I for one buy games 2nd hand and I’m not a thief! The comparison is dumb!"

I never said used-buyers were pirates. But the effect is the same: they're denying the creator of the value ( = the game) the compensation that is due. They're giving money to a middle man, while the creators of the game lose out.

For most pirates, at least it could be said that they wouldn't have bought the game anyhow, hence no damage done. Used-buyers however demonstrate that they *are* willing to pay money, so they would have been far more likely to pay full price if the used-buy option weren't there.

Apart from the fact that David should stop bitching and start showing some progress on Elite 4 it comes down to this:

Every gamer knows that most games will hit a bargain bin in a few weeks / months and will also be cheaper 2nd hand.
Now the question is what is stronger: The urge to have the newest games asap or the will to wait out and grab the games a bit later while saving a lot of money.

I was no. 1 for a long time but due to a huge baclog of unplayed games I switched to be no. 2.
I don't buy any game full price these days besides limited Collector's Editions + Blizzard games.
I save tons of money that way and I don't give a flying f*** if that hurts developers or not.
It's about free markets stupid!

>It's about free markets stupid!

Which is why he's suggesting cheap rentals as an alternative.

>and I don't give a flying f*** if that hurts developers or not.

You will if games stop getting made as developers go out of business. Or stop making "hardcore" games in favour of shitty mini game collections


And btw - it's ONE of the causes of games prices being so high. The pre-owned market lowers the shelf life of a product. For example - a movie has many years to recoup it's costs (cinema, rental, dvd owned, tv, etc) and a bigger market than those who play games (everyone watches movies). Thanks to pre-owned - games have a shelf life of a month max to recoup their (high) development costs.

Still - if your moaning at braben about bringing this topic up.. And fully support pre-owned games and think "developers should stop bitching" - then you have no right to start bitching when developers make their money back by going for the "mainstream" market and making another wii sports clone... Its your own faults....

"developers should stop bitching" - well maybe gamers should to?

"And then they lost the sale to the dude who bought the game you traded in. Had you bought fewer games, without trading them back, the industry would likely have earned more."

Not if the guy who buys 2nd hand games just pirated them instead, which is what you were suggesting.

2nd hand sales may or may not be a loss overall for the industry, but I don't think they're equivalent to piracy.

Jeez, still 50% of comments are written by people who have no understanding of economics....i give up...

(not pointing at davc4 btw, you have reasoned arguements, just not quite right ;-))

Lets all make Fifa 09 and remove all choice for the idiots who don't seem to care that developers need money to actually make the games you like.

@Fodder:

Eh? What are you talking about? Right.. Lets try this simply for your head to understand

A buys a game new 50 quid (with say 10 quid going to the developer)
A completes it and sell it back to the store 20 quid
B buys the 2nd hand game 40 quid
B completes it and sell it back to the store 20 quid
C buys the 2nd hand game 40 quid
C completes it and sell it back to the store 20 quid
D buys the 2nd hand game 40 quid

So the store has made 110 quid off the SAME GAME .. But the game developer only saw 10 quid. The game developer DOESNT see ANY money from sales from B, C and D (and in some cases this can be 20 odd re-sells).


So back to your point:
"Not if the guy who buys 2nd hand games just pirated them instead, which is what you were suggesting. "

Either way, buying 2nd hand, pirating - the developer doesnt see any money.

"2nd hand sales may or may not be a loss overall for the industry"

There's no "may not" about it..

Which is why most developers are selling to the casual market now who pirate less and buy more new (not 2nd hand) titles - and the development costs are cheaper so it doesnt matter if the 2nd hand market has caused the shelf life to be 2 months or less.


(note : When i say "2nd hand market" i'm NOT referring to someone selling their game to a friend or on ebay..)

>Braben is a wanker, isn't that what capitalism is all about?

Well in that case gamers like you are wankers for not realising it's you who are causing all these "casual" and "cheap to make" games on the market.. but then no doubt bitching about them too.


"Games get shunted into the pre-owned market due to their price"

And games are expensive due to costing lots to make and only having a short shelf life BECAUSE of pre-owned sales...

You make a game, it costs 50 million to make.. But your potential audience only consists of 20 million people.. and you have to recoup your sales in 1 month...

Its no wonder game devs have started aiming for the $1 million to make casual market..

I fucking hate the "im holier than though" atitude some gamers on forums have.

Rather than listening to someone in the industry who knows MORE about the subject than they do.. They just think they know more about it - they understand the ecconomics of making games and where the money is coming from.. Then result to calling the person who's MAKING the games they love so much names.

Sometimes I think some gamers are such complete nobs that they deserve all games companies to go out of business so the only thing they have left to play is "barbies riding school"

- lavalant im looking at you.

@TurboBailey
Thats just what I was thinking - Stop stareing into my brain!!!