This week’s episode is a little late due to a power outage. However, despite the lack of really interesting news, the crew still finds plenty to chat about.
This week’s news includes:
The Question of the Week is, “What popular game did you play long after its initial release?”
This episode follows the landmark 500th episode, and this next episode is dominated by Nintendo, both in the news and looking back at the Gaming Flashback for Wii Music and the infamous E3 performance starring Reggie Fils-Aime and Cammie Dunaway.
The news includes:
All of this and Listener Feedback.
Over the last year we’ve seen developers scrambling to find “value add” features to new game purchases. Their goal is to convince the customer to buy new instead of used because developers don’t see a penny from a used game sale. While GameStop sees 48% profit margins from the used game market developers struggle to stay floating in the industry.
This is not the fault of GameStop and their 48% profit margins because they’re only getting 7% to 20% profit margins (say analysts) on new game sales. As someone that’s run a game store online, if you’re getting 15%+ on a new game you’ve got some great hookups in the distribution channel or are buying in huge quantities.
Buying games in huge quantities to build profit margins can be a huge mistake in this industry. Gamers are fickle little creatures and they’re going to buy their top tier games for a few weeks and then sales will drop significantly. No retail chain wants to purchase a thousand copies of GTA IV (only as an example) and sell seven hundred over the first few week to be stuck holding onto a few hundred copies when the dust settles. Now you’ll have to put them on sale to get them out of the store because the hardcore gamer have already done their shopping and you’re not going to get any price protection if you’re not a major player in the industry.
Why take 7% profit margins when you can get 48% on a used game? The gamers don’t seem to mind because they’ll trade in a used copy of a sports title like Madden to save $5.00 on the latest franchise release. Gamers will buy Fable 2, beat it in a week and rush to the store to get the “most for their dollar” before the game gets stale and buy-back prices drop like a stone. Why not rent Fable 2 and save yourself $50.00? Of course, renting pisses off developers as well because they see no additional revenue.
While the economy struggles and consumers fight for their jobs, the entertainment side of life continues to grow. People would rather “cocoon” in their homes playing video games and watching movies on their brand new HD television because it takes them away from the low points of the economy if only for a few hours. History has shown us trends in entertainment during the down points of economies, it’s natural to want to get away for a bit.
But, consumers want to play these games on the cheap because their job may not be there tomorrow. Saving $5.00 knowing the store just took the title in for half the price doesn’t bother you; $5.00 in your pocket is better than in their pocket right? The fact that they just pocketed upward of 40% on the game doesn’t matter to you — it’s all about your bottom line!
While we’re bargain hunting during the recession developers are going to try and up sell you to a new copy of the game. If that means giving you special game items and features with a “one time code” upon purchase, it will be up to you to decide if it’s valuable. All the while GameStop will lock out the game industry from selling used games because 42% of their overall gross profit is from used game sales.
You, the consumer, benefits from a slightly cheaper game, bargain bin fire sales and additional game features if you do choose to buy new. The economic down turn is a great time to be a gamer, as long as you remain employed.
Harmonix, MTV Games and Electronic Arts has announced their next block buster killer app: Rock Band 2. First, the most important feature is backwards compatible downloadable content. They’ve surpassed 15-million paid downloads, we want our content and we want to keep all the awesome songs for future games, else we might as well stop purchasing now, right?
The question remains, will we want to upgrade our instruments? They’re saying we’ll have “more variety of instrument choices than ever before with new and improved drum and guitar peripherals, enhanced functionality and innovative new designs – all fully compatible with the original Rock Band instruments.” Will the enhanced instruments really want to make us go out and buy them?
If these new instruments are highly desirable or add any new features to the game (or make newer features ‘easier’) then we may be persuaded to look into new hardware…yet with Guitar Hero World Tour we’re already pressured into considering another drum unit.
So confusing, but yet so much desired. I guess that’s the love hate relationship of a gamer with a passion and a, slight, addiction!
Hi guys.
Thanks for the episode. It was intersting and funny as always 🙂 To your question of the week: I Played Portal the first time last year. Of course i completed it very fast, but this was a PC game i played about 10 years after its release 🙂
For Console games, it must be some of the first 6 Mega Man Games … i don´t remember which ones i played as a kid, but of course not all of them. So i decided to play through the first 6 Mega Man games last year 🙂
I like to play all the old games, i missed in my youth, but as you know: now (as an adult) you got the money to buy games, but you dont have the time anymore to play all of them 🙂
Jonah: Archon is a really great game! I loved it as a kid, even i did not understood it at all 🙂 (I am born in 1980, so i was 4 years old, when Archon was released, and i got my first C-64 when i was 8).
So thanks again guys and keep gaming 🙂