This podcast is plagued with audio issues, unfortunately, as it returns from a week’s hiatus to check out the new games and controversies, as well as Gaming Flashback for one of the greatest superhero games of all time, Batman: Arkham Asylum.
The news this week includes:
Let us know what you think.
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.
The guys talk about Dave the Diver finally arriving on Xbox Series X/S, Krafton CEO allegedly asking AI to “brainstorm ways to avoid paying” earnout bonus to Subnautica 2 devs and the Xbox Partner Preview.
The Gaming Flashback is the indie megahit Undertale.
More news:
Let us know what you think.
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Famitsu Magazine is reporting the Nintendo console, Wii, has managed to sell 7-million units in Japan. This is roughly three times the number of Sony’s PlayStation 3, the console with superior graphics and power.
Japan isn’t about graphics and power or they’re not a fan of the high priced PlayStation 3. The three times factor seems odd, still, considering the PS3 isn’t three times the cost and really isn’t that bad of a console. Unless the titles on Japan’s console are just not as inviting, the PS3 should be keeping pace with the tiny Wii console. Sony is a Japanese company as is Nintendo and both have a very good grasp of the games the Japanese culture is attracted to buying. What’s happening here!?
“The Wii’s 7 million sales put it far ahead of its foes in the ongoing console conflict in Japan. According to Enterbrain figures quoted by GameDaily, Japanese sales of the PlayStation 3 numbered just 2.37 million units as of September 30, when the Wii had sold around 6.83 million units in the territory. Sony estimates the PS3 sold nearly 17 million units worldwide by the same date.” (gamespot)
The Xbox 360 still can’t compete against the PS3 or Wii in overall numbers, regardless to boosts when they put out a game the Japanese actually find interesting. If Microsoft and Sony learn anything from this generation of consoles, it’s that simple makes better. No, we’re not telling the developers to end the goals of hardcore gaming… we’re just wondering if branching out a bit to scoop up some casual gaming interest.
