This week’s episode takes a look at Sony’s State of Play, Ubisoft Forward and Nintendo Direct, and all of the games revealed in each conference. In addition, cryptocurrency gets all the reaction it deserves. Jonah expresses an unpopular GoldenEye 64 opinion, too.
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.
If you’re looking to see what the next greatest DS hand-held will look like, plan to wait until Nintendo starts to see declining sales trends for their current DS hardware. Sensible from Nintendo’s standpoint, but a major bummer for those hand-held gamers who want to see something new and cool out of the Nintendo camp.
While the DS sells great, many of us tech fans would love to see what a new generation of DS would look like. Perhaps something closer to the iPod touch in screen size and touch-abilities with real WiFi capabilities connecting to the Internet? Wouldn’t it be neat if they added GPS location and tilt abilities much akin to the iPhone or iPod Touch?
Personally, I envision a system where you are in total control of your character from leaning, to sliding, to moving your fingers around the screen and communicating over the Internet sharing high scores, drop-in drop-out multiplayer titles with complete voice communications.
Alas, Nintendo tends to gimp most of their hardware from hot innovation such as Internet communication, much like the Wii. While Nintendo has the next-generation capabilities now for Internet communication they’ve constantly opted to have a more useless version of connectivity to “protect the consumer.”
We need a DS store, much like the Xbox Live Marketplace for downloading DS casual games, considering DS game size is much smaller than a PC, PS3 or Xbox 360 title. We need a smaller form factor mimicking the iPod in thickness and durability with a larger screen or unfolding dual screen to double the size of an iPod style play area.
Hardware innovation seems to be more acceptable to Sony and their PSP product while Nintendo always opts for something more simple. Unfortunately, the PSP cannot compete against the DS which will leave them in the lead with very little desire to re-up their hardware with new capabilities and sexy new designs.
Oddly enough, the DS is the perfect device for the mass market which means they’re not going to be forced to innovate beyond its current capabilities for now. Apparently people don’t desire huge leaps in technology, screen size and speed, or we’d would probably see a decline or dis-interest in the DS hardware, thus forcing Nintendo to re-innovate and evolve.
The day will come, but probably not for a long time.
Although PlayStation 3 is still third in worldwide sales, behind the Xbox 360 by about 5-million units, the PS3 community services now have as many online gamers as Xbox 360 says Sony. Sony posted on their blog saying, “with 14 million active accounts and 273 million pieces of content downloaded, we know that you’re thirsting for this digital entertainment.”
Although US sales of the 360 are killing the PS3, the community membership does give gamers a reason to get online with the PS3. Nobody wants to buy into a console that has very few active online games or an easy way to find friends (*cough* Wii). Having 14-million users helps them bridge the sales gap by building gamer confidence. Social networking is the new term; gamers want to socialize with each other online and with their consoles.
Microsoft recently announced their 14-million subscriber base and continue to update folks when they hit big milestones. The main difference, LIVE is a subscription system — those 14-million gamers are also paying for the service (we’re not sure if silver memberships count in that figure) and this means income for Microsoft while Sony does their service for free.
Although Microsoft is making money on their service, no doubt Sony will bypass their total membership because it has no cost barriers to play. The biggest cost barrier to get on Sony’s network is the PS3 itself and many gamers hold out for price drops which aren’t coming anytime soon (so says Sony). However, building a larger community on a free network allows Sony to siphon gamers to buy downloadable content, games, music, movies and all the goodies that go with these services.
It seems a better idea to triple your audience with a free service knowing a large amount of “hardcore gamers” attach themselves to the easy to buy content on said service. So, is it better to make US $50.00 a year on half the population or give triple that population an opportunity to spend more money on content?
“Thanks to all of you, PS3’s momentum is stronger than ever. There are nearly 17 million PS3 systems around the world, and in the United States, PS3 hardware sales are up nearly 100 percent from where we were at this time last year. Software sales have tripled from a year ago. Yes, we’re proud about everything we’ve accomplished, and we’re even more psyched about where we’re going with our holiday software lineup” (playstation.com)
Eventually gamers may have access to Sony’s Home project, which could raise the community figures and give Xbox 360 something less to brag about. Although, we’re sure Sony would rather be boasting “number one” console again, at least they’ve finally got a win on their side because 14-million users is only the beginning for them.
Plus, it’s hard to argue free.
Hi guys.
Thanks as always 🙂
I played a lot of Magic the Gathering because a new expansion was released. And since wrath of the Koch king classic was released for WoW I got back to it for a lot of hours 🙂
Regarding the topics: I have a simple stereo setup at my pc, because most of the time I play with headset anyway to talk to my friends in discord or listen to music. In my living room I have good 5.1 setup with a new receiver and 5 nice Teufel speakers 🙂
X-com: I played it 10 years ago but I don’t think I will replay it. Maybe … we will see.
Pac-Man 4 sound interesting… maybe I will check it out 🙂
Kirby Games: I think the only Kirby game that I have played is the one for the first game Boy back in the days. Good old times when you spend a lot of time to a single game!
The other games I barely know … i have heard of fire emblem but never played it :/
Please stay healthy and keep on gaming!
Greetings from Germany
Ralf