Why GameStop Wants Your Used Games So Bad

It's common knowledge that GameStop is reliant on the used game trade to stay afloat, but if you ever needed hard numbers to put it in perspective, here you go.

Releasing its latest quarterly financial results, the global games mega-retailer has revealed that the sale of pre-owned games and hardware accounted for 47.4 per cent of the company's total profits.

In dollar terms, that's $US250.2 million in profit, which is a lot more than the company made from the sale of new games, which "only" brought in $US182.4 million.

Makes it easy to see why the battle over "online passes" and "project ten dollar" is such a heated one, doesn't it? Take away those trade-ins and GameStop goes bust.

[via MCV]


Comments

    Though... if there was no pre-owned market, that would only give people the option to buy the game new, since consumers won't have a choice they'd buy it wouldn't they?

      So games publishers would have believe.

      That's the same argument that allows the RIAA to be awarded damages in the tens of thousands: people can't help buying our stuff, so giving it to them via any other channel is stealing from our pockets.

      Although most people only spend a certain amount on games. So AUS$500 can either be 5 new games, or 8-10 preowned ones-including the same 5 that otherwise would have been bought new.

      I work in retail and I've had many customers walk out the door saying "I'll wait until there's a pre-owned copy". Not everyone can afford to buy games at full price, and hence won't buy them at all - at least until either a sale or a price-drop comes along.

        People who buy Pr-owned new release games are only saving %10 off the sale price. They can clearly afford the game, otherwise they would only but old games %50 to %70 off the new price.

        This is a clear case of GS undercutting the publishes. GS are actively introducing direct competition by reselling games so close to launch. Publishers now need to skew the value of used games down to make their new produce less valuable if it has already been bought once.

      Nope they wouldn't you'd start to see a trend of people waiting for mark downs on the game's

      It would only be the blockbuster games that make sales on the first few days.

      which should lead to a drop in game prices, to accomodate for this.

      in this day and age there are normally cheaper options than pre-owned anyway's since JB normally sells below EB's Preowned rate, and importing normally kicks all there asses. Even when the dollar was 80c, since you then pay 1.25 dollars for every american one and as a result games cost 62.5 dollars still beating our retail

        jb sell below eb only on new releases. the majority of money that eb makes on preowned is in back catalogue stuff, and in back cat, jb don't have it... in preowned or new.. and if they do have it new, well, eb is usually cheaper. jb are only cheaper on new stuff mate.
        as for games overseas, fair enough they are cheaper. but when minimum wages are $5 an hour for an adult, a comparison can be made as to why stuff is cheaper... we earn more here, we pay more here.. dollar parity has nothing to do with it..

    It's a classic case, if you stop preowed games then they would lose heaps of sales on new games, I worked at game stores and I know that without a trade in system alot of kids (and adults) simply couldn't afford the new games they want. so no trade in = less new game sales....fact

    My worry if the pre-owned games market is ever gotten rid of, is what happens to games 6-12 months down the line.

    With a lot of smaller release games there is only the ability to purchase them new for the first 3-6 months, after that they're just not available in most stores. (there is always online, which I have no problem with but plenty of the market still likes to buy brick and mortar).
    Does that mean publishers will do a second print run if pre-owned doesn't exist? Unlikely, hence it will limit getting older games to ebay (2nd hand) or hoping certain stores keep stock longer.

    A good example of this is Ace Combat 6 for Xbox, within about 6 months it was impossible to find for new in stores, and was only available via pre-owned for the last few years.

    Come to australia and complain about full priced games. Our dollar is at parity and we still pay double for our games.

    I don't think publishers would drop their prices if the preowned business disappeared. I too work in a games store and a lot of people are grateful that they can buy the preowned games so cheap.

    Don't most publishers base the success of their games on the first 1-6 months of a products life anyway? The ratio of new to preowned stock in this time frame is one sided anyway. It takes a while for their to be enough preowned stock to make a fair comparison in PO/new sales.

    Considering I think a lot of games will have a DL version come out six months to a year later. And I seriously see the Console market moving to a DL only model. Heck look at Steam, I can buy a game half the price I can at EB or at least notably cheaper and if a game I want comes up in the sales I can get it for say $25 instead of $90.

    All recent PC games I've purchased have been DL. Let's face it the days of the retail version having cool extras are long since past. Manuals for most games are little more than pamphlets. And on Console the retail bonus seems to be mainly early access or visual only upgrades. Unless it's a special game like Halo: Reach or GT5. Something guarunteed to sell heaps.

    ""Take away those trade-ins and GameStop goes bust""

    How is reduced profit the same as going bust?
    How is $180 million in annual profit not adequate for GameStop?

    It is fine for GS to take in all that money, just as long as everyone realises they they are literally taking a bit chunk of that revenue from publishers, and are a big reason for game developers going out of business, and lack of innovation in the market.

    If they had new game sales only, then making US$182mil a quarter is hardly going bust..

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