THE PRICE OF USED GAMES:

IN DEFENSE OF PRE-PLAYED GAME FEES + DIGITAL OWNERSHIP

It’s been about a week and a half since the official Xbox One reveal, and gamer response has been tepid at best… and borderline accusatory at worst.  The Xbox One – though, in theory a versatile and powerful device – didn’t give the impression that playing games were its primary focus, which is somewhat disconcerting for a $500 video game console.

Though Microsoft has tried to temper those fears with an up-front $1 billion investment in games for the system, some believe that the damage may have already been done; by announcing its identity as an all-in-one living room entertainment center, Microsoft has inadvertently convinced many gamers that their needs and expectations will be secondary to the company's interest in appealing to a much broader “home entertainment” market.

The most controversial rumor about Microsoft’s new system is the unconfirmed claim that gamers will be required to “link” games to their account and pay a predetermined “entry fee” before being allowed to play a purchased, physical copy of a used game.  This speculation immediately had gamers foaming at the mouth, hungry for Steve Ballmer’s sweet, sweet neckblood.

Meanwhile, the PlayStation 4 is practically being sanctified across internet forums, especially in Reddit’s /r/gaming and more formal /r/games subreddits (even if some have claimed that the sources of its reverence on the site are somewhat dubious).

Though my knee-jerk reaction to the “used game fee” was one of disgust and my hand was halfway to my torch-and-pitchfork drawer, after considering the issue, I actually got to thinking that the concept “account linking” to one’s game library is not such a terrible idea.  As a matter of fact, I think it’s a pretty good one; one that could improve the next generation’s online dynamic, lead to more affordable games for gamers, and better finance independent game development.

WHAT DOES IT MEAN TO "OWN" IN THE DIGITAL MARKETPLACE?

What does it mean to “own” something?  Usually when you buy a product, be it a car, book, or piece of clothing, you are given free reign to utilize it as your choose.  Peanut butter can be spread on sandwiches or on the soles of your fetishist feet – either way, you have to right to do with it what you will. 

You’re usually able to resell those items at your discretion – albeit usually at a reduced price.  Almost all physical objects you can purchase will inevitably degrade over time (unless they’re, like, I don’t now: diamonds?).  Cars get worn down against miles of pavement, clothing get stretched, stressed, and embedded with your armpit funk; and, heck, even books lose that “new book smell.”  So, if you own a physical product and later choose to sell it, you’re normally selling what is agreed upon to be a lesser, degraded version of the product – which is why it’s sold at a discount. 

Digital products are inherently different, however: unless a disc is terribly scratched – in which case it shouldn’t be sold at all – the experience the next owner will not be a degraded one.  Rather, the experience will be arguably identical to the one the original purchaser had.  There is no “degrading” that takes place, so an immediate price cut due to previous ownership isn’t as economically logical as it would be for pre-owned physical products, since both the “new” and “used” consumers are having indistinguishable experiences with them.

So, the nature of what it means to “own” something is a little more finicky for digital products.  PC software has wrestle with this ambiguous issue for years – oftentimes, you’re not “buying” a program as much as you are purchasing a license to use it for a period of time.  As lower-priced, digitally distributed games become more and more common, I wouldn’t be shocked if license purchasing or a Netflix-style rental model become emulated in the video game market. 

WHAT DOES IT MEAN TO "MAKE" IN THE DIGITAL MARKETPLACE?

The definition of “production cost” is generally pretty different between the creation of video games and, well, just about anything else.  When a film or book or piece of clothing is put on the shelf to be sold, that’s the end of the cost for the company that manufactured said product.  It’s already developed, crafted, and sold to a distributor.  There’s no more manufacturing or shipping or troubleshooting that needs to be done – that burden is now placed on the store that purchased it wholesale and has the responsibility of selling it. 

Video games, however, are unique in this way: they can still “cost” the company well after their release – and well after most of their sales have been made.  A game must obviously still be patched for potential bugs and user issues; beyond that, there are add-on modes and updates that are made to reinvigorate player interest in the game.  For multiplayer games, servers must still be maintained and moderated, hackers have to be removed, and other measures have to be taken to make sure the game remains both fair and fresh. 

For videogames, the cost of production is ongoing, oftentimes for half a decade after the game’s release.  So, if you sell a copy of a video game, its continued use is still costing the developer and publisher, even though they are receiving no further revenue for their prolonged services.  I don’t want to compare that exchange of goods and services to indentured servitude, necessarily, but it’s a flawed model nonetheless.

It is also worth noting that the only substantial money that the videogame industry earns is from the purchase of games themselves.  Music and film can rely on a variety of revenue streams: tickets to performances, the sale of CDs and DVDs, and royalties for contents’ use.  Videogames, however, only truly make money off of the original sale, making the purchase of a game that much more vital to its creators. 

The increase in both used game sales and piracy are why many recent games have been using less conventional revenue methods: many are going free-to-play, like League of Legends and Lord of the Rings Online, and the rise of expanded downloadable content (DLC) has also helped financially support games whose “core game” is no longer selling new copies.

Both the “free-to-play” and “DLC” methods rely on purchases being associated to a personal account.  Both of these approaches can be done clumsily (“Horse Armor” in The Elder Scrolls IV: Oblivion) or in a way that’s downright manipulative (like Super Monster Bros. and other sketchy mobile games). 

To sidestep these issues, a golden rule for expansion content exists: no optional purchase should be required for “full” game experience.  If this was kept universally in mind, such a system could ideally expand the lifespan of games, reduce the piracy of these games by providing a more community-driven experience, and encourage developers to keep their games fresh and fleshed-out, in order to maintain and grow a fanbase that will help support the game over a broader length of time through smaller, more digestible transactions. 

WHY ARE USED GAMES SO DANGEROUS?

Used games are damaging to the industry because they don’t help support developers or publishers at all, and the only parties who receive any profits from the sale of these games are the stores selling them.  When you use shops like GameStop or GAME as a middleman, you’re buying a game that was purchased from it’s own for a borderline offensively low price – offers so merciless that they make Rick from Pawn Stars look charitable.  However, they’ll sell you that same game for only a few dollars below the full price of a brand new one, usually making 70% – 80% profits! 

Last time I checked, the gaming population wasn’t very fond of these game retail stores, and I think we’d all rather support the handful of creative and passionate people who made the games we play over than the corporate chain stores that distribute them at unreasonable prices.

For those pessimistic about the implications of having your purchases linked to a “gaming account,” take a moment to consider all that’s changed in the PC gaming world over the past 5 – 10 years.  Not too long ago, used games used to be bought and sold in the same format that consoles are currently subject to.  However, when Steam came along and provided a more convenient service with more competitive price points, gamers finally moved past their apprehensions and embraced the new definition of “digital ownership.”  Despite a few hiccups along the way, PC gamers have never looked back – it’s now created it’s own private culture, economy, and elitism that that no other currently competing service can touch.

Console-based digital game distribution services, like Playstation Network, Xbox Live Arcade, and the Wii Store unfortunately cannot match the level of affordability that Steam does – outside of free Playstation Plus offerings, Xbox 360’s recent sales experiments, and the recently (and blissfully) affordable retro WiiWare sales, you’ll be hard pressed to find anything remotely competitive with the “75% off” sales that Steam offers on a near-weekly basis.  This isn’t due to any lack of trying, however.

Console digital distribution services are unfortunately stilted due to the consoles’ reliance on the GameStops and Best Buys of the world for physical game distribution.  If digital copies of games are offered on these networks for less than the store-mandated prices, many of these stores will no longer carry those games – or so they’ve threatened, at least.  This has been a huge issue that has stitled the console gaming economy, and is something that people hope Sony’s PS4 will address with its rumored developer-chosen price points (though please note that this is still distinctly a rumor at this point).

The same challenge also faced PC gaming several years ago but was completely steamrolled by the slow-building success of services like Steam , Good Old Games, and the philanthropic Humble Bundles.  Though it forced PC gamers to give up the concept of “physical ownership” and the ability to sell their purchased games, it came with a plethora of perks.  Beyond the vastly improved pricing, Steam also allows game owners to re-download their games anytime, anywhere, on any number of machines – as long as they are signed into their account. 

This makes lost, stolen, or damaged games a thing of the past – and makes it much, much easier to bring your game collection with you on the go, since it doesn’t rely on a bevy of discs and registration keys.  And as much as I love the aesthetics of physical game boxes, it no longer feels like I’m giving up very much for that increased convenience; now that physical games more often than not come with slips of paper with a web address in lieu of the tome-like manuals of older games, there are fewer and fewer reasons for one to purchase a new game on a potentially damageable blu-ray disk.

BABY STEPS IN THE RIGHT DIRECTION

There are a great deal of reasons why these account-based services will do good for the console gaming world: they will likely reduce costs and improve convenience for consumers down the line, they will more directly support the developers making these games, and they will help reduce both developer-damaging piracy and gamer-damaging, store-mandated overpricing.  I think that Sony’s movement to have all games available as a digital download is a step in the right direction, and I imagine that Microsoft probably has similar plans for the Xbox One, as well.  That’s only the first fight in a long and complex battle, however.

Though I do feel like account-based game ownership is the best-of-all-possible-worlds solution, there are further changes that need to be made before that is attainable.  First off, backwards compatibility is a must – if a game is digitally purchased, then it needs to be purchased forever and potentially available on any technologically capable device in which your “account” is applicable.  Microsoft has recently announced that the Xbox One will not support old XBLA games, which, though a gnarly issue, completely negates the entire argument for digital ownership: an important draw is that the game can’t “disappear.”

Secondly, requiring annual payment to access these game distribution services needs to stop, period.  Companies using Microsoft’s method of requiring gamers to pay $50 a year to access features that other game systems offer for free is simply insulting.  Maintaining that business model in this upcoming console generation, after adding all these other unprecedented (but understood) “used game” costs, would make them no better than Moneybags from Spyro 2.  And if you haven’t played Spyro 2, that is one of the most cutting capitalistic insults I can possibly conjure.

Lastly, the gaming industry should go the way of the much-loved Kindle and adopt real-world sharing of digital content.  For example, a Kindle owner can “lend” their e-book to another account, during which point the original owner is locked out from reading it.  This seems like a manageable compromise, and they could get away with a tolerable, one-time entry fee (somewhere in the realm of 5 dollars) for a shared party to access the lended game.  I’m certain gamers would find that philosophy and price point agreeable.

This whole argument is incredibly complicated and has more sides than a D&D die, but I believe that encouraging console games to go the same route that Steam has would ultimately be a good idea, both for game developers and for the gaming public.  Though I don’t want to spend the whole article vilifying GameStop, in the end, they would be the only suffering party in this situation, so I don’t have much apprehension in supporting a change that will provide better prices for gamers, better financing for publishers to put towards future projects, and better support for independent game development.  Supporting developer control of used games isn’t anti-consumer; on the other hand, when deconstructed, it’s very pro-gaming industry and pro-gamer.

EDIT: I understand that this article could come across as extremely pro-Sony and anti-Microsoft, and the last thing I want is to be accused of is fanboyism.  I am just working with what information has been released and rumored so far, and I pray that things will look more balanced after this year’s E3.  And I won’t lie, I don’t underestimate Sony’s ability to utterly shoot itself in the foot at the last minute. So in the meantime, take this article for what it is, and let’s all enjoy our popcorn as we watch the early drone strikes in this generation’s console war.