14 DAY TRIAL // The recent discussion about a used game blocking technology for the next generation of home consoles has prompted an analyst to argue that any kind of solution to eliminate used games sales will hurt hardware developers more than it could help them.
Michael Pachter, who watches the video game industry for Wedbush Morgan, has stated that, “I think the industry will disintegrate; I think there will be no more video games if next-gen consoles don’t support used games. You hear that, Sony and Microsoft? You have to support used games.”
He added, “Why would the next-gen consoles not support used games? Sony doesn’t sell that much software; maybe 10% of sales are Sony products. Everything else, the other 90%, is third-party. Sony isn’t going to help its overall sales that much – let’s go with 1%, 2%.”
This apparent advantage will be eliminated as long as Microsoft allowed used game sales on the Xbox 720 and it attracted more gamers to its new hardware generation.
Pachter believes that gamers take, on average, three weeks to one month to finish a modern release, which means that the impact to the bottom line of publishers is limited and the analyst estimates that only about 5 percent of new sales are lost because of the used titles that are on the market at the same time.
Both publishers and developers have said that the video game industry needs a new business model that rewards them with a small sum every time a game is traded in.
Retailers like GameStop, who depend on used video games for a lot of business and profit, have said that most gamers only trade their possessions in so that they can get the credit they need to pick up the newest releases.
Neither Microsoft nor Sony has made official announcements about their next home consoles.