Microsoft vs. Used Games

microsoft vs used games

The Playstation 4 press conference came and went, and although every detail wasn’t announced quite yet, one thing that was announced was that Sony won’t block used games from being playable. Rumors have been circulating for months that Microsoft will block games from being played on more than one console, with some sort of one-time use number or something being required. Electronic Arts (EA) has been using their Online Pass system to prevent used games form being played online without the purchase of an additional Online Pass number. This system is marginally fair, since these additional Online Pass numbers only cost around $10. If Microsoft created something like this at the system level, it would mean no more used games at all.

The logic against used games is the same used against music piracy: every used game sold is a lost sale of a new game. This of course is downright ludicrous, since the reason people buy games used is mostly financially driven. These people buy games used because $60 is a lot of money for them to spend on a video game, and often times they can by almost two used games for the price of a new one. It’s likely that most of these people don’t exclusively buy used games, so it’s not as if game publishers aren’t getting some money from them at some point.

Buying used games also creates a value proposition. Some games are worth $60. People who play hundreds of hours of Call of Duty online get their money’s worth and wouldn’t be as hesitant to pay full price. Games with incredible depth, like Skyrim, or deep stories like Red Dead Redemption, offer value up to $60 for some people. But there are plenty of average games that don’t make the cut. Some games are not worth a look at $60, but at $40 it’s a different story. It’s safe to assume that sometimes these purchases open people up to other games later, like sequels or similar games that they never would have tried for $60 originally. But after having played the first game for $30 and loving it, they are more likely to buy a sequel for $60.

Truthfully though, at the end of the day, buyers of used games only hurt Microsoft’s (and game publisher’s) bottom line. They get nothing out of these sales, and ultimately while it’s not a one to one ratio of loss sales, it does mean some lost sales. But that is only one side of the story.

In order for these use games to be in stores, someone has to sell them, and that’s what is being overlooked here. Sure it’s possible that people who sell used games are just in it for the money, but I would bet most are subsidizing their future purchases. People who play the latest and greatest can’t always wait for used games, or get the benefit from it, since most used games aren’t worth the money until several months after they come out. So these “bleeding edge” gamers are buying games at a decent clip, but most of these people are likely between the ages of 15-25, not exactly the kind of people who are flush with cash. If these people are selling games so that they can buy other games, it somewhat makes up for the fact that they used games sales are taking away from new game sales.

This is undoubtedly the part that Microsoft is overlooking, and it could cost them. It’s safe to assume that banning the sale of used games will only minimally affect game sales, and it’s likely that Microsoft would find this out quickly. More importantly though, Sony has set the bar by saying used games will be playable. If Microsoft goes the other way, console sales will ultimately be impacted. There are plenty of casual gamers who live off used games who, either fully or partially.

Having the used game market cut off seems like a perfectly good reason for someone to take a spin with a different console.