HMV UK & Ireland CEO and MD, Simon Fox, has voiced his support for the pre-owned market, suggesting that the ‘vast majority ‘of trade-ins allow gamers to purchase a new title. Mr. Fox said he understood publishers’ views on the pre-owned market but became the first ‘industry’ person to say what we’ve all been thinking:
“The fact is, in every case, the manufacturer of whatever it might be makes their profit from the original sale, transfers the IP or ownership to the buyer – and if the buyer then chooses to sell that item, it’s up to them. You don’t hear book publishers asking for a share of the second-hand book market. I’ve never heard that.”
“I think it’s slightly odd that publishers should somehow think that they have a claim to profit that a customer might make on a second sale.”
Mr. Fox said that HMV try and provide trade in offers which promote purchasing another game rather than sellers taking the cash. The pre-owned market has also helped HMV compete with price slashing supermarkets.
“By providing a trade-in offer on a new release you can make that new release affordable, perhaps even cheaper than the supermarket price – but it’s part of a deal. They bring something back, and in exchange they can have the latest product at a very competitive price.”
Source: GamesIndustryBiz
3shirts
Finally. Give that man a biscuit for saying what we’ve been arguing for ages.
bunimomike
Agreed. Simon Fox, you have my respect.
jayjay119
I second that, or is it third that? Ah what the hell, Simon Fox I like ya!
Bilbo_bobbins
yep, 100% agree. FInally, someone has spoken the truth.
DeathByNumbers
I trade games in solely to buy other brand-new games, most likely not from the same developer but it only takes a few weeks and I buy a game from them again.
bigdon23
Well said Mr Fox, thats one for us poor people,
he is dead right though, respect where its due
duncanuaz
I use pre-owned to see if I like a particular style of game and that sometimes leads to buying the new ones brand new. Case in point was the WWE Smackdown games. I picked 2007 up in Gamestation for £2.99 and between my son and myself have bought 2009, 2010 and 2011 is preordered from shopto. They would probably never have those new sales without me trying it second hand first.
TSBonyman
*Applauds* Nicely said Mr Fox.
Crazy_Del
Simon Fox I salute you Sir *hats off*
jimmy-google
“I think it’s slightly odd that publishers should somehow think that they have a claim to profit that a customer might make on a second sale.”
That’s not their issue, it’s the likes of HMV taking a profit from a second hand sales that developers don’t see.
Tuffcub
Erm.. isn’t that the same thing?
jimmy-google
The act is the same but Fox is spinning it to make out developers have an issue with gamers when its really with retail holding all the profit form second hand.
Devlopers want gamers to have money to buy games, why should retail take more profit for doing very little and devlopers not get much per game
Severn2j
Developers don’t have a problem, publishers do. Also, I believe the spin is coming more from the publishers side who have a history of trying various tactics to maximise their profit margins.. To continue the book analogy, a lot of bookstores make their living from buying and selling secondhand, why should it be different for games? If a publisher sells me a product and I decide later to sell it on afterwards, that’s up to me, you can’t just change the rules of a market, because you don’t feel you’re making enough profit..
jimmy-google
The problem is book and games aren’t the same thing. The cost is drastically different for a start and the sale price doesn’t reflect the development cost.
You don’t get updates, patches, DLC (free or paid for), technical support etc… for books.
While many publishers (and developers) are struggling financially this will be an on going debate. Either Retail finds a way to get more money to publishers/developers or publishers/developers will find means to cut out the retailers.
Severn2j
That shouldn’t matter, whether it’s a book, a movie or a pair of skis, the publishers money is made on the original sale. They aren’t involved after that point.. As for cost not reflecting the sale price, the games industry is the biggest media industry in the world, it rakes in more than the entire movie industry, are you really telling me it’s not profitable? I’d love to see some figures to back up the claims that publishers aren’t making money, because I suspect there’s some ‘ Hollywood accounting’ going on somewhere..
hazelam
but jimmy, if it’s the retailers profiting that is the problem, why are the publishers going after the customers?
because they can get away with that, that’s why, they can’t afford to piss off the retailers so they come after the customer.
3shirts
Also, have you ever bought a non-fiction book for university or a college course etc? Some of those are as expensive as games, often even more! There is a very similar second-hand market too with students buying last years edition for £10-15 instead of the new one for £40. This is almost exactly like the pre-owned market of a game like Fifa.
jimmy-google
If books and games are so comaparable then why don’t HMV sell second hand books? (or CDs and DVDs for that matter)
Tuffcub
Because they wouldnt make much money. The mark ups on games are much higher.
jimmy-google
And that why developers have an issue. Retail makes huge amounts from second hand sales. Book publishers don’t have an issue as the mark up is tiny. So small that retail generally don’t bother with it.
Severn2j
It doesn’t make any difference, the transaction is between the customer and the store, the publisher has no involvement, so deserves no payment. The value of the transaction is irrelevant. The publisher was paid when the game was originally sold.
Tuffcub
Agreed, the reletive value of a second hand sale has nothing to do with it. By your argument, Ford and Nissan would be screaming Blue murder verytime someone sold a second hand car 6 months abfter the bought it. They dont.
The argument is a customer MAY buy a second hand copy of FIFA 11 rather than a new copy. If they buy a New copy, Pubs get money, if they dont, Pubs dont.
Thhe problem is HMV, GAME et all stock second hand games right next to the new ones. If you can get a pristine copy of FIFA 11 for a tenner less, why would you buy a new one?
Its bad news for the Pubs but good news for the retailers – they make huge mark ups on second hand games, much more than they would on new ones.
Frankly us consumers have sod all to do with this arguement – people were selling PS3, Xbox and PS2 games on ebay for years without anyone complaining, but now second hand sales are marketed right next to new titles in major stores, the publishers are having kittens.
Bilbo_bobbins
Hi Jimmy, can I just ask is that your real name?
jimmy-google
No just a nick name from work.
Bilbo_bobbins
just thought it was funny, didn’t want to laugh in case it was a real name ;-)
3shirts
I have a dog that knows everything.
He’s a Labra-Google
grimm
Bravo, let’s hope some other retail/developer bigwigs follow suit with similar comments.
Juelz345
This is a debate that isn’t going to go away until digital distribution becomes the standard.
Developers and publishers (rightfully) want to make as much money from their product as they can, and people (rightfully) want to trade in games to have $ for other games.
If the shift to digital distribution brings with it a price drop, then both the Devs and consumers win. If i can purchase a game at midnight on the release date for say $35-40 (as opposed to $60) then I’d happily do so. Then the Publisher doesn’t have the packaging and distribution expenses to deal with and don’t have to worry about that sale being resold. And I get the game, faster and cheaper. Obviously there would need to be a way for me to access all my games from any console that i log into (like Steam).
Obviously this is bad for retailers, but it’s happened already with music (iTunes) and is getting really close to (if not already) happening with movies.
At the end of the day, one of the tree parties involved (Dev &/or Pub, Retail and consumer) gets the shorter end of the stick. If i had to choose which one I’d pick the retailer. Looking forward to the day when games are released digitally, day and date with retail releases at lower prices. That way the people who don’t have access to proper (or any) internet can still buy there games and trade them in and the rest will have access to the games at a more affordable price while still having the option to purchase the physical media and then trading it in if they wish.