The Motley Fool Discussion Boards

Previous Page

Stocks G / Gamestop


Subject:  Could there be a truce in the war on used games? Date:  3/29/2012  11:04 AM
Author:  Gordogato Number:  200 of 251

Penny Arcade Reports (the "real news reporting" arm of the Penny Arcade empire) has a new story out about the console makers' war on used games and how one would expect that to be bad for Gamestop, but they conclude that there may be a truce because the console makers need Gamestop more than you might think. And unlike most of the stories you read in the gaming press, Penny Arcade actually pulled sales numbers out of the 10-K filing and analyzed them.

GameStop is dependent on used games in the same way that Activision Blizzard is dependent on World of WarCraft: If that one product were to disappear the company might survive, but the days of milk and honey would be over. The question is whether the publishers could survive the wrath of GameStop. Would the company still sell the hardware if the used game profits were stepped on? [...]

This is all doom and gloom, but the reality is that there would likely be a compromise struck between the console manufacturers and retailers before any details of this sort of thing reached the press or consumers. Sony, Nintendo, and Microsoft need GameStop to build up hype and take pre-orders for new hardware, and GameStop needs to make money from used games. It’s very possible that the margin may change, but the result will be tolerable for both sides of the coin.

Copyright 1996-2018 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us