So EA finally went and did it.

This isn't new.  EA locked out Spore via the same method.

Spore wasn't sold via Consoles.  PC DRM systems are now expanding past the PC - Avatar's Blu-Ray release was all but destroyed by the inclusion of DRM on the disc.  Imagine if Assassin's Creed III requried your Xbox or PS3 to be connected to the internet at all times.

True Spore itself wasn't on console, but Spore Hero for Wii, Spore Creatures for DS, Spore Hero Arena for DS, and a Q4 2010 untitled Spore for PC and consoles.

Admittedly didn't read the article so didn't pick up the 360 reference.

But what isn't new is that EA is trying to kill second hand sales.  That was evident from the new DRM they started in Spore, locking the game to an online account (and further developed for the later C&C game).

Agreed, however this isn't just encouraging people to purchase the game new with optional content to prevent re-selling the gane.  This is actively punishing people who don't buy the game new by removing popular features such as the entire multiplayer component.  The next logical step is to not sell codes to activate this; you either buy it new, or you don't play multiplayer at all.

From a business point of view... this does make alot of sense, though - right?  I'm not a huge fan of ea, but gamestop, etc, certainly cuts into their profits a bit. This allows them to make $10 on every $60 game that is repurchased instead of nothing... whereas gamestop makes what, $20-$35 per used game?  You do see where this going... $10 is the tip of the iceberg...

The problem with that logic is that most people actually use their trade-in money on old games to buy new releases.  Then there's another big issue: a lot of the people who buy used games do so precisely because they don't want to spend any more money.  Seems to me that trying to sell stuff to someone who doesn't want to spend more money is a complete waste of time and effort.

Honestly, I don't know their precise margins, but that seems a bit high.  They have to pay to repurchase the game from the former owner, and they have to mark down for being used.  Then they have overhead at the store on top of that.

Well, that's true enough, but the big picture is that so much of the business is contained at gamestop.  You take one title, brand new, and sell if for $60... retailers obviously don't pay $60 for the game.  You buy back that game for $35 dollars.  Then you sell it again to another customer for $55 dollars.  That copy that sold for $55 used earned the game's publisher 0... repeat this process millions of times and you have gamestop.  Logically, if Ea's practice of charging extra for the ability to play online (it will), then people will be MUCH less likely to buy a used copy of a brand new game for $55 instead of $60.  This will force gamestop to sell their new used titles cheaper and will encourage people to buy the game brand new... which would hurt gamestop while putting some extra revenue in the publishers pocket.  

If you read some of the quarterly earnings conference call manuscripts, you'll probably see some interesting things about gamestop.  The QA from the analysts is generally very intersting - Q1 2010 call is due out this month.  http://seekingalpha.com/article/194473-gamestop-corp-q4-2009-earnings-call-transcript?page=1

Anyway - I think its a smart business move... do I really like where its heading?  No. 

The main people hurt in this type of model is Gamestop.

If EA wanted to *kill* used sales, there wouldn't be an option to buy a code. You buy a new copy or you don't get multiplayer, period.

What they're doing instead is adding a fee. So instead of Gamestop being able to sell a used copy for $5 less then a new copy (where they keep half of that $55 and the publisher gets nothing), Gamestop instead sells it for $45 and also sells the $10 code. Gamestop still makes money, and the publisher makes $10 (or some fraction thereof, if they're using Microsoft points for the code system then MS would take a cut).

 

And the argument that used game money goes to buy new games doesn't matter a lot to the publisher. User 1 pays $60 for a new game, then sells it to Gamestop. Gamestop pays $25 for that game, and resells it to user 2 for $55.

Gamestop makes $30. User 1 gets back $25 towards another game, but user 2 spent $55 and the publisher didn't see a dime. This isn't a winning proposition for them. They're much better off if user 1 doesn't sell the game and user 2 pays $5 more for a new copy.

In the end all this happens for 1 reason and 1 reason only, because the average person will pay the extra $10. Otherwise they would not have come up with this idea. Many people complain about how unfair this may seem, but in the end they give in. I did with Modern Warfare 2 after hearing about the lack of dedicated servers and on top of that I for the new map pack that cost $15 so now my game was worth $75 with a new map pack coming in a couple of months for another $15 which chances are I will pay as well. They charge because we will pay, plain and simple.

Isn't this anti-trust?  Creating a market where you can only buy and sell from the corporation certainly says that.

I'm not sure what you mean?  If you are suggesting that EA charging a fee to play online using their servers is a monopoly, I'd argue that world of warcraft must also be a monopoly as users pay a monthly fee.  I'm pretty sure EA is within their rights to do this.

Well, at least it will work. I thought all used games were moving towards not selling used at all, let alone playing online. 

If the used price with the new key price is reasonable, it works for me.

No more so then Apple's app store. Or Microsoft/Sony/Nintendo having a stranglehold over what games are allowed to go on their consoles.

I tend to agree this is more of a continuation of their campaign against the secondary market than a shot at customers.  They already took steps in this direction with 'bonus' DLC.  It must obviously not have had the impact they wanted, so now they're going to try crippling features instead of holding back bonuses.

For once I actually support EA on this one.  Gamestop is pretty damn arrogant, often selling used games for $5 less than new while giving the person who traded it in maybe 1/3 of that price.  The publishers don't see a dime of this, while Gamestop is essentially printing money.  There were articles about how publishers were unhappy about this situation years ago, but Gamestop executives clearly didn't care.  All they had to do was offer a cut of the resale to the publisher, and it wouldn't have come to this.  Now console gamers can probably expect this to occur more and more, until the entire game is tied to an account like PC games and can never be resold.  Gamestop and similar companies' days are numbered at this point, and it's their own fault.  Like Blockbuster video and traditional movie rental outlets, they refused to acknowledge that technology has advanced to the point where their business model can and will be replaced.

As PC gamer who has not been able to trade in or sell old games for years, I can't shed a tear for the console gamers over this.

Doesnt this also affect the people who rent games badly?

That's true.  Another thing brought from the PC model; you can't rent games on PC.  You have to buy, or when the publisher feels like releasing one, try one-level demos.  Publishers like that, and probably want to eventually cut the rental companies out of the picture too.  Considering games are getting shorter and shorter on content these days, and day 1 DLC offerings getting more and more common, it's not really a surprise if they want to eliminate rentals too.  Can't have kids renting the game for a week and beating it for $10, saving $50-60.

That I don't agree with at all; but I'd bet good money it's going to happen within the next 10 years.

That's actually a really good point.  This would certainly cut into profits for game rental spots. 

Seriously, people will pay $55 for used when they can get new for $5 more?  I'm surprised people actually go for used at those prices.

Its not just used stores. Theres trading or giving to friends. Buy a used comp with games thrown in. Many many ways to come across a used copy without paying that price.

The entire point behind copyright and patent law is to intentionally, artificially create a monopoly for that product. The only time anti-trust action can reasonably be pursued is when someone ties multiple items together, leveraging their market share for one product into forced sales of another. That's the issue MS ran into with their browser, not that they were the only ones that could sell it. They were effectively forcing people to buy it as part of Windows, when it should have been a separate product.

What would be funny is EA executives being prevented from buying previously owned homes.

"Sorry Sir, you have to buy a new home from the construction company. You're not allowed, you see, to buy a used home - that cuts into my profit margin, being a (land) development company. You'll just have to tear it down. Now now, don't get upset, it's just business and we need to take care of our profit margin. It was a might bit tricky, to get the law passed, but now it's passed and that's just the way it is.

Oh come now don't make that long face. You can get a pretty cheap home built for you in Utah these days. You don't mind moving out of California, do you? And if you buy it new, I'll even throw in an extra towel rack, some blankets for your horse - you do own a horse, right sir? - and some copies of National Geographic.

Oh I know you were hoping to settle down in a nice little place here with your family. But come now, be reasonable."

Where this becomes a problem for EA, is all the people out there who are like me.  We purchase games, but don't accept restrictions on their use.  I have a desktop and a laptop, but if I can only install the game on three machines, what then?  Therefore I absolutely refuse to purchase anymore games from EA, or any other company which restricts the number of times I can install the game or requires an internet connection for its use.

Piracy isn't going to kill EA's PC division... it is overprotecting against it.

EA is just shooting itself in the foot. It boggles my mind that people buy games and exchange them and then other people come up behind them to save 10 bucks and buys them used. However, these people that are buying games and then exchanging them tend to buy a lot of games. They buy a heck of a lot more games than I ever have in a year. They buy it for 60, turn it in for what 20-40 depending on the title and run out and buy another new game. If EA destroys that used market, they're not just destroying the people buying used games, they're killing the people who buy the most games by devaluing what they can get when they turn it in, so they'll buy fewer new games.

EA's claim is just bs. If you sell a million copies of an online game, your servers should be capable of supporting a million players. The fact that player A leaves the server and player AB enters has nothing to do with that. The million players doesn't change, that's how many copies are floating around. Who cares which hand is holding it as long as its legit. That 60 bucks covers the cost of that game being on the servers for as long as EA keeps the servers running. It's bs they are trying to get more. This industry never ceases to amaze.

I'm amazed at some of you saying Gamestop should be giving publishers a cut of their used game sales. Once you sell a product, you no longer have the right to make demands regarding its use. The new owner doesn't magically owe you money if he in turn sells the product to someone else, regardless of how much he may profit from doing so. Claiming otherwise is to go against thousands of years of economic reality.

I haven't heard of any used bookstores making payments to book publishers every time they sell something, so why are we expecting Gamestop to do it?

Cuz generally book publishers have not found away to prevent us from reading their books if we are not the original owner. If Gamestop wants to make their used games still feasable, they should do it.