Second-hand market hits game sales

How much are you paying for your video games? The answer has remained roughly the same for years

How much are you paying for your video games? The answer has remained roughly the same for years. But new consoles such as the Xbox 360 are trying to significantly raise prices, to reflect rising development costs.

Unfortunately for publishers, increasing numbers of consumers and retailers seem determined to pull in the opposite direction.

The second-hand or "pre-sold" games sector is booming, although it is still tiny by comparison with income from full-priced titles. But in light of recently reduced revenue forecasts from games publishers Take 2, Electronic Arts and Activision, it can't be ignored any longer.

After years of turning a blind eye to eBay, publishers have at last begun to voice their concerns - pricked by the rise in retailers selling full-price and pre-sold titles (or increasingly just the latter). Opinions have been flying back and forth, with the likes of Sony suggesting that there could be long-term effects if reselling keeps growing.

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"We recognise the second-hand games market is part of the revenue mix, for retailers at least," said a spokesman. "However, if it continues to grow, it could potentially starve us of the funds necessary for research and development, and therefore, developers will be less willing to take a risk on new and genre-diversifying titles."

Judging the true extent of this impact is tricky, especially when none of the publishers contacted were willing to name specific titles being affected.

And while the appearance of King Kong in the second-hand section of Game or Gamestation only days after release might well have an effect on the full-price version a few feet away, this only brings it in line with the heavy discounting offered by supermarkets and online retailers.

Furthermore, trade-in customers create a constant churn of products that some retailers maintain has invigorated the games economy as a whole.

"We have had a trade-in programme and have been selling pre-owned games for more than 10 years," said a spokesman for Game. "Many industries thrive on giving consumers better value for money - the motor car industry is a prime example. We are in no doubt that our trade-in programme helps drive the sales of new products."

Can publishers stem this market? As a disc is physical property, there's nothing in law to prevent a person reselling one they have bought legitimately. The publisher might try to alter the licensing agreement or even try to discourage retailers from dealing in full-price and pre-sold titles. However, such measures would be tricky to enforce.

For now, the challenge to full-price games seems certain to get worse before it gets better.