The end of used game sales wouldn't be the end of the world
Twitter's 140 characters don't let me say what I want to say, so here's a not-so-quick blog post on the topic of game prices in a world where the upcoming PlayStation and Xbox hardware lock out the possibility of used game sales.
Basically, the assumption seems to be that since game publishers have spent the last few years doing things that us consumers tend to regard as greedy, we can expect that those publishers will behave the same way in a world where used games are no longer the significant issue that they are today.
There are HUGE problems with that logic, though, and one of the biggest problems in my mind--the one I'd like to address here--is that people view this as a certainty. It's not a certainty. Yes, game publishers might use the lack of used games as a point of leverage. Given the rising costs of game development as consumers continue to expect more complex and more technologically advanced games, they may keep prices at their current level or they may even jack them up since they don't have competition from used game sellers. That is a possibility, however, not a certainty and especially not a likelihood.
The measures that the game industry takes right now to combat used games (and piracy, which also deprives publishers of some of the sales they might otherwise enjoy) are measures taken by an industry that has run out of feasible options in the short term. Working within that structure, the publishers have come up with invasive and restrictive DRM, which is not ideal for anyone. They've come up with downloadable content, which gets some consumers angry. "Greed!" those consumers cry. "Greed!"
Let's admit, however, that "greed" cuts both ways. Yes, publishers want to see the greatest possible return on their high-risk investments. That's natural. They're never going to be satisfied with the revenue they get because they'll always be suspicious that somewhere along the line, they left money on the table. However, consumers also will never be satisfied. It is not in our nature. We always want more for less, no matter how much we're getting. I have seen people complain that they're not getting enough when they were paying nothing. I have seen software pirates complain about customer service when torrents didn't offer them an illegal file that they wanted in their preferred format. People want better, no matter what. Always, people want more for less, no matter how that impacts someone else's bottom line. It's hard to fault anyone for preferring more for less.
But let's say that suddenly, the new consoles prevent used games from working. Suddenly, you have to buy a game new or you don't play it. The market for games doesn't suddenly disappear. How could it? If prices remain constant, we're talking about a $5 difference in price when buying a game new versus used. Instead of buying a used game for $55 from GameStop, someone will buy it for $60 from a store that makes a common practice out of stocking new games (so... not Gamestop). Or--more realistically--many consumers will start to feel comfortable buying the game for $50 from the game's publisher, instead of the $60 that he would have paid previously.
Why do I consider that more realistic? It's because publishers won't have to worry about used game sales when used games no longer function. In that scenario, 30 to 40% of sales that previously didn't mean anything to them (because the money went to Gamestop) suddenly will mean a great deal. In a predominantly digital scenario (hopefully, there will be idiots like me who ensure that physical product is a necessity for years to come), 30% of a game's sticker price no longer goes to retailers and distribution partners. The publisher makes more money from every new game sold, and every game sold is new. So there's a lot more money coming in even if the number of people playing a game is the same and the sticker price hasn't increased. In a marketplace where your only competition comes from other game publishers, rather than the current one where you also have to deal with other people who are making money by selling the game you produced, there are suddenly more incentives to offer discounts to drive sales.
Another reason that a price drop is possible and even likely: when people are buying something and they know that they can't turn around and sell it, they're going to be less inclined to take risks and pay the full $60 price point. They'll wait for reviews or they'll buy more affordably priced games instead. Publishers--the smart ones--will realize that. So even if the standard price for games doesn't drop, the practical price for games will drop. Publishers will realize that to move the number of units they want to move, they finally have to price games at a mass market price point. We probably won't see games drop to a $40 price point--which I think would be perfect--but we might see a lot of new games becoming available for $50 in brick-and-mortar stores and online.
My scenario is no more guaranteed than the "greedy game publishers screw us like always" scenario that some people believe is the probable reality. My point, actually, is that there's no guarantee one way or the other. I happen to see my scenario as more likely, but I could be wrong and so could anyone who believes differently. The only certainty here is that publishers want to make more money and consumers want to spend less money. The reality that we experience a few years from now, if game consoles do lock out used games, will be the reality that finds the most workable arrangement for consumers and publishers alike.