It’s something we’ve heard countless times from developers this generation; that used game sales are ruining the video game industry, because developers see not a damned cent from pre-owned sales.
Silicon Knights boss Dennis Dyack is quite vociferously against used games – going so far as to say that unless something is done about them, there isn’t going to be a video game industry.
And while you may try tell him that trade-ins help fund new game purchases – he’ll probably just block his ears, going “lalalalalala I CAN’T HEAR YOUUUUUUU”
“I would argue that used games actually increase the cost of games,” he told Gamesindustry in an interview. “There used to be something in games for 20 years called a tail, where say you have a game called Warcraft that would sell for 10 years. Because there are no used games, you could actually sell a game for a long time, and get recurring revenue for quite a while. Recurring revenue is very key.
“Now there is no tail. Literally, you will get most of your sales within three months of launch, which has created this really unhealthy extreme where you have to sell it really fast and then you have to do anything else to get money,” he continued, pointing towards things like post-launch DLC.
“I would argue, and I’ve said this before, that used games are cannibalizing the industry. If developers and publishers don’t see revenue from that, it’s not a matter of hey ‘we’re trying to increase the price of games to consumers, and we want more,’ we’re just trying to survive as an industry.
“If used games continue the way that they are, it’s going to cannibalize, there’s not going to be an industry,” he added. “People won’t make those kinds of games. So I think that’s inflated the price of games, and I think that prices would have come down if there was a longer tail, but there isn’t.
The solution, he says – is to go digital, or invest in a cloud computing gaming solution – not unlike Onlive. My suggestion? Stop making horrid games like Too Human and X-Men Destiny and you’ll survive just fine. He could be right about the industry caving in on itself though. the current budgets for video games is astronomical – and is only set to increase in the next generation. We’ve reached a point where it’s only AAA titles that do well financially – and it’s a huge risk for smaller to medium developers to sink $50 million in to game. If the game tanks, the studio will likely go down with it.
“On the top side of the triple-A, highly-funded titles, you have $100 million games, and looking towards next generation people once again are saying we’re going to have development costs that are two or three times of what they were last generation. I cannot see how that economy is going to continue,” Dyack stated.
“I don’t think as an industry we can afford $300 million budgets. I think some games can, don’t get me wrong. For a game like Call of Duty, if they had a $100 million budget, or whatever their budget is, they can afford it. That’s not the industry, that’s sort of a one-off. But what is everyone else going do?”