DRM News

According to Cowen Group analyst Doug Creutz, a large share of the blame for currently weak game sales can be placed on second hand game purchases.

From Gamasutra :

“In our view, GameStop has exploited the negligible difference between the value propositions of new and used games to capture a significant portion of the video game value chain,” says Cowen Group analyst Doug Creutz.

The biggest part of the market currently seeing slower sales of new games is consoles, specifically the 360 and PS3. Creutz puts part of the blame on the high price points for console titles, but the growth of used games sales is described as a significant factor.

His recommendations? More game options that need to be purchased after a used copy is bought as extra DLC. He actually suggests publishers go further in to ‘cordoning off’ more game content from used players that has to be added later on, since there’s nothing Gamestop can do to prevent it.

I find myself wondering if this might actually have a different affect, as Gamestop would eventually be forced to lower used game prices to reflect the fact that other content would also have to be purchased from the publisher by anyone grabbing a copy.

Also suggested is a more aggressive shift towards digital distribution, a market that Gamestop obviously can’t really be a factor in when it comes to used sales.

How will gamers respond? “We believe that consumers are likely to grudgingly accept a revised and evolving pricing strategy that reflects the value they receive outside of and in addition to the traditional single-player offline experience,” predicts Creutz.

“Against a backdrop of our expectation for improving growth in videogame software sales through the remainder of 2010, we believe that the evolution of these new pricing strategies give investors additional reason to become more constructive on the third party video game publishers,” he concludes.