Will The Next PlayStation & Xbox “Block” Used Games?

Will The Next PlayStation & Xbox “Block” Used Games?

Will The Next PlayStation & Xbox “Block” Used Games?

H/T Reader Dan

$GME is modeling continued growth in their “trade-in” segment through 2014. They also have significant growth in the refurbished/used tablet/iPad segment through the same time frame. If the used game market dries up because A) people move to downloads B) new consoles block the used games from being played on them, foot traffic at $GME will plummet. Along with it will sales of ancillary items like their tablet, accessories, consoles etc…..

Value Partners Asia Bets On India In Hopes Of “Demographic Dividend”

Value Partners Asia ex-Japan Equity Fund has delivered a 60.7% return since its inception three years ago. In comparison, the MSCI All Counties Asia (ex-Japan) index has returned just 34% over the same period. The fund, which targets what it calls the best-in-class companies in "growth-like" areas of the market, such as information technology and Read More

Again, I ask, if games can be downloaded (they all will very soon) why does $GME have a need to exist? Can’t everything they do be done directly through game maker and console maker? If new consoles block used games, this effect is intensified. Without a disc to deliver a game, why do game makers and console makers need the middle man?

Citing a single anonymous source, Kotaku says it believes the code name for the next PlayStation is “Orbis.” And while the next console from Sony ($SNE) is widely expected to be called PlayStation 4 when it hits shelves, the site infers that Orbis might be the system’s final name.

Whatever it’s called, Kotaku says we can expect to see it released in the holiday period of 2013 — the same timeframe most expect the next Xbox to arrive. If so, that would eliminate the one year head start Microsoft enjoyed with the Xbox 360 ($MSFT), a year that gave it a lead over Sony that thus far has proven insurmountable.
[Related: New Sony CEO to keep charge of troubled TV operations]

Much like the rumored next Xbox system (codenamed Durango), the new Sony system will lock games to a PSN account, which could impact the used game market.
“If you then decide to trade that disc in, the pre-owned customer picking it up will be limited in what they can do,” the site said. “While our sources were unclear on how exactly the pre-owned customer side of things would work, it’s believed used games will be limited to a trial mode or some other form of content restriction, with consumers having to pay a fee to unlock/register the full game.”

If true, that’s likely to upset a notable segment of the gaming population, not to mention have a serious impact on retailers like GameStop who make a tidy profit on the used game market. And Sony could ruffle even more feathers if the system ditches backward compatibility with the PlayStation 3, as Kotaku says it will.

Updated on

Previous article Will iPhone 5 Have iGo’s Chip?
Next article How To Keep A Check On Apps That Your Friends Are Using On iOS
Todd Sullivan is a Massachusetts-based value investor and a General Partner in Rand Strategic Partners. He looks for investments he believes are selling for a discount to their intrinsic value given their current situation and future prospects. He holds them until that value is realized or the fundamentals change in a way that no longer support his thesis. His blog features his various ideas and commentary and he updates readers on their progress in a timely fashion. His commentary has been seen in the online versions of the Wall St. Journal, New York Times, CNN Money, Business Week, Crain’s NY, Kiplingers and other publications. He has also appeared on Fox Business News & Fox News and is a RealMoney.com contributor. His commentary on Starbucks during 2008 was recently quoted by its Founder Howard Schultz in his recent book “Onward”. In 2011 he was asked to present an investment idea at Bill Ackman’s “Harbor Investment Conference”.

No posts to display