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Analyst: Blocking Used Games Will Mean Retailer Backlash

We already know that publishers and developers despise the second-hand market. They claim they're losing money because these consumers aren't purchasing the pricy, mint copies. Only the retailers are generating revenue from these used games and thus are driving prices of the retail versions upwards.

But some of us on the consumer side say we flock to used versions because new copies are just too damn expensive. We bought the hardware, and we should have the right to play second-hand copies.

But recent reports have indicated that the next-generation Xbox 720 and PlayStation 4 "Orbis" consoles will either block or severely limit the play of second-hand games. Full-priced retail versions will be locked to a specific user, and those who pick up those titles at GameStop or GameGiant will be forced extra to unlock the full game for a price. Wedbush Securities analyst Michael Pachter believes that if Microsoft and Sony do implement some kind of blocking feature, retailers who thrive on second-hand sales will revolt, if not ban the new hardware altogether.

"It isn't really in Sony's or Microsoft's best interests to block used games. It would benefit Activision and EA slightly, and would hurt GameStop a great deal. If Sony unilaterally did this, I could see GameStop refusing to carry their console, and sales of the PS4 would therefore suffer," he told

He also added that if one console maker blocked used games, and the others didn't, the one who does will see a loss of market share. None of the Big Three would be foolish enough to do this unilaterally, and none of them are evil enough to do it together as a group.

David Cole of DFC Intelligence agrees. "A system that tried to stop used game sales would probably turn off the core consumers that rush to trade in their old product to buy new product. In other words, I don't think it would do so well in the core market," he said.

Lewis Ward, IDC's research manager, says customers would rebel. "I can certainly see Sony stepping up the idea of $10 online passes for connected multiplayer and so on, but especially for families of limited means or that have a narrowband connection at home, the ability to buy/trade use discs is an important reason why they buy game consoles in the first place," he said.

It was also pointed out that any kind of DRM/security to block or limit used games would eventually be thwarted by hackers anyway, so implementing such measures would really be a waste of time.