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What Ails the Second-hand Digital Goods Economy?
"Imagine buying a used copy of The Usual Suspects on DVD, only to realize that you had to go online to buy access to Keyser Soze's denouement."

Continuing upon our piece last week on the legal troubles befalling online digital ‘second-hand record store’ Redigi, we’ll now take a quick look at another industry causing some outcry due to it’s ‘creative’ interpretations of customers’ right of resale: that of video games.

What to do with our unwanted digital goods, and how to potentially recoup some of their costs, will continue to be a hot-button issue for years to come. Interestingly enough, some industries aren’t content to even wait until digital sales are the issue, and are attempting to confound the reselling of physical goods.

Causing the most fuss at the moment is the video game industry. So-called “first-use codes”, whereupon buying a game a user is given a code that unlocks some percentage of the game, but can be used only once, are rapidly becoming the norm, and are inspiring a healthy amount of ire from the gaming community.

Imagine buying a used copy of The Usual Suspects on DVD, only to realize that you had to go online to buy access to Keyser Soze’s unveiling. Absurd though that may sound, major game producers, including the likes of Electronic Arts, THQ, and Capcom, have made that a staunch reality of late for gamers.

Video game producers claim that second-hand sales are crushing their business, though I’ve never heard of Karim Rashid positing that resales of his Oh Chair affected his ability to buy innumerable pairs of fuschia driving glasses, or Ford claiming that used F150 sales stifle automotive innovation (though I would absolutely love to hear the rational behind that one).

Many games already come equipped with codes that limit access to online play, or, unsurprising given the plethora of teenaged boys in the gaming community, to the viewing of scantily clad women. For example, in Batman: Arkham City, Catwoman is available only through a single-use code. Someone who purchases the game second-hand would then have to go online and purchase another code in order to satisfy his digi-Pfeiffer fantasies.

Wired Editor Chris Kohler, in his latest thoughtful and impassioned jeremiad on the state of the video gaming industry, discusses the rumours that the nascent XBox 720 will have hardware restrictions preventing the use of second-hand games altogether, which, quite frankly, displays a callous lack of respect for our rights as consumers, not to mention Smithian free-market economic principles. 

Kohler goes on to espouse the argument that video games these days typically cost more than they’re worth, and, rather than making them more expensive and more difficult to use, producers should consider lowering prices, in line with every other digital entertainment medium.

The prices of most entertainment content have come drastically down as digital distribution reduces costs ranging from packaging to shipping, from overhead to staff. Those of you who were post-pablum in the ‘80s (or read Less Than Zero more than once) surely remember the days when Temple of Doom on VHS would cost hundreds of dollars. These days Amazon wants 12$ for it. An LP, or even a CD, could easily have cost 30 or 40$ a decade or two ago, now Radiohead adheres to a policy more reminiscent of a Salvation Army Santa Claus; give what you will. 

Post-recessionary spending habits indicate that we’re all looking for as much entertainment ‘bang for the buck’ as we can possibly garner. As the iOS app store and it’s analogues are all of a sudden providing a wealth of gaming options for relatively puny prices, all but the best console games are going to have their work cut out for them. 

Sure, if you’re Activision you can lock content ‘til the cows come home; it won’t stop anyone from buying the latest Call of Duty. But the typical game publisher risks extensively alienating potential customers by restricting their right of resale, and treating them with all the respect of a curfew happy nanny. 

_____ 

Byron Hawes is a Toronto-based writer. Follow him on Twitter @quentincrispy.

For more, follow us on Twitter at @torontostandard, and subscribe to our newsletter.

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