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[PS3] Sony makes moves to stamp out lucrative second-hand market
Words: Matt Cundy

Wednesday 24 May 2006
High street games shops have been told by Sony that there will be no PS3 pre-owned sections in their stores as it will be illegal for customers to sell any next-gen PlayStation games that they've bought, retail sources have revealed to GamesRadar.

It seems that Sony is planning to adopt a licensing system that will mean gamers won't own the PS3 titles that they've paid money for. Instead, they will only be purchasing the licence to play the game and that the software itself will still be Sony property - meaning that the disc won't be the customer's to sell.

We assume that the thinking behind this move will ultimately be to stop PS3 games being resold several times - which currently snatches potential sales away from Sony - and to counter the impression in consumers' minds that games are only really worth their pre-owned price and are not worth buying new.

When we contacted Sony, it issued us with the following statement: "We have made all of the official announcements at E3 and cannot make any further comments at this time. We will be announcing more news running up to PlayStation 3's launch."

Seggybop wrote:There's no way that's going to stand up legally.

Alyeska wrote:Sony doesn't want this to go to court. They might not realize it, but they don't. If this went to court, their precious EULAs will get flushed down the drain.

Noble Ire wrote:It's almost like they don't want anyone to buy their system...

1UP wrote:We have built up a certain brand equity over time since the launch of PlayStation in 1995 and PS2 in 2000 that the first five million are going to buy it, whatever it is, even it didn't have games," Reeves told Computer and Video Games in an interview.

If true, such a move would be a massive boost for publishers and developers which do not profit from the lucrative and damaging retail trade in used games. In fact, many publishers are furious that they have to spend support money on consumers who have not actually contributed a dime to the company's coffers.

In turn, it would be a catastrophe for retailers, which make a significant proportion of margin from used games. Consumers would likely be less than overjoyed.

Sony, which is refusing to comment on the story, does have a patent on technology which would tie a piece of software to an individual piece of hardware. But technology and desire are not the only parts of the puzzle. Whether the company would be prepared to take on retail, consumer goodwill and, most likely, the U.S courts, is another matter.

One expert in retail law told Next-Gen.Biz, "Sony can theoretically sell a license to play the game, but the user would have to acknowledge acceptance of the license. You've seen this when you install software on a PC. I'm not sure that the license agreement is enforceable if the licensee doesn't agree to it.

"Also, even if the agreement is enforceable, it's hard to preclude subsequent sale of the disc. The consumer could theoretically agree that he doesn't own the right to transfer his license, but why couldn't he sell the medium that held the license (the disc)? Sony can't enforce the agreement against a third party, as it lacks privity with the third party.

"Stated differently, I don't believe Sony can keep someone from selling a disc, even if they create a license agreement. The only way that this can truly be effected is to require registration of the disc with a specific PS3 console. Sony has a patent on such a technology, and could render a disc unplayable once registered. That would accomplish their goal (if they really have such a goal). In summary, I don't believe this is real."

A senior games publishing source told us, "Sony and the rest of us would love to put an end to this damaging trade, but actually making it happen looks like a fight that's beyond even Sony. I can't see it happening, but i hope I'm wrong."

Another senior manager at a third party publisher said, "I know that Sony is very upset about the used games market. But this story seems a bit far-fetched."

Nephtys wrote:It's not like anyone's going to buy a PS3 with pre-owned games anyway, until 2 years down the line.

Edit: Also, that's another reason to stop by EB for PC games. There's plenty of PC pre-owned there.

Praxis wrote:

Nephtys wrote:It's not like anyone's going to buy a PS3 with pre-owned games anyway, until 2 years down the line.

Edit: Also, that's another reason to stop by EB for PC games. There's plenty of PC pre-owned there.

Huh. My local EB doesn't have pre-owned PC games either. Only new.

1UP wrote:We have built up a certain brand equity over time since the launch of PlayStation in 1995 and PS2 in 2000 that the first five million are going to buy it, whatever it is, even it didn't have games," Reeves told Computer and Video Games in an interview.

Praxis wrote:Also, it should be noted that this is exactly the way PC games are now. Notice the lack of used PC games at GameStop.

If true, such a move would be a massive boost for publishers and developers which do not profit from the lucrative and damaging retail trade in used games. In fact, many publishers are furious that they have to spend support money on consumers who have not actually contributed a dime to the company's coffers.

In turn, it would be a catastrophe for retailers, which make a significant proportion of margin from used games. Consumers would likely be less than overjoyed.

Sony, which is refusing to comment on the story, does have a patent on technology which would tie a piece of software to an individual piece of hardware. But technology and desire are not the only parts of the puzzle. Whether the company would be prepared to take on retail, consumer goodwill and, most likely, the U.S courts, is another matter.

Arthur_Tuxedo wrote:This is just another mis-step from Sony at a time when they can't afford to have any more of them. Still, despite the unfortunate wording of redefining a game purchase as buying a license, I can't quite condemn it completely. After all, why should retailers be able to sell a company's games without the company making a dime?

It seems that Sony is planning to adopt a licensing system that will mean gamers won't own the PS3 titles that they've paid money for. Instead, they will only be purchasing the licence to play the game and that the software itself will still be Sony property - meaning that the disc won't be the customer's to sell.