Sega Europe Boss Talks Sense on Used Game Sales

Kudos to Sega Europe chief Mike Hayes.

While Take-Two CEO Ben Feder and other video game industry moguls have been doing a great deal of whining about used game sales of late, Hayes has opted for a rational, consumer-friendly approach. is featuring an interview with Hayes, who explains his common-sense view of the used game issue and says that he wants to avoid "relationship damage with the consumer."

Good thinking.

Here are Hayes’s used game comments:

Right now it’s probably not on our top ten list of things that we need to take action and be concerned about. The whole second-hand games market is one of those very, very sensitive areas that I’ve got to say Sega keeps a pretty low profile on – and I’ll tell you why. I know that there are publishers that are vehemently, aggressively against it.

My reluctant view is that while I can understand that, if publishers were to try and enforce a non-second-hand market to the consumer, I think there would be relationship damage with the consumer. Of course, commercially, do I support it? Of course not, and I have to think here of the 650 people we employ at Sega Europe.

However, do we have a successful business working with the retailers that offer that service? Yes, we do. So would I ever join a campaign to get it stopped? The answer is no. Do I like it? The answer is no. I may be sitting on the fence here, but there needs to be a bit of reality on the market.

Tweet about this on TwitterShare on FacebookShare on Google+Share on RedditEmail this to someone


  1. 0
    questionmark1987 says:

    It would be nice if most gamers didn’t care about pretty graphics, but all the polls and numbers that I’ve seen (and I’ve seen quite a bit since it’s the focus of my schooling) show that graphics are the first thing consumers use to make a choice in what they buy, if the graphics aren’t up to par they won’t. The wii is an interesting anomaly in this but it’s by no means the norm.

  2. 0
    Chuma says:

    Where as the whiny corporates want people to buy their own copies of things and then tell them after they part with their cash that they do not own the product they bought.  Personally I can’t think of anything more conducive to piracy than getting rid of the 2nd hand market.

    Next we will have the Movie industry whining that people are lending DVDs to their friends or having them over to watch a film rather than buying their own version…

  3. 0
    ZippyDSMlee says:

    Like they have good story, AI and such now, my point is they can not keep on this path without slowing down, the first thing to go is not innovation,nor gameplay but graphics. Lower that you lower a good chuck of overhead, that means more can be spent on gameplay and the real meat and bones of quality no petty graphics.


    Thats half right, but for the msot part you lower grpahics you open up more thigns to easily port to.



    Well the problem is who has the time to code when they are focusing on maxing out graphics?
    They can not do both they do have have the mindset for it they can not wait to patch a game right they can not wait to release it early.

    If they cut back on graphics and modeling it will clear up time and money for other parts of the project, also if they built engines for more portability a dev/pubs would spend less on porting, but there is so much chaos going on the industry can not optimize itself to produce games better. .

    Gore,Violence,Sexauilty,Fear,Emotion these are but modes of transportation of story and thought, to take them from society you create a society of children and nannys, since adults are not required.

  4. 0
    GoodRobotUs says:

    That’s down to the quality of coding, not the amount of money you pour into it.

    I see this argument a lot, that funds that already aren’t going into the game business would somehow mean better games if it was, and it’s complete tosh.

    You’re talking about Hardware improvements, which increase speed and physics, coding skill, which is more down to the ability to the people they employ, and the game engine that is either going to be proprietry, which is down to the coders again, or licensed from another company.

    This whole idea of ‘Throw more money at it and it’ll be better’ has proved itself to be wrong time and time again, I can’t understand why people hang onto the idea.

    This is more about lining the pockets of shareholders than any real quality improvement from the players point of view, the quality of the game will still be limited by the abilities of the machine it’s played on and the coders who wrote it. Admittedly, they could pay a little more for higher qualified coders, but considering the profits the game business is already pulling in, there’s hardly any excuse for not doing that already, and the shareholders wouldn’t have it anyway, since people are buying games at their current quality, and they are making a nice tidy sum already, so why not keep the quality the same and simply make more money from them?

    That’s the real grudge about the Second hand sales, it’s not about money for the people who wrote them, the coders will still be on the same wage as before, it’s about making more money for the shareholders themselves.

  5. 0
    chipsugar says:

    But their "pretty graphics" can actually limit their market. The PC I have is just entering the too old to buy games for (athlon xp & agp graphics card) category and I have no intention of upgrading my pc. I’m happy to play old games whether they’re second hand or not but for newer games like Bully Scholarship Edition I’m SOL because Rockstar wants their games to be prettier than my pc can make them.

    I’m not saying they shouldn’t develop for the top end machines but if they don’t develop for older machines the 2nd hand market will always be there.

  6. 0
    ZippyDSMlee says:

    Games are in a 3 way cluster fck, 1.Console war model thins out software sales,2.Industry ineptness to lower cost/graphics to stay solvent, 3.High prices that slow sales.

    Its lose lose all around and will only get worse as you move forward, the modern industry will have to do away with one of these to move forward and stay in business..

    Gore,Violence,Sexauilty,Fear,Emotion these are but modes of transportation of story and thought, to take them from society you create a society of children and nannys, since adults are not required.

  7. 0
    TheEggplant says:

       Truth about OEMs Zippy, but I was speaking strictly about retail boxes. Especially when you look at what Microsoft has done to OEM Vista to keep it out of the hands of private consumers. This is why I keep bringing up PC games. There is no used market except from private seller to buyer or smaller retail outlets. These games still come out a full price. Then there’s a gold edition. Then prehaps a stripped down Jewel Case editon. Console games however stay full price for a longtime. Furthermore if more orders for new games equaled lower prices then why isn’t Wal-Mart undercutting everyone else? Because they can’t. Because wholesale prices on new games are high for every retailer.

    The idea of no used market equals lower prices is BS. Whenever the CEO of EA/2K/Activison/Epic complains about used games what they are really saying is "We only want the free market to apply when it is benefical to us." i.e. the market will bear $60 games. When a second-hand market springs up though they want all the rules to change in their favour.

    ——————————————————————————————————————————— Hookers and Ice Cream aren’t free.

  8. 0
    ZippyDSMlee says:

    Ture to a point, but games have less hardware to sale on so their prices will be higher than movies because of the effects that come from having to to do more to sell enough titles to break even, the problem is they are going to have to make games cost effective and cut fat, like super high end graphics.

    Gore,Violence,Sexauilty,Fear,Emotion these are but modes of transportation of story and thought, to take them from society you create a society of children and nannys, since adults are not required.

  9. 0
    halfcuban says:

    "Books, cars, all of material products in general. The cost of producing comes on an order by order basis."

    Are you kidding me? Cars take massive amounts of development time and retooling of factories and supply chains to launch. It’s why when a new model flops, the company takes such a hit; they just can’t pop out a new car if the current design fails to sell. So billions are actually involved, if not more, before a single car is ever produced. So actually the comparison is apt.

    And the used game market has a built in ceiling into it; if no one’s buying the game new, no one can buy it used. And if everyone merely waits for a used copy to show up, a gamer, somewhere, will have to pony up if they want to play it. I buy plenty of new and used games, and I also purchase plenty of DLC’s for said games. I am hardly a rip off artist.

  10. 0
    NovaBlack says:

    to be fair though.. investing alot upfront… thats how it works, and dont make out like publishers didnt know that when they got into the industry.. and if they didnt… well no sympathy from me.

    Its a hit driven industry. A Publisher may have funds behind ~5 or so projects at one time, and examines the market/current trends and reallocates funds to ‘back the winner’ so to speak. If one game gets canned, or more often gets funds heavily reduced, the game will be rushed out the door to recoup some losses.

    Do publishers have any problem shafting me out of cash when they rush a game out in this way?. when ive purchased a game from them, say on pc, that i cannot then return after ive installed, only to find out its broken as heck , unfinished, and doesnt really have half the things mentioned on the box.. will they give me my cash back if i email them and ask nicely?…. fraid not. Thats just how it works.. pull funds, rush release, recoup losses with sales of poor unfinished product, that would not be acceptable in any other industry, but somehow is ok, since nobody has truly challenged a completely faulty rip-off game in court. If buying games as a consumer means that i occasionally get ripped off (and lets not beat about the bush, im not syaing the game wasnt to my tastes, im saying truly ripped off.) then im going to look at ways of making my investments safer.. i.e. paying half as much for a used copy. Until im protected adequately, im sorry, but ill still occasionally buy second hand if im unsure about a particular game. If they want to extend a promise (ie. gamers bill of rights) then i wont buy preowned. that simple.

  11. 0
    NovaBlack says:

    ”In fact, many publishers buy out developers simply because they go into severe debt and otherwise would fail, where as the publishers can assume the risk and weather the temporary cashflow situation.”


    Um thats not the exception though, thats the norm. Devs dont fund the development, publishers do… Its rare for the devs to ever fund the development themselves….

    I mean you get exceptions e.g. valve, who made enough to start funding their own projects.. but 99% of the time, its the publisher footing the bill. thats why devs make so little money from actual game sales (around only 5% goes to devs!). The publisher foots the risk, and eats up all the profits. Thats just how it works. Hence my point about the publishers taking the hit of a bad project over devs. I mean the devs will still ultimately get paid as they meet milestones, wether or not the end product actually sells.


    ”This is simply not true. Developers are far more likely to go bankrupt than publishers. ”

    As long as devs secure funding from a publisher for projects, then tbh there is far more chance of the publisher busting out than the developer. If a publisher puts funds behind multiple projects and only one, or even None do well, then the publisher suffers. The devs have been paid at that point and should have the next project lined up.



  12. 0
    Flaps says:

    um to be fair the developers making them typically are NOT going bankrupt.

    This is simply not true. Developers are far more likely to go bankrupt than publishers. Many developers run into major cashflow situations due to a single project running behind or over budget.  In fact, many publishers buy out developers simply because they go into severe debt and otherwise would fail, where as the publishers can assume the risk and weather the temporary cashflow situation.

    Often you don’t even hear about a developer failing, but a publisher is always major news.

  13. 0
    Baruch_S says:

    nobody sets out to make a bad game

    Really? How about those games that are relying on their association with a movie or existing franchise to sell the game? They may not have been intentionally making a terrible game, but they ignored the opportunity to make a good game in favor of cashing in on another franchise.

    It’s absurd to say that publishers need a bigger cut. They can charge the retailer whatever-the-hell they want for games. If they want more money, they can charge the retailer more and force him to either take a hit to his profits or raise his prices.

    I’d also like to see you prove that a smaller secondhand market would make the firsthand market larger or prevent studios from shutting down. You’re forgetting that many people resell their used games in order to buy new ones. You’re assuming that the people who buy used games would be willing to pay significantly higher prices for new games and that the people who sell their old games would still scrounge up enough to buy the same number of new games. That’s pretty idealistic. The secondhand market helps fuel the firsthand market by giving people money for their old games in order to buy new games.

    There are plenty of people like me who try not to pay over $40 for a game. I either wait until the price is down or buy used. In fact, I consistently stay a console generation behind to save money. If I couldn’t easily get used games, I probably wouldn’t buy console games period. Then the guy who sold his PS2 and a bunch of games to buy a PS3 wouldn’t have gotten his money, so Sony wouldn’t have sold that PS3 and all the games that guy has bought since. Which do you think they prefer?

  14. 0
    NovaBlack says:

    um to be fair the developers making them typically are NOT going bankrupt.

    The devs get paid pretty much as the development progresses. Meet a milestone, get paid. Finsih the project, get paid.Thats how it goes. The publishers burden the real costs.  Devs atually only get something stupid like 5% of the cash from a game sale, the publishers and retailers split the rest. I think somebody should look at how publishers and retailers are shafting devs, before whining about consumers tbh.

    And can you blame consumers for moaning about paying $60 for a game?. I remember when i bought Kane and lynch on the pc.. absolutely furious. Barely worked, never a patch released. A Buggy POS. They are happy to take cash off me, and then i cant get a refund when i realise how broken and unfinished it is. So why should i worry about paying less for games preowned, when it just limits the damage to my pockets if the game turns out to be a buggy unfinished rip-off that in ANY OTHER SECTOR would be a violation of the sale of goods act. If it doesnt work as advertised then it shouldnt be released. But they have no problem doing that even if it means shafting consumers. (K & L advertised  coop on pc.. but once installed would only do that split screen  and only with a £35 360 controller…. on a pc… and with a paid Live Gold account) (not mentioned on original box ANYWHERE. Plus it had many game breaking bugs. )

    All in all i think that if their  ethics towards consumers change, then consumers will change their ethics towards them. Its a two way street, they cant have their cake and eat it too.


  15. 0
    NovaBlack says:

    ” please consider that nobody sets out to make a bad game (not even movie licensees). ”


    yeah but look at it from the other angle. do (for example)  movie licensees set out to make a good game? Im afraid the answer is no. Speaking from experience on this, they set out to make a game that is cheap, quick to produce, and will generate sales based on the license, not the game quality. They couldnt care less if the game is actually good, as long as its completed enough to drag its ghoulish half complete body out the door and have people only just accept it. Thats a cash in. Thats how it works. And it shouldnt be like that. Movie licenses technically have way more potential than the majority of other games. I mean come on an established IP with a dedicated fan base. So much potential there. And yet they just milk the fans for cash.

    Furthermore just look at wii. Shovelware is commonplace. An ocean of slurry you have to wade around in to find one tiny morsel of a good game. i Mean you are right, of course ‘nobody sets out to make a bad game’. That just wouldnt make sense. But dont think that they always aim high, or even satisfactorily. Sometimes they see that mark that indicates ‘uhh.. yeah.. ok.. itl just about scrape by without consumers sending us angry letters but itl make us cash’, and wont aim any higher.

  16. 0
    E. Zachary Knight says:

    The $60 price tag is exactly the result from the huge development budget. When it costs $50 million+ to make a game, of course you have to charge more to recoup those costs and at that point anyone not buying new is going to hurt your ability to make a profit.

    Tha tis why I advocate for cheaper to develop games. That is why I support the Wii and refuse to support the 360 and PS3 at this time.

    For me and Millions of other Wii owners, we Don’t need the massive graphical capabilities of the PS3 and 360. HD gaming is not a priority.

    If games like World of Goo, Braid (yes I know it is an XBLA title) etc can be developed with a team that can be counted on one hand and still be a huge success, There is very little justification for teams of 100+

    I am not just talking about team size though. This is mostly about risk management. If two games both sell 1 million copies, but one cost 5 million to make and and sold for $50 while the other cost 50 million to make and sold for $60, which was the better investment? Which is more damaged by the 500 thousand used copies sold later on?

    Is there a place in gaming for those $50 million games? Yes. But they should not make up the bulk of the games produced. Just as not every movie need to be a Micheal Bay movie, not every game needs to be Resistance or Halo. There is room for the cheap popcorn pushers.

    So thinking along those lines, I still think what Take Two said is whining. They are whining because their business model cannot cope with the used market. So they whine and complain about the used market while paying lip service to fixing their business model.

    E. Zachary Knight
    Oklahoma City Chapter of the ECA

    E. Zachary Knight
    Divine Knight Gaming
    Oklahoma Game Development
    Rusty Outlook
    Random Tower
    My Patreon

  17. 0
    questionmark1987 says:

    I don’t see why this is whining, he’s simply stating facts. Game stop DOES promote their used games over all else, every sale of a new game they tell you "You could buy used for $5 less."

    Used sales DO have a meaningful impact on new sales, no not every used sale is a lost new sale, but even if you stick it at a low number, say aorund 20%, that’s a significant number of new sales the developer has lost.

    Management of many companies IS frustrated and looking for ways to eliminate it. Some are looking at DRM, some at EULA and some simply at game models (MMOs are very hard to second hand sell for example).

    If you want to talk about whining, how about the consumers who are whining about having to pay $60 for a new game right when it comes out, while the companies making them are going bankrupt and closing because they can’t make up thier costs of operation? I’m sure the industry and quality of games in general will increase as the amount of companies competing continues to decrease.

  18. 0
    SticKboy says:

    "Sounds like a fair amount of whining to me."

    …sounds like whining to me. How on earth can stating that you’re looking into "ways to ameilorate the problem" be considered whining in this or any other context? That’s evidence of a practical mindset, unless you’re going to cast aspertions as to their true intentions?

    Put it this way: if the second-hand market was a bit smaller and the first-hand market a bit larger, fewer studios would be closing down. That’s a fact.

    Oh and before somebody chimes in with "why don’t they just make better games and sell them for less, then I’d buy them new", please consider that nobody sets out to make a bad game (not even movie licensees). Developers don’t simply state, "oh, we better make a good one this time round." Moreover, if more of your money was passed back to publishers rather than staying with retailers, the publishers would actually have the option to reduce the RRP or MSP of new releases. Surely you must have thought of that?

  19. 0
    ZippyDSMlee says:


    Not quite some software is sold as OEM at 1/3rd or less of the retail price.

    But you are right its all a shame they make up to make exesisvice profits, the software industry needs to rethink its place in the world and move to a more mass produced mindset like dvd/film/BR, lower consumer prices, wider market, I mean sale a OEM game no manual, in a paper sleeve for half the price of the retail set, the only down side is it would undermined your retail market, but what happens when you do this though digi distribution with no resale ability?

    You would start gaining profit because people that can well buy the retial those who can’t will buy the digi distro one so you are making consumers not losing them.


    Gore,Violence,Sexauilty,Fear,Emotion these are but modes of transportation of story and thought, to take them from society you create a society of children and nannys, since adults are not required.

  20. 0
    TheEggplant says:

    I’ll refer to my previous statement on the issue with links.

    You can’t say that the more wholesalers buy, the cheaper the games will be at retail when it never happens. Games that are almost guarenteed to sell millions are still the same price.(see Halo 3 and Gears of War 2) The prices don’t come down on games based on units ordered because the publisher don’t sell in bulk. Why doesn’t Microsoft sell Windows cheaper to the consumer, considering how many units are bought? Because they don’t want to. This is why retail Windows is the same price everywhere.

    Granted there is some inference on Take-Two CEO Ben Feder’s statement. That’s because 2K has shown them selves through use of DRM that they are not a friendly company. If you don’t make noise now they will assume you accept whatever they are going to do.


    ——————————————————————————————————————————— Hookers and Ice Cream aren’t free.

  21. 0
    unholyblackdeath says:

     Well spoken.  The real issue is that the consumer should always get what he or she wants, end of story.  The market is consumer driven, not corporation driven.  If consumers want to re sell games, then that ios what is going to happen.  This man obviously sees that.

  22. 0
    questionmark1987 says:

    So when the games stop ahving the pretty graphics and the good AI and the good story and the good gameplay because they decided to not pay their developement team well and had to hire less skilled people to do it you’ll still buy it?

    Yeah I can totally see that working. The irony of whiny consumers, we want everything for nothing.

  23. 0
    ZippyDSMlee says:

    Media does not improve through artificial means’ you cannot spend more money on a media industry and think ti will improve the corporate mentality of cost cutting important things like story, polish, bug work, development time arte too insipid.


    The used game market keeps whatever balance is left intact remove it and there will be serge to piracy we’ve not seen since the 1600’s.

    The 2nd hard market brings more enough foot traffic to the industry to allow for the sale of so much goods you cannot dismiss its worth and benefits to the industry as a whole, so what if developers and publishers are feeling their pennies pitched since they cannot off set their bottom line fully on the consumer without losing said consumer.

    All this whining about profits goes back to the main issue they are spending too much to create games, the onus is on them to change or go under!


    Gore,Violence,Sexauilty,Fear,Emotion these are but modes of transportation of story and thought, to take them from society you create a society of children and nannys, since adults are not required.

  24. 0
    questionmark1987 says:

    Bad analogy is Bad.

    I’ve said it before and I’ll say it again, the ONLY comparable market is movies.

    Books, cars, all of material products in general. The cost of producing comes on an order by order basis. If it only cost $35 or so per copy of a game to amke each game, companies could easily just produce as many as there is in demand and make up their costs. But that’s not the way movies and games work.

    The majority of the cost of making a movie or a game (IE millions of dollars) happens before a single copy is ever sold. Developers and publishers produce enough copies at the beginning of a game’s lifecycle to hopefully recoup the costs of developement and production. If they don’t sell X copies, they just lost money, and most likely won’t be able to make another. Only big companies with in house publishment (EA, Midway, Etc) and designers with insane name recognition (Cid Meir, Will Wright) can make large mistakes liek that and stay afloat, and even they egt some damage from it.

  25. 0
    E. Zachary Knight says:

    While yes he did suggest ways of making their games more attractive as new purchases and have a longer home life, it was proceeded by a considerable amount of whining:

    GameStop continues to aggressively push their used game business, which is having a meaningful negative impact on sales of new games," noted analyst Doug Creutz, following a meeting with Take-Two CEO Ben Feder this week.

    "Management is frustrated with this trend and is examining ways to ameliorate the problem

    Sounds like a fair amount of whining to me.

    But  Iam happy to see them want to compete rather than destroy.

    E. Zachary Knight
    Oklahoma City Chapter of the ECA

    E. Zachary Knight
    Divine Knight Gaming
    Oklahoma Game Development
    Rusty Outlook
    Random Tower
    My Patreon

  26. 0
    beemoh says:

     …except Ben Feder wasn’t "whining", or trying to "enforce a non-second-hand market to the consumer", he was merely identifying that a second hand market exists due to a failure on his part to create a product you didn’t want to trade in.

    In fact, he said pretty much what Hayes is saying. But, of course: OMG EVIL CORPS TAKING AWAY OUR USED GAMES WAAA!


Leave a Reply