Analyst says Sony would not risk backlash by blocking used games

Well, let’s hope that for once Pachter is right.

Posted By | On 04th, Jan. 2013 Under Article, News | Follow This Author @shubhankar2508

Sony recently filed a patent that would render used games useless, making it so that they can run on only one specific system. As a result of this patent, GameStop- who see a hell lot of profit thanks to the used games department; well over $1 billion, in fact- saw a plummet in their shares.

However, Wedbush Morgan analyst Michael Pachter wants to warn people that this is all probably an overreaction. Pachter believes that no publisher- Sony included- is “foolhardy enough to take such a risk”, and that the patent doesn’t even mention if Sony will necessarily use the technology. The patent would only give publishers the option to do so if they wanted to.

“This patent reminds me of SOPA,” Pachter said in a note, “and if Sony puts the technology into the next PlayStation and any publishers attempt to limit the playing of used games, I expect the consumer backlash to be similar.”

Pachter also said that PlayStation US boss Jack Tretton told him earlier in 2012 that he is against blocking used games. “For the record, I’m totally opposed to blocking used games,” is what Tretton said, according to Pachter. “I think it is great for the consumer that they can buy those. We have a customer that buys our console late in the cycle, pays less and is looking for value-priced games. I think it would be anti-consumer for us to do that.”

He did add this, though: “I don’t know, maybe Japan will think something different but that’s my view.”


“Sony benefits little from a unilateral decision to block games,” Pachter said, talking about whether or not Sony will actually ever implement this technology that has created a shitstorm in the industry. “The company’s first party software sales represent less than 10 per cent of overall sales on its consoles, and it is unlikely that blocking used games would result in a lift of more than 10 per cent in new game sales. That means that Sony’s sales would rise only marginally if the PS4 blocked used games.”

“Sony would be materially hurt if its console blocked used games and competitor consoles from Microsoft and Nintendo did not,” he continued. “The Wii U is already on the market with no used game prohibition, and we believe that Microsoft would take advantage of Sony’s prospective decision to block used games by marketing that its own next generation did not block used games.

“If we are right, consumers would favour the console that provided more choice, leading to loss of market share for Sony’s console and a benefit to Microsoft’s.”

Well, online passes discourage the sale of used games as it is, but it seems highly unlikely, as Pachter said, that any publisher would take a risk such as this. The used games industry is a major pillar that supports the revenues of all publishers and retailers, and no publisher, especially one as important or as big as Sony, would risk such a move.

Tell us what you think in the comments section below.


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