Profiteering is ruining the gaming industry

Profiteering is a new trend in the video game world. Scalpers buy up some supply at launch and resell anywhere from 150-200% the MSRP.

What isn't realized is the harm this does to the industry.

1) Provides bad feedback for the manufacturers. In the case of the PS3 launch, about 75% of the PS3's bought were intended to be sold. The product sold out, but it was largley due to the upcoming holiday season and the idea of turning a quick profit.

2) It artificially inflates the price and will lead to a true price in inflation. The biggest concerns the past two generation launches have been pricing. We see profiteers moving product at 100% above MSRP and we grow used to this new pricing structure. In developing the next generation, the developers will not be nearly as price sensative and may even add to their own margins with the idea that the market will bare the higher pricing.

3) Lack of goods at the intended time of purchase cause consumers to buy a product they didn't want. Not only does this send even more false feedback to the manufacturers, but it also breeds disdain in the consumer and stunts industry growth.

Over the weekend I looked in close to 10 stores for a copy of WiiFit. I was only able to find a copy on sale for 200% MSRP from online retailers in Oregan! You cannot buy this online at MSRP.

A product that is being contested for it's real value in gaming circles sells out in hours. A hefty chunk to profiteers. This isn't a console. Rockband didn't sell out to profiteers and Guitar Hero didn't sell out to profiteers. So why has WiiFit? The trend is slowly spreading from consoles to peripherals and eventually nothing will be sacred. Everyone will have to preorder or wait 6 months. It's a huge blow to the economic system that drives this country and the only benefactor is the profiteers.

I don't see any possible way of stopping this other than price regulation on popular resale and auction sites; But I'm pretty damn tired and not thinking clearly. I'd like to see what everyone else thinks of this.

Profiteering is a new trend in the video game world. Scalpers buy up some supply at launch and resell anywhere from 150-200% the MSRP.

What isn't realized is the harm this does to the industry.

1) Provides bad feedback for the manufacturers. In the case of the PS3 launch, about 75% of the PS3's bought were intended to be sold. The product sold out, but it was largley due to the upcoming holiday season and the idea of turning a quick profit.

2) It artificially inflates the price and will lead to a true price in inflation. The biggest concerns the past two generation launches have been pricing. We see profiteers moving product at 100% above MSRP and we grow used to this new pricing structure. In developing the next generation, the developers will not be nearly as price sensative and may even add to their own margins with the idea that the market will bare the higher pricing.

3) Lack of goods at the intended time of purchase cause consumers to buy a product they didn't want. Not only does this send even more false feedback to the manufacturers, but it also breeds disdain in the consumer and stunts industry growth.

Over the weekend I looked in close to 10 stores for a copy of WiiFit. I was only able to find a copy on sale for 200% MSRP from online retailers in Oregan! You cannot buy this online at MSRP.

A product that is being contested for it's real value in gaming circles sells out in hours. A hefty chunk to profiteers. This isn't a console. Rockband didn't sell out to profiteers and Guitar Hero didn't sell out to profiteers. So why has WiiFit? The trend is slowly spreading from consoles to peripherals and eventually nothing will be sacred. Everyone will have to preorder or wait 6 months. It's a huge blow to the economic system that drives this country and the only benefactor is the profiteers.

effthat

The funny thing is it would probably be cheaper for me to buy a US product at 150% and have it shipped than to buy retail here (Australia).

It's supply-demand.

if we just stop having this feeling like we just have to have it right away, they will still sell through there first shipment, and us smart gamers will wait till its in stores, actually has worthwile software, and usually has better drives than the original release.

pretty much we should all learn to avoid this profiteering, its nasty business

You cannot stop this from happening, in fact to do so is anti-capitalist. The reality is, there are people who are willing to pay *any* price to get their hands on a videogame system in short supply. Simple microeconomics tells us when there is high demand, and low supply, the price should be higher. When the price is not set higher at the store, it will instead reach its natural price point in the second hand market.

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This isn't a "huge blow" to the economic system - this is the economic system. This market only exists because Nintendo is undervaluing their system - that is, they are selling Wii Fit and the Wii at prices that are lower than the equilibrium price point. They actually do this so that they don't have to constantly adjust prices, which can create consumer confusion, but so long as they launch at the same price they intend to sell at for a year, during periods of high demand (launch of a new product) the price WILL get driven up.

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Frankly you should consider yourself lucky - you have the opportunity thanks to pre-orders (next time, eh?) to get a game below its fair market value. Yes, getting Wii Fit at retail price is below free market value - and frankly a Wii as well, because there is a shortage on these items.

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But if you're concerned about prices being higher in the second hand market, then I simply suggest you don't goods from resellers. If people refuse to pay a premium on such goods, then resellers will not bother speculating on them.

You forgot that people who buy the system for twice the price have less money to spend on games or controllers.

They should chip humanity and control their purchases. I heard in the USA they're halfway there by chipping Your passport :PKungfuKitten

I'm pretty sure someone who is willing to pay two grand to get something on eBay the day it comes out isn't going to be particularly phased by spending another couple hundred bucks on software and accessories.

You cannot stop this from happening, in fact to do so is anti-capitalist. The reality is, there are people who are willing to pay *any* price to get their hands on a videogame system in short supply. Simple microeconomics tells us when there is high demand, and low supply, the price should be higher. When the price is not set higher at the store, it will instead reach its natural price point in the second hand market.

-

This isn't a "huge blow" to the economic system - this is the economic system. This market only exists because Nintendo is undervaluing their system - that is, they are selling Wii Fit and the Wii at prices that are lower than the equilibrium price point. They actually do this so that they don't have to constantly adjust prices, which can create consumer confusion, but so long as they launch at the same price they intend to sell at for a year, during periods of high demand (launch of a new product) the price WILL get driven up.

-

-

Frankly you should consider yourself lucky - you have the opportunity thanks to pre-orders (next time, eh?) to get a game below its fair market value. Yes, getting Wii Fit at retail price is below free market value - and frankly a Wii as well, because there is a shortage on these items.

-

But if you're concerned about prices being higher in the second hand market, then I simply suggest you don't goods from resellers. If people refuse to pay a premium on such goods, then resellers will not bother speculating on them.

subrosian

I refuse to buy from profiteers. The theories are all correct, but in practice this is what caused our current economic situation. Housing prices were booming and flips were the hot investment item. Now we have about 36 months worth of housing supply on the market and everyone is taking a hit. It just happens that this spread into the lenders and caused even more trouble with the financial institutions further complicating the matters by making it nearly impossible to get a loan at the same time that the dollar is inflating at breakneck speeds.

My issue isn't that the prices are high. It's that it's being done by individuals who can't appropriately forecast demand and this messes up the system. PS3 launched and sold out. Prices bottomed out over night on ebay. Profiteers were stuck with breaking even after shipping or returning the product. The Wii and WiiFit might be doing great for profiteers, but the market will eventually bottom out. By then the damage is done, the manufacturer sees inflated demand, the retailer sees the returns and no longer stocks the item, the consumers never wanted the good in the first place.

There are other problems with the profiteering, though. These individuals aren't offering a warranty, don't offer reliable service, don't insure their end of thebargain. Not to mention don't pay taxes. Finally, most investors expect to make money. They refuse to sell for less than they paid. Again, the price isn't able to fluctuate properly and causes inflated prices.

There are other problems with the profiteering, though. These individuals aren't offering a warranty, don't offer reliable service, don't insure their end of thebargain. Not to mention don't pay taxes. Finally, most investors expect to make money. They refuse to sell for less than they paid. Again, the price isn't able to fluctuate properly and causes inflated prices.

effthat

Frankly you should consider yourself lucky - you have the opportunity thanks to pre-orders (next time, eh?) to get a game below its fair market value. Yes, getting Wii Fit at retail price is below free market value - and frankly a Wii as well, because there is a shortage on these items.

subrosian

I'm upset that when there is high demand the lowest market value IS retail price. I understand the cause, but this still baffles me.

[QUOTE="effthat"]

There are other problems with the profiteering, though. These individuals aren't offering a warranty, don't offer reliable service, don't insure their end of thebargain. Not to mention don't pay taxes. Finally, most investors expect to make money. They refuse to sell for less than they paid. Again, the price isn't able to fluctuate properly and causes inflated prices.

HuusAsking

No. I'm saying that these people are investing blindly because they know nothing about investing and there is no real way for them to predict what will happen. So they will buy up the stock and inflate the price regardless of demand. If there is no demand for an extended period of time, they've kept the reciept and return the product (in most cases). There is still considerable damage from this though.

The point is that profiteers aren't real businessmen/women. They see that a few other people have made a quick buck and jump on expecting the same success to work time and time again for them. Anyone who studies business knows that markets change daily.

Look at the ebusiness crash and the housing crash. People who shouldn't be involved think they can turn a quick profit and it works great at first, but causes over speculation and eventually there is a readjustment of the market that sends shockwaves through the value chain.

Profiteering exists is literally every industry, it's called "capitalism", trust me, no gaming producer, ever, has gone out and said "Man, lets make a non profit console, just so people have something to play!", therefore, since it's existed since day 1 in the industry, it cannot ruin it.Andrew_Xavier

Profiteering doesn't exist in every industy. It may derive from capitalistic values but lacks some basics (such as the addition of value). Furthermore, you know nothing about nonprofit organizations and it shows.

Please come back after you've studied business principles a bit more.

It's supply-demand.

Eponique

like oil, it's not real demand but rather speculators hoping to make a quick buck with flipping. this happened in the housing market as well. prices eventually crash hard. much like the demand for the ps3. it was impossible to get at launch but the actual demand was a lot less and thus in a couple of weeks the speculators fled and anyone that actually wanted a ps3 could get it easily.

[QUOTE="Andrew_Xavier"]Profiteering exists is literally every industry, it's called "capitalism", trust me, no gaming producer, ever, has gone out and said "Man, lets make a non profit console, just so people have something to play!", therefore, since it's existed since day 1 in the industry, it cannot ruin it.effthat

Profiteering doesn't exist in every industy. It may derive from capitalistic values but lacks some basics (such as the addition of value). Furthermore, you know nothing about nonprofit organizations and it shows.

Please come back after you've studied business principles a bit more.

I actually know a decent amount about non-profits, more than, say, someone stating "you know nothing about *insert title here*", and I don't beleive I mentioned them, in any way?

I simply stated, a producer of consumer goods, in this case, a video game console producer, is not going to do it without making some kind of profit, I mean, nintendo released an entire feature film, put it in theatres, many people saw it, just to advertise Super Mario Bros 3....was called The Wizard.

[QUOTE="effthat"]

[QUOTE="Andrew_Xavier"]Profiteering exists is literally every industry, it's called "capitalism", trust me, no gaming producer, ever, has gone out and said "Man, lets make a non profit console, just so people have something to play!", therefore, since it's existed since day 1 in the industry, it cannot ruin it.Andrew_Xavier

Profiteering doesn't exist in every industy. It may derive from capitalistic values but lacks some basics (such as the addition of value). Furthermore, you know nothing about nonprofit organizations and it shows.

Please come back after you've studied business principles a bit more.

I actually know a decent amount about non-profits, more than, say, someone stating "you know nothing about *insert title here*", and I don't beleive I mentioned them, in any way?

I simply stated, a producer of consumer goods, in this case, a video game console producer, is not going to do it without making some kind of profit, I mean, nintendo released an entire feature film, put it in theatres, many people saw it, just to advertise Super Mario Bros 3....was called The Wizard.

And we're done talking...

enjoy your in-depth knowledge non-profits and your economics degree...

[QUOTE="Andrew_Xavier"][QUOTE="effthat"]

[QUOTE="Andrew_Xavier"]Profiteering exists is literally every industry, it's called "capitalism", trust me, no gaming producer, ever, has gone out and said "Man, lets make a non profit console, just so people have something to play!", therefore, since it's existed since day 1 in the industry, it cannot ruin it.effthat

Profiteering doesn't exist in every industy. It may derive from capitalistic values but lacks some basics (such as the addition of value). Furthermore, you know nothing about nonprofit organizations and it shows.

Please come back after you've studied business principles a bit more.

I actually know a decent amount about non-profits, more than, say, someone stating "you know nothing about *insert title here*", and I don't beleive I mentioned them, in any way?

I simply stated, a producer of consumer goods, in this case, a video game console producer, is not going to do it without making some kind of profit, I mean, nintendo released an entire feature film, put it in theatres, many people saw it, just to advertise Super Mario Bros 3....was called The Wizard.

And we're done talking...

enjoy your in-depth knowledge non-profits and your economics degree...

So, you posted a thread, to...not...encourage discussion? Interesting.

Sure, this has been a big trend this gen with all three consoles at launch (The Wii just expanding a bit longer) and now with Wii Fit. Part of it is that these things are finding their way into the mainstream media more. There were tons of news stories about Wii Fit before it came out, which caused people to say, "This is going to sell huge, if I grab a few I can make some big bucks."

Yes, it sucks for those that really want the product, but it sucks for every person that buys products that create secondary market, toys, comics, etc. It's jsut that this is relatively new to the gaming industry, in part because the tools like ebay and craigslist weren't as heavily used at the time of the last launches.

As far as having overwhelming impact on the industry, I doubt it. I'm sure Nintendo is at least vaguely aware of how many Wiis are sold on Ebay. Stores put mechanisms in place to limit bulk purchases of these high demand items, usually limiting one purchase per household at a time.

[QUOTE="effthat"][QUOTE="Andrew_Xavier"][QUOTE="effthat"]

[QUOTE="Andrew_Xavier"]Profiteering exists is literally every industry, it's called "capitalism", trust me, no gaming producer, ever, has gone out and said "Man, lets make a non profit console, just so people have something to play!", therefore, since it's existed since day 1 in the industry, it cannot ruin it.Andrew_Xavier

Profiteering doesn't exist in every industy. It may derive from capitalistic values but lacks some basics (such as the addition of value). Furthermore, you know nothing about nonprofit organizations and it shows.

Please come back after you've studied business principles a bit more.

I actually know a decent amount about non-profits, more than, say, someone stating "you know nothing about *insert title here*", and I don't beleive I mentioned them, in any way?

I simply stated, a producer of consumer goods, in this case, a video game console producer, is not going to do it without making some kind of profit, I mean, nintendo released an entire feature film, put it in theatres, many people saw it, just to advertise Super Mario Bros 3....was called The Wizard.

And we're done talking...

enjoy your in-depth knowledge non-profits and your economics degree...

So, you posted a thread, to...not...encourage discussion? Interesting.

There is a difference between intelligent conversation and what you've posted. You say that capitalism is in every industry, but if that were the case then socialism and communism wouldn't exist as these are not based on the free market. You also claim the profiteering is capitalism, which it is not. Capitalism relys on the addition of more value than the sale price. Profiteering adds no value. In fact it takes away the value of convenience and product guarantees. Profiteering is strongarming the consumers by creating a false lack of supply.

You also talk about the manufacturers as if they're controlling this! Yes, businesses exist to amass wealth through the creation of value. No, Profiteering is not a business nor does it add value.

Discussion is only valuable when both sides contribute something of value. You've yet to contribute anything of value. When you are able to, I will gladly continue to discuss the topic of private profiteers and their effect on the market.

Sure, this has been a big trend this gen with all three consoles at launch (The Wii just expanding a bit longer) and now with Wii Fit. Part of it is that these things are finding their way into the mainstream media more. There were tons of news stories about Wii Fit before it came out, which caused people to say, "This is going to sell huge, if I grab a few I can make some big bucks."

Yes, it sucks for those that really want the product, but it sucks for every person that buys products that create secondary market, toys, comics, etc. It's jsut that this is relatively new to the gaming industry, in part because the tools like ebay and craigslist weren't as heavily used at the time of the last launches.

As far as having overwhelming impact on the industry, I doubt it. I'm sure Nintendo is at least vaguely aware of how many Wiis are sold on Ebay. Stores put mechanisms in place to limit bulk purchases of these high demand items, usually limiting one purchase per household at a time.

shadowcat2576

One or two cases doesn't effect the industry. Prolonged exposure and an increase in it's occurance (as we've seen) will eventually lead to a price readjustment.

It undermines the industry and steals value from the value chain. It's bad for the industry at all levels.

You also claim the profiteering is capitalism, which it is not. Capitalism relys on the addition of more value than the sale price. Profiteering adds no value. In fact it takes away the value of convenience and product guarantees. Profiteering is strongarming the consumers by creating a false lack of supply.

effthat

You're a bit off. Capitalism is many things and one of them being placing a value on opportunity. Right now hedge funds are one of the biggest purchases of oil futures contracts at the moment and they have zero intent to ever take delivery of the oil they buy. In fact, that contract may flip several times before it's sold on the spot market and delivery is taken. Time, capital, and opportunity are all values in a capitalistic system. As such all are "invested" in the practice of speculating, flipping, etc.

I bought 4 PS3's when they came out. I kept one and sold the other three. Two for almost $2k. If some idiot parent thought their kid was worth $2k then more power to them. Didn't bother me in the slightest.

As far as having overwhelming impact on the industry, I doubt it. I'm sure Nintendo is at least vaguely aware of how many Wiis are sold on Ebay. Stores put mechanisms in place to limit bulk purchases of these high demand items, usually limiting one purchase per household at a time.

shadowcat2576

[QUOTE="effthat"]

You also claim the profiteering is capitalism, which it is not. Capitalism relys on the addition of more value than the sale price. Profiteering adds no value. In fact it takes away the value of convenience and product guarantees. Profiteering is strongarming the consumers by creating a false lack of supply.

ramey70

You're a bit off. Capitalism is many things and one of them being placing a value on opportunity. Right now hedge funds are one of the biggest purchases of oil futures contracts at the moment and they have zero intent to ever take delivery of the oil they buy. In fact, that contract may flip several times before it's sold on the spot market and delivery is taken. Time, capital, and opportunity are all values in a capitalistic system. As such all are "invested" in the practice of speculating, flipping, etc.

I bought 4 PS3's when they came out. I kept one and sold the other three. Two for almost $2k. If some idiot parent thought their kid was worth $2k then more power to them. Didn't bother me in the slightest.

Finally we get to the meat and potatos! Oil futures are going up because it's one of the few products that are going up in the currant market. Commodities in general are currently over speculated, though, and a price readjustment is bound to happen. Private investors who know very little about the market trends see the big guys putting money into it and decide thats where they need to be. The big guys turn millions of shares at a miniscule profit and leverage volume sales. The little guys that are attracted can't leverage volume and the market isn't forgiving. Once it drops out, these smaller investors get drained.

The issue is that nobody wants to add real value anymore. They want to turn a quick easy buck and disregard the risks based on past results. When these guys come in big enough numbers it throughs off the whole system. Value is being forecasted that isn't going to be created. The eventual readjustment hurts the investors, the producers, and the consumers.

The "value" is being "created" by profiteers constraining the supply and hording the product to be released slowly at the new equilibrium price. It's done with diamonds and it's done with oil and it is not a part of capitalism. It is the product of individuals who know enough about economics to think that they can rig the system to payout. In reality they can't and someone is going to get burned for the actions of the profiteers. There are repercussions of profiteering that extend far down the line and we'll never know exactly how much they effected the marketed. We do know that they will and do and in most cases it's for the worse.

[QUOTE="shadowcat2576"]

As far as having overwhelming impact on the industry, I doubt it. I'm sure Nintendo is at least vaguely aware of how many Wiis are sold on Ebay. Stores put mechanisms in place to limit bulk purchases of these high demand items, usually limiting one purchase per household at a time.

HuusAsking

In addition, most don't care anyway. A friend of mine bought several Wii's from a lady at a local retailer simply by giving her twenty bucks. Not a bad deal. If you divide the 5 Wii's by that amount it's only a $4 addition to his per unit cost. At one point he even said he was talking to a manager about giving him a percentage of each unit sold if we would notify him when shipments were coming and hold them till he got there. I'm sure this isn't the only story like this as well.

The issue is that nobody wants to add real value anymore. They want to turn a quick easy buck and disregard the risks based on past results.

effthat

It depends on what you consider "real" value. Value isn't dependent on emotion or perception. It's entirely dependent on what someone's willing to pay for what you offer. If that happens to be $2,300 for a PS3+Time+Opportunity+Possession on Dec. 1st 2006 then that's the real value of those combination of product.

capitalismvicmackey39

[QUOTE="effthat"]

The issue is that nobody wants to add real value anymore. They want to turn a quick easy buck and disregard the risks based on past results.

ramey70

It depends on what you consider "real" value. Value isn't dependent on emotion or perception. It's entirely dependent on what someone's willing to pay for what you offer. If that happens to be $2,300 for a PS3+Time+Opportunity+Possession on Dec. 1st 2006 then that's the real value of those combination of product.

What some is willing to pay is greatly influenced by emotion and perception. The "value" is "created" by constraining supply and strongarming the consumer. Nothing has been added to the product and several things have been taken away. It's no different from protection fees or a school bully charging kids on the playground to not give them a wedgie. There is no real value added.

[QUOTE="shadowcat2576"]

Sure, this has been a big trend this gen with all three consoles at launch (The Wii just expanding a bit longer) and now with Wii Fit. Part of it is that these things are finding their way into the mainstream media more. There were tons of news stories about Wii Fit before it came out, which caused people to say, "This is going to sell huge, if I grab a few I can make some big bucks."

Yes, it sucks for those that really want the product, but it sucks for every person that buys products that create secondary market, toys, comics, etc. It's jsut that this is relatively new to the gaming industry, in part because the tools like ebay and craigslist weren't as heavily used at the time of the last launches.

As far as having overwhelming impact on the industry, I doubt it. I'm sure Nintendo is at least vaguely aware of how many Wiis are sold on Ebay. Stores put mechanisms in place to limit bulk purchases of these high demand items, usually limiting one purchase per household at a time.

effthat

One or two cases doesn't effect the industry. Prolonged exposure and an increase in it's occurance (as we've seen) will eventually lead to a price readjustment.

It undermines the industry and steals value from the value chain. It's bad for the industry at all levels.

Look at it this way. A guy walks into burger king, buys all the whoppers, and then sits out front selling people the whoppers. Only now, they're cold and there is no way for him to guarantee that the whopper is cooked properly or made properly or won't give you mad cow.

This person is not creating value!

What some is willing to pay is greatly influenced by emotion and perception. The "value" is "created" by constraining supply and strongarming the consumer. Nothing has been added to the product and several things have been taken away. It's no different from protection fees or a school bully charging kids on the playground to not give them a wedgie. There is no real value added.

effthat

Again, you seem to be hung up on the belief that value is entirely dependent on material addition to the product itself. The purchaser believes that the utility of getting Product X day and date with minimal effort is worth it. That's all that's important. The fact is, every PS3 and Wii would have sold out to end users for their respective prices at launch. If anyone is willing to pay a single dollar more than retail to have it day and date without effort then the real value has gone up by a dollar. If somone is willing to pay a dollar more than that person then it goes up by two dollars and so on and so on until we arrive at the market cap of hundreds or even thousands of dollars above retail. People wouldn't pay these prices on Ebay and such if they didn't feel there were receiving worthwhile utility for their dollars or respective currency.

[QUOTE="effthat"][QUOTE="shadowcat2576"]

Sure, this has been a big trend this gen with all three consoles at launch (The Wii just expanding a bit longer) and now with Wii Fit. Part of it is that these things are finding their way into the mainstream media more. There were tons of news stories about Wii Fit before it came out, which caused people to say, "This is going to sell huge, if I grab a few I can make some big bucks."

Yes, it sucks for those that really want the product, but it sucks for every person that buys products that create secondary market, toys, comics, etc. It's jsut that this is relatively new to the gaming industry, in part because the tools like ebay and craigslist weren't as heavily used at the time of the last launches.

As far as having overwhelming impact on the industry, I doubt it. I'm sure Nintendo is at least vaguely aware of how many Wiis are sold on Ebay. Stores put mechanisms in place to limit bulk purchases of these high demand items, usually limiting one purchase per household at a time.

shadowcat2576

One or two cases doesn't effect the industry. Prolonged exposure and an increase in it's occurance (as we've seen) will eventually lead to a price readjustment.

It undermines the industry and steals value from the value chain. It's bad for the industry at all levels.

It's been relatively short. 2 years. Especially in an industry where the core value item has a lifetime of 5 or more years. With the amount of profiteering that has occured, you can bet that the manufacturers and developers will gather up this info and use it when considering their pricing strategy next generation. Especially when profiteers are affecting brand loyalty. It can be quaranteed that all 3 companies will use a price skimming strategy to fend off the profiteers. The effects may not be visable right now, but they are going to effect the future in ways that are bad for the consumers.

Look at it this way. A guy walks into burger king, buys all the whoppers, and then sits out front selling people the whoppers. Only now, they're cold and there is no way for him to guarantee that the whopper is cooked properly or made properly or won't give you mad cow.

This person is not creating value!

effthat

Because there is nothing to gain. The consumer has alternatives such as another Burger King up the road, McDonalds across the street, or the knowledge in matter of minutes more whoppers can be made. However, if he has screaming kid in the car demanding a whopper at that exact second he might capitulate and by the whopper, cold or not. And such, utility derived.

By the way, Mad Cow is a prion (an altered protein at the molecular level) and cannot be elliminated by handling or cooking at the retail level.

With the amount of profiteering that has occured, you can bet that the manufacturers and developers will gather up this info and use it when considering their pricing strategy next generation.

effthat

As well they should. In fact, it would be a great idea for them to recoup some development costs with launch premium pricing.

[QUOTE="HuusAsking"][QUOTE="shadowcat2576"]

As far as having overwhelming impact on the industry, I doubt it. I'm sure Nintendo is at least vaguely aware of how many Wiis are sold on Ebay. Stores put mechanisms in place to limit bulk purchases of these high demand items, usually limiting one purchase per household at a time.

ramey70

In addition, most don't care anyway. A friend of mine bought several Wii's from a lady at a local retailer simply by giving her twenty bucks. Not a bad deal. If you divide the 5 Wii's by that amount it's only a $4 addition to his per unit cost. At one point he even said he was talking to a manager about giving him a percentage of each unit sold if we would notify him when shipments were coming and hold them till he got there. I'm sure this isn't the only story like this as well.

I'm not too sure why people haven't gotten wise to the fact that Wiis are typically stockpiled to the weeks they are posting in the store add or the release of a big game. I have found plenty of stock well into the week with the release of MK Wii, SSBB, and Wii Fit.

I am not disputing that it happens or why it happens. I'm saying that it hurts the industry and the consumers in the long run.

Nowhere in the value chain is there a need to add another retailer and distributor. If we can expect that next generation will come with an aggressive price skimming strategy, we can expect that our already weakened dollar will not go as far. That means we'll have less money to spend on games. Compound that with rising costs of living and we'll see that the budget for consoles may dry up completely, but forecasts from the previous userbase suggest a much greater demand. The producers over supply, lose billions, and go under.

I'm not suggesting that there isn't a valid economic function at work here. I'm saying that it is a bastardization of the system and will eventually come back to bite all of us.

[QUOTE="shadowcat2576"][QUOTE="effthat"][QUOTE="shadowcat2576"]

Sure, this has been a big trend this gen with all three consoles at launch (The Wii just expanding a bit longer) and now with Wii Fit. Part of it is that these things are finding their way into the mainstream media more. There were tons of news stories about Wii Fit before it came out, which caused people to say, "This is going to sell huge, if I grab a few I can make some big bucks."

Yes, it sucks for those that really want the product, but it sucks for every person that buys products that create secondary market, toys, comics, etc. It's jsut that this is relatively new to the gaming industry, in part because the tools like ebay and craigslist weren't as heavily used at the time of the last launches.

As far as having overwhelming impact on the industry, I doubt it. I'm sure Nintendo is at least vaguely aware of how many Wiis are sold on Ebay. Stores put mechanisms in place to limit bulk purchases of these high demand items, usually limiting one purchase per household at a time.

effthat

One or two cases doesn't effect the industry. Prolonged exposure and an increase in it's occurance (as we've seen) will eventually lead to a price readjustment.

It undermines the industry and steals value from the value chain. It's bad for the industry at all levels.

It's been relatively short. 2 years. Especially in an industry where the core value item has a lifetime of 5 or more years. With the amount of profiteering that has occured, you can bet that the manufacturers and developers will gather up this info and use it when considering their pricing strategy next generation. Especially when profiteers are affecting brand loyalty. It can be quaranteed that all 3 companies will use a price skimming strategy to fend off the profiteers. The effects may not be visable right now, but they are going to effect the future in ways that are bad for the consumers.

If we can expect that next generation will come with an aggressive price skimming strategy, we can expect that our already weakened dollar will not go as far. That means we'll have less money to spend on games. Compound that with rising costs of living and we'll see that the budget for consoles may dry up completely, but forecasts from the previous userbase suggest a much greater demand. The producers over supply, lose billions, and go under.

effthat

I think you're being a bit overdramatic. If a pricing model fails, it will be recognized fairly quickly and adjusted. You're making a mountain out of a molehill. In fact, one could probably argue that limited supply of the Wii has even made it more desirable to have. Humans for some odd reason seem to always want things more that are tad bit unattainable. That's just our nature. Piracy is a far bigger problem them someon making a quick buck on Ebay, and that's where the biggest "thread" to game companies lie.

I am not disputing that it happens or why it happens. I'm saying that it hurts the industry and the consumers in the long run.

Nowhere in the value chain is there a need to add another retailer and distributor. If we can expect that next generation will come with an aggressive price skimming strategy, we can expect that our already weakened dollar will not go as far. That means we'll have less money to spend on games. Compound that with rising costs of living and we'll see that the budget for consoles may dry up completely, but forecasts from the previous userbase suggest a much greater demand. The producers over supply, lose billions, and go under.

I'm not suggesting that there isn't a valid economic function at work here. I'm saying that it is a bastardization of the system and will eventually come back to bite all of us.

effthat

[QUOTE="effthat"][QUOTE="shadowcat2576"][QUOTE="effthat"][QUOTE="shadowcat2576"]

Sure, this has been a big trend this gen with all three consoles at launch (The Wii just expanding a bit longer) and now with Wii Fit. Part of it is that these things are finding their way into the mainstream media more. There were tons of news stories about Wii Fit before it came out, which caused people to say, "This is going to sell huge, if I grab a few I can make some big bucks."

Yes, it sucks for those that really want the product, but it sucks for every person that buys products that create secondary market, toys, comics, etc. It's jsut that this is relatively new to the gaming industry, in part because the tools like ebay and craigslist weren't as heavily used at the time of the last launches.

As far as having overwhelming impact on the industry, I doubt it. I'm sure Nintendo is at least vaguely aware of how many Wiis are sold on Ebay. Stores put mechanisms in place to limit bulk purchases of these high demand items, usually limiting one purchase per household at a time.

shadowcat2576

One or two cases doesn't effect the industry. Prolonged exposure and an increase in it's occurance (as we've seen) will eventually lead to a price readjustment.

It undermines the industry and steals value from the value chain. It's bad for the industry at all levels.

It's been relatively short. 2 years. Especially in an industry where the core value item has a lifetime of 5 or more years. With the amount of profiteering that has occured, you can bet that the manufacturers and developers will gather up this info and use it when considering their pricing strategy next generation. Especially when profiteers are affecting brand loyalty. It can be quaranteed that all 3 companies will use a price skimming strategy to fend off the profiteers. The effects may not be visable right now, but they are going to effect the future in ways that are bad for the consumers.

There is a fine line here. Has Nintendo created a console that on merit alone has created an elastic pricing structure where these profiteers can move in? OR has Nintendo priced their console at such a low point that the exposure of this console at a low cost point has created a windfall of demand?

In the long term this matters because without relatively comparable products being priced 2x the cost of the Wii, the Wii wouldn't seem cheaper.

It is impossible to tell how this factors in from our current available information. In the end I think that it matters very little as to why the opportunity for profiteers is created. They are going to shape the future of the industry and they are doing so by creating artificial market conditions. This can't be good in the long run!

How about we stop people from being so stupid, and buying these systems for 3 to 4 times what they are worth?Rocky32189