We were eager to draw attention to the issue of grey PC game code selling this week because what started as a mild nuisance is quickly escalating into a major problem for the industry.
There are hundreds of these code stripping stores now. Visit one of the numerous digital price comparison sites (yep, even they exist now, just for this section of the video games market) such as DLCompare, and you’ll see a mass number of retailers you’ve never heard of. And they’re selling the likes of Titanfall and Elder Scrolls Online for more than 50 per cent cheaper than the outlets you have heard of.
It’s not just hurting revenue, but it’s also creating misleading figures. Just how big is your market share in Russia if the customers are really in the UK? Are consumers really still demanding boxed sales? Or are these boxes merely being bought for the codes and then destroyed? It becomes almost impossible to tell when the codes travel from country to country on the sly.
"What started as a mild nuisance is quickly escalating into
a major problem for the industry. Grey PC game codes are hurting
revenues and misleading the trade."
The fact this is now a problem, and one worth drawing attention to, is testament to how the digital market is maturing. It’s still a Wild West out there, but there are also an increasing number of businesses looking to tame it and build structures that work for everyone.
And that’s the important thing here. Because for too long this hasn’t been a business for everyone. The early years of the digital games market were fenced off from third-party retailers. And even when those fences were taken down, the publishers and platform holders were still dealing with ‘preferred partners’. Everyone should be able to sell games, digital or otherwise.
So perhaps it’s no wonder that so many of these online retailers are bending the rules and stripping out codes in an effort to get a slice of this market. This isn’t intended as an excuse, but put walls up and retailers will find a way around them – whether that’s by sourcing grey stock, setting up warehouses in the Channel Islands or dramatically ramping up your efforts on pre-owned.
Certainly, these situations would have been avoidable if everyone was allowed to compete on a level playing field.