GameStop stocks plummet as a result of Sony pre-owned game “suppression” patent


Sony’s recently filed patent for technology that could allow the company to detect, and potentially block, pre-owned games caused GameStop’s stocks to plummet by as much as 7 per cent during trading hours yesterday.

The system works by associating a permission tag with the game – stored on the disk – which is checked against the system’s player ID and verified through an online connection. The tech could keep a record of how many systems the disk had been used with.

“As a result, the dealing of electronic content in the second-hand markets is suppressed,” the patent describes, “which in turn supports the redistribution of part of proceeds from sales of the electronic content to the developers.”

While many have been quick to label the technology as a pre-owned block, preventing anybody from playing second-hand games on their console and forcing players to purchase new copies, this is just one interpretation of the patent’s wording.

Supporting a “redistribution of part of proceeds” to devs could simply point to the enforcement of a paid-for, next-generation online pass equivalent – a setup that would effectively give developers control of second-hand sales and, presumably, provide Sony with a cut too.

Even so, the effect of the patent’s discovery (by a NeoGaf forum user) on GameStop’s shares demonstrates investors’ concern over even the potential of blocked pre-owned sales.

Speaking to Gamasutra, Wedbush analyst Michael Pachter said his firm felt the reaction was “overblown”, highlighting the fact that such an enforcement would do little for Sony’s bottom line as it only publishes around 10 per cent of PlayStation games. But used in the less extreme way we suggest above, it certainly wouldn’t hurt revenue.

Either way, Sony will want to avoid damaging its relationship with retailers – especially with PS3’s heavy reliance on that route to market – so will likely move to clarify its position in the very near future. Of course, that won’t halt rampant speculation in the meantime.