GameStop CEO Wants Price Drops

GameStop CEO Wants Price Drops

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Dan DeMatteo, the CEO of GameStop, wants to see price cuts from the PS3 and the Wii.

"That price point is clearly an issue in this economy," DeMatteo said about the PS3's asking price in an interview with CNBC. According to DeMatteo, Sony needs to drop the price of the PS3 to maintain growth. Sony can talk all they want about how they're not going to do it any time soon, but they need to, DeMatteo thinks, and when they do it, they need to do it big and drop it by $100.

"I don't know that $50 gets you that much," DeMatteo said.

Sony did drop the price of one of its products recently: the PS2. But DeMatteo doesn't really think this made much of a difference. "To be honest, it really wasn't worth doing," he remarked. "If they'd done it earlier, publishers probably would have kept making games for the PS2, but once they've stopped, they've stopped."

He also expressed a desire for Nintendo to drop the price on the seemingly ever popular Wii, stating that he thinks the console's sales could very well wane within the year. "I think [demand for] the Wii could slow down to the extent that Nintendo may want to cut the price," he said.

And, seemingly confirming speculation that Nintendo has chopped its production costs for the Wii drastically, DeMatteo said that it's totally within Nintendo's power to do a price cut. "Nintendo has it within its arsenal to do that. The component costs have come down considerably," he said. "They used to break even on the Wii, but now they're making a considerable margin."

If they're making "considerable" bank now, why would they want to stop? That honeymoon's far from over, Nintendo probably thinks.

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And I want to see price drops from Gamestop's used game department.
What a dick.

I don't see what is up with this guy trying to push companies around like this.
How about a compromise.
He stops screwing his customers over with used games, and companies will listen to him.
No? Thats what I thought.

A PS3 price drop would be sweet, I'd probably buy one if they dropped it by $100.

So all of a sudden, if Gamestop want something they deserve to get it? Since when were they the nicest kids on the block?

Never that's when.

ThaBenMan:
A PS3 price drop would be sweet, I'd probably buy one if they dropped it by $100.

The sad truth is that they did.
In England it went from 425 to now 279, and it still continues to be bashed for a high price.

Isn't Sony losing money because the PS3 is ALREADY underpriced? I heard it takes more money to make a PS3 than the price its being sold at.

This is coming from the man who runs a company that charges an arm and a leg for used games. I'm sorry, what he's saying has all the credibility of a 4chan post.

I think it's kinda funny that the guy whose company is raping publishers through resales is trying to dictate their business.

It's like a burglar telling you that you need nicer drapes and easier to break windows.

He also expressed a desire for Nintendo to drop the price on the seemingly ever popular Wii, stating that he thinks the console's sales could very well wane within the year. "I think [demand for] the Wii could slow down to the extent that Nintendo may want to cut the price," he said.

If that happens they can still act on it. However it's more likely that they'll just wait for the next big game release and if that doesn't help release colored versions of the console. Iwata said that the company's philosophy is not to give price drops because those are only a measure you take when the value of the product no longer matches the price and he'd rather increase the value to match the price again. Hey, it worked for the DS.

Darkside360:
Isn't Sony losing money because the PS3 is ALREADY underpriced? I heard it takes more money to make a PS3 than the price its being sold at.

Underpriced for the manufacturing cost but that doesn't mean anything about its price in relation to what customers are willing to pay.

Catkid906:

ThaBenMan:
A PS3 price drop would be sweet, I'd probably buy one if they dropped it by $100.

The sad truth is that they did.
In England it went from 425 to now 279, and it still continues to be bashed for a high price.

Well, it's still $400 in the US, most people here would agree that it's pretty expensive.

Yeah good luck with that Dan, maybe you could set an example by lowering your prices first, after all, "I don't know that $50 gets you that much".

buy teh haloz:
This is coming from the man who runs a company that charges an arm and a leg for used games. I'm sorry, what he's saying has all the credibility of a 4chan post.

I doubt he even knows what 4chan is. He is simply out of touch. From what he has said, it looks as though he just pulled some numbers out his proverbial ass so that he can increase sales for another year by pushing around much bigger and more important companies.

There is no reason for Sony to drop the price of the PS3. Given the costs of production/shipping/resale I believe it is fair enough as it is.

If the price of the PS3 or the Wii drops at the production end, how much of a saving will we as gamers get from buying it at a reseller?

Trick question. We won't get any saving because the reseller will simply not tell the customer, therbey making another $100 profit on the console.

Maybe he should just sell the console for $100 less for a loss expecting to make more money in the long run off of PS3 games sales?

Yeah, didn't think so.

If I were to punch said CEO in the face he'd have to spend more than a hundred dollars getting reconstructive surgery so he should count his blessings.

TheSKSpecial:
I think it's kinda funny that the guy whose company is raping publishers through resales is trying to dictate their business.

It's like a burglar telling you that you need nicer drapes and easier to break windows.

That made me smile. I would put up gawdy 60's era drapes and replace the windows with old fashioned glass that would slice him up to ribbons, and end up with a wall on the other side of the drapes.

Either way said "guy" is speaking out of his other end, probably with very little research to back up his claims. True it would be nice to see lower prices for games and/or systems, but not at the expense of the company tanking in today's economy. Would sure love to see the job security for CEOs plummet.

1) Console price lowered by $100
2) Gamestop is "unaware" of this price drop
3) Unknowing customers grant Gamestop $100 more profit a console for a while

I deciphered their nefarious schemes!

Ugh, how do people not realize that the PS3 is more bang for your buck then 360. 360 core is a $100 less then a PS3 right? Through in a wireless adaptor for the 360 (which PS3 has) and boom, there you go, same prince. Plus the PS3 on top of that is a Blu-Ray player. Seriously people, what's $100 more on something you're going to spend hundreds of hours playing?

Monocle Man:
1) Console price lowered by $100
2) Gamestop is "unaware" of this price drop
3) Unknowing customers grant Gamestop $100 more profit a console for a while

I deciphered their nefarious schemes!

Just for comparison purposes, I looked up the price of a PS3 on Newegg and then on Gamestop. Surprisingly, they are the same price. Then I looked up the price of Little Big Planet on both.
Newegg ..................Gamestop
$39.99 new............$54.99 Used

Apparently, he just likes screwing us on game prices.

Whatamaroon. Yep, a Bugs Bunny reference from me. Whoulda' thunk?

Supply and demand drive prices. That is the rule of buisness.

Darkside360:
Isn't Sony losing money because the PS3 is ALREADY underpriced? I heard it takes more money to make a PS3 than the price its being sold at.

Yes but the console itself is still very expensive and, because consumers are not willing to pay that much, less consoles are sold. When less consoles are sold, less PS3 games are sold and the less likely that developers will want to use the money/resources to make a game for the PS3 specifically. Less developers = less games. Fairly simple train of logic, I know but it took me a while to realize that...I figured I would share on the off change that anyone else missed it.

If the PS3 sold more consoles, they could make up for their losses with new games created by the developers that actually started utilizing the PS3's capability.

Anyway, to stay on topic...Really? I just find this rediculous. You have no problems with charging us obscene amounts for used games that the creators do not get a cut of but when a console is too expensive, then it has gone too far. I'm willing to bet my middle fingers that he is trying to get a price lowered so that he can sell more consoles and games to make more money. There is no way in hell that he is acting in the interest of the consumer here.

i dont really have a problem with gamestops used game department. i think everyone is just jumping on the bandwagon with that one. he is right tho about the ps3 needs to drop its prices.

He needs to not point fingers at Sony, or people might tend to notice his own hypocrisy. Maybe he wants the price lower so more people will buy and return the games to GS, thus ensuring GS even more profit when they resell Sony's games for $5 less than the new price and keep 100% of this used price for themselves.

Sony will lower the prices whenever they get tired of losing sales to their cheaper competitors. Until then, GS needs to realize that it has as much credibility on video game matters as Wal-Mart does on selling quality products.

And my problems with Gamestop are almost entirely from my OWN personal experiences with them. This isn't a "bandwagon" issue-this is about companies treating consumers and their own employees like garbage and making tons of money because of it.

dagens24:
Ugh, how do people not realize that the PS3 is more bang for your buck then 360. 360 core is a $100 less then a PS3 right?

AFAIK it's 200$ in the US (PS3 400$, 360 Core 200$ or so). Here in Europe the 360 Pro is 200€ while the PS3 is 400€. I think that greatly changes the equation.

Anyway, feature to feature comparisons are Apple math. People don't buy the console for the technology, they buy it for the games. Someone who doesn't care about BluRay until you can get a top of the line player for 50$ at WalMart and BRDs for the same price as DVDs won't care about the PS3 having a BluRay player and I think that's the vast majority. HD is nice but it's not worth paying extra for, the only usage that really needs HD is text and I don't think anyone wants a BRD to just dump a crapload of text on the screen.

The 100 of hours you spend playing aren't spent on the console, they're spent on the games. The games matter WAY more than the console itself. Sure, having a comfortable controller instead of that inquisition torture tool that is the DualShock design helps the experience in those games but the library still reigns supreme.

Overall though the sales numbers of the 360 and PS3 are fairly equal, I don't think it's the price that constrains their sales but the two-genre game libraries. Their libraries have almost no variety compared to the PS2 or DS. Big titles tend to be yet another xPS (Why hello there, Killzone 2!) or beat 'em up (now with more blood and black-and-white moral choices!). The systems have a limited genre coverage and the people who want those genres already have the systems. I think unlike common internet wisdom the majority of the gamers are mature enough to consider excessive violence a negative.

Well, I have nothing but good things to say about Gamestop...A used game is slightly cheaper a comes with a one week "return for no reason" policy.

And shut up about how much they give you for used games. WHAT IF NO ONE BUYS IT? How would they profit then?

/rant defending Gamestop

The CEO is truly a dick, though. Can't defend that jerk.

I think Nintendo would be absolutely insane to drop the price of the Wii before the demand starts dropping off. That's just basic economics, after all.

I would, however, dearly like for the price of Wii games to drop off. There's a Wii game that I've been interested in buying, but since it came out about a year and a half ago its price has not budged one cent downwards from NZ$120. And I'm not that interested.

KDR_11k:
Their libraries have almost no variety compared to the PS2 or DS. Big titles tend to be yet another xPS (Why hello there, Killzone 2!) or beat 'em up (now with more blood and black-and-white moral choices!). The systems have a limited genre coverage and the people who want those genres already have the systems. I think unlike common internet wisdom the majority of the gamers are mature enough to consider excessive violence a negative.

Actually their are 2-5 games of each genre on the PS3 that are good and exclusive for people who want them, people just ya know... never pay any god damn attention.

Oh don't get me wrong it's the same for all 3. Anyway I don't have a Gamestop in Australia so... here we go

t(-_-t)

Awesome-Smiley

Onmi:
Actually their are 2-5 games of each genre on the PS3 that are good and exclusive for people who want them, people just ya know... never pay any god damn attention.

2-5 is pretty pathetic, especially the lower end because I don't see much approaching 5 (even when you count multiplatform titles) in the less served genres on these platforms. Most people don't like every single game in the genres they like so the number goes down a bit in practice and if you're looking mostly for 2-3 of the unserved genres you'll end up with way too few games to justify a purchase.

Besides, the games hardly make themselves known, I shouldn't be required to search through the depths of forums to find games I'd want and they can expect to lose sales if they fail to make me notice the game when I'm looking for it.

 

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