Electronic Arts CFO Blake Jorgensen says trading in an old game in order to buy a new one is "not a bad thing at all."
It's accepted as gospel that videogame publishers hate the used games trade because they get no cut of the market. You would think, then, that rumors about the next generation of game consoles not supporting preowned games would make the guys in the suits very happy. Yet the chief financial officer at EA says that's not necessarily the case, because used games have been "critical" for the health of the retail sales channel, and a healthy retail sales channel is important to the industry as a whole.
"The business will probably never be 100 percent digital. Bandwidths are a constraint, and will continue to be a constraint for many years to come, which hold back the ability to do full digital downloads of some games," he said at the Goldman Sachs Technology and Internet Conference. "So at the end of the day, it's storage capacity. Unless you've got a giant storage server in your house, keeping hundreds of games can tax your storage capacity. And so having a healthy retail channel out there like GameStop or Best Buy or others is important, and to the extent that used games is important to them, I think that's a positive."
EA would obviously prefer to sell everything at full price, but the used game trade creates "liquidity" and that's good for everyone. "If someone goes in and trades in a game, there's a good chance they're going to buy another one of our games," he said. "And so if there's a liquid market, I think that that's not a bad thing at all."
As for the rumors about anti-preowned technology in coming consoles, Jorgensen said the trend toward anti-preowned technology at the hardware level is "going to create some issues going down the road," but didn't sound entirely positive about the prospect, adding, "I think that the consumer likes [the used games trade], and it's been good for the retail channel."
It's a rather unexpected perspective from a top executive at a major game publisher, but EA seems to be in the mood for honesty these days: The company acknowledged yesterday that Medal of Honor: Warfighter was a bomb not because gamers are tired of the genre, but simply because it wasn't a very good game.