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PS4 Rumors Send GameStop Stocks Down

Posted on January 4, 2013 AT 09:14pm

Since the PS3′s early development, Sony has always had it in for the used games industry, something that GameStop thrives on. Before the PS3 was released, rumors were circulating about a mythical technology that would prevent used games from being used in the console, effectively killing the used PS3 Games market short of some quick hacking. Fortunately Sony backed down and the technology, should it have ever existed, was never used.

With the PS4 seemingly on the horizon, the same rumors of similar technology are once more in circulation, but this time with some proof of the concept. It has been rumored that Sony took its vendetta against the used games market a step further by applying for a patent on a type of RFID technology that would be implemented on PS4 discs. The technology would allow discs to connect to a console and record its unique ID. If the disc was then placed in a different console with a different ID, the disc would recognize this and simply not work. In other words, there would be no market for used PS4 games. Or so the story goes anyways.

Rumor or not, it is already having an affect on one of the largest used games sellers in the world, GameStop. In fact, used games accounted for over 46% of the company’s total profits last year alone, but as a result of Sony’s nasty technology rumor, GameStop’s stocks fell a full 7%.

The most concerning thing many don’t consider is the possible consumer backlash. Says US analyst Michael Pachter, “This patent reminds me of SOPA. And if Sony puts the technology into the next PlayStation and any publishers attempt to limit the playing of used games, I expect the consumer backlash to be similar.” He goes on to say, “Sony would be materially hurt if its console blocked used games and competitor consoles from Microsoft and Nintendo did not. The Wii U is already on the market with no used game prohibition, and we believe that Microsoft would take advantage of Sony’s prospective decision to block used games by marketing that its own next generation did not block used games.” He also adds, “If we are right, consumers would favour the console that provided more choice, leading to loss of market share for Sony’s console and a benefit to Microsoft’s.”

James Conrad is a Pokemon fanboy, lover of the arts and is forever broke.
Tweets: @JRCnrd

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