The Stock Market Is Bad For Game Companies, Vol. 5481

GameStopTo me, the biggest news of last week wasn’t the fact that Sony was looking to patent a system that would lock out used or borrowed games via an RFID system. To me, what was most surprising was that it was not surprising at all. Microsoft had drawn up plans to tackle something of a similar nature well before Sony’s patent request, and such a scheme is a third party publisher’s wet dream; even if it will bring about the death of the console market, such horrific DRM is likely inevitable, either due to that or a more natural migration to digital distribution that puts the cost of distribution wholly on the consumer.

To me, the bigger news, speaking in a big-picture sense, was the stock market’s reaction:

GameStop’s share prices closed at a loss of five per cent (Thursday) night after speculation over a Sony patent filing regarding second hand games affected trading.

The retailer’s stock has fluctuated considerably over the last six months, climbing over the Christmas period before dropping by $1.30 a share to around $24.40 over the course of yesterday’s trading.

Let’s review: this report, which contains only a patent and runs contrary to unequivocal statements on the part of Jack Trenton stating that the company is not interested in using technology to kill second hand sales, was enough to send Gamestop’s stock tumbling.

On the one hand, it makes sense to be wary of GameStop’s stock because of the uncertainty of the company being able to move past the second hand system that benefited them so greatly in the PlayStation 2 era. On the other hand, the stock tumbled so far in one day, not because GameStop’s whole business model changed overnight, but because speculators decided it was a good jumping off point. Therefore, because of one bit of news, the stock market made waves due to what amounts to guessing games.

Bear that in mind the next time you wonder why a publicly traded company makes a decision that is likely good for business but bad for gamers. You’d be cautious too if you were swimming in a shark tank.

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Christopher Bowen

About Christopher Bowen

Christopher Bowen is the Editor in Chief of Gaming Bus. Before opening Gaming Bus in May of 2011, he was the News Editor at Diehard GameFAN, a lead reporter for DailyGamesNews, and a reviewer at Not A True Ending, also contributing to VIMM, SNESZone and Scotsmanality. Outside of the industry, he is a network engineer in Norwalk, CT and a veteran of Operation Iraqi Freedom.