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Varchild2008 (83.71)

Gamestop Digital Sales Growth is Elite

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December 22, 2011 – Comments (3) | RELATED TICKERS: GME

You know the drill by now.  Someone comes along with a brand new "Gamestop is definitely in trouble  hoooooooo  boy  Gamestop is going to go bankrupt!!!!!" type argument.

So what's today's argument regarding Gamestop filing for Chapter 11 Bankruptcy?

Apparently, the existence of Call of Duty Elite is the newest argument to suggest Gamestop is going bankrupt...along with that are the usual "Cat Calls" about Digitial Downloading Competition among Microsoft, Sony, Nintendo, Electronic Arts, and Activision Blizzard, and ad nauseum.

As I recall Gamestop's digital growth of 40 to 60% range in 2010, 2011 has obviously been ELITE despite Microsoft, Sony, Steam, Nintendo having their own digital downloading services.

So arguing competition is like trying to drum without drum heads.  The facts aren't there to support that argument.  The drum head isn't there to support your drum stick playing.

Let me break it down for you.  Here are some comments regarding Call of Duty Elite Membership:

"...if you like getting achievements then you will want new achievements to come with the new maps, like i did with black ops. All I can say is this is the first time and last time I will ever buy hardened or this elite. They should change it to Call of duty garbage."

Via  Gamer Reviews on Gamestop's webpage for Call of Duty Elite DLC.
Total Review Score for Call of Duty Elite:  6.0

http://www.gamespot.com/news/take-two-skeptical-of-call-of-duty-elite-like-services-6347151?tag=result%3Btitle%3B0

The above article on GAMESPOT is what it is.... Take Two Skeptical of the Call of Duty Elite like Subscription Service.

The CEO basically says they do not have any stake (paraphrased here) in whatever format customers want to buy the publisher's products.  Right now customers want to buy packaged goods by 90% margin.

The reality is publishers like Take Two Interactive (Grand Theft Auto Series Fame) aren't going to abandon the physical retail market when customers prefer it overwhelmingly....

And Call of Duty Elite has given some people a bad taste in their mouth.
Sure...4 million gamers signed up to it almost right away.....A lot did so because of the promise of FREE DLC!!    But, how is it FREE if you are paying $45 for the service?

Another thing to consider is I am not sure TREFIS stating that Call of Duty Modern Warfare 3 Map Packs in the future will not be able to be sold by Gamestop is truthful.   Or at least that is what I got out of TREFIS's article....I think they are actually trying to say that the ELITE service will cut into sales of the Map Packs for Gamestop.

Those with Slow internet connections will not be happy having to Annually Subscribe to ELITE for $45 on top of the XBOX LIVE Subscription fee in order to download MAP PACKS.

How much of a success Call of Duty ELITE service really is remains to be seen.  As of right now it appears the CEO of Take Two isn't all that thrilled over its prospects.

Some video gamers on joystiq.com aren't thrilled either:

"Choosing a superior product is exactly my point. And no, I'm not talking about bf3. I'm talking any game that doesn't recycle the same garbage year over year, and then charge you for it. That business model won't work after mw3. People will catch on. Eventually."

That is from a Commenter/Reader from joystiq.com:
http://www.joystiq.com/2011/11/28/call-of-duty-elite-trailer-gives-us-the-rundown/

Bottom line is that we have the usual game of

Because  X happened.... Therefore Y will happen.... Even if lots of customers are disenchanted with X and the possibility of a Backlash could occur and thus Activision may abandon the ELITE service idea and then MAP PACKS are back to being sold in stores once again.....

No... Let's not even consider that that will happen after all ATVI's share price is SOARING!!!!

Right? (ATVI) $11.90 (a year to date price DROP of 4.35%).

Wall Street obviously isn't impressed with the ELITE service at this point.
So, it is PREMATURE to start blowing Trumpets and Shouting from Mt. Everest that Gamestop is going to go Bankrupt because Customers will just abandon ship on Retailers over this ELITE service and oh oh yea.... Competition for digital dollars will also some how destroy Gamestop...or something.

Last time I checked, I was never *FORCED* to pay a Subscription Fee just to shop around and buy products at Gamestop.

3 Comments – Post Your Own

#1) On December 22, 2011 at 6:44 PM, Varchild2008 (83.71) wrote:

CLARIFICATION:

Yes... One can argue Gamestop has $15 Rewards Program which is their "Subscription Fee."

But that argument is disingenuous.   The fact of the matter is that Game Informer Magazine Subscription is $15.00.

You get Game Informer Magazine for your $15.00.... + 10% off the price of Pre-Owned software + Rewards Points you can spend on merchandise after you purchase a Pre-Owned product or trade in a product you own.

So.... Not exactly the same thing here and no one is *FORCED* to be a Power Up Rewards Pro member..... Cause frankly you can choose the Free of Charge Membership version....although you don't get Game Informer with it.

It is simply not the same thing...

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#2) On December 23, 2011 at 12:01 AM, G8BigBoom (66.65) wrote:

I got back from Game Stop less than an hour ago. They have a deal on games, buy two get one free. No deal for me just Red Dead Redemption.

 Best Buy is moving into the used game market. I walked through Best Buys (BBY) selection and it's tiny compared to the massive inventory of Game Stop. BBY could be the little light in the distance that turns into a train and runs Game Stop over, at least not for a few more years though.

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#3) On December 23, 2011 at 1:01 PM, chk999 (99.97) wrote:

The Red Dead series rule.

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