Today marks our first point v. counterpoint article where two of our bloggers will go head-to-head to debate one of collecting's hottest topics: the state of collecting sealed games. In the red corner we have the man with the plan, the author of this statement, the most handsome man in the history of the universe, SirPsycho! And in the blue corner, we have the second most handsome man in the same history, slackur!



Sealed video games are not the only items that some people collect sealed. So how do sealed video games compare to other types of factory sealed media such as toys, board games, movies, music, etc.?

Psycho - Video games are a much younger form of consumable media compared to the others mentioned, so they're still going through growing pains. While they're younger, the market has exploded and video games have been ingrained into popular culture since the height of Atari's power during the early 80's. Now that games are a huge modern commodity, there exists as many ways to collect games as there are ways to play them. The biggest hurdle to sealed games is the digital age, companies do not want to make physical copies anymore, but we, as consumers, like "stuff." As long as we demand "stuff," physical games will keep being made, but companies are trying hard to lower the output of physical copies since not everybody thinks the way some of us do. In some cases, this leads to supply problems, and those that get lucky can run to the store to stock up on limited items and quickly turn around around and sell them higher than MSRP the day they launch. Toys and board games are more limited to physical consumption, so these problems will not manifest as easily. Movies and music are moving even faster to digital formats, since they are much smaller files than games.

slackur - First, I'd like to mention that while SirPsycho is in fact the most handsome in this particular universe, there are many alternate universes where I am considered the most handsome.  And the most humble.  And- oh, yeah....debate. 

These growing pains aren't limited to video games; music, movies, even books are going through the same digital-digestion transition.  And while video games are notably the youngest of these, that factor combined with video games being a completely technology driven industry, means it will be on the forefront of media revolutions.  I don't think the smaller files of other media-to-digital have brought them faster transition; purely digital games have been around since the earliest cell phones (I do miss Snake), early PC BBS games featured download-only titles before we called them such, and consoles have been nabbing completely digital games over modems as far back as the Atari 2600's GameLine service. 

As for a smaller output of physical-only product, when an economy is consumption-based, the consumer is the final judge.  The sealed-luxury-good market only exists because there is a demand.  Some collect for nostalgia and crave their memories to be as thorough and complete as possible, often in better shape and condition than their originals.  The profit-minded recognize a product has its highest value when it is as close to untouched as possible, so it only makes sense to seek the highest quality or evidence of a product unspoiled.  This has held true for comics, action figures, books, vinyl records, and more modern media such as video games.


Where is sealed video game collecting at right now?

Psycho - Its a niche. Older, sealed games go for a premium compared to opened copies, and the harder the game is to find, the higher the ceiling is. Most that want older, sealed games have enough expendable income to purchase them, and this is fine. Even many legitimately rare games have a known, sealed copy sitting around somewhere, so our newer releases are not in any danger of being 100% opened.

slackur - Sealed game collecting will only grow alongside our industry growth.  I assume the expansion will likely top-out within a decade or two, due to the eventual majority conversion and popularity of download-only new titles. This means there is an eventual, visible ceiling, which will increase both demand and price, and ensure that sealed game collecting and flipping will indefinitely continue to be a vibrant element of video games.

Now that there are official organizations to grade the quality of used opened and sealed games, not to mention a growing professional sector of sealed-game resellers, the sub-market of sealed game sales has gained official legitimacy, which offers much more protection for both buyer and seller.

How do sealed collectors think?

Psycho - They're working to preserve the history of a hobby they care deeply for. The action is to be commended, but in the modern day, it's more wise to be patient. For older systems, it might make sense to invest in sealed games sooner rather than later, since many systems have prices that only seem to be climbing higher and higher. Newer systems and games are still in print, and its nearly impossible to predict when a reprint is coming. Backlog warriors, like myself, can be patient when acquiring a title. For relatively newer games, I've been able to be patient and find some good deals on brand new copies on Amazon.

slackur - For better or worse, sealed-game collecting tends to be either something that makes immediate sense to a gamer/collector, or it something that goes against the grain of how a gamer/collector views video games.  Sealed game purchasers tend to buy for two specific reasons. The first is to 'flip' and resell, thus using their skills, fortune, and hunting to make money for fun and profit.  Yet others see a sealed game as a collectible treasure, generally connecting a memory or event to a specific game, system, or item, and finding much greater personal value in keeping it more permanent.

In any case, the recent explosion in popularity helps provide a legitimacy to anyone seeking out sealed games.  In the same way that classic comic books or Magic: the Gathering cards became far more valuable once their popularity passed enough time and proved not to be a simple fad.  In the same way, sealed game collecting has also given an overall legitimacy to video games as a worthwhile media.  For some, a sealed game is a thing of interest and beauty that eclipses the actual playing of a game.

For a long time there have been vocal individuals that will buy two copies of a game at release. What is the philosophy behind this?

Psycho - The idea is to have a sealed copy of a game you care about. What most do is buy them at release, but there is a problem with this type of thinking. Before a game releases, how do you know beyond all reasonable doubt that you even like the game? Why invest twice as much money on a 'maybe?' Even for my most beloved series, I avoid buying an extra copy because I'm never sure if this new release is going to be worthy of the name, let alone the legacy.

slackur - For the collector who has the means and disposable income, purchasing two of any game is the most practical way to enjoy their hobby.  The logic of "one to keep and one to enjoy" is the best of both worlds.  Some will argue that this practice hurts the market and keeps games out of the hands of more gamers who just want to play the game, but such an argument has a built-in assumption that when a sealed collector doesn't buy said game, it would magically filter, cheaply, into the hands of non-collecting gamers.  This may occasionally happen in rare situations, but overall the market is designed around as many people being able to play a developer's game as feasibly possible.  It is a business, after all, and the retail process works best when games are sold in a way that benefits as many gamers, as well as developers, as possible. If this was not the case, the business model of new games, and the reselling of old games, would fizzle out instead of showing the explosive growth the industry is enjoying.

Most of the older sealed games are not coming from a primary retail source, and some newer ones are bought only to be resold. How does this effect both buyers and sellers?

Psycho - In the short term, it enriches a few who have the time to sit and watch for new pre-orders of games and seek out release types that will be in demand. In the long term, this will affect how publishers price their games. If they charge $60 at release, but scalpers are making $150 the next day, then why not charge $100 or more for their next game? If hardware manufacturers did not lock in the price of games for their systems, this would happen, and if scalping keeps happening, the publishers will likely push this policy by releasing games with a couple of cheap goodies and hiking the price through the roof. This has already happened with the "Collector's Edition" boom, where it seems that every game has a special release. Though this has mostly cooled down. Smaller publishers like Aksys, XSEED, and Atlus still release these types of bundles, but are generally able to find their audience even thought these games are not the most well-known in mainstream culture.

slackur – Looking at the modern release calendar, I'm not sure the Collector's Edition market has really cooled; in fact, as much as I keep telling myself that I'll limit my CE purchases every year, I find myself picking up more!  CE's and limited-time, free day-one  digital content is one of the many ways retailers are pushing for that vital early sales window.  As a general rule, every week after a game is released, its sales drop dramatically (with natural exceptions such as holidays) so those early weeks are usually the peak time a game makes money.  With that in mind, the practice of scalping is a very minor percentage in overall sales (with a few exceptions, such as some recent Nintendo products).  Sure, there will be some second-hand sales at twice the price, but the business-minds in the pricing model know that if the next product is sold at a higher price, demand (and therefore sales) often drop.  In other words, most of the time it makes more business-sense to sell at a price that gains the most return, knowing some scalpers will make their money, instead of overpricing a product and risking it sitting on the shelf, which is the worst-case scenario for both buyer and seller.

Not all video games sell the same number of copies. So people have taken to trying to guess which game can be hard to find, rare, or just have a small print run. How does this effect the primary and secondhand market?

Psycho - Its all about the name. A random Aksys visual novel localization goes mostly unnoticed, but an extremely limited Square Enix release will likely cause as much hubbub as the Majora's Mask 3DS stories. For example, a lot of people were disappointed at the quantity of Collector's Editions for Bravely Default, but almost no one talked about the even smaller quantity of Hakuoki Limited Editions.

slackur – As any retailer (and not just game retailers) can tell you, guessing consumer interest and demand is tricky at best, disastrous at worse, and a tough call all-around.  There are many great games that sell terribly and many poorly-made games that disappear off the shelves.  I've seen it working at a mom-and-pop as well as at major retailers; no matter how many customer polls, expensive marketing ads, and word-of-mouth recommendations happen, its impossible to really know what will sell well or sit indefinitely.  So retailers large and small have to look at trends, consumer data, and future speculation to make an educated best guess without losing money due to either over- or under-production.  For distributors, it is easier (and often less costly) to under-produce and then evaluate the cost-to-benefit ratio of a reprint rather than overproduce, so we've seen more and more of that trend over the years.

As for the secondhand market, it is self-generated because of demand; if there were no demand, it would have collapsed instead of showing expansion.  There will always be fluctuation and adjustments that don't seem to make sense; many a gamer have walked into a Game Stop and have seen a used game go for more money than a new one due to overstock or temporary sales.  Sometimes a notably limited, fairly new game (such as some home-brew Genesis RPGs or preorder only physical releases) create reseller saturation, but that happens in any other market as well, and usually the prices eventually 'fix' themselves.

There are a lot of places to buy games now, many more than what there were when we were all growing up. How does the dynamic of online shopping effect brick and mortar stores and vice versa?

Psycho - Nothing moves faster than online markets. A lot of brick and mortar stores aren't paying attention to publisher sales, Amazon warehouse sales, or sudden price drops on eBay. They will catch permanent price drops, but weekend sales go largely ignored or unnoticed. Some digital markets, such as console dashboard markets, have the problem of never going on sale. I remember seeing a digital copy of Call of Duty: World at War on Xbox Live for $60 when I could walk down the street and buy it used for $10 after permanent price drops.

slackur – This is one of the best things about modern gaming.  Between online sales and digital “re-releases” of older games, online retailers like Steam and Amazon, “Flash” sales, and services like Playstation Plus and Games with Gold, there is an unprecedented wealth of inexpensive or free games available. Even physical-media collectors benefit, as brick-and-mortar storefronts have to continuously find ways to stay competitive and relevant in the marketplace.  Rare games such as Suikoden II and Radiant Silvergun are far more accessible and inexpensive to play now that their digital download versions are available. 

Some games have remained sealed for four decades, other games were released yesterday. How does age effect a game's value in these markets?

Psycho - Its all about the name. Of course some names get ignored in the myriad of releases during their day, but people will discover them as a hidden gem eventually. That is what leads to price spikes, even on games that are extremely easy to find. Some names are valuable and the price never drops, Nintendo style. Others may stay high by virtue of being a critical darling and/or for having a small print run, leaving the title to rest firmly in a niche.

slackur -  A rule of economics is that a product's worth is not its value, but its perceived value.  Really, a sealed game isn't any more 'valuable' than an opened one of equal quality, but the perception is such that it has more value.  A dollar isn't worth the linen it contains, but the gold value it represents and the perception of the market value determines how the dollar changes value depending on market perceptions.  Same with oil, stocks, and pretty much every other economic product.  Obscurities, rare games, and 'flippable' purchases only have as much value as what anyone is willing to pay.  If the seller guesses wrong and the product doesn't sell at a high price, eventually one will correct the other. 

Not to mention, the 'sealed' market has always existed, but it has only recently become larger and more well-known.  There have always been collectors looking for sealed Atari games and those who buy new games without the intent of ever opening them; now the practice is simply more popular and in the open. Really, this benefits those who are looking to buy sealed games, since there is more awareness of demand and therefore visible availability.  It also benefits potential sellers who may have otherwise thrown out or opened games without that more recent awareness.

What are your personal preferences?

Psycho - I open my games up, even the limited prints like my Class of Heroes Gaijinworks releases. I just have to read through the manual to check it out, and Gaijinworks has a long history of making extremely useful manuals. Sometimes random goodies get thrown in that would otherwise be completely unnoticed without opening it up, like an extra certificate or an offer for some rare shirts or posters.

slackur - I have to admit, I open every game I pick up without much hesitation.  While I understand the reasons some buy and collect or 'flip' sealed games, I find it a shame that a game would never be played.   Not to mention, I only buy doubles to either give away or have as a loner/backup.  While I don't doubt I could financially benefit from my favorite hobby, I don't want the games I pick up to turn into dollar signs in my eyes, but to stay as something I plan to pop in or load up and have some fun.

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