The CEO of a gaming company has courted controversy by calling retailers “parasites and thieves” and that publishers have more “right to survive” than retailers.
Louis Castle, the CEO of browser game company InstantAction, and also known as the co-founder of C&C creators Westwood Studios and former vice president of creative development at EA, was interviewed about his hatred of game retailers:
You accused Walmart and GameStop of thievery, do you stand by this statement?
They are, they’re thieves. They’re parasites and thieves. Because they don’t let the publisher participate in the used games business. They take all the money. They take a game from somebody for ten bucks and then turn around and sell it for $30, and they don’t give any of that $20 back to the original copyright holder.
Something would be OK, but zero is not OK.
What can publishers do about this?
There’s nothing they can do about it. Legally, the retailers are within their rights to do it. I’m not saying they’re doing anything illegal. But just because you can legally steal doesn’t mean it’s not stealing. Gambling is statistically theft – people know they’re going to be stolen from.
I was heckled by a guy who said he was from Gamestop who said, “You seem to hate retail.” He was trying to make the case that if lots of people get exposed to the game then it’s good for the publishers – I’m not sure I understand that.
If we make something like woollen blankets and we start eating the sheep, pretty soon, we have no more woollen blankets. It’s taking from the one thing that’s making you money. If we stop making games, they stop being able to sell them.
His point was that we had to do it because their margins were shrinking and they were going to go out of business. And I’m like, well, so now you’re shrinking the publishers’ margins so we’re all shrinking and are going to go out of business.
But, honestly, gamers can survive without retailers, but they can’t without people making games. I just don’t think the retailer has a higher order of right to survive than the people who make the content.
Maybe I’m wrong about that! I don’t worry about being provocative in my wording, because it’s what I think everyone in our industry feels, and no one will say it.
But traditional retailers don’t really know where their business will come from, with services like InstantAction coming along and bypassing them entirely.
It costs a lot of money to do what we do, and we can make a lot of money, but our margins are very thin. We’re not trying to replace the retailer – that’s not our goal.
The game business has not been disrupted by the internet tremendously because the process of buying the game is still about learning about it through reading about it somewhere, you go to someplace to buy it, and you get to play it afterwards.
That’s the exact opposite of what the media on the web is about. There it’s about finding media anywhere, I can sample it for free and if I like it, I pay for it.
That’s a different philosophy. You have to change your mindset. GameStop might say, “Well, where’s our place in that?” Well, you have to become a value-added retailer. It’s better to buy with a GameStop card because you get to go to that retailer and hear about the games. That’s one way.
There are lots of ways for them to survive other than taking the money out of the system that’s going to the publishers.
Publishers are the ones who are taking all the risk. They’re paying for development, pay for the marketing – the retailer has zero risk.
It’s all consignment anyway: if a product doesn’t sell, they box it up and send it back to the publisher. I’m sorry their margins are eroding, but that’s not the publishers problem. To use a loophole in the law to just gouge them is just unacceptable.
It is of course not surprising to hear a game publisher unhappy about the resale of games – the game industry has, with varying degrees of success, repeatedly sought to ban game resale and rental, with its latest efforts eschewing legal methods in favour of crippling second-hand copies by banning them from multiplayer or stripping them of DLC.