I won’t kid you, I’ve been excited about the PlayStation 3 since the moment I saw the video at E3. Sure people like to argue that what we saw was fake, not real game play footage, or even done on super computers … but clearly that wasn&…

It seems to me that a lot of patents are filed by corporations but then never optioned. This seems to be the major rule in the tech industry in particular.

But if we assume that Sony acts on this particular patent, then (to me) it seems that the VG industry is the only industry that the patent could be applied to. Sony doesn’t own a monopoly on DVDs and CD players - so it doesn’t make sense that they could pull-off such a strict change in these industries. But for the Playstation series, 100% of the hardware is produced under their factory control, and so they can have their way with the hardware any way they want. This isn’t a motive, however.

So I started thinking about Netflix and how much they must impact DVD sales. Netflix is a major provier of DVD rentals and not video games, But think about this: Each franchise of a local Movie Rental shop has to buy 10 or so copies of a movie. Netflix can be extremely efficient with their purchasing, buying a considerable fewer copies to service REGIONS. And they’ve probably have made a noticeable impact on the number of DVDs purchased in the US.

Gamefly (and surely their upcoming competitors) offers a similar service and has the potential for a much greater impact on these sorts of things. Why?

#1 - We all know that unlike the DVD industry and the Music industry, Sony actually takes a hit when it comes to hardware sales (at least traditionally). For each PS1/2/3 console sold to a consumer Sony will lose money. Their only hope is to make this loss back with game sales, and they have faith that each console owner will buy enough games to cover their losses. Historicaly, early on in the console’s lifespan this hasn’t been a problem — Games were only availble to be purchased new. But today I can buy a PS2 for roughly a hundred bucks, and then I can purchase my entire library used from EB Games. Also, I personally had a plan to offset the extreme costs of the 360 — I was thinking of buying that bastage and renting _all_ of my games from Gamefly .

#2 - The local Video Stores’ capacity for renting games has always been a sideshow to their main business. It’s often that they have 1-2 copies of each game, and that they don’t have the specific title that I entered the store intending to rent. On the other side of the fence we have Gamefly, which has _every_ game available to me (at least at some point). And since I can have each game ‘out’ until I beat it, the service effectively takes the place of my gaming library. Personally, I very rarely purchase games anymore.

#3 Gamefly makes its money by deriving formulas of efficiency to purchase as few copies of a game. They act as a purchase-buffer between the consumer and Sony. On the bottom line their business is to leach money off of Sony by minimizing the number of titles purchased. And once a gamefly title _is_ purchased it can continues to service their customers indefinitely. If demand for a particular game drops, then gamefly sells the game used.. again, making money that Sony never sees.

#4 - Movies and music aren’t enjoyed in the same way as video games. Most game titles seem to have a more distinctive ‘end’ to their story, and over the years the replayability of games has decreased (that’s an entire different article altogether). This why Eb Games has such a huge collection of used titles - people _beat_ the game and want to get credit back to play another title, beat that one, repeat, and Sony makes absolutely no money on the resale of these used games.

What Sony can do with this patent is regain the lost revenues of the Gameflys and the used game swap on Ebay / Electronic Boutique. Yes, it would alienate some people - and Sony would probably lose a substantial percentage of their fanbase. But each game purchase will be far more profitable for them, and I could totally envision how some accountant figured out that the financial profits outweigh the loss due to unpopularity, and through some flashy boardroom presentation convinced Sony executives that exercising this patent was a good thing for the company to do.

Sure.. take it with a grain of salt. But damn, I could still see how they’d want to, and defintely could pull this stunt off and come out ‘better’ for it.