r/gaming • u/yourfavchoom • 16h ago
GameStop CEO Ryan Cohen Insists Sony Killing Physical Discs 'Doesn't Matter at All' Because Video Game Sales Make Up So Little of His Business
https://www.ign.com/articles/gamestop-ceo-ryan-cohen-insists-sony-killing-physical-discs-doesnt-matter-at-all-because-video-game-sales-make-up-so-little-of-his-business265
u/MelissaBee17 14h ago
I mostly play on pc so usually I go to GameStop because it’s in a walkable area where I’m like going to several stores, so may as well stop by there.
It is predominantly people talking about Pokémon cards, some people asking about consoles and even I predominantly am looking at plushies. Them turning into a card, and gaming merchandise store was a smart move even if many people lamented it
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u/nickmcmillin 14h ago
Card games are still games, right?
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u/WhySayManyWordGancho 12h ago
yep, along with mind games and reindeer games and head games
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u/MannToots 15h ago
Go into any gamestop. It's kinda obvious. I used to work on a gamestop in my mid 20s working through college. I'm 42 now. It's not the same store. They sell way more merchandise these days. I thought this was obvious.
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u/RipErRiley 15h ago
I miss the Funcoland/early era Gamestop store vibes.
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u/BoSocks91 15h ago
I miss having more local retailers.
I never used to care much about corporations vs local businesses, but as I’ve gotten older, I really wish it was easier for local businesses to flourish in certain industries like Gaming.
Gamestops, while I have fond memories of their midnight releases, hurt the local gaming scene in my area.
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u/Chit569 13h ago edited 12h ago
OMy area is the exact opposite. There have been 2 grand opening for video game stores in my area just this year. I now have 6 within a 45 min radius. And they are all seemingly growing pretty well too. And I don't live in a city, I live in a small rural town in PA.
I actually just got back from a trip to two of them and picked up Halo: Combat Evolved on PC (the gearbox port lol) and Ninja Gaiden Black for the Xbox. And these stores don't just specialize in older games, they get new releases in too.
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u/TheTresStateArea 15h ago
I worked GameStop in HS and undergrad, 05-11
I miss hearing about which stores just got some unique whatever. I went way out of my way to go to the last GameStop in my part of Jersey that carried PSone games to pick up Suikoden 2.
It was a good time
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u/mrjamjams66 13h ago
Never worked at a GameStop, always wanted to, though. It seemed very competitive to get a job there in the areas I lived when applying.
I have so many fond memories of GameStop as a kid.
We lived like a 30 minute bike ride away from one and we went all the time to play the kiosks and just browse.
When we'd get some pocket change we'd all pool together to buy a game and then argue over who got first dibs and the sharing schedule.
On the flip side....so many traded in games I wish I still had. Kuon is a good example
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u/TheOnlyToasty 10h ago
Funcoland was so awesome. I loved going there and finding gems from time to time. I remember grabbing mario rpg and megaman x from them. By the time I could drive myself there, they'd already been bought out by gamestop...
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u/MonkeysxMoo35 15h ago
Yeah the franchise these days is basically a toy store that sells video games rather than a video game store that sells video game-related merchandise. And even then, I’m sure most of their revenue right now comes from Pokemon cards
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u/MobileArtist1371 14h ago
It's not obvious cause everyone that talks shit about gamestop hasn't been to a gamestop in 5 years. This is one of those topics where people expose themselves without even knowing it.
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u/ashdrewness 15h ago
Yeah I took my son to a Barnes & Noble last week & there was a GameStop connected & we walked through it. 90% of the store was gaming, anime, comic, tv/movie merch. An interesting business model considering you could buy all of it online.
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u/PromiscuousScoliosis PC 11h ago
Yeah the difference between them and FYE is basically just slightly more focus on video game pop culture
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u/aphilipnamedfry 15h ago
It's obvious to those who visit the store often enough, not to those who visit maybe once a year or less. Those people see the word "game" in the store name and rightfully assume it is a game focused store.
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u/Next_Helicopter_4291 15h ago
The local target had a better game selection than the local gamestop last I went in.
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u/Weirdo_Crusader 12h ago
“You are under the misconception that we are a video game company. We are not. What we are, really, is a collectibles company.”
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u/DjKennedy92 15h ago
I mean they bought out think geek for collectible’s and have pivoted to trading cards
My local GameStop only has games/hardware along the walls but the store is all nerd culture collectibles
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u/thegta5p 15h ago
They should just become a TCG/Tabletop gaming store at this point. It’s more popular and plus I can buy paints for minis and stuff.
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u/The_Law_of_Pizza 15h ago
It's probably their only chance - but FLGs hardly turn a profit, and they need much more space than the typical GameStop has.
You need butts in seats at your gaming tables for hours, getting up periodically to buy more boosters, snacks, and card sleeves.
GameStop just doesn't have the floorspace.
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u/Boxinggandhi 14h ago
I can barely get around in a GameStop when there are like more than 5 people in there.
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u/Doctor_Womble 15h ago
Never been to a GameStop but In the UK we have GAME. Used to be a wonderful cave of obscure used games, consoles and new releases.
Go in one today and it's second hand smart phones, t shirts, funko pops and plushies. A few of the biggest releases at insane prices. No idea whose shopping there anymore.
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u/TheoDW 15h ago
You still have CEX for your used games needs, even with the smells (ew)!. Mandatory stop for me when visiting Spain.
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u/sephjnr 15h ago
CEX became the bastion of physical media because GAME essentially folded and HMV keeps shrinking.
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u/Aubergine_Man1987 15h ago
HMV still sells physical music, which is what they were always most interested in. But definitely less shops now
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u/caniuserealname 15h ago
Go in one today
You don't go in one today... they don't have anymore stores.
You go into a sports direct and find the awkward little corner where they're allowed to set up their shelves and till.
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u/Jakob535 13h ago
In Australia, we have EB games, which is just GameStop, but we also had this store called Zing, EB games had some collectible stuff but nothing crazy, Zing was completely collectable. No gaming.
Zing stores just started popping up next to or very near EB, then we started getting merged EB/Zing stores. Skip forward to present day and now every EB games is just a Zing store with all the games and consoles etc wedged into the corner.
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u/TeaAndLifting 12h ago
The funny thing is that EB in the UK became GAME. They all come from the same place.
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u/Xyro77 15h ago
GameStop switched away from games as a priority many years ago. This news isn’t shocking at all
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u/Dholtz001 15h ago
Definitely agree. And even if weren’t true, it’s not like he would say “physical games are going downhill and we’re fucked” anyways. It would just freak out investors and lose them tons of money.
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u/DueBonus3837 11h ago
They closed 270 stores last year
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u/darth_butcher 5h ago
Yeah, at the peak they had over 7000 stores (in 2016). Nowadays they only have 1600 stores left, but what's really impressive is the following from their recent Q1 earnings:
"Highest quarterly net income in GameStop’s history of $389.6 million. Highest first quarter operating income in GameStop’s history of $143.3 million. Net sales grew 14% year-over-year, driven by collectibles."
I know there is still the narrative about the dying brick-and-mortar business but at the end of the day the financial result are all what counts. And the financial results have improved significantly since Ryan Cohen became CEO.
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u/Xsun686 15h ago
MSM: GameStop is a dying brick and mortar physical gaming company and needs to pivots to a new business model to survive. GameStop: pivots away from software with record operational profit. MSM: no, not like that
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u/iPod-Phone 14h ago
Maybe, but people come in because of them. Gas stations make very little profit off gas, most comes from food and beverage sales. Without gas, customers may just go somewhere else. Same here. You need the games to get people in the door at the very least.
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u/LunarWingCloud Switch 14h ago
Yup. Anyone that knows retail knows that you have loss leaders or just items that are not meant to be the profit but they're meant for people to come to you and then you sell other higher profit items they'll likely grab coincidentally alongside the thing you don't make the money on that is why people come to you.
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u/Dapper_Derpy 7h ago
"I'll still be making shitloads of cash, so y'all can all get fucked."
That's what that sounds like to me.
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u/SputnikFalls 12h ago
I mean, when software sales only make up about 12% of your business and will likely keep shrinking year over year, not only because Sony seems determined to kill the physical games market, but because GameStop saw the writing on the wall years ago, it's not exactly surprising they pivoted into collectibles. They were nearly bankrupt before making that shift, and now they just posted their most profitable Q1.
I'm glad this thread has more people who understand that's the natural progression for the company. I keep seeing Redditors acting surprised that GameStop isn't dead yet, or just wishing that it would be.
It also doesn't seem like GameStop is done with the secondhand market either, considering the CEO is trying to acquire eBay.
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u/baddazoner 11h ago
Things like this are among the many reasons they are ditching physical discs
The majority just dont buy them
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u/darksamus8 13h ago
Ironically, I bought my Switch 2 in-person on launch day, with no reservation. If they hadn't had such good stock, they would have missed out on my money.
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u/natayaway 12h ago
He's not wrong. GameStop as a company owns ThinkGeek and other brands that make merchandise. It's now a lifestyle brick and mortar store.
For every copy of Mario sold, there's going to be... posters, lamps, shadow boxes, desk-sized mousepads, headsets, thumb grips, limited edition consoles, new and used themed controllers, plushies, Funkos, backpacks, cups, bowls, ramen bowls, shirts, socks, hats, fleece blankets, themed board games, SD cards, legally-distinct-Lego sets, figurines, painted/printed door hangars, stationery, all per CHARACTER in the Mario franchise.
One $50-80 game, versus... 25 different kinds of items x 12+ characters separate other items... even if all of the merch above were sold at a dollar, at $300+ for the entire lot that's still far exceeding the sale of the game. At their actual prices, even if you don't buy the lot, three of those items alone... a mousepad, backpack, and shirt together would end up exceeding the cost of the game.
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u/NoNouns 14h ago
Weird how GameStop news gets everybody panties in a wad. Profitable company by the way
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u/4thBeard 13h ago
Yeah its odd how everyone wants a brick and mortar chain to fail so bad. Gamestop will always be the place I went to for midnight releases.
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u/jflatt2 15h ago
Rename it FunkoPopStop then
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u/MyVoiceIsElevating 9h ago
How do those things still sell?
It’s the millennial equivalent of boomers’ china cabinets.
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u/sendgoodmemes 11h ago
I mean, I’m not sure they are selling much other then cards at this point. They have closed so many locations around me that I can’t believe they are still around.
Honestly they probably would be had it not been for the massive stock prices that had absolutely nothing to do with their actual sales.
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u/CalebTGordan 14h ago
The interview that this came from had a lot more context around this quote, but Ryan didn’t do well in explaining what’s going on. If you think GameStop is a dying brick-and-mortar business that sells used video games in an increasingly digital marketplace, you haven’t actually been paying attention.
GameStop is doing great. It isn’t going to go out of business, it isn’t drowning in debt, and it isn’t sticking to its old business model. It’s doing well because Ryan and the board have been working hard to make it successful, and they pulled off a turnaround. GameStop just posted its most profitable quarter yet, and it’s set up to do much more in the future.
How did this happen? Ryan Cohen wrote a letter to the board prior to buying the company that explained his strategy and he’s followed through on that. He’s done a lot of what he laid out, like closing redundant storefronts, cutting costs, and refocusing the business towards e-commerce.
Part of that was evolving with a changing world away from physical media and towards a focus on markets that are growing. It’s been clear that gaming has been moving away from discs and towards digital downloads, and Ryan made clear he wanted to pivot the business to address that. GameStop has had mixed success, it failed to launch an NFT marketplace but has succeeded in launching services around the collectable market.
I suspect a big chunk of their revenue has been from collectible cards, like the Pokemon CCG. Specifically, graded cards that can be obtained through a newer digital service, or through their website. The last couple times I’ve been in a GameStop they had someone turning in Pokemon cards for cash, buying a high value cards themselves, or picking up a recent release of a collectible card pack. GameStops offer grading services, though they haven’t fully earned consumer trust and stories of an employee stealing high value cards still plague them.
But every type of collectible can be found there. I got most of my Black Series Star Wars figures from there, and GameStop has been one of the best places to grab Japanese Godzilla collectibles for my son. People joke about a big wall of Funko Pops but those have been reduced down to a single small section of most stores and other types of nerdy merchandise can be found in the space once filled with pops.
So he is probably right that it doesn’t matter to GameStop if games go all digital. The business has already shifted away from that side of their marketplace and found success elsewhere.
But that doesn’t mean they can stay in that space. Pokemon cards might see a collapse in popularity and value, so how do you keep GameStop future proof?
Enter eBay. I think Ryan is spot on that the board for eBay is running it into the ground and could do way more with what they have. If he can pull of the acquisition he has the making for a fantastic business model that secures the future for both companies. He explains it in the interview, even if he does so poorly.
eBay handles the digital market side, providing a place for people to sell goods and items much like how they do on that platform now. The physical stores GameStop already has provides a solution to one of eBay’s current problems, authentication of that the seller has what they claim to have. Currently, there’s little that can be done to authenticate the items sellers claim they have, and sellers will list items they don’t currently have. Once the sale goes through they then go out and buy the items themselves and then have that item shipped to their buyer. If the price went up past what they sold it for they cancel the order and refund the buyer. And sometimes this means their buyer has to wait a very long time before they get what they ordered.
GameStop storefronts act as both in-flow and fulfillment centers. The idea is that people can go into a storefront, drop off an item they have listed on eBay (or get help at the store to list it), have the store authenticate the seller had that item, and then when it is sold the store handles the shipping to their buyer.
It creates more confidence in eBay listings, as items dropped off at the physical storefront will be authenticated and confirmed to be part of that seller’s inventory. It might also help mid-sized sellers who don’t want to dedicate space in their home to their inventory, while having an inventory size that doesn’t justify monthly rental of a storage space.
Meanwhile, eBay also provides the digital infrastructure for a digital resale site for people to sell their digital game codes. There are already sites out there that do something like this, and it seems Ryan has been trying to find a way to create a competitor in that market.
So yeah, what Sony is doing doesn’t matter to GameStop’s future. They already saw the writing on the wall and have been working to future proof the business.
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u/3DSFreak 13h ago
It's called GameStop but doesn't matter if it stops selling games 😂
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u/Ma1ikNabers 11h ago
It’s their plan all along to rebrand their name to “Stop”, so people have to stop at their store
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u/SomeConfetti 13h ago
For me, it's Sony that doesn't matter at all. They made themselves completely irrelevent to me even before the killing of their disc manufacturing. Their exclusives homogenized, the studios and IP's I liked were killed off. Enshittification of everything Sony does ramped up since 2019. I loved Playstation for Sly Cooper, Killzone, Little Big Planet, Gravity Rush, Resistance, Ratchet and Clank, Uncharted, Infamous, etc. There's no reason to get a PS6 if it's only getting one(1) ratchet game, God of War, Spider-Man, Ubisoft Samurai game, Horizon, and whatever Naughty Dog makes these days.
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u/GreatnessToTheMoon 15h ago
His business is now just collecting interest payments from all the money people gave him during the GME hype
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u/Negative-Concept-197 15h ago
I mean, 140mil operating income is still impressive for a brick and mortar gaming store
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u/Bezere 13h ago
during an economic downfall
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u/squirtbert3000 13h ago
Exactly! Most retail are zombie companies helping criminal Wall Street service debt. GameStop sales keep going up up up.
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u/nickmcmillin 14h ago
Turned the company around. It's now holding 9 billion in cash. They're in the process of becoming the highest owner of eBay stock and planning to buy it.
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u/MrRottenSausage 15h ago
Of course he would say that, local GameStop was selling used videogames with a higher price than buying them new on the Walmart next to it
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u/SolidusBruh 13h ago
My local one would try to give me used copies of games at the New price because they “couldn’t find the sealed copy.”
I wasn’t surprised when the three GameStops near my area shuttered.
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u/GentlemanLeo 15h ago
GameStop acts like if the consumer did this to them. They were notorious for buying games at super low offers and selling them for 5x that amount. So of course no one wanted to do business with them lol
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u/nickmcmillin 14h ago
WERE. The business and company has changed a lot the past 5-6 years.
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u/Actionwill65 14h ago
From the sounds of it IGN may as well say "Local Vegetable Market says Sony ending discs is irrelevant to business as it makes up so little of business"
I'm in the UK, but from the sounds of it GameStop went the same direction as our GAME, as in just becoming a collectables store that had a few games in a bin somewhere.
It's also irrelevant, because GameStop can still sell software past 2028, because supposedly Sony are allowing retailers to sell code-in-box games.
IGN have really been pumping out some shocking sharticles about (both for and against) Sony ending disc production.
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u/Antique-Show-1371 13h ago
When I worked at GameStop in 2020 our manager who went on to be a regional manager said GameStop makes little to nothing off new games. However, most of their money is used games. Sooooo not having used Sony games does seem like it’ll hit them a bit
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u/acart005 12h ago
Its been like that since the Gamecube era. New brought foot traffic, actual cash was used. And now collectibles.
Sony being totally idiotic has much less impact than you would think.
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u/crocicorn 12h ago
Yup because most of their profits are coming from overpriced Pokemon cards and merch. See: EB Games Australia lol
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u/lonesharkex 12h ago
gamestop would be history if they didnt get saved by memelords. His company is hardly a compass for whats right or good.
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u/DuckCleaning 15h ago
Funko pop stop
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u/Pure-Golf789 13h ago
Online shoppers! nobody can be arsed to go out these days! Maybe thats why hes getting so little surly it doesn't boil down to 1 factor or reason it has be many reason that it fall into.
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u/Zackreeetard 13h ago
I remember them selling a marked up cloud ex soldier deck for 100 when I bought mine on Amazon for 80. They’re more of a collectible tgc shop that sells video games, I guess.
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u/thugbobhoodpants 12h ago
Thought this the whole time
Eb games in Australia feels like 7% games and 93% Funko shit and pop culture anime shirts and mugs from 2007
Like Naruto shippuden came out almost 20 years ago and they’re still selling baseline naruto season 1 merch or a hoodie that says don’t talk to me I’m a level 99 gamer or some shit
I get all the reasons physical games going away is bad for a lot of people, but I would care more if physical games both existed, and were cheaper for me. 6 years into this generation a ps5 pro is $1400 for me and launch title remake Demon Souls is like $115 it’s insane, when I bought a ps4 before rdr2 release, spiderman, horizon, bloodborne, god of war, days gone and uncharted were like $10 each preowned or $25-40 new and now demon souls is the flag of launch title still sold for full max price
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u/Sleepy-Zero 12h ago
I mean yeah, anyone that's been to a gamestop in the last decade knows that they made a shift away from 90% used games. I'm not surprised at all.
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u/sanban013 12h ago
i went to four gamestops to get action figures....never once i though about the video games...guess its true
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u/The_Kaurtz 11h ago
Discs are better for customers, that's it, you can't run a business selling games anymore, but it's better for the balance of the system and being able to own things
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u/ExtremisEdge 10h ago
He isn’t wrong. If they would go balls deep into selling singles and embrace the second market…dear god. They would be printing money.
I don’t blame them for that, not a second. If they were better at treating their employees better they would be a much better company.
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u/AdamAtomAnt 10h ago
Who the hell buys Funco Pops?!?
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u/GrimmTrixX Xbox 9h ago
Far more people than you would think. Gamestop has been "a store that sells video games" and hasnt been a "Video Game Store" in a long time, sadly.
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u/irish0451 8h ago
I have one friend who still insists on physical media while most of us went digital back in the early 2010s.
Even he hasn't bought it in store for well over 10 years.
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u/EmperorDeathBunny 8h ago
Keep in mind, even if Sony's decision did negatively impact them financially, he would never admit that out of fear that it would hurt their stock prices and therefore upset the shareholders.
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u/InsayneShane 7h ago
Meanwhile the now privately owned EBgames owner is a selfish piece of shit who hardly stock the shelves at any of the stores.
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u/FandomMenace 6h ago
Last time I went, there was a family who was wading knee deep in all their funko pops. I had to wait while they checked out and spent their rent money trying to make money, or whatever the fuck people into that shit do. So weird.
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u/Radiant_Cat_1337 5h ago
I have also forgotten that they are a video game company. They don't matter to me right now as I see them more as a collectibles company. I know where to get games that I play when I want to.
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u/Mr_robasaurus 36m ago
They buy Pokemon cards under mrsp and sell them for more than MSRP, they're scalpers with a storefront
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u/AJfriedRICE 15h ago
I’ve been wondering how GameStop has stayed in business this long. Turns out they’re basically a collectibles store now