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Best Buy May Purchase GameStop

best-buy-may-purchase-gamestop

Thats right… you heard me. Recent rumors have circulated that Best Buy has been looking to purchase a huge player in the video game industry – GameStop. This is interesting to say the least.

Recently these companies have had growing competition between eachother, stemming from a recent price war over the price of videogames. Additonally Best Buy has been testing out used games, at a lower price than GameStop. GameStop has responded by lowering their prices even more and has had the clear advantage over Best Buy, as they are the leader in this niche. Since Best Buy can’t compete with GameStop’s, why not go ahead and buy that advantage?

Funding would be a major issue for Best Buy, as the Game Retail Giant is valued at approximately $4.2 Billion – an amount that they do not have.

According to Kotaku, when questioned about the potential purchase, CFO Ryan Robinson responded the following at the Dow Jones Newswires:

“What I think is something that we’ve missed in the industry and is something other participants have been doing is the proportion of business that is used,” Robinson told DJ Newswires. “We’ve not developed the capability to the extent that other participants have. It’s a very margin-rich portion, so I think there’s opportunity in that business.”

This could very well make Best Buy a powerhouse in┬ávideo game┬áretail sales – both used & new.

What do you think about this potential acquisition?

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3 Comments

  1. Comments  DarkKnightH20   |  Tuesday, 22 September 2009 at 2:23 PM

    Hopefully they wont buy ’em…

  2. Comments  Blue Star   |  Tuesday, 22 September 2009 at 3:38 PM

    First question is, how big is the marginal gain from used game sales?

    Second question is, How much longer will people actually play games on individual brand gamecubes/os?

    Third but not least, gamestop is small chainstore targeting local areas or malls. Will bestbuy keep the stores but co-own it as a parent company or consume the stores completely and close them down??

  3. Comments  Naota   |  Tuesday, 22 September 2009 at 5:20 PM

    Huge margins… Gamestop buys games for $10 bucks (or less) and resells them from upwards of $20 (usually at least $30.) They also don’t sell any n64 games or sega games for instance. They stop selling games for older consoles when they lessen in popularity, and basically clearance them for the price they bought it for.

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