GameStop shares tumble following Sony patent application
Specialty retailer per-share value dives 5 percent today after technology from Sony that could block used games emerges in filing.
GameStop shares dipped Thursday by more than 5 percent following the publication of Sony's patent application for technology that could block used games for a future system. The company closed trading today at $24.36, down $1.30 (or 5.07 percent) from the day's start.
The technology would make it so only the original purchasers of a game could play the title. Thus, retailers that buy and sell second-hand games like GameStop would be negatively impacted.
A GameStop representative was not immediately available to comment.
Analysts--speaking to Bloomberg Businessweek--said blocking used games, previously rumored to be a feature of the PlayStation 4, would be detrimental to Sony's overall business. It would put the platform at a competitive disadvantage, nullify revenue from game rentals, and elicit consumer backlash, these analysts said.
Janney Capital analyst Tony Wible told Bloomberg news of a similar technology surfaced in 2005 prior to the arrival of the PlayStation 3 and sent GameStop shares into a downward spiral. This technology, of course, never came to be.
In after-hours trading, GameStop shares have rebounded slightly, up $0.04 to $24.40.