GameStop to Debut Tablet Device

Discussion
Nov 01, 2011
George Anderson

Back in April, when RetailWire ran a story/discussion on plans by GameStop to explore the development of its own tablet device, reaction was generally positive.

At the time, Larry Negrich, retail business solutions consultant, Avnet Technology Solutions and a member of the RetailWire BrainTrust, said, "Perhaps a bit outside of its core competencie,s but likely a step they should take. OEMing this device with their brand would be a good way to get a firmer grip on the distribution of their products and put the store in the hands of their best customers. The device needs to be high quality and rugged to meet expectation of these high-value customers."

Now comes word that GameStop will begin selling its Android OS tablet devices in 200 of its stores beginning this Friday. GameStop, which operates around 6,500 stores, worked with three different manufacturers — Asustek Computer, Acer and Samsung — to produce the units, which come equipped with seven free video games plus links to the retailer’s Kongregate Arcade app store.

"Customers have been telling us that they like to game on multiple devices," J. Paul Raines, GameStop’s chief executive, told The Wall Street Journal. "We believe there is a gaming opportunity on tablets."

While 60 percent of respondents to a RetailWire poll back in August — sans details on the launch — thought it was somewhat or very likely that GameStop would succeed with its tablet, others are less sure now that more facts are being revealed.

Michael Pachter, an analyst at Wedbush Securities, told the Journal that slow sales of Android tablets as well as a price in the $400 to $500 range will work against GameStop.

According to the Joystiq website, "GameStop now accepts iOS-device trade-ins, which means, in theory, you’ll be able to trade in your Apple product directly for an Android one."

Discussion Questions: What effect do you think GameStop’s tablet device will have on the video gaming business? Is this the right or wrong move for GameStop?

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9 Comments on "GameStop to Debut Tablet Device"


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Phil Rubin
Guest
9 years 6 months ago

It’s one thing for a retailer like Amazon to follow up on its successful Kindle line with a tablet but GameStop’s going to have an uphill climb with its tablet. Gamers are nothing if not savvy when it comes to value and it’s very unclear that the GameStop tablet qualifies as a legit value. So far the early reviews are at best skeptical, if for no other reason than pricing. Amazon can much more easily afford to sell its Kindle Fire at a loss given the size and scale of its business. It’s far less certain whether GameStep can do the same.

Max Goldberg
Guest
9 years 6 months ago

In a word: none. Apple dominates the tablet business. Everyone else is still trying to catch up. Why would GameStop want to enter the field of tablets? It does not make financial sense.

Doron Levy
Guest
Doron Levy
9 years 6 months ago

This is a logical next step for GameStop to acquire more business through online selling. The GameStop app Kongregate provides a unique way for the store to connect with the customer. Installed on a high performance Android tablet will provide a seamless and exceptional gaming experience which could drive sales. This is a great differentiator for GS and they should sell thru their entire allocation.

Art Williams
Guest
Art Williams
9 years 6 months ago

I believe that its success may depend entirely on the price point. $400 to $500 seems too high to me. I’m not sure what the impact will be of allowing credit for trading in old games, but it obviously will help encourage frequent gamers. If they can determine the right price point and still be profitable, it should be a big winner for them.

Bill Bittner
Guest
Bill Bittner
9 years 6 months ago

I may be showing my ignorance here, but does this idea conjure up the image of the stack of device chargers I have in my kitchen drawer for anyone else? Unless there is some particularly unique hardware requirement for game playing, I don’t really see why the consumer would consider this a good idea.

Probably the most difficult factor entering the decision for a tablet purchase is the content that will be available. I understand why content providers want to get away from the “Apple Tax,” but I am not sure consumers will follow. We talked about HTML5 recently, opening up the Apple platform to running local content and allowing content providers to bypass the Apple Store. I think Game Stop would have been a lot better off rethinking the software platform for their games instead of the hardware.

Ed Rosenbaum
Guest
9 years 6 months ago

When the question of a GameStop pad was first put out, there were not as many “players” in the market as now. That will limit the level of success GameStop might attain. However, GameStop’s key customer base is a loyal group. This might be the stimulus they need to put them among the elite of the pad sellers.

Liz Crawford
Guest
9 years 6 months ago

Beautiful Vertical Integration Strategy. Watch out.

Rick Myers
Guest
Rick Myers
9 years 6 months ago

Bad idea. Sure way to get stuck with devices that are out of date and need constant updating. I don’t think they can produce them with enough profit built in to make a go of it. And if they do, they are competing with a host of other devices. If the idea is to get more people signed up for their service, then maybe it might work. But if it isn’t a game changer of a tablet, I see it falling flat. Especially if I can get their app on other devices.

Jesse Rooney
Guest
Jesse Rooney
9 years 6 months ago
I think the success of this tablet rests on two elements: the applications and the interface. As they are selling this as a new gaming platform, GameStop will need to secure good games that people are willing pay for. GameStop is actually a little bit ahead of the curve because they already have the ability to send thousands of games digitally to consumers through their Impulse product. However, many of these games are old, dated, and not necessarily the kind of products that will encourage people to embrace a new platform. If GameStop can work with game producers to create new games unique to the platform then they might have some success. They also have to overcome issues with the user interface. Assuming this new gaming platform is being sold to people who already play video games, GameStop’s target consumers will be used to looking for an interface similar to that of existing video game and computer systems. In contrast, the current batch of tablets have a touch-screen interface that, while nice in many ways,… Read more »
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