Considering that Amazon introduced Kindle and Barnes & Noble rolled out Nook to spur e-book sales, it probably shouldn't seem crazy that GameStop is considering developing its own tablet computer for gamers.
Tony Bartel, president of GameStop, told Gamasutra this week, "If we can work with our partners and the OEMs and they come up with a great tablet that is enabled with a great gaming experience and coupled with a bluetooth controller, then there's no need to go out and develop our own. But, if we can't find one that's great for gaming, then we will create our own."
Mr. Bartel said tablet devices represent "the next explosion in the gaming space."
Mr. Bartel's revelation was something of an aside to the news that GameStop had purchased the digital distribution service Impulse along with Spawn Labs, a streaming service that offers, according to the Technologizer website, a "Slingbox-like" device that allows consumers to broadcast video games to personal computers and PS2, PS3, Xbox, Xbox 360, and GameCube. It is not compatible with Wii.
"Our customers are beginning to consume games in a hybrid manner, both physical and digital, so we are becoming a hybrid company to meet their needs," Mr. Bartel told Gamasutra. "Both of these programs are designed to sell more of the games we sell today."
GameStop plans to work with internet-enabled television makers to offer the service, but the initial focus will be on tablet devices.
"We really believe that's a chance for us to lead the tablet playing field," Mr. Bartel told Gamasutra. "Just like people create [lower-priced, immersive] games for the PC, we think people will begin to create immersive games for a higher price for the tablets. Someone needs to offer those games, and that's something GameStop will be the leader in doing."
"GameStop management is doing just about everything right," Michael Pachter, an analyst with Wedbush Securities, told CNBC. "Both acquisitions [enhance] the overall level of GameStop service, allowing it to better retain its high value customers over the long term."
One of the reasons GameStop chose to acquire Impulse was because it felt the service would be able to integrate its PowerUp rewards program. According to CNBC, over eight million have signed up for the program over the past eight months with five million paying $15 per month for GameStop's "pro service." The chain expects to reach up to 15 million members by the end of the year.
PowerUp members spend $65 more on average than non-members at GameStop and shop the chain twice as often.
"PowerUp [is] the new 'secret sauce,'" Colin Sebastian, an analyst with Lazard Capital Markets, told CNBC. "We believe [the program] can help GameStop remain differentiated in the retail market, as well as provide a conduit for jump-starting future digital initiatives."
- GameStop Announces Acquisition of Spawn Labs and Agreement to Acquire Impulse, Inc. - GameStop Corp./Business Wire
- GameStop Maps Out Digital Plans - CNBC
- Interview: Tony Bartel On GameStop's New Digital Strategy - Gamasutra
- GameStop Mulls a Tablet, Will Soon Buy Yours - Technologizer
- Spawn: It’s SlingBox for Your Console Games - Technologizer
- GameStop planning iOS-like digital distribution, iPad-like game tablet - Apple Insider