Last year when Wal-Mart Stores and Best Buy decided to test kiosks for the buying and selling of used video games, it was seen as a direct challenge to GameStop. Now that both retailers have decided to remove the kiosks from their stores, GameStop can rest a bit easier, at least for now.
The decision to remove the kiosks appears to be no-brainer in light of assessments by analysts, such as Arvind Bhatia of Sterne Agee who called the performance of the units at the two retailers "underwhelming."
While GameStop and its over 6,000 stores appear to benefit from the withdrawal by Wal-Mart and Best Buy from the used game market, there is no saying the companies may not take another run at it in perhaps a different form or at least with a different partner. Regardless, according to Mr. Bhatia, "it is clear the used games business is not an easy one to execute."
Discussion Questions: What is your take on the decision by Wal-Mart and Best Buy to get out of the used video game business? Do you think we'll see these companies back in the category in the future? Are there other retailers who you think might provide a suitable challenge to GameStop in the category?