Normally, we don’t find ourselves making fun of companies for expanding their business into the mobile arena because those companies have generally been behind and generally need to catch up. In the case of GameStop, we find ourselves nearly dumbfounded by the company’s decision to offer mobile plans as a service.
GameStop plans to sell a wide array of voice, messaging, and data plans to customers who already have devices for a ‘low’ monthly payment. In addition to this, GameStop Mobile offers them a no-contract no-obligation option of keeping service. Normally, we’d find ourselves praising a company for giving consumers more choice, but GameStop does not even belong in this business unless they are selling 3G enabled devices, which they are not.
Taking a look at their plans, we can see that their prices are relatively competitive and that they already start their network off by already exposing consumers to the fact that there is no such thing as unlimited data. In addition to that, we found it very interesting that they opted to offer a data only plan, which may cater to a very specific audience, but $55 for 1GB of data is a bit high. This is especially true when you consider that their other $55 plan offers 500MB and unlimited voice and texting. If GameStop Mobile wants to be serious, they will recognize that the difference between a user that uses 500MB and 1GB does not exist, but rather the difference between a user that uses 500MB and 2GB does exist.
According to TechCrunch, the network that GameStop Mobile is running off of is AT&T’s 850MHz network and users that wish to use (we’re not sure why anyone would) GameStop Mobile must make sure their devices are 850MHz GSM compatible.
While we have absolutely no idea how this new business venture fits into GameStop’s current business model, it does acknowledge one thing. Their traditional business is struggling even though the game industry as a whole is still growing. The fact that GameStop is a physical location that generally rips people off (customers and employees alike) without giving them any real reason to shop there has attributed to their continued poor financial performance. We do not see that GameStop Mobile will affect GameStop’s revenue or profitability at all since they need people to actually come into the store in the first place. GameStop has missed the digital download train and will be slowly cut off by services like Steam and Origin as well as online game retailers like Amazon and Walmart.
GameStop is in a similar position as Best Buy, except for the fact that Best Buy’s merchandise is not becoming intangible and easily transmitted over wires. While some of Best Buy’s products did indeed become digital, the company has in recent years changed their business model to embrace digitally delivered content. GameStop’s venture into the world of digital downloads was too little too late. If the company wants to survive, it will not be on the backs of selling pay-as-you-go cellular plans, but rather creating a value for the customer to come in and purchase the physical copy in the store. If GameStop cannot figure this out, then they don’t deserve a place in this rapidly changing marketplace.