My wild speculation on why Gamestop will sell iOS devices

Here's another from the "weird rumors that might be true" file. According to, video game chain Gamestop is going to start selling a full line of iOS devices sometime in the months to come.

A full line? That I find hard to believe. I can't envision the clerks at the local Gamestop dealing well with setting up a cell phone plan. They seem to be kept plenty busy trying to sell pre-orders or disc insurance or memberships in their frequent buyer's club or whatever. I just don't see myself standing at the counter of a Gamespot talking about what's included in my 2-year AT&T contract and all that. And I really don't want to be waiting in line behind someone else doing so. They could add a kiosk, I suppose, with a dedicated phone employee, but it just doesn't make a lot of sense to me. (Selling used iPhones that customers can then move their SIM card to, or take elsewhere to be activated, might work for them.)

But iPads and iPod Touches? Those are much more feasible, I suppose. I'm just not sure what's in it for Gamestop. The company is infamous for its system of buying back used games for a fraction of what a customer originally spent, and then re-selling those used copies for nearly full price. They (at least, this is what the Gamestop near my office does) actively discourage customers from buying new copies of games since the mark-up is so much smaller for them.

Selling a customer an iPad just means handing that customer over to Apple after that initial sale. That isn't the Gamestop way, and there has to be more to it than just selling the hardware.

Now back in April there was a rumor going around that Gamestop was looking to sell or create a tablet with a Bluetooth controller, and that it'd then sell games for that tablet.

So here're a few theories.

First, Gamestop is about to also launch a Bluetooth controller that pairs with iOS devices. That gives them one more thing to sell, but it still doesn't seem to fall in line with Gamestop basic 'long tail' sales philosophy. I think this is part of the plan, but not all of it.

Second, Gamestop has it's own iOS appstore in the works, much like what Amazon has done with Android. It'd have to be web-based, and I guess the games would have to be as well. Otherwise Apple would step in and block this system. Overall I don't see that as being likely, considering iOS doesn't support Flash. If this was the angle Gamestop was working they'd be going with Android devices.

Third, and I think most likely, is that Gamestop is getting ready to roll out a streaming game service, similar to OnLive, and it wants a portable platform to offer it on. We know it sees OnLive as a threat after the stunt it pulled with Deus Ex: Human Revolution (removing OnLive coupon codes from inside the game box before selling it to customers). We know it purchased Spawn Labs, a company working on a streaming game service of its own.

So here's the plan I'm imagining. Gamestop produces a branded Bluetooth controller that pairs with iOS devices, and it gives away an iOS app that acts as the thin client for the Spawn Labs streaming service. Now whenever a customer buys a streaming license for a game, Gamestop gets the revenue (Apple might get 30% but there are ways around that, such is using a web site for the actual purchasing).

Now Gamestop essentially has its own gaming platform. It's selling the hardware (iPads, iPod Touches, and the custom controller) and the software (the licenses to play on the Spawn Labs service, which will be branded Gamestop Instant or something). Now they have a business plan.

Again, this is all pure speculation on my part, based on Gamestop's history and recent acquisitions. Just selling iPads for the sake of selling iPads doesn't seem lucrative enough for Gamestop to bother doing it. Granted, they'd probably pay $25 for a used iPad then put it on the shelf pre-owned for $475 rather than the $500 a new one costs, and maybe that's all that they'll be doing, but I think they're planning something bigger.

Thoughts? Am I totally crazy, or do you think this theory holds water?

Read more of Peter Smith's TechnoFile blog and follow the latest IT news at ITworld. Follow Peter on Twitter at @pasmith. For the latest IT news, analysis and how-tos, follow ITworld on Twitter and Facebook.

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