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GAME finally gives up and goes into administration. But is it gone forever? Here's what this really means

So then. After crawling along for weeks like that legless torso zombie in the first episode of The Walking Dead, the GAME retail chain has today officially filed for administration. Coming just after the retailer asked to be removed from the stock market (which is a bit like having to call an early taxi home from a party because you've got drunk and embarrassed yourself so badly that you absolutely cannot stay), the move is obviously being seen by many as a cyanide pill shaped like a final coffin nail which also sounds a bit like a death knell when you hit it with a small bell hammer. But is it really?

Everyone knows that going into administration is a Very Bad Thing, but what does this actually mean in real terms? Is GAME finally dead? Is it likely to make a comeback? If you go to your local store tomorrow, will you still find it there, or will there just be a big smoking crater? Is GAME really admitting defeat, or is it cooking something up? Allow me to explain the possibilities (and probabilities).

Administration is a flat-out admission that a company can no longer successfully run itself as a business, and has appointed - or has filed for - a third-party to come in as an emergency interim Chief Executive in order to deal with what's left amongst the wreckage. The administrator works on behalf of the company's creditors (in GAME's case very probably a whole bunch of game publishers who haven't been paid for stock) in order to work out the best way of dealing with the company's assets while avoiding total liquidation, thus allowing the company to continue operating in the interim. From the point of administration, creditors cannot communicate directly with the company in question.

There are several options. GAME could be sold outright. It could be broken down into different elements and sold off in bits, like stripping a car for parts. There's also the option of the 'pre-pack' administration method, whereby a restructuring plan is decided before administration is announced, and assets are sold off immediately. Often in these cases, the company's previous management or directors will step in to pick up the assets themselves, using them to restart the business as a new company. This ensures business continuity and often saves a lot of jobs. And there's currently a rumour that this is exactly what GAME is going to do, relaunching the UK and Spanish company assets under a new brand to be announced on Monday. 

Good news? Well not necessarily. You see if true, the rumoured plan to essentially reboot GAME does not include Gamestation, the rival chain GAME bought out a few years ago. The guys working there would still be screwed. And it's debatable how much support the new GAME would get from the game publishers vital to its success. If you were EA, and had (rightly or wrongly) been niggled for years by a chain which built its business model primarily around pre-owned games that cut you right out of the financial equation, and were quite possibly owed a stack of cash from said chain after it went under, would you really be thrilled by the idea of supporting it again a couple of weeks later, when it popped back up under a different name? 

So, GAME as we knew it is dead. Gamestation too. That's pretty much the whole of the UK's game-dedicated high street retail gone. Their stores will continue to operate as they currently are until the administration process finishes, but we're talking about a dead chain walking. What will rise to fill the gap, we cannot currently guess. It might be a new chain, it might be ramped up game sales from the supermarkets, it might be a new iteration of GAME itself, or it might be nothing. But whatever comes out of this, our absolute best wishes to anyone directly affected.

(GamesRadar AU Ed: With GAME Australia operating independently from GAME UK, the company's future down under remains unclear. We've attempted to make contact with GAME's Australian office, and will bring you further news as soon as it becomes available.)

Your thoughts?

25 comments

  • jackthemenace - March 23, 2012 9:28 a.m.

    It's sad, in a way, to hear, but since I haven't bought a game in-store in over a year I can't see I'm too upset. Buying games online's a lot cheaper and a lot easier. That said, though, I would really like to see a return to the 'indie game shops' you guys mentioned in this weeks podcast. I mean, I don't remember them, being a young whippersnapper, but they sound great. I mean, there's an indie clothing shop in my local city (Which is a little different, I know) but the guy that works in there's really nice, and he makes an effort to learn about his customers and what they like. If there was a shop with attendants like that, that sold games, that'd be the best thing to happen to gaming since... well, the 'A' button.
  • pin316 - March 22, 2012 10:06 p.m.

    I personally have absolutely no sympathy for the company whatsoever after their recent history. - bought out a growing Gamestation purely to counter the fact they were losing customers to them due to their inflated prices - refused to follow trends in reductions in prices of new games that all online retailers were doing, as part of a trategy expressly designed to encourage customers to buy used games instead in order to maximise their own income at the expense of the studios - were consistently amongst the most-expensive places to buy hardware/peripherals, knowing full well that a lot of their customers would never realise that they could find them priced cheaper elsewhere as they were the most recognisable brand for non-gamer buyers (i.e. family members buying presents and the like). and to top it all off - less than a month ago I received and email from Gameplay (an online retailer who were very reasonably priced), saying they had just been bought out by Gamestation (and thereby by Game) and so would be closing their own site - not exactly a respectable move considering the financial difficulties they were under. The downfall of Game is a direct result of their policy of trying to screw as much money out of all associated parties - both customer and industry partners - and is therefore completely deserved. The front-line employees have my sympathy, of course, but the company itself - i say good riddance to you
  • MrDobble - March 22, 2012 10:08 a.m.

    I'll be very sad & disheartened if GAME will dissapear. Despite being able to get the same game somewhere else for cheaper, I enjoyed talking to the staff there, as they're always friendly and very knowledgable. Even moreso, there's nothing quite like coming home with a brand new game in your hands that you've been excited for, and not having to wait 5 days for delivery. Not only will it be bad for the gamer, but bad for the UK economy too. Not that we're doing too smashingly as it is. Hang in there GAME!
  • Pacific - March 22, 2012 3:04 a.m.

    Looking at how mentally busy my local Game (and Gamestation for that matter) was coming up to Xmas, I can't understand how they have done so badly financially. I think a lot of it has to rest on the shoulders of local government - ridiculous town rates for property (at least where I live, big gaps in between shops these days, and lots of pawn and charity shops taking the place of respected high-street retailers), combined with continuous increases in parking costs. Our local council has even channelled this money into making more parking meters, and more traffic wardens. Everything that is done in this manner adds a barrier to town shopping, at a time when really it should be doing everything it can to combat the internet. If all of GAME, and Gamestation, do disappear from the highstreet, it marks a bleak day for not just the games industry but also UK highstreet retailing in general.
  • MCN2011 - March 22, 2012 5:10 a.m.

    If GAME and Gamestation go under, there's at least two other retailers I can think of who will be poised to take their place. Grainger Games and Chips would leap at the opportunity to pick up GAME's old customers.
  • tomthespesh - March 22, 2012 9:26 a.m.

    Where I am in Reading there's 3 game retailers. 1 GAME 1 Gamestation and a little independent one which does pre-owned only. I've never heard of Grainger games and Chips closed years ago so I'm not sure they're poised to take their place. Not here at least. If I want new games from a shop it'll have to be whatever's left in HMV or a supermarket.
  • MrDobble - March 22, 2012 10:05 a.m.

    Completely agree with you. Same thing is happening with my local government. The UK highstreet is suffering enough as it is, but you're right when you say if GAME & Gamestation go under too, the future of the UK highstreet looks bad.
  • CitizenWolfie - March 22, 2012 1:47 a.m.

    Bad times. I always felt good about buying stuff from Game and Gamestation. The staff in there actually know what they're talking about as opposed to some bored, miserable checkout person on "CD/DVD duty" in Asda. And midnight launches were always fun - surrounded by other excited gamers and staff who seem genuinely psyched as well. I guess most people would rather pay £37.99 than £39.99 for a new release. I'd rather spend the extra couple of quid and get my points on the store card.
  • Faustinator - March 21, 2012 6:04 p.m.

    Shame. Author of the article has no more of a grasp on the real world than Alice did of Wonderland. Not every video game user is metally retarded, or indeed, oblivious to the inner machinations of the actual world we live in. Though, it would appear, you perceive your reader-base to be made up of basement-dwelling sub-teens. Perhaps that shines some light on your inner physce?
  • MCN2011 - March 22, 2012 5:11 a.m.

    *psyche
  • bebl09 - March 22, 2012 7:44 p.m.

    Lol.
  • Wolfman3000 - March 21, 2012 3:32 p.m.

    I heard Walmart are interested.
  • josh-horvath - March 21, 2012 2:57 p.m.

    goodnight, sweet prince...........
  • BALLSTOTHEWALLET - March 21, 2012 2:12 p.m.

    I bought my GameBoy, GBASP, DS, original Playstation, two PS2s plus more. I was in line there to buy my PS3 at 7am on Launch day(23rd March '07) and got my picture taken for the Ulster Herald while doing so. At one point had £36 on one of my two GAME reward cards, bought hundreds of games there and now they're shutting down. :(.
  • e1337prodigy - March 21, 2012 2:05 p.m.

    My brother works for Gamestation as a Manager. He is looking for jobs elsewhere. Wishing him luck.
  • beemoh - March 21, 2012 1:33 p.m.

    "If you were EA, and had (rightly or wrongly) been niggled for years by a chain which built its business model primarily around pre-owned games that cut you right out of the financial equation, and were quite possibly owed a stack of cash from said chain after it went under, would you really be thrilled by the idea of supporting it again a couple of weeks later, when it popped back up under a different name?" I'm sure I read somewhere that GAME in the UK was actually fine, it's the international business that was letting it down- if that is true, then there's every chance that any nu-GAME might be in a good position to butter EA et al up enough that it wouldn't matter. If.
  • BLOODmuffins - March 21, 2012 11:48 a.m.

    Forgive me for being a confused Yank here...is filing for administration similar/the same to filing for bankruptcy?
  • bebl09 - March 22, 2012 7:43 p.m.

    Pretty much. It's basically the company saying it's run out of money, although it continues to trade in the interim. This allows it to attempt to reduce debts by selling off assets, making staff redundant, etc. In most cases, the company will have to find a buyer in order to avoid folding completely, as they've usually got into this situation cause they don't have any money so it's highly unlikely they'll be able to get out of it themselves.
  • Mooshon - March 21, 2012 11:42 a.m.

    Feel bad for the workers. Think I have £5.70 on a points card somewhere though. Fire sale please.
  • vigilant - March 21, 2012 11:41 a.m.

    RIP, Dear Friend. I will now loot your corpse and buy many a game on the cheap, but know it is with a tear in my eye.

Showing 1-20 of 25 comments

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