PS5 Scalpers & the Bots People Hate
(This story was originally published on Medium).
Sony’s PlayStation 5 hit stores on November 12, 2020, and yet many customers have struggled to obtain a console for themselves. Retailers across the planet have been releasing steady opportunities for customers to purchase one. Still, despite this steady trickle of supply, consumers have experienced by crashing home pages, glitched carts, and in some cases, long nights in line during the height of a pandemic.
Part of this delay has to do with the novelty of the situation. A new console has only been released roughly every seven years, with the PlayStation 4 first dropping in the US on November 15, 2013. The coronavirus pandemic created a time where many people are stuck at home wanting something to do, leading to a massive demand for the console. There were over one million global pre-orders placed before the product even launched.
Overwhelmingly, though, the number one complaint that has surfaced is not of too much demand, but that “scalpers,” people who purchase scarce products in bulk and then sell them at a marked-up price, have been using automated scripts or “bots” to constrain supply. Comments decrying scalpers have garnered wide reactions all across the web. In one of several instances, it was speculated that a scalper was robbed at gunpoint during a sale in Toronto, Canada.
This bot crisis is emotionally pressing because many people are stuck inside and are looking for escapism. Still, it’s also part of a longstanding problem plaguing the retail space for a while now. The world of online shopping has become like the Wild West for those with the programming know-how and the willingness to seize it.
When we start to explore the world of online scalping, the first thing that becomes apparent is how brazen many people are with this activity. There was another internet rumor, first seen on the discussion forum GameFaqs, that one user named M (we are omitting their name for privacy) was also robbed at gunpoint for bragging about their huge haul of PS5’s on social media with the caption “f@ck your feelings.”
They allegedly failed to conceal their location in the picture’s metadata, or, in another telling, bragged about where they lived, and someone allegedly came to their house and robbed them, also at gunpoint.
This story has not been substantiated, and as far as we know, it's another example of internet telephone (though similar cases have been reported in Chicago and New York).
Still, the idea that a scalper would brag about their haul of goods is quite believable because many of the most successful ones do it all the time. The YouTuber Gunner Tierno has an entire channel dedicated to botting goods online. In a camo hoodie and sunglasses, they tell users in their November 19th video on botting the newest generations of consoles that in the latest restock, he “…got seven X-boxes on [Walmart’s website] and…one PS5.”
Source: Gunner Tierno’s YouTube channel
Tierno is hardly an exception to this game — though he is one of the few willing to show his face online. A quick YouTube search shows dozens of influencers trying to gain clout by instructing viewers on how to buy a new console.
For example, a video put out by Andrew2007 on November 11th — the day before the PS5 launched — has over 150,000 viewers, and that attention is hardly a rarity. “We’ve done it again…members have secured another 2000 consoles in the past 48 hours,” bragged the group CrepChiefNotify to their followers on Instagram. Nearly 400 liked it, and the account has over 30,000 followers.
Most of these influencers are pretty adamant that they are doing nothing wrong, with opinions ranging from “look how awesome I am” to “well someone’s going to do it.” As YouTuber Mr. Pr33m told viewers in their November 21st video:
“I know many people are getting mad at people using bots, which totally makes sense…obviously in a perfect world nobody uses bots and nobody resells it. But that’s just not the case…if you want the PS5 to play or to sell, you’re gonna have to do your best, and everything you can to buy it, or else you’re just not going to.”
This attitude can occasionally be a detriment to some of the more vocal scalper communities. When CrepChiefNotify, for example, publically bragged about those 2,500 PS5’s for resale, telling people that “reselling isn’t going away,” it generated an intense backlash from the gaming community. When the group tried to create a similar order of over 1,000 Xbox Series X consoles a couple of days later, they were denied by the retailer Very due to “technical difficulties.”
With these short-lived victories aside, groups like CrepChiefNotify are correct that reselling will probably continue for the foreseeable future. This practice is not illegal, and retailers have so far shown little incentive to constrain bot usage on their end.
Online retailers may have taken some simple steps, such as limiting traffic from a single IP address. Still, such solutions have easy workarounds like IP Proxies that even novices can implement.
The developers behind the bot CandyPreme 2.0, for example, have a Beginner Guide that is very user friendly. When that fails, most scalpers belong to “cook groups,” which are online forums (e.g., typically discord or slack channels) that share the latest information and strategies.
Scalper groups may be annoying to the consumer, but, arguably, they are not detrimental to the original brands they resell. The scalpers we are referring to here are often tied to the acquisition of luxury goods, especially sneakers and tickets.
When you examine what most cook groups bought before Sony and Microsoft released the latest generation of consoles, they were overwhelmingly devoted to self-proclaimed “sneakerheads,” using bots to snag shoes such as Air Jordans. AIObot, for example, is specifically devoted to corning the market on rare sneakers and has a logo of a robot carrying a shoe.
Source: Twitter handle @ANB_AIO
These luxury brands ultimately benefit from scalpers because they are not trying to sell through quantity alone, but instead from the price markup that comes with prestige. Sneakerheads bring with them fervent demand, and Nike makes the object of their obsession a rarity by constricting supply.
Companies such as Nike could stop scalping by merely increasing the supply of their limited editions to make the markup less desirable, but in many ways, that’s beside the point. Fans are paying for the allure of scarcity (real or imagined), and they are using bots to do it. As Felix Salmon writes in Splinter:
“…Nike knows better than anybody that use of bots is a sign of fandom. Show me a fan who managed to get his hands on one of these sneakers at launch, directly from the website, and I’ll show you a fan who used a bot.…Nike could put the bots out of business tomorrow, if it wanted — and so when it attacks them with mere words, that’s a clear sign that the company is actually OK with their existence.”
The same can be said of next-generation consoles. The early adoption of consoles is a difficult process. They are notoriously released with many bugs and few exclusive titles, which, if current reporting is to be believed, remains true with the PS5 as well. Players are not obtaining a PS5 due to it being an optimal gaming experience — that’s months, if not years away — but for the prestige of having the thing before everyone else.
Even if retailers are not getting the profit from a scalper’s resale, they still benefit from increased anticipation and demand. When the market rate for a console online is $1000, you will think the retail rate of $399 for the digital (and $499 for the hard disk) is a steal by comparison.
The press generated over its perceived scarcity might have even piqued your interest in it in the first place. As one frustrated shopper, who was unable to secure one of two PS5’s at a California GameStop during Black Friday, told ABC News: “…there’s a huge craze, people are fighting and murdering each other, everyone’s going crazy. And then all of a sudden: Media! Press! Free advertising for this console.”
We could not find any occurrences of someone in the U.S. being killed over a PS5 sale, but the frustration in that statement, though maybe not the reality, is clearly felt by consumers. People are frustrated by the constraint in supply, and the majority of that hatred has fallen on scalpers. While men such as Tierno like to style themselves as slick entrepreneurs or even self-proclaimed Robin Hoods, the dominant narrative is that they are to blame.
The scalping craze with consoles may have hit the news with the PS5, but it actually started months earlier with the Nintendo Switch in April. When millions of Americans lost their jobs due to the COVID-19 recession, thousands flocked to the reselling space to supplement their income.
The beginning of the pandemic created a huge demand for entertainment. Reporting from Vice indicates that an emerging community used a bot called Bird Bot to snag Nintendo Switches and resell them at a markup, sometimes even relying on their stimulus checks for liquid capital.
As of right now, this field is largely focused on reselling high-end luxury goods and electronics such as sneakers, next-generation consoles, and graphic cards. These goods may be necessary for a minority of professions, but they are not essential for most Americans. It’s an annoyance (in some cases, one perpetuated by some truly desperate people) that most consumers will be able to wait out.
However, we are quickly entering a space where bots could potentially hamper people’s access to things such as food and healthcare. When, for example, developers released add-ons in April that allowed people to secure timeslots for grocery or meal delivery services, there was widespread concern that these tools would be abused.
It was straightforward to see how people could take advantage of these bots and make booking appointments more costly for those who don’t have the technical expertise or resources to use them. As Joseph Cox wrote in a separate article for Vice:
“Some of those most at risk of the coronavirus, such as the eldery, who are staying inside and may need to use food delivery services are not going to be able to use bots or scripts to help them order food, or even know that this is a technical possibility. Instead, these bots may disproportionately benefit those who do have the technical know-how to do so, leaving others behind.”
As essential services become more online — both because of COVID and due to our world’s increasingly interconnected nature — scalping might turn into price gouging. We could be headed for a world where firing up a bot becomes the cost of doing business online, but that terrifying future remains within the realm of conjecture. Its inevitability or avoidance will depend on the practices of businesses, consumers, and governments.