WataGate has been exposed. But some think retrogaming is already dead.
Here at The Ghetto Gamer, we believe that gaming—and retro gaming in particular—should be a hobby that anybody can enjoy, even if they don’t have a lot of money. Unfortunately the new trend of having games “graded” by Wata Games, and then attempting to sell them for a small fortune, has turned game collecting into something strictly for rich nerds.
And we haven’t even gotten to the alleged market manipulation by Wata Games and Heritage Auctions. Am I seriously the first person to think of WataGate?
Regardless of any fraud or manipulation, games collecting has taken a bowling ball to the junk over the last couple of years.
For most of my adult life, my gaming has been focused around older games. Not because I preferred them–at least, not originally–but because I was broke living in the ghetto and older games were substantially cheaper than new ones. With only a tiny bit of expendable income, I could afford to start collecting.
Back in my day, Video Games Were Cheap as Dirt
Alright, maybe they weren’t that cheap. But for decades, new-release video games maintained a consistent price point of between 40 and 60 dollars. Don’t believe me? Just have a look at this old Toys ‘R’ Us ad I fished off of Imgur. (Credit to ProfessorPancakes)
After games were done being new, as console generations moved forward, the older games got predictably cheaper. There were a few exceptions, of course, but by and large, it was very easy to get into retro game collecting.
When you take inflation into account, we’ve been getting great deals on video games for most of our lives! When Sony announced they would start charging $70 instead of $60 for new AAA titles, some gamers were incredulous, but I remember begging my parents for Mortal Kombat when it came out for that same price.
Of course, all things change. The games market is no exception. The golden age of cheap retro games had to end sometime. But did it have to take such an extreme turn? Have a look at this chart from PriceCharting.com:
I’ve already spilled tons of ink about games prices (and N64 prices in particular) as they dip and spike. We’ve discussed which games have become expensive, which ones are still cheap and which ones are likely to blow up in value. But if the market continues at its current rate, retro collecting could become completely out of reach for all but the bougiest of gamers.
Game Collecting is Over.
There’s been a growing problem in the world of retro game collecting. Yes, the stay-at-home pandemic has had a massive impact on pricing trends. That was bound to happen. But I dared to hope that, as things settle down and life returns to normal, prices might relax.
So far, that has not proven to be the case. Retro game prices are not improving, they’re getting worse. And besides the COVID-induced price spikes and people spending more time at home, there’s a new virus that is infecting the retro gaming community: Wata grading.
Please behold the below tweet. And keep in mind this listing is for an empty box.
Game collecting is over. pic.twitter.com/56RxveO0md
— Dongled (@dyhptg) August 13, 2021
I’ve been fretting and complaining over eBay listings like this for a while now. At first it was cute and cringey, but over the last few months it’s started to become an epidemic.
Just take for example any mediocre game… Like Shaq Fu… a game which is famous for being mediocre. Ordinarily you can pick up a complete copy for a measly $15.
Granted, it doesn’t come with the audio CD, but everything else is in reasonable shape. That CD is exceptionally rare, and might be worth a great deal to hardcore Shaq-Fu collectors. But how many hardcore Shaq-Fu collectors are out there? Are they driving enough demand to price that CD into the thousands?
If you happen to be one of those hardcore Shaq-Fu fans that simply must own the CD, you can get Shaq-Fu Wata graded for a paltry $5,000.
In the listing immediately following this, another seller is offering the same exact game, sealed and Wata graded, and selling for the vastly lower price of $1,400. But wait! Look closer and you’ll see that this second copy is not really Wata graded at all.
You can tell it isn’t graded because it’s not in one of those stupid Wata boxes. You can’t remove a graded game from its box ever. It would void the grading.
So in reality, this eBay seller just added “Wata” to their item description completely arbitrarily to try to trick buyers. This is frickin’ Shaq-Fu we’re talking about!
You can search for just about ANY common game and find a massively overpriced copy thanks to Wata grading. Some sellers are even listing games as “Wata or VGA Ready”. It’s a meaningless way to try to demand inflated prices for the most common, overmanufactured games of all time. There are TONS of eBay listing offering “Wata ready” games. Like this Wata-ready GTA III:
There are so many things wrong with this scenario.
- Wata-graded items vary drastically in their suggested pricing.
- Sellers think they can grade any damn thing and it’s magically worth a fortune.
- The glut of massively overpriced retro games on eBay is driving market prices even higher.
- Worst of all, recent evidence shows that Wata themselves are deeply involved in practices to manipulate the market and make the pricing bubble even worse. More on that in a bit.
What is Wata Games?
So who is this company Wata Games? What’s the deal with Wata grading, and why do sellers expect graded items to sell for 10X or 100X what non-graded versions do?
Let’s have a closer look at Wata, what they do, and what this means for the future of retro gaming.
What is Wata Grading?
Allegedly, Wata Games “provides fair, objective grading standards”. They see themselves as the ultimate authority on how well-preserved a video game is.
Wata grading works on a scale of 1-10, with 10 being an example of a factory-fresh, pristine copy. Very few 10s exist in the world. In fact, most games are already no longer a 10 by the time they hit store shelves. They have to be completely perfect.
Wats’s website insists that their service lets you buy and sell games with “complete confidence”. The site also contains many paragraphs of fluff about staying “true to our community roots, focused on building and sustaining our relationships, and serving you with excellence. At our core, we are inspired to be like water.”
Basically their site is full of BS and happy sunshine prose that tells you absolutely nothing about the company. As a professional copywriter, I’m qualified to tell you how cringe it is.
Anyway, Wata insists their “expert video game grading empowers collectors to collect sealed games, CIB games, loose cartridges, and many more video game collectibles with confidence.”
Oxford Comma notwithstanding, idea behind grading is pretty acceptable on its face. Simply put, it’s a way to let buyers know what they’re getting. The condition of an item is verified by a third party and guaranteed. According to the folks at Wata Games, it’s a good service because it protects buyers.
But there’s more to it.
While it’s true that buyers can have a guarantee of an item’s condition, sellers are also passing the cost of grading–which is NOT cheap–on to those same buyers. With the cost of grading being entirely arbitrary and set by Wata.
Let’s look at Super Mario 64 as an example.
Mario 64 was one of the best games to hit the Nintendo 64 and one of the best-selling games of all time with almost 23 million copies sold. There are plenty of Mario 64’s for everyone that wants a copy. There is literally no reason for a loose cart to be expensive and with prices commonly between $20 and $35, they really aren’t.
Boxed and complete copies are quite a bit rarer, but you can find plenty of them on eBay at an average of like $160.
Factory-sealed copies are far and away the rarest and most expensive condition to find old games. It’s a lot harder to price items when they’re this rare.
But of course an item is only worth what someone is willing to pay for it.
Keep in mind the listing change constantly, and even high-dollar listings will mysteriously disappear. Presumably because the seller came to their senses and re-listed for a few thousand dollars cheaper. I saw it happen at least 3 times just as I was writing this piece.
So our search has 4 organic results and one sponsored result:
- (Sponsored) First print, complete but not sealed and Wata 7.0. The seller is asking $2,439.20, which is a 20% markdown from its original price.
- A CIB, not sealed first print. “Potential 9.0 Wata” being offered for $500.
- Sealed Wata 7.0 Players Choice version. Seller wants $9,999.99 (Oh, FFS)
- “super mario n64 sealed” for $20,000.00
- Sealed copy, Wata 8.5 being offered for $49,999.99 (Because a flat 50k would be too much.)
We can see that prices are all over the place. When we narrow the results to Mario 64 “Sold listings” we can see that CIB copies of Mario 64 have been selling for between $70 and $150. Only a handful have sold for more than this, and those went for prices between $300 and $400. I’m not sure why those were deemed to be worth more, I didn’t have time to investigate.
Recently sold listings for non-graded sealed Mario 64 games range from $1,500 to $2,250. One glaring exception was a sealed 1st print copy that sold for $15,999.95 back in May which smells totally fishy to me. The other, more believable “sold” listings were certainly not chump-change, but still a far cry from the $49,999.99.
Does Wata Grading Increase a Game’s Intrinsic Value?
So what’s up with Wata grading? Can you really just get a game graded and then add a pair of zeroes to the end of the price?
The problem here is that grading a game does absolutely nothing to change its value other than to render it completely unplayable. Which in my opinion completely destroys its value in the first place..
And I’m not alone in feeling this way. In writing this article I reached out to my pal JJ, owner of PriceCharting.com. He’s the only games pricing expert I know personally and he loves to nerd out on this stuff.
On the topic of Wata grading and what it does for the hobby, he had this to say:
“I personally don’t like grading for cartridge or CIB items.”, he told me via email. “Games are meant to be played. Once they have been graded they can no longer be played and they are just display items… I don’t like it.”
He feels a little better about sealed games or other items that are strictly collectables and not intended to be played. But he still expressed some dismay for the pricing of graded games.
“I’m a bit torn on the game grading thing”, he says. “Offering grading for those [sealed games] allows collectors to know the condition from a 3rd party source. I think some of the prices for those items have been ridiculous lately. Much higher than non-graded copies.
“Those markets should be related, but some recent sales don’t appear to be related. Like Mario 64 for $1.5 million.”
JJ is referring to the recent sale of Mario 64 by Heritage Auctions back in July, a transaction which drew major headlines then, and has made its way back into the public eye within the last week.
In the time since I started writing this article, and after contacting JJ, a 52-minute investigative video came out by Karl Jobst blowing the lid off Heritage Auctions and Wata Games’ market manipulations.
When JJ said the graded and non-graded markets didn’t appear related, he was absolutely prescient. Indeed, that Mario 64 game was sold and bought by a small group of individuals loosely associated with Wata. Their massive and unprecedented transaction was allegedly just a publicity stunt to draw headlines, manipulate the market, and keep inflating the current game pricing bubble to outlandish proportions.
If you haven’t seen Karl’s video, you really should make some popcorn and settle in for a bit. The rabbit hole is deep and the deception from Wata and Heritage is offensive.
The tl;dr is that Wata and Heritage are allegedly working together and making themselves rich by artificially inflating the games market. It’s still being investigated and Wata is pushing back, claiming that Karl never tried to contact them. Karl has provided screenshots proving the contrary.
For what it’s worth, I also reached out to Wata for comment while writing this piece and they ignored me too.
Has Wata Grading Ruined Collecting?
For the moment, it has seriously impacted the market in a negative way. As someone who started collecting many years ago, I watched games prices gradually appreciate in a predictable curve. But within the last couple of years the market has lost its ever-loving mind and the results, in my opinion, are tragic.
The notoriously massive prices on some of these recent sales have made scalpers bolder than ever. Speculators are putting listings on eBay for outrageous prices either hoping somebody naïve will buy their crap, or that keeping their $15,000-listing alive will help normalize these sky-high prices.
Every time someone buys a vintage video game at 10X or 100X its actual value, the average price of video games rises a bit.
Every time a headline promises “Your Old Games Might be Worth a Fortune”, a few more speculators list games at 10X or 100X their actual value.
The cycle continues and the bubble gets bigger.
But if Jobst, history, and common sense tell us anything, it’s that pricing bubbles always pop eventually. And as word of Heritage and Wata’s (alleged) market tampering continues to spread, we get a little closer to the end of this bubble and –hopefully–a return to fair pricing that can make retrogaming a reasonable hobby even for those without tons of disposable income.
Just like the good ol’ days. Thanks so much for reading.