An interesting idea, but like in all things, timing would have to be impeccable. Games are like books, and most of their value comes up front. They aren't like engineering programs or productivity tools where they are able to provide literally unlimited value. Once you've played them, it's time to move on to something new.
Thus, for older games, releasing the code might be a fantastic way to breathe life into them. But for newer titles, it would probably just canabalize sales. But then, since most game sales happen within 18 months of the original release, I could see a smart development house using this strategy to develop a robust community around their brand.
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