Denmarkian said:
You're missing one of the key points of having direct downloads: they're cheaper.
If software distribution goes completely digital, there's absolutely no reason for the retail price of a new game to remain at ~$60 because the costs of designing the box art, disc art, manufacturing the disc, packaging the software, warehousing the merchandise, and transporting the merchandise to the retailer are gone.
None of those costs matter anymore, unless you're a complete idiot who wants to appease the physical-copy-fetishists and give them a box for a digital download game like Patapon 2.
I'll have to do some digging through Steam to get some better comparative pricing lists, but I'm fairly certain that brand-new titles released on Steam are not priced at the exact same amount as a new-in-box copy of the game at Best Buy.
--EDIT--
Okay, so there are several games that are the exact same price on Bestbuy.com and Steam:
Guild Wars Trilogy - $49.99
Fuel - $39.99
Spore: Galactic Adventures - $29.99
Prototype - $49.99
What the hell?!?
That completely shits over my entire argument. Fuck.
Well, I hope that in the advent of digital-only distribution we can see some more reasonable pricing models. I think that these pricing examples are there because the costs I mentioned at the beginning of my post were already factored in and need to be recouped before publishers can discount the price.
I absolutely love Steam for being a platform that grants me access to a lot of my games that were published before Windows Vista came out, and even where I can find anthologies of old games I had only one or two of. I mean, they've got a Space Quest collection for $15, I only ever had a copy of Space Quest IV and I don't remember how I got it. If I ever want to get it, I'm sure I'll always have that option, and it will never be out of stock because it only takes up server space for one copy instead of a warehouse full of unsellable boxes.
There's one thing you overlooked in your statement, "there's absolutely no reason for the retail price of a new game to remain at ~$60." There is a reason, one very GOOD reason...
People are willing to pay it.
That is the MAIN reason games are priced where they are. A game can be priced $59.99 and sell ten million copies. So regardless what happens to the cost, what makes you think they'll drop the price?
Games used to be $79, then they were $59 and then $49 and $39. Last gen, they went back up to $49. And something strange happened. Publishers wend crazy with $59.99 LE and SE versions of game, AND PEOPLE BOUGHT THEM. So what happened this gen? Simple. Games came out at $59.99, and the LE and SE versions were bumped up to $79.99.
If prices drop to $49 with the digital download revolution, it will simply be as an incentive to get people to adopt the concept faster, NOT because games are cheaper to make. A $3.00 bag of chips costs a dime to make... why aren't they .50 instead of $3.00? Because people will pay $3.00.
Don't worry about selling hardware. If retailers drop hardware, big deal. Hardware is sold by the cargo container on places like Amazon.com, WalMart.com and BestBuy.com. What they miss out on profits from software sales, they will more than make up be the extra traffic forced through their websites. The best thing that could happen to those retailers would be a webstore "killer app" like a game console.
If stores still want to make a profit on software, and gamers still want a nice DVD case with a printed manual and other crap, retailers can sell the package with a code for the download. They could even sell SE and LE editions. We get our chotchkies, they get some profit, and the publisher still gets the full value for the download code.
Oh, and "10 years from now," LOL! Try FIVE or THREE.