Retail Still Dominating Other Forms Of Game Software Distribution

[Andy Chalk]

Retail Still Dominating Other Forms Of Game Software Distribution

Despite the growing popularity of digital distribution services like TotalGaming.net [http://www.steampowered.com], a new report indicates that retail outlets remain by far the dominant channel for global videogame sales.

Compiled by Games Investor Consulting [http://www.gamesinvestor.com/], the report indicates that "full-game direct download" distribution accounts for only 0.4 percent of global videogame software revenues, while "downloadable console casual games" for all three major game consoles, which includes casual, retro and back-catalog games, added up to only 0.1 percent. Retail sales channels, meanwhile, accounted for 72 percent of the game software market worldwide.

Among other non-retail sales channels is mobile gaming, which despite what the report calls "structural problems" in numerous areas leads the way with ten percent of the market, followed by incremental downloadable content (currently seen primarily in Asian MMOGs) at 7.3 percent, MMOG subscription fees at 6.7 percent and casual PC games distributed through community sites, game portals and independent developers, which holds 3.2 percent of global sales.

"Retail is (and will remain for the foreseeable future) the dominant sales and distribution channel for games," the report says. "The mechanisms behind retail - manufacturing, infrastructure, POS, inventory, sale or return agreements - are the foundations of the industry's most common commercial models, whose rigidity is reflected in common commercial models but is also driving innovation in digital distribution."

"Retail will retain its position at the head of the growing list of distribution channels for at least the next five years, and probably longer," the report says, but also adds, "It faces a war of attrition with digital distribution, which will take a steadily growing proportion of the market."


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[Katana314]

Wait...so apparently someone DIDN'T know that more people walk into Wal-Mart than buy off Steam?

 

[Eminate]

I, for one, have whole heartedly embraced the digital download format for purchasing games. I am at the moment without a vehicle so it costs on average an extra $30 in cab fare to get to the nearest retailer selling pc games so when the exact same program can be purchased and installed on my computer from home, why wouldn't I?

Another issue that game distributors should be aware of is the effect digital availability of games has on piracy. I naively believe most people are basically good at heart and when given the option will pay someone for the product they have worked hard to entertain us with. When given the option. When the game, however, is not available in this format, the temptation is a hard one to resist.

One other issue that has me steaming is with EA games you are given a choice of being able to re-download your purchase for 6 months and then its gone if you lose your hard drive, or for an extra six filthy dollars you get a whole 2 years of security to format your drives and still have access to the game. EA has just nickel and dimed themselves out of one potential long term customer with this almost usurious practice now that I have Crysis safely installed and backed up. I will be taking my credit card over to Direct2drive and then have a look at steam.

 

[Andy Chalk]

I don't think the point is that more people shop at Wal-Mart so much as how few people are actually using Steam and the like.

I don't do digital distribution. Many reasons, most of which will lead into long and abusive rants, but here are the two that I suppose could be called the most legitimate:

1. I collect. Boxes, manuals and media are a big part of that. I'm not one of these multi-thousand-game-owning psychos, but a big part of gaming for me isn't just playing the games, it's the and <3 I feel in the more tangible parts of the collection.

2. Browsing. Who goes to EB without spending some time checking out the pre-owned stuff? That's my favourite part of the whole deal. You can find some screaming good deals there, or games you never thought you'd see sitting on a shelf. You don't get that from buying online.

It's not as though hitting the store is any more convenient for me than it is for you: My nearest EB is an hour drive from here. But as long as the option exists, that's how I'm gonna roll.