Digital sales of video games on consoles have been creeping upwards for years, leading many analysts to believe that they will overtake physical sales in the not too distant future. According to EA, however, serious ground may be made before the year is up.
Speaking in a financial call last night, EA stated that they believe 40% of all game sales on consoles will be digital before the end of the year. That’s huge, and somewhat surprising.
Nine times out of ten, it is simply cheaper to go retail with AAA games. Although the PlayStation Store regularly and Xbox Live semi-regularly hold broad sales on video games, they are usually minimal reductions that bring the prices to be closer to online retailers, though still not as cheap. The RRP for UK video games is set at roughly £50 when a game goes on sale digitally through either platform, so any discounts then applied are only bringing the price down to what it arguably should be.
There’s also the fact that there is no resale value with digital. With physical games, they can be traded in for other games or sold through sites like eBay. For digital games, once it’s in your library, the only possible option is a refund.
EA’s Blake Jorgensen clarified that they think that this will be industry-wide and not just for EA, though he confessed that it might take longer for them to reach that mark – they themselves anticipate digital sales to amount to 38% by the end of the year. This is down to their biggest franchises, such as FIFA, having an appeal in countries where the internet connection is not as solid as others, meaning that most consumers prefer to go physical:
“In terms of full-game downloads, the number surprised us because we had thought that it’d be around the 5% year-over-year growth. Some of that may simply be the consumer is shifting faster than we know or we expected. The trends can sometimes jump in dramatic ways and maybe we’re starting to see that overall shift.”
This is fascinating, in my opinion. With a stronger and more “direct” grasp on the video game market, publishers may be wanting to weed out places like GameStop, which make their money through pre-owned games. It also means that publishers could start setting their own prices more freely – with less competition driving the prices down comes more opportunities for profit.
Perhaps I’m looking too deep into this, but the war between physical and digital video game sales is a really interesting trend to keep an eye on. What do you think?
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