UPDATE Digital Game Sales Finally Top Retail Sales

UPDATE Digital Game Sales Finally Top Retail Sales

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It's been a long time coming, but according to the NPD Group, retail videogame sales have finally fallen behind the intangible sale of digital games.

Update: It should be noted that the NPD Group counts game rentals and the sale of used games alongside what it refers to as "other monetization methods." These methods, taken as a whole, have topped retail sales. Digital sales are a rapidly growing force in the industry, but that alone does not yet trump retail sales. We apologize for any confusion.

During the second fiscal quarter of this year, sales of games (and accessories and hardware and all the associated gimmickry the industry puts out) hit $4.2 billion, a slight increase over the same time period last year. This is business as usual.

However, the NPD Group announcement that included that de rigueur bit of news also announced that for the first time in the history of the gaming biz, cash generated by digital game sales overtook the sales of physical, retail games. The former pulled down $1.74 billion, while the latter earned a still-quite-respectable $1.44 billion.

Presumably, you've all got a grasp on what "retail game sales" means. That includes games you pick up from a store, complete with clamshell packaging, nifty artwork and if you're lucky, some kind of gaudy trinket that will sit on your shelf for months collecting dust.

Digital sales, on the other hand, includes all the games purchased over Xbox Live, the iTunes App Store and via Facebook. For the most part, these titles are far less expensive than their retail counterparts, so that $1.77 billion figure consists of far, far more copies sold than retail's $1.44 billion.

As All Things D points out however, the NPD Group has only been tracking the sales of digital games for a relatively short time, so it is possible that this victory for digital sales is a momentary quirk. That said, I doubt you'll find many in the industry who can claim genuine surprise that this day is finally upon us. It's been predicted for years.

The real question we are now faced with is what exactly this means for the future of retail sales. Assuming the numbers indicate a genuine trend, it seems increasingly nonsensical for developers to devote time and energy to the relatively less lucrative enterprise of stocking GameStop's shelves with the latest triple-A games.

I'm not suggesting that this might signal a decline in the size and scope of games as a whole in favor of smaller, Angry Birds-esque distractions -- there will always be a thriving market for epics like the brilliant Dark Souls -- but perhaps the days of bedroom floors littered with endless game cases is quickly becoming a thing of the past.

When your kids inevitably ask you what a DVD was, you'll be able to turn up your nose in disgust, and mutter something about having to walk uphill in the snow (both ways!) to get your Gears of War fix.

Source: All Things D
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Get ready to be forced to register personal information for a dozen different digitial distribution clients on your PC because each publisher wants their own exclusive releases on their software. Already started with EA's Origin

Of course, it did take the combined purchases from LIVE and apple as well, so it's not truely "ahead" of retail.

Funny story, the last computer I got had to be picked up when a blizzard hit... I was taking public transport and then suddenly, no more buses :(

Yeah, I'm not even sure which game the last one was which I bought retail, I think it may have been the Orange Box back in 2007. Maybe I've bought something else later on retail but I don't remember right now.

There's also a nice interview with Gabe Newell about how the prices affect the sales and revenues of games and what possibilities digital distribution platforms have in relation to that.
http://www.next-gen.biz/features/valve-are-games-too-expensive

As long as they keep selling retail games, I'm fine. I like to have something I can touch, instead of something that can be taken from me any second.

Kingme18:
As long as they keep selling retail games, I'm fine. I like to have something I can touch, instead of something that can be taken from me any second.

With half the games coming out now they can do that if you have a physical copy or not.

Good luck buying your AAA titles digitaly and your rental services. Digital media will ruin gaming archaeology.

Edit: If doom was sold digitaly back then we woudln't have a picture to post here.

Edit 2: I posted that as if retail was going to end but in reality I don't think that's gonna happen, at least not any time soon.

esperandote:
Good luck buying your AAA titles digitaly and your rental services. Digital media will ruin gaming archaeology.

Steam, Origins and lots and lots of digital distributors already sale AAA titles. And it works perfectly fine. Most of my triple A titles are bought from Steam on sales.

And how will it ruin gaming archaelogy?

TheKasp:

esperandote:
Good luck buying your AAA titles digitaly and your rental services. Digital media will ruin gaming archaeology.

Steam, Origins and lots and lots of digital distributors already sale AAA titles. And it works perfectly fine. Most of my triple A titles are bought from Steam on sales.

And how will it ruin gaming archaelogy?

You won't be able to collect playable Games, Boxes, Manuals.

Alright?

Nobody will abandon retail. While it makes slightly less money than digital, it's still a HUGE chunk of money that publishers/developers need.

To abandon retail when it's still such a large percentage of the market would be stupid.

esperandote:

TheKasp:

esperandote:
Good luck buying your AAA titles digitaly and your rental services. Digital media will ruin gaming archaeology.

Steam, Origins and lots and lots of digital distributors already sale AAA titles. And it works perfectly fine. Most of my triple A titles are bought from Steam on sales.

And how will it ruin gaming archaelogy?

You won't be able to collect playable Games, Boxes, Manuals.

That sounds more like gaming hoarderism. I like the switch to digital. No more waiting until UPS finally arrives to play my games on release day. If I want to play something, I buy it and play it. I'm fairly nocturnal, so it's rather annoying to decide I want to play something at 11 PM, and have to wait until I'm awake and out of the house while stores are open to actually do so.

esperandote:

TheKasp:

esperandote:
Good luck buying your AAA titles digitaly and your rental services. Digital media will ruin gaming archaeology.

Steam, Origins and lots and lots of digital distributors already sale AAA titles. And it works perfectly fine. Most of my triple A titles are bought from Steam on sales.

And how will it ruin gaming archaelogy?

You won't be able to collect playable Games, Boxes, Manuals.

Regarding my Steam library the first point is a lie. Since I have also limited space and I only started buying digital copies about 8 months ago I don't miss boxes or manuals (also, since I collect games and not boxes I don't see the point in the box).

I still buy retail copies but why should I buy everything physical if I can have it stored online and always there when I want it?

There is market for both schemes. I rather retail.

TheKasp:

esperandote:

TheKasp:

Steam, Origins and lots and lots of digital distributors already sale AAA titles. And it works perfectly fine. Most of my triple A titles are bought from Steam on sales.

And how will it ruin gaming archaelogy?

You won't be able to collect playable Games, Boxes, Manuals.

Regarding my Steam library the first point is a lie. Since I have also limited space and I only started buying digital copies about 8 months ago I don't miss boxes or manuals (also, since I collect games and not boxes I don't see the point in the box).

I still buy retail copies but why should I buy everything physical if I can have it stored online and always there when I want it?

I'm not sure about how digital distribution works but..

Will you be able to play the games 15 years from now, different PC, different OS?
Will streaming services be available that long?

And I'm sure digital games won't increase their value over time like Cardtriges and Discs do.

welcome to the world of tomorrow

OT it was bound to happen eventually and i welcome the day when digitial media is the primary purchasing market, so AAA and indie titles can fight head to head and real price changing can occur because tbh there are too many games not worth 30 quid retail price, and would do better starting lower.

Interesting. It's about time, however I'm sure there's gonna be some debate as to whether apps and facebook games are considered 'games'. Also, very important, is this only NA or the entire world?

This was inevitable, but I hope, and believe, that there will always be a place to find boxed releases. Maybe it's just nostalgia, but there's just something special about holding that brand new game in your hands, ripping it open and playing it (not to mention new game smell).

Earnest Cavalli:

When your kids inevitably ask you what a DVD was, you'll be able to turn up your nose in disgust, and mutter something about having to walk uphill in the snow (both ways!) to get your Gears of War fix.

esperandote:

TheKasp:

esperandote:

You won't be able to collect playable Games, Boxes, Manuals.

Regarding my Steam library the first point is a lie. Since I have also limited space and I only started buying digital copies about 8 months ago I don't miss boxes or manuals (also, since I collect games and not boxes I don't see the point in the box).

I still buy retail copies but why should I buy everything physical if I can have it stored online and always there when I want it?

I'm not sure about how digital distribution works but..

Will you be able to play the games 15 years from now, different PC, different OS?
Will streaming services be available that long?

And I'm sure digital games won't increase their value over time like Cardtriges and Discs do.

should be able to, i see steam sticking out, origin and onlive may not though.

As for selling games in the future? really thats what you think when you decide to keep a game, just incase its worth lot in the future? get into antiques mate.

esperandote:

I'm not sure about how digital distribution works but..

Will you be able to play the games 15 years from now, different PC, different OS?
Will streaming services be available that long?

And I'm sure digital games won't increase their value over time like Cardtriges and Discs do.

These are things we can discuss.

Yes, I am actually taking a risk here. But since Steam seems to be a plattform which is not going to die soon I'll took the risk there. I am not streaming, I am actually downloading this game and installing it. In most cases I'll get also all patches and / or needed fixes to get this game running on Windows 7 (not all games I bought on steam are young enough to run without problems from the physical copie). I take Vampires 2 as an example. I can't get this game to run from my CD. I bought in on sale for some bucks and with a simple download and installation I can run it with minor problems thanks to lack of support for nonexisting screenformats back then ;).

Most games supporting Steamworks will work on coming OS and I won't have problems running them on other computers (I have three here, my old rig, my less older rig and my laptop). All of them have steam installed, 2 with always offline mode, but there are games I have installed on all three (Terraria for example).

I would not say that DD is all today. I'll wait and buy the things where I actually won't mind losing them.

On the "value" part: No, they are not growing in value. And I frankly don't give a crap about this. I don't sell games, I don't buy used.

bahumat42:

esperandote:

TheKasp:

Regarding my Steam library the first point is a lie. Since I have also limited space and I only started buying digital copies about 8 months ago I don't miss boxes or manuals (also, since I collect games and not boxes I don't see the point in the box).

I still buy retail copies but why should I buy everything physical if I can have it stored online and always there when I want it?

I'm not sure about how digital distribution works but..

Will you be able to play the games 15 years from now, different PC, different OS?
Will streaming services be available that long?

And I'm sure digital games won't increase their value over time like Cardtriges and Discs do.

should be able to, i see steam sticking out, origin and onlive may not though.

As for selling games in the future? really thats what you think when you decide to keep a game, just incase its worth lot in the future? get into antiques mate.

I certainly don't wanna be buried with them... *ponders*, no I don't. They are (will be) antiques, besides I'm not passionate about furniture and stuff.

Alright.

I like my game boxes but I have a few games off of Games on Demand and I have a growing library of Steam games that can run on my laptop.

So... yeah. This doesn't bother me much.

...but I had better be able to play any game I want to ten years from now!

Also, not everyone has an internet connection that runs like Roadrunner (the cartoon character, not the internet service). Some of us have to stick with standard, basic DSL. Like me. It's good enough to download stuff, play online, watch Netflix movies, etc., but it takes a good long time to download a game.

Aris Khandr:

That sounds more like gaming hoarderism. I like the switch to digital. No more waiting until UPS finally arrives to play my games on release day. If I want to play something, I buy it and play it. I'm fairly nocturnal, so it's rather annoying to decide I want to play something at 11 PM, and have to wait until I'm awake and out of the house while stores are open to actually do so.

See, if it were 11PM and I didn't have a game that I wanted to play, if I started the download then I would probably be playing it the next morning. Not to mention that some games are really, really, really big downloads and space on hard drives is more limited than space on shelves. Even my 500GB hard drive is getting full, admittedly not so much with games but...

My feelings on this:

esperandote:

TheKasp:

esperandote:
Good luck buying your AAA titles digitaly and your rental services. Digital media will ruin gaming archaeology.

Steam, Origins and lots and lots of digital distributors already sale AAA titles. And it works perfectly fine. Most of my triple A titles are bought from Steam on sales.

And how will it ruin gaming archaelogy?

You won't be able to collect playable Games, Boxes, Manuals.

A trivial distraction to what gaming really TRULY is about. The reason we all really care about games.

It's like coveting a reel of film that is to fragile to ever be used or even scanned.

The important thing that matters is the GAMES! The experiences. And those experiences cannot last. CDs decay over time, ROMS rust but a data file can be backed up and preserved indefinitely and be infinitely redistributed, remixed and remastered.

Don't you see? Hard copies are FAR more fleeting and intangible than digital copies. A digital copy can never decay or disappear into non-existence, it will always be there.

I can't find a copy of Super Mario RPG any more for less than £40 yet I have the complete Doom on a USB playing via a source port (Zdoom) that vastly improves controls and performance. I bought the doom collection on Steam by-the-way. It will never disappear, and long after the last Mario RPG has rusted away rom-rips and virtual-console re-releases are all that will remain, THAT is the archaeological legacy! Just one of information.

Retail? What's that? And what the heck is that thing in the picture?

All joking aside, this is great news. I definitely use digital because I'm too much of a lazy bastard to go to the store. It's much more convenient. Plus, Steam and GOG's specials are amazing, whereas most stores don't have anything like them aside from bargain bins and used games.

I think this article is increblely skewed in looking at it from the console/pc/AAA angle. Millions of people download games for thier smart phones everyday, not to mention all those facebook mircotransactions. the point being this happens across all age groups while consoles etc are the realm of young people mostly. if you look at it from this angle, the story would be the oppsite (expect for pc gaming, but all three consoles etc would out weigh this, alothugh it wouldbe interesting just to see figures for the AAA industry

Does this include sales through Steam? If not, then I feel we may be late to the party in announcing this.

Treblaine:
My feelings on this:

esperandote:

TheKasp:

Steam, Origins and lots and lots of digital distributors already sale AAA titles. And it works perfectly fine. Most of my triple A titles are bought from Steam on sales.

And how will it ruin gaming archaelogy?

You won't be able to collect playable Games, Boxes, Manuals.

A trivial distraction to what gaming really TRULY is about. The reason we all really care about games.

It's like coveting a reel of film that is to fragile to ever be used or even scanned.

The important thing that matters is the GAMES! The experiences. And those experiences cannot last. CDs decay over time, ROMS rust but a data file can be backed up and preserved indefinitely and be infinitely redistributed, remixed and remastered.

Don't you see? Hard copies are FAR more fleeting and intangible than digital copies. A digital copy can never decay or disappear into non-existence, it will always be there.

I can't find a copy of Super Mario RPG any more for less than £40 yet I have the complete Doom on a USB playing via a source port (Zdoom) that vastly improves controls and performance. I bought the doom collection on Steam by-the-way. It will never disappear, and long after the last Mario RPG has rusted away rom-rips and virtual-console re-releases are all that will remain, THAT is the archaeological legacy! Just one of information.

Nice set of pictures :)

I also care about the experience, that's why I collect games that give me good experiences.
It's great that the [games] roms of the are there for when the hard copies dissapear but the storage of it's information isn't the same than the material evidence.

Digital is the future for the MAIN source of gaming purchase, but retail will always have a place for it. Dont forget those nifty LEGENDARY, EXTREME EDITION packs. my witcher 2 game is one of those, complete witha map, soundtrack, game guide, a real coin of the game. those are ALWAYS awesome.

Personally, I'm a hardware guy (and it's why I went to college for) and not so much a software guy. I don't dismiss the sale of digital media, nor do I feel that it is inferior to its physical representation. I just grew up in a physical world and if I can own something that I can physically hold in my hand, then I'll go for it.

If anything, I'm glad that digital media is doing well. This means that instead of having to wait for certain classics to be re-released in HD for the current consoles, we can just download original versions from the comfort of our own home (unless you really need to hunt down for the physical cartridge/disk of the game on Amazon or eBay).

It's really odd, I don't remember the last time I went to a shop to buy a game, but I mainly buy retail. That is I buy from an on-line retailer and have the game posted free of charge. This works out cheaper than Steam. Don't get me wrong I also get games from Steam when they have a killer deal on. But otherwise buying retail, all be it not from a bricks and mortar store, is how I normally buy.

Never brought a game from GFW Live or perish the thought Origin. Most of the ones I get from Steam are ones that have Steamworks anyway so I would have to use Steam anyway.

I would never want to give up having a physical copy of a game that is no subject to on-line outages or account bans. Not unless the price of on-line is a lot less, but no-one is offering that at the moment.

I would have a rant about how the industry seems to be moving to a games as a service, rather than something you purchase, but without any pricing changes, but that would be off topic...

esperandote:

Treblaine:
My feelings on this:

esperandote:

You won't be able to collect playable Games, Boxes, Manuals.

A trivial distraction to what gaming really TRULY is about. The reason we all really care about games.

It's like coveting a reel of film that is to fragile to ever be used or even scanned.

The important thing that matters is the GAMES! The experiences. And those experiences cannot last. CDs decay over time, ROMS rust but a data file can be backed up and preserved indefinitely and be infinitely redistributed, remixed and remastered.

Don't you see? Hard copies are FAR more fleeting and intangible than digital copies. A digital copy can never decay or disappear into non-existence, it will always be there.

I can't find a copy of Super Mario RPG any more for less than £40 yet I have the complete Doom on a USB playing via a source port (Zdoom) that vastly improves controls and performance. I bought the doom collection on Steam by-the-way. It will never disappear, and long after the last Mario RPG has rusted away rom-rips and virtual-console re-releases are all that will remain, THAT is the archaeological legacy! Just one of information.

Nice set of pictures :)

I also care about the experience, that's why I collect games that give me good experiences.
It's great that the roms of the are there for when the hard copies dissapear but the storage of it's information isn't the same than the material evidence.

I also collect games, I have over 127 games on Steam, many more downloaded from GoG yet the majority I have not played even a year after purchase.

To me, luminous creations are games not this crude matter.

In a way I am glad digital game sales are doing well I find they are great for getting games that I cant get physically anymore (or at least very easily) but as for modern games I would still go physical media for a few reasons but chief among them being I dont want to have my computer out of action for 3 days while it downloads an 8gb game and I dont want that game taking up so much space on my hard drive.

One thing that does worry me a bit though is price fixing if digital ever truly takes over, especially if every major publisher/developer has their own service you have to subscribe to they could easily just set the price and it wouldnt be cheap either with no competition and what if you violate one of their rules somehow, do they ban you and deny you access to all of your games you purchased off them?

But as it stands I dont think physical game copies are in trouble yet 1.44 billion is still to hefty an amount to ignore plus they are mostly going after different markets.

The only way digital distribution will ever pose a real threat to boxed products is if they establish solid services people can trust secondly the infrastructure in many countries would need to be massively improved i.e every home with huge bandwidth connections or thirdly everyone decides they want to play angry birds and snake instead of COD/Assasins creed/whatever.

Treblaine:
snip

Update: It should be noted that the NPD Group counts game rentals and the sale of used games alongside what it refers to as "other monetization methods." These methods, taken as a whole, have topped retail sales. Digital sales are a rapidly growing force in the industry, but that alone does not yet trump retail sales. We apologize for any confusion.

Alright, that was decievingdeceptive.

esperandote:

Treblaine:
snip

Update: It should be noted that the NPD Group counts game rentals and the sale of used games alongside what it refers to as "other monetization methods." These methods, taken as a whole, have topped retail sales. Digital sales are a rapidly growing force in the industry, but that alone does not yet trump retail sales. We apologize for any confusion.

Alright, that was deceiving.

I think it's more dumb than deceptive:

Dumb on NPD's part to lump game rentals with digital downloads

And kinda dumb for the author not determining this before going to "print" though I do appreciate the speedy update (though it kinda renders the title null).

To think I used all these victory images:

maybe I should use this one instead:

image

Hooray for the systematic removal of ownership being accepted by the consumer!

Saying that, i don't think anybody's actually owned anything for the past decade.

I still very much value the physical retail copies that I do have. I like digital distribution but only when it's much cheaper. In all other situations I would rather have the case sitting on a shelf or something.

 

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