EA Exec Predicts the Looming End of Retail Game Sales

EA Exec Predicts the Looming End of Retail Game Sales

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EA Games Executive Vice President Patrick Soderlund says the fork will be stuck in retail videogame sales in less than ten years.

The decline and fall of retail game sales isn't a question of "if" at this point, but of "when." Digital game sales are skyrocketing, while retail numbers are in a slow but steady decline. And while the big brick-and-mortar sellers struggle to figure out what they can do to maintain some degree of relevance in the industry, the writing is on the wall: retail is a spent force.

"I think it's going to be sooner than people think. I think it's going to be sooner than ten years," EA Games Executive Vice President Patrick Soderlund told CVG. "That's my personal opinion, and might not be what EA thinks."

In fact, Soderlund said that the majority of EA's revenues still come from retail and that it remains a viable business model. But while he still has a preference for the physical, he acknowledged that he's not representative of the "new generation of gamers," and said that game companies that fail to adapt to changes in the industry risk becoming irrelevant.

"I look at it as evolution. Looking back five years and looking at today, there is such a vast difference to how I consume entertainment and how I connect with people. We just have to embrace these changes rather than be afraid of them. I think some people are so surprised by the changes that are happening that they become afraid of it," he said. "They try to stick to what they know and that's the danger. If you don't adapt you become irrelevant. I absolutely believe that's the case."

I share Soderlund's appreciation for the physical side of videogames, but I'm a little more reluctant to predict that retail Ragnarok is quite so close. The end of retail is dependent first and foremost upon the existence of an infrastructure that can support alternative delivery methods, and while some people access to that, plenty of others do not. Is ten years enough time to put that kind of far-reaching, high-bandwidth network in place? If it's not, then I suspect retail will be around for a little longer than he thinks.

Source: CVG

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EA really needs to stop using this as a talking point. It seems every week, EA uses "digital sales will eventually take over physical boxes" as a talking point to distract from the fact that their stocks have fallen tremendously.

EA is not looking out for the future. The stockholders are concerned whether the company will survive into the future.

Digital sales are an inevitability, and when that time comes, developers will sell directly to consumers and publishers such as EA will have become obsolete.

The future is what EA is talking about all the time, yes. It's just that they fail to understand the future has no place for EA.

I'm not a big fan of digital games I like having physical copies of the games I own.

Absolutionis:

Digital sales are an inevitability, and when that time comes, developers will sell directly to consumers and publishers such as EA will have become obsolete.

The future is what EA is talking about all the time, yes. It's just that they fail to understand the future has no place for EA.

I don't think you fully understand all of the aspects of what a publisher does.
If you did you would know that a publisher's job doesn't only entail printing and shipping out retail copies. Seriously why would publisher like EA have so much flack from the public if that was all that they did?

Sooooo... Are you going to "Standup for the industry" by suing Gamestop out of existence?

I think high level broadband will easily be spread far enough in 10 years to make retail game sales irrelevant. Remember that gamers are naturally more inclined to be in high tech regions, and actually, if even a whole 5% still didn't have broadband access, well that would still make high street retail pretty irrelevant. It will take longer for online shopping to become irrelevant but we're rapidly approaching that day.

Apart from anything, indie games are driving innovation and are completely digital, pushing the high end of the market into digital shopping, at the same time casual games are also entirely digital so the low end of the markets also going to be brought up on digital. And the middle will be consumed. It might take a while to get CoD of the shelves, but game specific retail is dying as we speak. Game took a big hit this year, Blockbuster is dead and the rest seem to be struggling and are trying to find their place with silly things, like selling online gift vouchers. Maybe the top 20-30 games a year will be in the general stores for 10 years to come but everything beneath that is going to be deadweight.

Is that why EA are trying to forcibly insert Origin in everyone's anus? Ok EA if you are not to totally die in the digital future you need to do the following;

-Reduce your pricing; The real value of digital information is technically nothing. Your costs for making the game in DD is heavily reduced. Your pricing is insane gouging. Fix it. Or fuck off.

-Stop making Origin feel like an enforced punishment for a horrible crime; Origin as no benefit to anyone, there is no upside to it. If you make it enticing to use people will use it. So Improve your horrendous, crippled, asshat service. Or fuck off.

-Learn to work with other online services; EA is a bad company run by terrible people. Or at least that's how it acts. It takes every opportunity to screw anyone over. They seem to think they should have a total monopoly on the gaming market and be able to mug random people on the street for money. EA needs to learn that other people can sometimes deliver content better then them or in more diverse ways. EA shouldn't throw a massive tantrum and pull its games every time it cannot crush someone into submitting to its will. STEAM is bigger, better and frankly less vomit inducing than you. You're going to have to learn to live with them. Or fuck off.

EA has pulled so much shit i don't care at this point if everyone in their management structure ends up bankrupt and giving out handjobs by the freeway but if they are serious about the digital future they need to live with some of the disadvantages for them.

Actually why am i telling EA how to survive? Everyone would be better off if they just didn't exist. Keep doing what you are doing EA, just keep on pounding your head against the wall and then maybe you will see just how wrong you are. And you can finally fuck off.

No. Screw digital distribution. I collect video games, therefore, I need physical copies. I also take great care of those games, and I'm not going to rely on a "service" to play my games on anyway. I'm not going to accept any outrageous terms and service DRM agreements like Steam or Origin. Screw them, screw digital, I want to smell my brand new damn games damn it!

Phyisical media will always have a place. Like everything else, it's too big too just falter like that.

Jove:
No. Screw digital distribution. I collect video games, therefore, I need physical copies. I also take great care of those games, and I'm not going to rely on a "service" to play my games on anyway. I'm not going to accept any outrageous terms and service DRM agreements like Steam or Origin. Screw them, screw digital, I want to smell my brand new damn games damn it!

Those days are long gone.

DRM on retail copies now mean they will be unplayable years from now if the company decides to cut the plug on the servers that verify your game. This happens a lot since developers want to force a game to be obsolete so they can buy the sequel.

Games now have always-on DRM regardless of where you buy it. People just go to steam because they are the least intrusive DRM and actually care about people.

Besides, Valve wont become another EA for decades. And why would you bother holding onto 20-30 year old games that will most likely be incompatible with your future-rig?

Companies keep going on about how new and used sales are dying, but then I look at CeX, the amount of trade that goes through my local one daily is ridiculous, it's what keeps many games going years after they're released.

Considering how this comes out less than a week after the fall of OnLive, I think it's safe to discount this prediction as nothing more than a bunch of hot air.

And EA WANTS this.

When gaming become 'digital only' all gamers will be able to do is RENT the games.

This will screw us over more then any other thing.

And it is regional. Just because it may happen in the US (that bastion of technology and freedom) does not mean it will happen in other places.

I buy almost every game digitally now; I can't even remember the last time I set foot in a retail store for a game... but then again I play on the PC, so the market is rather skewed in favor of digital over retail. So yes, I wouldn't mind seeing the industry go digital, but I'd like to see developers still putting out physical copies, maybe as pre-orders or special editions for the hard-core fans?

Retail distribution is as dead/dying as PC gaming.

Wait a minute.... the vast majority of my gaming time is on the PC....

I've bought a mixture of both digital and retail and to be honest I much prefer retail.
Reasons for retail are unless it's a steam sale retail is cheaper (especially with amazon), I have a physical disc and if drm servers are shut off I could download a crack to actually play the game I've paid for (excluding purely multiplayer games from this). I also like having a nice physical collection and on the older games having the manuals. (I still read that big old starcraft tome from time to time).
Reasons for digital would be steam sales, getting older games to play on modern machines (bless you gog) and convenience to acquire some games that are either unobtainable by retail or horrendously expensive as a physical copy.

Frankly EA trying to be digital only fills me with dread because the company seems more like the type to hold your game collection to ransom and if the toll isn't paid they'll wipe it out. I will weep for my once loved hobby if it does go purely digital because there will be more steam knock-offs, 1 for each developer and we'd probably need 10 of them at least to play our entire games collection and there will probably be membership fees just to access the service after all it's their digital distribtion service or no game.

I'm stopping here because I'm starting to rant now and am sleep deprived

I can see online shopping lasting longer than ten years if enough people remain outside of high speed broadband to make it worthwhile. That is a big if. High Street Retail is gone, the only thing keeping them alive is ripping off their customers with second hand sales.

EA already wiped out our games once if you bought any of their old DD service they were all gone, when origin came out and them you had to deal with customer "service" tell you prove you owned the game, well i bought it years ago...dont matter.

oh but i could see the games on my profile on the EA site as purchased from EA, but that was too obvious for EA make me do all the work. think i told them to go F themselves at that point uninstalled origin and swore never to deal with it again.

and durrr yes EA, microsoft and sony want retailers gone, moar profit for them.

I certainly hope not. My data cap barely allows dlc let alone a full fledged game.

"Look, I am a vice president. However, I am wearing a t-shirt and skater shoes, so that you know I am still cool and not just a boring suit. I also have my feet up, so that you know I'm laid back. I'm standing up for you!"

I hate him now.

Digital will never kill retail until everyone is able to get good internet connection. Somehow I think that won't happen in 10 years.

So long as there's still demand and supply there's always Amazon.

Ultratwinkie:

Jove:
No. Screw digital distribution. I collect video games, therefore, I need physical copies. I also take great care of those games, and I'm not going to rely on a "service" to play my games on anyway. I'm not going to accept any outrageous terms and service DRM agreements like Steam or Origin. Screw them, screw digital, I want to smell my brand new damn games damn it!

Those days are long gone.

DRM on retail copies now mean they will be unplayable years from now if the company decides to cut the plug on the servers that verify your game. This happens a lot since developers want to force a game to be obsolete so they can buy the sequel.

Games now have always-on DRM regardless of where you buy it. People just go to steam because they are the least intrusive DRM and actually care about people.

Besides, Valve wont become another EA for decades. And why would you bother holding onto 20-30 year old games that will most likely be incompatible with your future-rig?

No clue what your talking about in your first statement since 90% of my games are single player so thats just useless.

Really? All of them? My library says otherwise and laughs at your DRM. Valve will turn their back on their customers in a EA fashion pretty soon, especially if their monopoly service Steam continues to...well be a monopoly like it is. Their new terms and service agreement fiasco is only the beginning.

Why? Because I also keep my old consoles and have a spanking kick ass new PC? Egoraptor and JohnTron would laugh at your ignorance. XD

FalloutJack:
Phyisical media will always have a place. Like everything else, it's too big too just falter like that.

Not only that, but if this were the case, why isn't physical media like Movie DVDs or music CDs dead either with ITunes and Netflix around?

I care for an answer to this question. Because all I hear is ifs, buts, and maybes to this type of discussion.

Jove:

Ultratwinkie:

Jove:
No. Screw digital distribution. I collect video games, therefore, I need physical copies. I also take great care of those games, and I'm not going to rely on a "service" to play my games on anyway. I'm not going to accept any outrageous terms and service DRM agreements like Steam or Origin. Screw them, screw digital, I want to smell my brand new damn games damn it!

Those days are long gone.

DRM on retail copies now mean they will be unplayable years from now if the company decides to cut the plug on the servers that verify your game. This happens a lot since developers want to force a game to be obsolete so they can buy the sequel.

Games now have always-on DRM regardless of where you buy it. People just go to steam because they are the least intrusive DRM and actually care about people.

Besides, Valve wont become another EA for decades. And why would you bother holding onto 20-30 year old games that will most likely be incompatible with your future-rig?

No clue what your talking about in your first statement since 90% of my games are single player so thats just useless.

Really? All of them? My library says otherwise and laughs at your DRM. Valve will turn their back on their customers in a EA fashion pretty soon, especially if their monopoly service Steam continues to...well be a monopoly like it is. Their new terms and service agreement fiasco is only the beginning.

Why? Because I also keep my old consoles and have a spanking kick ass new PC? Egoraptor and JohnTron would laugh at your ignorance. XD

In the first statement its about always-on DRM becoming the norm.

Want a game? Sign up for multiple services then sign in.

When you buy retail its becoming increasingly prevalent to find something like this. Regardless if its single player or not.

The kicker is that most of these services never last forever. So you get games that stop working once the corporation decides that its not the "hot AAA product anymore." After all, why bother keeping the servers for GTA IV on when GTA VI needs those servers for its launch? There was even instances of EA shutting down servers as early as 6 months.

In fact I wrote an entire thread about how always-on DRM will kill the retro gamer. The DRM needs servers, and once they are shut off the games stop as well.

Secondly, why WOULD Valve turn into EA? A company that is barely hanging onto the industry by a thread? They built their entire empire on good will alone. Why would they piss off everyone when their formula works? Where has Valve done wrong to anyone that didn't deserve it?

To get banned from steam, you would need to be caught stealing accounts, committing tax fraud, or doing some illegal shit on steam.

Unless you plan to start stealing accounts then selling them on the internet, you don't need to worry about your account getting banned. Valve won't come to shut down your account for no reason. Their TOS agreement "fiasco" was nothing but a bunch of paranoid conspiracy theorists circle jerking it. It had no teeth and only served to scare off unscrupulous lawyers would only serve to drain customers dry and not help them.

Valve is not some monster hell bent on hurting you. That is blatant paranoia. What else, the government is conspiring to kill you because they can?

Stupid of them, really. The only way I buy EA games is through retail since they've pulled their games from Steam and Origin is a steaming pile of crap.

On top of that, didn't they just respond to the same-ish question saying that retailers are a big part of their business and they don't see the industry going full-on-digital any time soon?

Sorry Douche-bag, but retail will never die. If I'm gonna pay sixty bucks for a game, I want something physical and tangible. Call me crazy, but I like OWNING something.

I personally predict the looming end of EA sales due to them being parasites that devour great developers and turn their content into feces. It's just another case of a horrible company wishing a crappy future on the world. Screw you EA, if you want to see this dreadful future you speak of, just stop physically producing games and release them solely digitally. We'll see exactly how much your sales drop.

ForgottenPr0digy:
I'm not a big fan of digital games I like having physical copies of the games I own.

Im a BIG fan of digital games and I HATE having physical copies of ANYTHING. They get in the way, get lost, get damaged, require far more effort then absolutely necessary to keep track of and even swap when I want to play a different game. Enough so that in the days when everything was physical it would very often put me off of playing anything not already in the drive. And to be clear, I don't just hate being forced to use physical copies, but I don't even like having them at all, since that necessitates physical storage, hand sorting and other things I never have to worry about with purely digital games.

I do miss the manuals, but it's not the paper I miss just the content. That isn't a problem inherent in digital games, but instead in the way game companies are publishing digital games.

As for physical retail going out of business, the next 10 years isn't a bad guess. Fact is it doesn't matter that there will still be people who can't get games any other way due to poor or no internet services, what matters is if enough of them are still buying at retail to keep up the profit margins. Sorry to those who get screwed out of buying games if gamestop etc closes, that's just economics.

What will get me to move to digital sales is a few things. If you could actually own a digital game and if prices went down similar to physical counterparts then we might be in business. Also when internet speeds allow me to download the ever growing big games at a much quicker time I'll think about it.

I feel it's relevant to say this...

In my town, HMV stopped selling games, Gamestop is down to the mall outlet, and EB games is prettymuch done for. (At least, I haven't seen them.

There's a place called the 2nd Last Gamestore Around, and he takes a different approach by buying the games that sell. It's pretty fucking obvious, isn't it? But we're talking games from 2 or 3 generations ago, that still sell This, apart from lucking out in a Wal-Mart Bargain bin, is the only guy who will sell the DSi games I want. You can sell 300 copies of Daiblo 3, Or you can continue to find antiquated games and continue to sell them. Aside for their trade-in system. (2nd last also does this) EB and GS don't seem to get this, and they're stuck with 200 copies of Gears of War clogging their back room still.

In my opinion, Brick and Mortar stores can still survive, if their owners are gamers who know the market, and not just businessmen selling entertainment.

They know they're right, because they're actively trying to destroy all interest in the retail market.

Look it's that EA article again.

Sorry EA but I refuse to rent games from you in the future.

Heh, funny, did your stock price look a little shaky there Patrick? Had to convince the suits that Origin wasn't an ill-thought cash grab that hasn't replaced Steam like you thought it would. And so now you have to try and impress upon them that you "Totally know what we're doing guys, just give it ten years, you'll see!"

Nice try, but unfortunately I'm a touch smarter than that.

You know... looking at my game shelf, it's depressing the turn this company has taken, back in the late eighties, they released some amazing games (I was a little young to experience them first hand, but my dad introduced me to them) even into the 90's, I played the -crap- out of the Command and Conquer series (Up until Red Alert 2) and the Sims, even the old Need for Speed games have plenty of memories (Hell, especially Need for Speed III: Hot Pursuit, I spent many hours cramped beside my friends, sharing a keyboard as we mastered our amazingly terrible driving skills.)

I used to go out of my way to buy EA games, even if they weren't -actually- made by them, simply because it used to be a mark of high quality gaming. These days, I see that little emblem on a box and I can't help but sigh, and more often than not, unless it's a game I've really been wanting, like Mass Effect 3, I'll hang onto my money if I see they had anything to do with the game, simply because I'm just tired of dealing with them and their hair-brained management who are convinced that I'm just an ATM who has no will or choice but to buy their games, and I am down here thinking, "actually, I don't really need this that badly."

When that Google internet is available nationwide, retail will die. Until then, retailers have nothing to fear.

 

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