Game Retailers Hurting Themselves With Digital Distribution

GameBiz recently had the chance to speak with Brad Wardell, CEO of Stardock, about pricing and distribution within the games industry. Wardell follows up a bit on the Demigod piracy fiasco from a few days ago, and mentions that retail outlets may be on their way out. "Retailers need to be careful about this stuff. They're kind of signing their own death warrants once they push digital distribution at the store. Once you have the thing set up — once you've experienced how to purchase the game or deal with it online — why would I go back to the store for the next purchase? Especially if the store isn't providing added value. If you're a retailer, you're killing yourself. If I can't get a game off Impulse, I'm going to Steam. I like stores, but I'm really lazy."

Comments

why the devs / publisher's LOVE online distro

[SethJohnson]

Online distro favors devs / publishers for several reasons:

• Cut the retailer out of the cost column.
• Reduce packaging expenses.
• Reduce overhead.
• Small guy boutique can make a fortune with just a spare-time effort..
• End user can't re-sell the purchased product.

The last is the huge one. Adobe and Microsoft have tried all kinds of tactics to supress consumers' ability to re-sell software. The game companies no doubt hate seeing used game transactions taking place without them getting a cut. With online distro, the re-sell market is crippled.

Seth

Confusing Headline

[im_thatoneguy]

How is it that "Game Retailers" are hurting "Themselves".

Shouldn't the headline read "Online Game Distributors killing Game Retailers"?

I haven't seen any actions on the Game Retailers part that is hurting themselves except for existing. I suppose you could argue they should have become what steam is. But that's passively letting yourself die out.

Re:communism = forced economy

[fastest fascist]

Right, because before Marx, there was no government intervention in economies. I'm guessing you're from the USA by the casual way you throw the term "Communist" around.

Re:Seems kinda obvious.

[Lumpy]

Only for the excessively rich. The rest of us wait until the game hits the $19.95 bargain bin.

you might be incredibly wealthy and thinks that $69.99 for a game is nothing, but 90% of us think it's insane and wait for it to become affordable.

Digital distribution allows them to keep the price high as hell forever if they want, It costs nothing to make more copies for them and they dont have the stock of CD's or DVD's out in stores getting dusty over the course of a year forcing the price down.

also it helps game companies by destroying the used game market. If I have to buy all my Wii and Xbox360 games online, I cant sell them used or buy them used...

and the Game publishers are salivating uncontrollably over that idea, they desperately want the used game market to go away.