Digital Downloads Threaten Video Game Store Biz
digital downloads about to do the same to video games as they’ve done to
music CDs and will it mean the end of video games sold in stores?
digital downloads remain a relatively small portion of the overall video
gaming market with roughly 17 percent of sales in 2008, based on research
from NPD Group. According to the research firm, about 18 percent of Xbox
360 users who have a "Gold" membership regularly download from
the Xbox Live Arcade. Around 10 percent of PlayStation 3 users buy downloads
from the Sony PlayStation Network.
Wedbush Morgan Securities analyst
Michael Pachter told Reuters, "Downloads
will become 20 percent of the market within five years, and probably peak
at around 50 percent of the overall market in 10 years."
all are ready to hop on the digital download bandwagon and a number of
major chains, notably Wal-Mart Stores and Target, are not involved in game
downloads at this point.
of the major advantages of digital downloads is the ability to update and
upgrade games almost instantly.
Lombardi, VP of marketing at Valve Software, told Reuters, "Now
that games can be connected to their
audience, they will last and grow well beyond their traditional 6-month
to 1-year sales cycle."
Will downloads kill the video game store business? What should stores
be doing now to address the small but growing demand for digital downloads?