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Hard drive share as a strategic weapon for console publishers

MIDiA Research's Karol Severin on why AAA publishers need to dominate your storage - until streaming kicks off, of course

As you could tell from the social media frenzy about having to delete other games to accommodate the new Red Dead Redemption II release, hard drive space is a real issue for many console gamers, with their desire for a new game forcing some of their previously played games off their consoles.

Games grow larger in file sizes every year, while new consoles with larger memories are released far less frequently. This means that towards the end of a console's lifecycle there is a bottleneck situation, whereby players are no longer able to accommodate all the major games they'd like to play. The end result: a few top publishers capture an increasing share of console gamers' hard drives. This creates a significant barrier to entry for competing publishers and results in a competitive advantage for the few at the top to leverage.


Karol Severin, MIDiA Research

As a personal example, between GTA V and RDR2, Rockstar now takes up more than 42% of the hard drive space on my PS4 Slim. EA (FIFA 19 and Battlefield 4) take up another 27%. Therefore, 70% of my hard drive is captured by two publishers.

I'd love to try the new Fallout 76 (Bethesda), which will require another 12%, and I want to keep a bunch of smaller games (Rocket League, Fortnite, War Thunder), which takes me down to about 50GB of space, able to accommodate perhaps one new major title (if I'm lucky).

So, I'm now forced to say goodbye to fulfilling my Bethesda desires (Elder Scrolls) and give up Activision (COD) and Ubisoft (Far Cry and Assassin's Creed) entirely. In other words, a single download resulted in a complete redistribution of publishers' share of my hard drive, which will translate into redistribution of my engagement as well as money spent.

"Between GTA V and RDR2, Rockstar takes up over 42% of my PS4 Slim, EA another 27% -- 70% of my hard drive captured by two publishers"

PlayStation has a slim version (500GB), and a pro version (1TB). A portion is captured upon switching the device on. The actual hard drive space for games is 408GB for Slim and 861 for PS4 Pro. Sony doesn't break out Slim versus Pro sales, but it has been stated that approximately one in five PlayStation sales is a Pro version, meaning this affects the majority of PlayStation console owners. However, this is not to say that 1TB console owners won't experience the same problem. It may just take slightly longer.

Two additional caveats to the scope of the issue are 1) external hard drives can be bought; and 2) if you delete a game, you can always reinstall it later. However, both of these create a significant amount of consumer effort/friction - one of the scariest phrases in the attention economy.

Finally, when the next generation of consoles comes out, there will be more space and for the first few years the hard drive problem will temporarily diminish. However, as we progress towards the final years of consoles' lifecycles, the games catch up in size and the bottleneck re-appears. Thus, the importance of the hard drive share increases significantly towards the end of a console's lifecycle.

If an Xbox owner has multiple Microsoft games like Halo, Forza and Sea of Thieves installed, that leaves less room for third-party releases

If an Xbox owner has multiple Microsoft games like Halo, Forza and Sea of Thieves installed, that leaves less room for third-party releases

Put simply, the more hard drive share a publisher captures, the less of it there is for competitors.

"Until streaming takes off, top publishers compete for hard drive share, allowing fewer smaller companies (potential disruptors) to reach consumers"

Traditionally, it was all about physical/download sales. Publishers didn't have to care about engagement too much once the game was bought and revenue booked. Today, however, the gaming economy is moving fast towards engagement-related revenue (both through DLC and in-game purchases). Thus, the length of time a game survives on a hard drive (and the time it prevents other publishers' major games to be installed) is becoming a key component of publishers' revenue outlook.

Actively measuring and competing for hard drive share can prove significantly rewarding. Pre-release marketing plays a huge role. Not only does it drive game downloads, it also shapes my decision on which games I eventually keep. In the lead up to the RDR2 release, there was an immense number of bonuses to gain for GTA V, if you pre-ordered RDR2. Not only did I find out lots about RDR2 and got convinced to download it while playing GTA V, but all the attractive GTA bonuses (current and future) cemented the idea that 'no way am I deleting GTA V when RDR2 comes out'.

There are a number of ways to compete for hard drive share share. One is the above-mentioned marketing synergy between one publisher's titles. Another less honourable (and by no means endorsed by myself) way is to artificially inflate the file sizes of a title and/or its DLCs and updates. If a game is getting lots of traction, making the update files as large as possible (and realistically bearable by consumers) will force more competitors off consumers' hard drives.

Publishers with the most popular games franchises and largest marketing budgets stand at a significant advantage here. The more synergies they create, the harder it will get for second-tier games to persuade consumers to give up hard drive space in their favour.

As much as capturing hard drive space may help the commercial endeavours of top publishers, there's a limit to how aggressively this strategy may be pursued. If competition for HDD space is managed carefully, gamers will keep making choices between competing games. Taking it over the top, however, may usher more of them to consider streaming solutions or get the new console (if available), both of which rid top publishers of this competitive advantage.

When console-grade games streaming truly takes off (see Alphabet's Project Stream or Microsoft's Project xCloud), it will address the HDD issues. Until then, top publishers can fiercely compete for hard drive share, allowing fewer smaller companies (potential disruptors) to find their way onto consumers' consoles.

Karol Severin is MIDiA's lead analyst for research on games. This article was originally published on MIDiA Research's website.

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Latest comments (3)

Robin Clarke Producer, AppyNation Ltd2 years ago
None of these observations are untrue but they're not practically applicable either.

If install footprint is considered at all, it's in the context of how long it will take for the average user to download. The majority of users don't have enough games in active rotation at any one time for storage to become a significant issue.

The cost of systemic changes to the development process that would be needed to target a specific file footprint would outweigh the speculated benefit.
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James Prendergast Process Specialist 2 years ago
Anecdotally, I have to agree with Robin. While I constantly bump up against the storage limit of my ps4, it's the games I'm no longer playing that get deleted.

These are also, invariably, titles for which I've reached my tolerance for spending more money on them (or to put it a better way, I've played them enough that I feel like I've gotten my money's worth out of them - as well as any enjoyment on a personal level that costs nothing extra).

The new shiney will always win out over something I'm not playing religiously and, unless that game takes up 90% of the storage, there's no way something else won't be able to be deleted - even if it is with a pang of regret. I mean, it's not as if it can't be reinstalled later. I don't delete the save games!
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Simon Smith CEO, thumbfood LTD2 years ago
I've genuinely never heard of "full hard drive" preventing people from buying another game *at all*. They just delete other games, play the new one, then delete that for the next one, etc etc. If it's online then they keep that game and don't play other ones anyway (Fornite, etc). People are used to "the cloud" and know the games they have purchased are available to download again at any time from their Library - a hassle yes but not insurmountable.

Also, while an interesting subject to read/think about, there's no actual research quoted in this article, so its all the opinion of the author.
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