If you click on a link and make a purchase we may receive a small commission. Read our editorial policy.

Gaming Unboxed

The transition away from boxed goods has taken a great leap forward - but are consumers totally on board?

The combination of these factors has had a cumulative effect on how the digital transition is actually happening. Ten years ago, it was expected that this would be a very gradual transition, with progress slowed down by a number of factors - not least of which would be the gradual rollout of sufficiently fast broadband, and perhaps more importantly, the powerful industrial inertia behind existing boxed product distribution. Indeed, one common theme ten years ago was the frustration felt by nascent digital distribution services (few if any of which remain in business today) at the unwillingness of publishers to risk upsetting retail partners by being seen to make a major commitment to digital.

Perhaps these slowing factors actually created a pent-up demand which is now being released all at once, because what's certain is that the digital transition is now occurring vastly more rapidly than anyone expected. What was expected to be a gradual movement has turned out to be a major upheaval - we're seeing steady, serious declines in boxed game sales in many regions, matched with a sharp uptick in the industry's digital revenues.

What we're seeing now in terms of sales declines isn't down to rough economics. It's down to a very rapid transition in consumer behaviour, one which will not be reversed by a macroeconomic recovery

Right now, there's a strong temptation for executives to try to tie that decline to the world's tough economic climate - and certainly, that's likely to have had an influence in some regards. However, I believe that it's important to note that the people blaming macroeconomics for the industry's present state tend to be those from companies who aren't benefitting significantly from the upside to this process - those who haven't made the investment or commitment necessary to reap the benefits of digital.

The state of the world's economies may have been a significant trigger factor - the final straw that made the industry lurch forward into digital revenue models. What we're seeing now in terms of sales declines, however, isn't down to rough economics. Rather, it's down to a very rapid transition in consumer behaviour, one which will not be reversed by a macroeconomic recovery. The expectation that retail sales will return to growth once the world economy sorts itself out is bound to be disappointed.

That's because, as with the move to mobile gaming, the only truly predictable thing about the digital transition is the overall direction of movement. Individual events and developments will continue to surprise us, but the overall trajectory is clear - and it's away from boxed goods, and as a corollary, away from monolithic single-payment games, which made far more sense in the old retail-driven market than they do in this new marketplace, where the player's game experiences take place in a constantly connected environment.

For many veterans of the games business, there's a bitter note to this transition. We like boxed games; they hold immense nostalgic value, of course, but even beyond that, they also provided a business model which, while flawed and problematic, was well-understood and familiar. Moving away from that model will probably happen slower than makes logical sense simply because of nostalgia and attachment to the old model - and of course, it's not just people in the industry who have that sense of attachment, as it also persists strongly in many consumers, especially older gamers.

For this reason, in spite of the startling acceleration in the uptake of digital distribution and digital revenue models, this remains a transition which needs to be handled carefully and respectfully. It's easy for people in the industry to casually dismiss the concerns and criticisms of things like digital distribution and freemium business models which are commonly raised by consumers - but some of those concerns are both well-grounded and strongly held. Failure to address them risks alienating consumers, and we must never allow ourselves to believe that "once a gamer, always a gamer". Interest in the medium can wane or even lapse - and seeing concerns over a large-scale, disruptive business transition ignored or dismissed could well cause exactly that to happen. The digital future is very exciting, and the transition is now coming about faster than most people expected - but care must be taken not to leave loyal consumers by the roadside as we speed into this new era.

Related topics
Author
Rob Fahey avatar

Rob Fahey

Contributing Editor

Rob Fahey is a former editor of GamesIndustry.biz who spent several years living in Japan and probably still has a mint condition Dreamcast Samba de Amigo set.

Comments