Digital Distribution Helps Make up for Declining Retail Sales

Posted Tue Jan 3, 2012 at 07:30 AM PST by Dick Ward

In the first three quarters, alternate distribution methods run neck and neck with retail. In the fourth quarter, retail is still king.

Digital distribution has been picking up significantly thanks to the widespread adoption of smart phones. The iPhone, for example, gets people new to digital delivery used to the idea and encourages inexpensive games that can sell quite well. Those sales have helped to drive the game industry despite lagging retail numbers, but just how much is a mystery.

Tracking digital sales of games is tricky. On the PC side of things, Steam doesn't release sales numbers. Since that seems to be the game store of choice, figuring out just how well digital distribution is doing is folly. But that's just the PC side of things - trying to take into account iPhone games, Android games, social games like 'Farmville,' free to play games like 'League of Legends' and the rest makes things get very complicated very fast.

The NPD Group isn't great at tracking this sort of thing but they do make the effort. Unfortunately, they don't deliver that data in an entirely helpful way. Instead, things are split into retail and non-retail. Retail essentially means the sale of new games through traditional means - Best Buy, Walmart, Amazon, etc. Non-retail adds in used game sales from GameStop and others as well as digital delivery.

Non-retail sales are on the rise and it's not all GameStop. Taking the company's sales numbers out of the equation results in a definite increase in non-traditional sales. It's impossible to break that down further at this point, but things are looking good for the digital market.

Source: Gamasutra

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Tags: NPD Group, Digital Distribution, GameStop, Steam, Industry Trends (all tags)