Capcom predicting "severe contraction" of packaged market

Resident Evil publisher expecting traditional physical goods market to shrink by $5.3 billion by 2017; company will invest more heavily in DLC going forward.

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The traditional packaged game market is facing tough times, according to Resident Evil and Dead Rising publisher Capcom. As part of its 2013 Annual Report published today, the company spoke about "rapid changes" in the consumer market that it will face going forward.

"Analyzing the consumer market by platform, we forecast severe contraction in the package market, which is expected to shrink by $5.3 billion in 2017 (down 28.8 percent from 2012)," the company said. "At the same time, we forecast significant growth in the DLC market by $7.8 billion (up 109.9 percent)."

In 2012, the packaged market was worth $18.4 billion, Capcom said, down 17.9 percent year-over-year and the fourth straight year of negative growth.

Going forward, Capcom said it will allocate management resources to downloadable content to "ensure sufficient earnings." To this end, the company will increase the staff in its Consumer, Mobile, and PC online development areas by 100 people each during the next fiscal year.

Capcom president and COO Haruhiro Tsujimoto explained that in the traditional packaged games business model, the company used to recoup investment costs by simply pushing more titles out the door. However, the company is now shifting to a more DLC-focused approach.

"But now, even after game sales, the provision of digitally distributed content (DLC) facilitates longer enjoyment of each title, resulting in a business model with the potential for earnings on a continuous basis," Tsujimoto said.

Tsujimoto acknowledged that Capcom has not been quick enough to adapt its business to be more DLC-oriented, but said the company will shift this attitude going forward.

"I regret to say that, up to now, we had few plans for the full-scale implementation of DLC," he said. "From here on out, we need to focus on the long-term provision of content starting at the earliest stages of development."

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Written By

Eddie Makuch is a news editor at GameSpot, and would like to see the Whalers return to Hartford.

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Discussion

538 comments
Nightelf123
Nightelf123

from the time that capcom destroyed RE in RE 4 & 5 i lost my trust to capcom.

dskhury
dskhury

I bought over 300 disk games for both Xbox 360 and PS3 during the past 6-7 years, about another 100 digital downloads for PS3 alone...

One thing is for sure, on PS4, i plan to buy the minimum ammount of disk copies possible, i´m going for some exclusives just for the collecting, MAYBE.

And to be honest, after years with steam, it´s just natural to me to buy digital copies now... My personal view from this point forward, digital content is just going to wash disk based games away, i´m going to avoid disk based copies at all costs, i don´t sellf my used games anyways, and to hell if ipm borrowing my games to other people, with dem greasy hands...

How hard it is to put the god damn game back into the god damn box after removing it from the god damn video game? God damn humans.

SamuraiSeven
SamuraiSeven

Isn't this the same company the missed almost every sales prediction for their games over the last few years.  I believe predictions from people that accurately predict things instead.  Thanks Capcom.

Also, I like the physical disc.  The only way I would go digital is if they brought down the price, vs the physical disc.  I don't get why Diablo 3 is the same price as the disc when it takes less effort, overhead, packaging, and man hours to produce and distribute. 

Greed is not good.

hardeddie
hardeddie

When R* already figgured out how to cater to their fans other publishers are still stuck in the dark ages!

ericstifer
ericstifer

I believe it. Digital released earlier than physical will be the norm with added benefits for going digital. Mark my words.

Only reason it hasn't happened sooner is digital  releases have been an after thought on consoles....and that changes in November

jark888
jark888

Do they really have no clue that DLC and micro-transaction is the cause of the contraction?

Thanatos2k
Thanatos2k

Capcom is such a goddamn disgrace these days.

Garm31
Garm31

The market is shrinking because of the lack of quality games. Game sales are down everywhere. It's publishers like Capcom that are killing it . They have not produced one great game this gen. Add more gas to fire, by releasing more dlc? Capcom are now the same as  the  cancer spreading EA. A horrible blight on the gaming industry.

porsche_game
porsche_game

Ryu :( I'm really sad for you to be stuck with Crapcom.

pboontap
pboontap

lol well this is the logical extension of the way capcom has been operating so no real surprises there. i'm very curious to see how it works out for them.  not that i'll be paying for any game they make, mind you. i think the last capcom game i bought was for sega genesis.

kagento
kagento

Ok, skipping through the part that Capcom is already quite known for scamming DLC content, why don't you make the Street Fighter new versions DLC? That would be a start instead of charging a new game for a couple of new levels and characters.

ominous_prime
ominous_prime

Perhaps they could lower the price for entry into the game if the intent is to establish a steady stream of DLC. Capcom seems to be telling gamers that it's games will no longer release complete starting in 2017.

cousinmerl
cousinmerl

once it only took 2 guys to make a game 4 guys to market (1980s)
then...
once it only took 10 guys to make a game 20 guys to market (1990s)
then...
once it only took 100 guys to make a game 200 guys to market (2000s)

companies cant keep up with next gen product its costing WAY too much. its no wonder they make more money with phone apps, small teams less marketing, more ways to make money.

serphtensei
serphtensei

they sell more DLC because physical sales is bad because they sell more DLC because physical sales is bad because they sell more DLC because physical sales is bad because they sell more DLC because physical sales is bad because they sell more DLC because physical sales is bad because they sell more DLC because physical sales is bad because they sell more DLC because physical sales is bad because they sell more DLC because physical sales is bad because they sell more DLC because physical sales is bad because they sell more DLC because physical sales is bad because they sell more DLC because physical sales is bad because they sell more DLC because physical sales is bad because they sell more DLC because physical sales is bad because they sell more DLC because physical sales is bad because they sell more DLC because physical sales is bad because they sell more DLC because physical sales is bad because they sell more DLC because physical sales is bad

ryan_mole
ryan_mole

It's one thing for the DLC to be something useful like extra levels or modes of play, but when it's crap like extra characters that hold no value toward finishing gameplay, character outfits that only ad nostalgia, or even the pathetic avatar outfit items what's the point?...........oh yeah greed!

serphtensei
serphtensei

Sales of physical game copies are dropping, so Capcom CONTINUES to make and sell physical game copies AT THE SAME PRICE while CUTTING THE CONTENT IN HALF to sell them as DLC later to MILK FOR MORE MONEY, which has NOTHING TO DO with sales of physical game copies dropping?

Yup, that definitely sounds like a good excuse.

Come, Kim Jong Un would like to clap for you.

Cashmoney007
Cashmoney007

I am happy to buy dlc if the game is complete, and the dlc is actually good.  If I have to buy dlc to complete the game then no dice!

bunchanumbers
bunchanumbers

Remember when you bought a game you got a whole game? Capcom doesn't. 

apolloooo
apolloooo

DLC DLC DLC DLC DLC DLC DLC


that's what i read in this article. capcom keeps crapping

moonlightwolf01
moonlightwolf01

Oh yay, because we're all fans of buying stuff we don't actually get to own and having our games broken up and sold to us in pieces. That's sure to bring the customers flooding back isn't it Capcom.

ViskiJack
ViskiJack

Pirate bay doesn't charge for DLC or shitiy games.

Kyrylo
Kyrylo

interesting have they consider WHY they loosing fans. 

eslamm
eslamm

Fuck you, capcom with your shitty games and overpriced dlcs.

DullahansXMark
DullahansXMark

"I regret to say that, up to now, we had few plans for the full-scale implementation of DLC," he said. "From here on out, we need to focus on the long-term provision of content starting at the earliest stages of development."

Translation: "Right from the very start of production, we're gonna start planning on just what we can add to the game LATER and still charge lots of money for."

tightwad34
tightwad34

Just go work on Street Fighter IV/XXIIIV6 Deluxe Ultimate Turbo Super Mega Championship edition.

SacredGrey
SacredGrey

Bull manure. I like my boxes and manuals and I'll fight to still have them.

Can I get into the games industry by "predicting" controversial things once a week?

Dresden05
Dresden05

The worst instance of DLC I have seen has to be the one in Dragon Age, the guy is in your camp all the time stood in the corner, you talk to him and he introduces a great mission and then goes you have to have the following DLC.

What the hell they put the guy in the launch game and still made you pay for the extra content. 

He just stood there staring and ruined the game for me

Dresden05
Dresden05

Games companies and games need to learn to put an upper limit on a games cost

release a game at £30 have 3 DLC if people want them at £10 each total = £60

or absolutely everything for £60.

stop selling games at £60 and expecting people to buy the 3 DLC. gamers are to blame as they keep buying it

It's starting to take the piss and has to stop

i've pre ordered GTA and that'll be it. No DLC whats the point. 

telaros
telaros

I'm sure it has nothing to do with your rehashes and scamming consumers with fake DLC of stuff that is already on your discs. Nope. Gotta add more DLC!

Flawless strategy Capcom. Flawless.

Oh hey~ is that Inafune on Kickstarter with almost 3million dollars of FAN support behind HIS game? I sure hope he adds DLC otherwise it'll fail miserably too...

acerx7
acerx7

Wow, seriously?!

meedokicky
meedokicky

you've already been doing this :S

Andrew Richtmeyer
Andrew Richtmeyer

Physical copy will always, always be preferred. (regardless if it's a game or a movie.)

Metal_Jaws
Metal_Jaws

So...the company whose only great recent product, SF4 (easy fanboys of other series, just an opinion), which is basically a remake itself, and then countless rehashes of the exact same product (SF4A, SSF4, SFxT, and now SF4U) while screwing customers out of DLC experiences - now they predict disc sales are declining?!? Take some responsibility for your part in that Capcom. Make better games, love the fans, and the money will come - not the other way around.

Dragerdeifrit
Dragerdeifrit

i can't believe im about to say something so immature, selfish, and evil, but.... : I wish capcom  bankrupcy. and want every and single capcom employe to lose their job, i want them to starve and know the meaning of "i need a dollar to buy something to eat", "probably i be able to buy some clothes next month"  "i used my last cents on medicines" "dont know if ill be able to pay this month's rent".  maybe, and just maybe, they learn to not treat the customers like stock,  i cant belive im saying this, im not like this. but capcom just made me SICK, we are not farm animals that can be exploited to load their wallets.  

Square Enix just remade an ENTIRE DAMN  MMO just because their fans didnt like the original, then they gave away the new version for free to everyone who purchased the first one.  and capcom... wont event sell a complete game ?.... im not sure if i wanna be a gamer anymore, we need some kind organization that regulates the price on games based on content, quality and amount od DLC.... companies shouldnt be allowed to sell unfinished products for full price. it needs to be illegal damit  

ZOD777
ZOD777

Lol.  Their diagram is not unlike those people in infomercials that struggle on purpose for the camera to make the original way of doing things look terrible.  They just want to squeeze more money out of you.  Lets not forget how many times they release Street Fighter rehashes.  I got burned on SF IV to only see Super SF IV come out a few months later.  Capcom is dead to me.

Vari3ty
Vari3ty

Games as a service. Welcome to the future people, the sh*t is just beginning. 

derceto
derceto

 So Capcom intends to start making DLC which is actually "downloadable"?  Shocking!  What a concept.

Justforvisit
Justforvisit

Maybe somebody should tell Capcom that little industries secret what a game needs to sell well.

QUALITY

Shinobi120
Shinobi120

Capcom, I hope you go under. Just die already. You've been dead since 2010. 

badman11226
badman11226

I thinks time to nominate Capcom as the worst Game company EVEEEEERRRRRRR.    I think EA needs a break now

SamuraiSeven
SamuraiSeven

@Garm31  People may also be waiting to buy next gen.  Dropping the $$$ on the preorder can hurt current game sales also.  I have bought a couple of cheap digital games just for something new so I could go next gen.

aots_twilight
aots_twilight

@kagento Note though. While Capcom is taking a good blunt of the issue. Other companies also embrace the Nickel and Dime DLC content.

NIS America
Namco Bandai
EA


I could go on. But it's a good number in the industry. Sadly, DLC has been twisted by the the corporate mindset.

cousinmerl
cousinmerl

oh and resident evil 6 'sucked' so that's where they also lost allot of money.

ryan_mole
ryan_mole

@moonlightwolf01  I agree completely! How many times have we gone out and bought a "new" game only to get home and realize that you now have to spend about half of what you already paid to "unlock" all of its content. Not to mention that if you pre order a game you get "exclusive content" or a data code for an upgrade/level/etc. which is generally unlocked in gameplay or comes with the wretched DLC.