Games retail gone in 10 years, says EA exec

[UPDATE] EA Games executive predicts end of brick-and-mortar distribution in next decade, acknowledges "new generation" of gamers may not care much for physical games; EA says "next era of games will be played on a mosaic of formats."

Speaking to CVG in an interview, EA Games executive vice president Patrick Soderlund said digital distribution's acceleration is not slowing down, with packaged goods tracing a trajectory toward extinction in the next decade.

Games retail is going the way of the Dodo bird, says Soderlund.

"We know that packaged goods work today, and the majority of our current revenue comes from that," he said. "That's still a viable business model. But in the long term we'll see more and more people gravitate to downloaded content."

As for when distribution via brick-and-mortar retail outlets will lose viability, Soderlund said it's going to happen "sooner than people think," adding, "I think it's going to be sooner than 10 years."

Soderlund made clear that his comments were his opinions and "might not be what EA thinks."

The executive said that he personally places value on collecting physical games, but acknowledges that the new generation of gamers may not hold this enthusiasm.

"I happen to think that there's something about physical content, like books, that's collectible and satisfying to own," he said. "I still want physical content, but I'm not part of the new generation of gamers. I remember a time when I bought a cartridge and excitedly read the manual on my way home, imagining what the game was going to be like. Maybe kids don't have that anymore."

[UPDATE] Following the publication of this story, EA senior vice president of communications and public affairs Jeff Brown issued a statement on Soderlund's comments to GameSpot.

"At EA, we think the next era of games will be played on a mosaic of formats that include discs sold at retail, digital downloads, apps for mobile and tablets, and cloud-based games," reads a line from the statement. "Traditional retailers are building websites where consumers will shop for downloadable games and services. Both on discs and online, traditional retailers are demonstrating innovation and long-term staying power."

EA's digital business has a been a boon for the publisher. During its most recent fiscal year, the publisher tallied $1.2 billion in digital receipts, with EA CEO John Riccitiello projecting in May the firm's upcoming year to be one that sets it apart from competitors.

"In the coming year, we break away from the pack, with a very different profile than the traditional game companies and capabilities that none of our new digital competitors can match," he said at the time.

Written By

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

Discussion

552 comments
BradBurns
BradBurns

Is this a "prediction" or is it a warning that publishers will be more aggressive about forcing digital downloads down consumers throats in the near future...?

 

I think it's more wishful thinking than the "wave of the future". I don't think the majority will abandon physical games that soon. Broadband is required and not everyone can afford it. (PSP GO comes to mind)

PesmergaYuber
PesmergaYuber

He is not "predicting" the end of games retail, he is telling everyone that is the way it will be whether we like it or not.

 

As much as we all hate it, that is the way it will be sorry!

 

ghettalife
ghettalife

Not down w/ digital downloads as the primary choice.  What happens when your hard drive dies w/o warning like my PS3 did?  I mostly had demos on there, but other stuff as well.  It would take days to recreate everything, especially since I'm on a slower internet plan now.   What happens if you lose your phone or your tablet breaks--are these companies going to have you re-purchase the content?  How long will companies keep games in their catalog?  Someone gave me a netbook w/ a scrambled OS.  I now have to jump through many extra hoops to restore the netbook because it doesn't have a DVD drive.  At least w/ disks, you can reload a device easily.

Biggs613
Biggs613

Funny how it's mostly EA execs or analysts with these predictions of a digital only future...

BlackLense
BlackLense

I'm okay if the game/media is below 10mb, like mp3 file for example. LOL.

AcousticSoul20
AcousticSoul20

i never buy digital downloads of games! I'm all hard... copy! i like the idea of physically being able to hold what i own! I hope games don't go "all digital" fuck thaaat!

johngarabatos
johngarabatos

This is totally a mistake. what happen with all of those like me who buy used games on amazon? if the game cost originally 60 and in two months same game but used costs 35 0r 20 us. we are a big group of people who pursuit those games! So let me see every game will cost 59.99? if they dont have manual or box or cd they must be around 30 us or less. I prefer my pshycal games. There are people who doesnt have internet not everybody play online.

SmiLey2222
SmiLey2222

How many times has an EA representative come out and said basically the exact same thing in the past month? You'd think by now they'd have heard we don't really care what they think.

itchyflop
itchyflop

i agree with everyone having iphones/pads or some access to the internet and with rising prices on pretty much everything, its easier, cheaper and lazier to do it on those. Plus i think the games companies have to be realistic and lower their prices if they want to compete, they're ridiculously high. Its always cheaper on the net.

JangoF-76
JangoF-76

Plus, if games do go 100% digital that'll rather neatly solve the used game "problem" that publishers hate so much.

I hope it never happens. I'll certainly never spend a penny on a digital download again, unless it works out significantly cheaper than buying the physical copy (which at the moment it almost never does), and even then probably not because I like having the option to sell a game if I want to.

Right now, digital games = less value, less freedom

tgwolf
tgwolf

...Are you telling us about a coup of some kind? With what army, mind-wiped Bl*****d players? IMPORTANT: Not going to happen so long as there are sensible consumers and a free market economy...Which may be in jeopardy after all...

clqtte
clqtte

Physical disc with cool-looking box, I prefer............

mario-nin-freak
mario-nin-freak

Next gen will probably be the last good generation for gaming. I will enjoy it as much as I can while it lasts.

shinobiprophetx
shinobiprophetx

Articles like these make you wonder though, don't they? I mean, how do we know that by having some "AAA" executive spout this as a prediction based on solid statistics doesn't just set us up subliminally for an all digital retailer...because we were fed this was the inevitable outcome years prior to the shift, when in actuality we justified the end of brick and mortar retailers simply because, analysts told us this would happen whether we agreed with it or not.

 

I mean, if developers like EA had their way right now...their entire library would be digital, because it's a 100% profit all the time. Digital copies of games even tend to retail higher than their aged (non-used) physical counterparts. By feeding us the "logic" now, it reduces the resistance later.

 

Or....the brick and mortar bubble is literally popping.  

 

decoy1978
decoy1978

Why is it that EA always has something to say about the trend of gaming. I would have preferred to hear this from Nintendo or Ubisoft or Capcom. Bedgrudgingly I would have to agree with EA.

 

My collection of digital games is growing far more than it was last year. I assume it will continue to grow simply for the ease of not having to manage so many physical copies.

 

For all those naysayers, put it into perspective... Just 20 or so years ago we had FAT Nintendo cartridges, that evolved to into discs just 10 or so years after that, and now we digital.

 

We had casettes that turned to CD's that turned to mp3s. VHS tapes to DVD to BluRay's and now BR digital.

 

It seems the technology gets better and smaller every time. I think it will be 15 years before we see a giant push towards digital retail for gaming.

SavoyPrime
SavoyPrime

Digital probably is the future. But I'm not gonna front. I prefer having physical copies of my games.

Rat_King
Rat_King

Just to summarize the article for all of you that wanna immediately hop on the EA hate bandwagon...EA didn't say anything of the sort. An EA exec did, just like the headline states. Who said his comments do not represent EA. EA itself then responded as a company saying it disagrees and that games will be available in all formats.

 

Seriously, about 40% of you are saying stuff like "SCREW EA THEY DON'T KNOW WHAT THEY'RE TALKING ABOUT BLAH BLAH BAAHHH BAAHH" /sheepnoise.

 

Feel free to hate on EA, just don't do it blindly because you want to look informed or cool or whatever. GS articles are actually very well written, I recommend reading them sometime before you spew your unfocused and blind hate.

mkb11109
mkb11109

Hmmm 10 years. thats could be as possibility. cant remember when i went to a retailer to buy a game. even buy hard copies online.

dnguyen3
dnguyen3

With no more retail stores, our internet providers are going to love raising their prices on download usages and console manufacturers probably will raise prices on consoles with bigger memory storage. By that time if you HDD breaks (for whatever reason) may God help you. 

worlock77
worlock77

No doubt that digital distribution will take up a much large portion of the sales pie than it has to date, especially with hard drives becoming ever larger and more affordable, but I think Soderlund's being seriously over-optimistic about it. There will always be a market for physical games. There's a lot of people who want physical items, who like to collect them. It's a basic human trait to crave physical things. For another thing there are many people who simply don't have access to broadband internet, or who are subject to data caps. This kinda puts a cramp in the digital distribution model, and I really don't see the big ISPs giving up data caps.

Judas_III
Judas_III

Since when is EA dictating the industry. They need to be silenced.

PereM03s
PereM03s

And in 3 year's there are flying cars and a lot of other crap, (Back to the future)

nu1mlock
nu1mlock

I'm a bit interested in what EA mean with "a very different profile" and "capabilities that none of our new digital competitors can match".

CMOTKarlos
CMOTKarlos

It's not like 'kids' stopped enjoying reading the manual on the way home from the shop - it's the publishers who decided that it would be cheaper to simply not put them in any more. 

 

Mind you, I think EA might be missing a trick here - why not go ahead and make the manual Day One DLC? 

kdr_65
kdr_65

As long as they're making them I'm going to keep buying disk. I'm just kinda old school like that. I like having physical copies and like the person above said there is just something about buying a game and then checking out the manual on the way home. Unfortunately most gaming manuals suck nowadays. But yea Physical stuff is way better than digital!

brynhyfryd
brynhyfryd

without retail sales Christmas would become boring.

 

No fun in unwrapping a digital download.

epross
epross

My only problem with digital downloads is that if you can't save to a physical medium or have a backup -- then you are at the mercy of the seller potentially forever. I have games/movies etc that are probably older than most people on this site. Contrast that with digital media. I was watching a movie on Netflix and didn't finish it. I went back two weeks later and "this title is unavailable" message was in my recently watched section -- If I had the disc I wouldn't run into these kinds of problems!

 

Maybe he is right and the younger generation won't care, but if I buy something I want to be able to access it whenever I want, wherever I want, for as long as I want. I can do that a lot easier if I have control over the physical media than I can on some nebulous digital stream or download. That said, I do believe digital delivery is the future, it just needs to mature.

Coren_Larken
Coren_Larken

Yeah and no one appreciates uncompressed audio and uncompressed high definition content either, right?It's getting more and more difficult to find stuff I like....sad day.

afwaseem
afwaseem

i hope EA will be gone in 10 years ... any one else has same feeling like me?

peteuplink
peteuplink

I doubt they'll be completely gone. There are still plenty of people who like to see a physical product for their cash. That's why CD's still sell so well.

deathblow3
deathblow3

reduced maybe gone not a chance said the same thing about music and to this day i can still buy a cd and a cd player.

VexxRed
VexxRed

Is it time to completely boycott EA?!?

PetJel
PetJel

"In the coming year, we break away from the pack, with a very different profile than the traditional game companies and capabilities that none of our new digital competitors can match,"

 

ogodlolol

TimboII
TimboII

I think they are totally wrong. They highly overestimate how many people have access to high speed internet...especially in rural areas. Not to mention download caps. Unless this changes there's no way digital distribution will become the norm.

kavadias1981
kavadias1981

 @itchyflop The issue of cost definitely seems to be an ever increasing criticism amongst... I was going to say gamers, but I think it is fair to say that even those who do not play computer games also regard them as too expensive; especially when comparing the price to mobile games, which are only a generation behind now, if that. As you say, developers need to cut costs.

 

They could do this IF they abandoned retail entirely but for various reasons, this isn't going to happen any time soon. But they must eventually. Physical retail isn't really sustainable. It requires huge costs for manufacturing, shipping and staff, all of which aren't getting any cheaper. Primarily oil, which physical retail is dependent on.

 

itchyflop
itchyflop

 @JangoF-76 yeah your right man, fifa 11 is still 44 quid on vita dlc. Spot on dude :)

tgwolf
tgwolf

 @clqtte Just keep that as a mantra, as if it wasn't the only sensible option.

Texasguy
Texasguy

 @shinobiprophetx You said it perfectly. EA keeps saying this crap over and over to condition consumers in to thinking their way. I'm sick of hearing it

Rat_King
Rat_King

 @decoy1978 True, however there is no sign of movies or cds going 100% digital anytime soon. If it did happen, I'd say it'll be AT LEAST 10 years from now, when even the most rural of remote hidden shacks will have high speed satellite access from anywhere at anytime and Diablo-3 is released for free to newborn babies. I do think it's entirely possible, but not within 10 years. And again, movies will definitely not become digital-only over that time, CDs might be close though. So until then, the two will just be merged (moreso than now) and we'll have to see where we're at 10 years from now to take it further...

Pelican170
Pelican170

 @Rat_King Doesnt matter, saying that still represents EA... He shouldnt have said anything then...

Coren_Larken
Coren_Larken

I just don't like digital, non-tangible media....

Sure, I buy the occasional XBLA game...but maybe I'm just old-fashioned.

tgwolf
tgwolf

 @swamptick He's just pushing his idea, don't give him any credit, shut him down with attrition of sales and the fool goes broke and shuts up.

Threesixtyci
Threesixtyci

 @PetJel "Absolutly none can match... well uhh.... maybe except for Steam.  And umm... Amazon."

The_Wild_Tiger
The_Wild_Tiger

 @TimboII You are right.  Most people I know that live in rural areas still have to use dial up (the horror...). Those that don't have to use satellite internet. Also, here in Canada, download caps can be pretty brutal if you don't buy a good plan. Games are getting bigger in size and that sure will cause a problem when download caps are involved.

shinobiprophetx
shinobiprophetx

 @Texasguy Yeah so does Ubisoft, just spouting the same rhetoric in order to convince the consumer that they know what's best for us.

Rat_King
Rat_King

 @Pelican170 I disagree. That's like saying a teacher at a school who has a problem teaching the theory of evolution, even though it's approved curriculum in the textbook, and then accusing the whole school of being a biased hateful source because one teacher feels differently, even if every other staff member is atheist and believes in equal representation.

 

Contrary to popular belief, everyone at EA isn't a robot.

Khasym
Khasym

 @The_Wild_Tiger Bang on both of you. I've had cable for years, but the only games I buy via digital download, are MMO's. I think I've bought three or four games on XBL, that I could've bought in stores. Hell, with Gamestop trying to work out the rights to resell digital content, it's just as likely that the brick and mortal store, will just do away with the disc-based content. authorization codes, install programs, and cheap memory sticks can fix what DVD's and CD's can't. Space and security.