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GameStop Admits Fear of Digital Distribution

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GameStop Admits Fear of Digital Distribution

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Will digital distribution kill retail? GameStop, one of the world's largest evil videogame retailers that is often jokingly referred to as evil, seems to think so.

GameStop has under-valued the effects of digital distribution on its business in the past, but now publicly acknowledges that it's concerned. In an expanded fiscal report, GameStop has detailed that digital distribution could be very, very bad for the retailer. "Technological advances in the delivery and types of videogames and PC entertainment software, as well as changes in consumer behavior related to these new technologies, could lower our sales," the report says.

It continues: "While it is currently only possible to download a limited amount of video game content to the next generation videogame systems, at some point in the future this technology may become more prevalent. If advances in technology continue to expand our customers' ability to access the current format of videogames, PC entertainment software and incremental content for their games, as well as new types of browser and casual games through these and other sources, our customers may no longer choose to purchase videogames or PC entertainment software in our stores. As a result, sales and earnings could decline."

And it gets even more negative, as the report also states that despite GameStop's current strategies to compete and assimilate with digital distribution, it "can provide no assurances that they will be successful or profitable." Especially due to the mention of browser and casual games here, one such strategy has been to acquire Jolt Online Gaming, with GameStop pushing Jolt's Legends of Zork browser game recently. For all we know, GameStop could eventually become a game developer instead of a retailer.

It plans to keep pace with digital content delivery through methods such as PC downloads and digital kiosks, but as we see with Xbox Live Arcade and the PlayStation Network, the big boys have the power make games flow directly from console to customer, cutting out poor li'l GameStop. Key to GameStop's wording is the admission that new technologies could change consumer behavior in general, even if Microsoft, Sony, and Nintendo don't switch to a purely digital format.

Honestly, it would be a little sad if GameStop and other retailers hit the bricks, because the used videogame market holds such a great value for consumers. Can't find a random PlayStation 2 game new? GameStop probably has it at three nearby stores for $4.99. I'll be the first one to say that I don't want used games to negatively impact developers and publishers, but the physical retail store will likely always hold a value for consumers somehow. Then again, maybe not, as in a digital world every game would ideally always be available no matter how old.

Source: Gamasutra

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Well, I'm not sold on Digital Distribution yet. Having a Broadband limit of 75GB a month can be a bit much already, considering all the Youtubing, Online Gaming, WoW-ing, RPing, preparing to start a Blog-ing, webcomic reading and Google-ing is enough stress on my Broadband as it is.

Calumon: I understand nothing...

I prefer to have a hard copy of my games, so I most likely won't turn to this.

So, to defeat evil we just have to use Steam?

Tough choice that one.

The_root_of_all_evil:
So, to defeat evil we just have to use Steam?

Tough choice that one.

What's your avatar from? I know I've seen it somewheres

And as the other person said I like hard copies, because you have the cases and the manuals with digital copies you get none of that, so yeah, no special editions

They are evil, but honestly they already digitally sell games, I fail to see what they are afraid of when they are taking part in the evolution (for PC anyway). Besides I prefer a physical copy of the game I bought.

I also prefer to have a hard copy of my games, though occasioanlly I will download things online (I downloadead BioShock, Orange Box, and Dragon Age: Origins all online, and I've enjoyed all of them).

I'm the kind of pack rat that likes to have a box filled with useless goodies and slips of pretty paper to hold on to and use to reminisce.

With that said, BRING ON THE COLLECTOR'S EDITIONS! WOOOO!!

SUPA FRANKY:
I prefer to have a hard copy of my games, so I most likely won't turn to this.

yeah same here

If digital distribution does become a reality and the main way for things to be brought ot people then I am sure that it is going to be the case where the reatiler is ghoing to lose out at the end of the day

So, I can certainly see where they are coming from

Brick and Mortar shops should be afraid of digital distribution. It's the way forward.

Hopefully it'll scare them into stopping ripping off their customers so much.

When it comes to games and any media period. When I buy I want the physical thing. Plus I just saw a Ratchet and Clank demo that was 2+ gigs. I know the game will be a hell of a lot more and my connection just isn't nowhere near fast enough. Even 360 DVDs are like what 9GBs. Gamestop I mean Amazon and sometimes eBay for me. Well unless I want the game now or it's new and Amazon isn't offering a gift card deal on it

Quiet Stranger:

The_root_of_all_evil:
So, to defeat evil we just have to use Steam?

Tough choice that one.

What's your avatar from? I know I've seen it somewheres

All of my local game stops have stopped selling PC games. Seems they are shooting themselves in the foot.

I've said it once before, I'll say it again... I'll only take part in this digital distribution movement if they mail me a scratch 'n sniff that smells like a brand new box being opened. And even then I demand it be authentic!

I do fear though... the change. I grew up on boxes, then cases... the joy of holding them and that scent of opening it. Those days are going to be gone... aren't they?

Personally, I cannot wait until Gamestop goes out of business.

Tom Goldman:

Honestly, it would be a little sad if GameStop and other retailers hit the bricks, because the used videogame market holds such a great value for consumers.

Unfortunately Gamestop gouged most of the value out of the used game market. But even now, I often see new copies of games in regular stores that are cheaper than the used copies in gamestop.
What kind of value is that?

I'm not a fan of Gamestop. But I have to give them big ups for such honest admissions, most companies pander to stockholders, avoiding real self-introspection and the truth.

Calhoun347:
All of my local game stops have stopped selling PC games. Seems they are shooting themselves in the foot.

A few in my area have also stopped selling PC games. The ones that still do sell PC games have them sitting off on a tiny little shelf in the back of the store. The funny thing is that this business practice actually encourages people to get their PC games digitally. If retailers completely neglect the platform, how else are we going to get the games?

They should be worried. Advances in technology inevitably make old tech obsolete. Like it or not, love it or hate it, digital distribution is the future of video games. There will eventually come a day when there is no longer a profit in producing physical copies.

I still really hope Digital Distribution isn't the future (Which it probably is sadly). I like my hard copies and if I can't get games unless I pay 70$ to download a game that's singleplayer and requires an internet connection at all times to play I will just give all hope. Not like I have much now anyway.

Screw gamesstop and other price gouging scum suckers, their shops smell, their workers are rude, and their policies are obnoxious. As for used games... well I much prefer being able to snag things like the Complete Civ4 pack for $10 off stream then saving $5 off a game that may or may not actually work.

I have my doubts about digital distribution really killing off the retail sales since stores might refuse to stock consoles that primarily do digital, kinda like what we saw with the psp go, some places refused to stock the things since they wouldnt be able to sell games for it

Yeah, Gamestop is encouraging digital distribution. Last time I was in one, I heard the clerk telling a customer "Yeah, if you want to get that game, you'll have to preorder it because we're only getting like 2 copies in the store."

Which is why they don't have PC games anymore. I could only find Dragon Age: Origins at Target. Or Steam.

Problem with digital distribution for me is that when you get a new computer/console, they always bone you up the ass by forcing you to buy the same game again.

With a physical copy, when your console/computer breaks or becomes outdated, you don't lose your whole library of games.

Is Gamestop really that evil? I'm not being sarcastic or anything, I've just never really had a bad experience with them...

Kiefer13:
Hopefully it'll scare them into stopping ripping off their customers so much.

Rip-off? What rip-off?

Digital distribution on consoles would be rather troublesome for them.

baboon 101:
Problem with digital distribution for me is that when you get a new computer/console, they always bone you up the ass by forcing you to buy the same game again.

With a physical copy, when your console/computer breaks or becomes outdated, you don't lose your whole library of games.

Not really, Steam has your games tied to an account, so you can download them anywhere.

That might be how it works on Xstations or Peebuckets, but round here, young whippersnapper, we have the almighty monopoly of steam, and there's no way a monopoly would decide to rip us off...

Only problem is if you get your account hacked. But then , too many people use their usernames as passwords.

SUPA FRANKY:
I prefer to have a hard copy of my games, so I most likely won't turn to this.

I think they were referring to game delivery sites as well as direct downloads.

I'm not entirely against it since it might get rid of preowned sales a bit. It's nice to not have to wait for stuff to be delivered though and have the interaction at the store. It's always good browsing stores with your friends too!

Kids might rage because they can't order stuff online too. Which probably means moar piracy :/

There are plenty of benefits and consequences to digital distribution, but obviously the loss of video game stores could potentially be on the horizon. Sure, it is nice to be able to receive a game from the comfort of your home without having to waste time, money, and gas to travel around to find a game you want when you could just look it up on Steam or XBL or PSN. Of course, as long as that is the way the evolution is going, consistent tracking and receipts of digital purchases will become a much higher priority for security in the event of hardware failure or overall replacement in the case of PC games and unreliable console systems.
Look at it in terms of the parallel with music. Back before IPods took over the scene, there was a music store in almost every town. Nowadays, you might only be able to find physical discs in stores like Wal-Mart or Target. The digital revolution has claimed all the Sam Goodys across the face of the world, without many people crying out loudly for their return.

I appreciate the ability to download a hard-to-find game when it is difficult to track down a physical copy. It isn't that difficult to make a backup of the download onto a disc, if you find yourself in the habit of having less-than-reliable hardware. I have no problem acknowledging the work and effort that goes into developing and publishing games, but I fail to understand the consistent cost of games, even in digital form. Why must I pay $60 for a digital copy of a game when I'm not getting the packaging or a physical manual for said game? I understood it was easier and more cost-effective to sell games via the Internets, so why am I paying the exact same amount in some cases for a game I could buy at Wal-Mart in a box? I suppose the argument could be made that it costs service fees to maintain servers in which to download games, but it is really a mirror cost of producing a disc and a box?

Digital distribution will rack up many kills along the way. Video stores, video game stores, and music stores will be all but a faint memory for those of us old enough to remember when they existed. Sadly as we've all witnessed, the loss of these stores are visual reminders with the empty storefronts and aging signs still clinging to the sides of buildings, and one day we'll be able to tell kids of the "good old days" when we could go down to a store and buy games in person that came on a floppy, cartridge or disc. Frankly, if Gamestop continues to be so resistant to change, they will quickly find themselves lost in the digital dust of Steam and other companies that offer direct game downloads. They would serve themselves much better to embrace the change than to complain about it costing them their business. There is still plenty of money to be made in this environment, but they just need to pay attention to the way things are going.

Never liked Gamestop. If they bite the dust I certainly won't be shedding any tears.

The_root_of_all_evil:

Quiet Stranger:

The_root_of_all_evil:
So, to defeat evil we just have to use Steam?

Tough choice that one.

What's your avatar from? I know I've seen it somewheres

What episode is that? I'd really like to see it

Also as much as I hate EB (canadian gamestop) its the only good video game store around

Quiet Stranger:
Also as much as I hate EB (canadian gamestop) its the only good video game store around

It's called Blink.

A little bit overrated, if you ask me.

First off, I've never understood the hate for gamestop. I love my local branches, the people are nice and knowledgeable; unlike the sods at best buy who wouldn't know a good game if it slapped them on the ass.

Secondly I love digital distribution and gamestop is smart to be afraid of it. Its like impulse buying for shit far more expensive than skittles at the checkout line. I can be bored on a saturday night, pull up steam, find some indie game that looks worth my time, buy it, and be entertained for the span of an evening or 2-3 days at most. Then I can always go back and re-play them at my convenience without having to store them all on my hard-drive.

Enkidu88:
Never liked Gamestop. If they bite the dust I certainly won't be shedding any tears.

I honestly have trouble comprehending why people hate the store so much. Every time I walk into game, which is the European store name for it (same company still, i believe, if not my point isn't valid) it seems to be a case of *Dan walks in, picks up a game, walks to desk, pays for it, walks out*

dogstile:

Enkidu88:
Never liked Gamestop. If they bite the dust I certainly won't be shedding any tears.

I honestly have trouble comprehending why people hate the store so much. Every time I walk into game, which is the European store name for it (same company still, i believe, if not my point isn't valid) it seems to be a case of *Dan walks in, picks up a game, walks to desk, pays for it, walks out*

If GAME is the European version, then my experiences are closer to "Walk in, pick up game, walk to desk, create massive line as I have a half-hour conversation with the guy on the till about one or more upcoming releases, possibly get some insider info, walk out."

If this is the case, I REALLY don't understand the hate for GameStop...

Digital distribution is nothing to fear, there will be a HUGE loss of consumers if it goes completely to digital distribution.

Plus if it did I'd be out of a job T.T

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