Microsoft has told MCV that it sees downloadable content and Xbox Live as a ‘complementary’ addition to boxed product – and that it doesn’t see the packaged goods business declining.

However other standout companies have pointed to 2009’s explosion of download-only new releases – which cut out retail altogether.

Speaking in MCV’s investigation into the digital download sector, UK head of Xbox, Neil Thompson said:

“People often ask me, ‘Will Halo X be download only?’ But I don’t see the packaged goods business declining. What I do see is the growth of the download and digital content market – but it is complementary to boxed content and services. Wherever we can, we make sure retail is part of the Xbox Live ecosystem.”

And as companies such as EA and Warner Bros begin to release download only product – most notably the latter’s Watchmen movie tie-in – others in the industry have predicted that 2009 will be the year that exclusive digital delivery of full games finally takes off.

IGN Entertainment owns PC digital games service Direct2Drive. The firm’s head of marketing in the UK Rich Keen added:

“We are beginning to see the emergence of digital only products, especially within the core PC category. A recent example is Red Alert 3: Uprising, which capitalised on the established online community that surrounds the Command & Conquer franchise and their openness towards digital distribution to ensure success.”

You can read our full digital distribution feature here.