
1C says retail is to blame for decline in PC software sales
1C’s international publishing director Darryl Still has accused retail of failing to support boxed PC games.
The industry veteran says that by refusing to stock certain games and moving PC titles to the back of the store, retail is forcing publishers to head towards digital distribution. And that PC games software will be sold entirely through digital channels by next year.
“In the PC market at the moment the growth in digital is phenomenal,” said Still.
“If PC games manage to get listed at retail, then they’re rarely getting any exposure because they’re appearing at the back of the store.
“There is still demand, but retail is forcing PC games out. Digital is fantastic, and we’re very pleased with it. But it is not us as the developers and publishers driving products to digital – it is because the options for the PC at retail are so limited.
“You just have to head into a games store and look for their PC titles, and you’ll see there is no focus, listings or promotions for them.
“It is extra strange because there is a much better margin on PC games,” he continued. “The industry should be embracing PC more enthusiastically.
“Digital proves there is a consumer waiting for it. But these consumers are now more than happy to click the download button.
“Q1 2011 is my estimate as to when PC games will be sold completely via digital. I have seen the predictions that by 2013 more than 50 per cent of our revenues will be earned digitally. But if the PC games market has to wait until 2013 then we are all in trouble.”
Despite this, Still admits there are still some challenges in the digital market – partly caused by the sheer number of digital platforms out there, with publishers having to try and pick the right ones carefully.
“I feel like I am at the front of an express change, and every week we’re adding an extra carriage at the back, which is a digital distributor. We have contracts with 25 of them at the moment, and of that amount six or seven are producing decent revenue numbers.
“And this year I know more carriages will be added on and others will be coming off the rails. The issue is we don’t know which ones will succeed and which ones won’t.”
Comments
Interesting
I have worked for several smaller publishers that publish PC boxed games and I feel that the problem is not just retails lack of support but publishers need to give retail a reason to stock the games.
In my time I had my successes and failures with PC boxed product and on balance it was 50-50. I have seen a great deal of sub standard products dressed up as games in my time and you can't just release a game and expect retail to just take it and put it on their shelves and have unrealistic expectations. There is room for PC gaming but the products have to be unique, well presented. AAA titles on PC can generally be found on console also with the exception of a few. But games like Football Manager show that if you have a great product it will sell. Publishers just need to work harder. The responsibility lies with the publisher to seek out the very best product and to market it accordingly in order to keep P|c boxed product alive and to give the buyers a valid reason to take these products.
Never
I have been buying boxed pc games for years. In fact, i rarely buy console games. PC games are much more versatile in that most can be modded to the player's tastes and have a much longer life span (need i mention how many people still actively play Diablo II? I regularly buy pc games from retail and have no intention of ever switching to digital. I am no novice with the internet either. I have a steam account and am aware of Stardock's digital distribution system. I simply prefer to own a solid, physical copy of my game. I spend a fair proportion of my income on computer games (PS3 gathering dust) and just want to say that there will always be a market for boxed computer games.
expextmalot more game devs go bankuprt
I guess it only means more console game devs will go bankpurt. expect an unslought of pirated consoles in the future.Expect retail to come crashing down too.
by the way here is proof that console game devs go bankuprt
Oh by the way here is proof that console make game devs go bankuprt
http://www.develop-online.net/news/33622/Study-Industry-hit-by-11500-layoffs-since-late-2008
Dreamhunk Is A Moron.
Dreamhunk, are your parents brother and sister? Console devs go bankrupt? Is that why MW 2 was the biggest entertainment launch in history, selling 98% of it's total sales on CONSOLES??? You must be mentally retarded, this is why PC gaming is dead. Why is it that games ALWAYS sell better on consoles than PC? Because idiots like you don't buy PC games.
PC devs don't need idiots like you talking trash on forums, they need your money. This is why most devs can't afford to make PC exclusives anymore. It doesn't do them any good if you spend all day on the internet telling everyone how great PC games are but don't even buy them, LOL!
When the PC version of games captures more than 4% of the total market you can try again.......PC is gaming for noobs.
PreOwned
PC games are dying for two simple reasons:
You cannot trade them in when they are complete making them expensive
PC's are too complex and expensive for most people to go beyond web browsing etc.
As such, the price has to be much lower for the customers to buy (since they will lose 100% of their spend), the margin for retail has to be much higher for them to stock them (no high margin pre-owned) and hence the money made for the publisher is much lower per unit sold. Publisher wants more money than the market will bear per unit sold and ignore the above = game does not sell, simple, then goes out of date and never sells.
Added to that, a high end gaming PC can cost much more than all 3 consoles (Wii, PS3 and 360) combined, adding to the financial strain.
Like it or not, pre-owned is not the 'destructive force' touted on this forum so frequently, but is infact what makes this industry tick, it allows publishers to charge initial high prices for a game and recover the entire production costs + make a substantial profit within the first week or two (before the game becomes dated), and then move on. It also allows retailers like GAME to sell below RRP and still make a profit (selling below RRP = less money & low margins for retail + higher demand from low price = more money for publisher) knowing they can make the money back up from the pre-owned aisle. PC games are usually set at RRP or higher due to a lack of a pre-owned option.
Many people will not spend more than a tenner on a new release if it cannot be traded back in, publishers are trying to force a business model and a very high price on a customer base not prepared to accept it, and they don't. The market will always win.
Not everyone is going to download games, most people still buy music albums in disc form and the physical market will never truly 'disappear'. The day it does will be the day the torrent sites popularity explodes.
just my thoughts
PC Gaming Far From Dead
Check out steam and many other indies that sell their games online, most are doing very well.
The problem is that its becoming more acceptable that people buy their games via digital distribution and buying boxed games via the internet so the highstreet and indie game retailers are going to lose out in the long run.
PC games , especially MMOs and RTS games are doing very well in the US and Asian markets (yes people even buy them legitimately) so you wont see the death of PC gaming for a while. And with a service like onlive (and them actually proving that its viable and companies like AT&T getting involved) then clearly that is another way to go in the PC Games Market)
I use to work in games retail (5 years and quit last Jan), I was in a town with a few games stores, and year after year more games just came out with DRM and multiple problems, many games can't be resold and many 2nd hand games were unattractive (all the sold out junk) so high street isnt going to make much from it, so no wonder why game and gamestation are cutting down the PC game sections as its clearly fact that Steam is the way to go with many releases as you can buy it once, and back it up many times over so you don't get screwed over if a disc breaks.
When it comes to PC gaming these days chains and indies should only really stock the big titles on release, MMO game cards and a few choice acessories, it would be daft stocking many back catalogue titles.
PC boxed games here for a while yet
AAA blockbusters, unique original titles, established brands and value titles/casual. I can't see boxed pc titles not being around after 2011 can anybody else? People like casual gamers, kids and gift purchasers will still want a physical boxed product in their hands.
Some clarification
Firstly for Tom, the article does not claim PC games are dead. it states clearly that there is a large demand for them that is not being supplied by retail.
For Martin, you can easily trade in PC games. Have you never looked at Amazon's excellent reseller opportunities? 8-)
But more importantly, let me clarify the Q1 2011 part of the interview as the quote has dropped slightly out of context.
The discussion was about the tipping point. The point in time where more than 50% of a companies PC revenue would be gained digitally, and in this respect I think Q1 2011 is not a far fetched estimate at all.
Frankly, 1C are at that point now outside of Russia and Germany (where PC retail holds stong).
In the UK and North America we’ve certainly gained more than 50% of our PC revenue over this Christmas by way of downloads.
Another mitigating factor to consider is that I am talking about revenue here, not units. A PC game going direct to a digital distribution outlet and retailing at $19.99 gains $14 a sale revenue....with no inventory or return cost. For the same game, selling out of a box in a retails store, the company would see about $4 per sale. So even if retail is outselling digital by 3 to 1, PC developers still make more on the digital model.
PC Retail alive and well!
I would like to assure you that PC stock is still given prominence and can be seen alive and well... "Where!?" you cry. At the end of most isles in any Morrisons supermarket. ;OP
Hahaha
The way I see it.
PC = Better frame rate, Better Graphics, Modular design, Expensive, not for rednecks and stupid people who can't operate a pc.
Xbox360 = Medium frame rate, medium graphics, cheap hardware, cheap price. good for poor people and the people who are too dumb to operate a pc.
most games made for pc and xbox can be ported easily to each other, since they run on the same platform Direct X(box). and so they often are. I own both, a top of the line pc and a 360. But I never buy a game for the 360 if I can buy it for the pc. Why? cause I'm getting a down version on limited hardware if I buy it for the 360.
So your a media guy like I am, and you have to have the best stuff out there. Get a HIGH END pc for games & get a xbox360 as a media center + for exclusive games. Ignore the PS3 since its just over priced junk with no decent games. ("bb b b bbbut it has BLUUURAYY!" so does the 60 dollar magnavox)
PC gaming will always be around, since ALL games are made on the pc before being ported plus the fact PC's will not be going anywhere since a good chunk of our life revolves around them.
DON
""So your a media guy like I am, and you have to have the best stuff out there. Get a HIGH END pc for games & get a xbox360 as a media center + for exclusive games. Ignore the PS3 since its just over priced junk with no decent games. ("bb b b bbbut it has BLUUURAYY!" so does the 60 dollar magnavox)""
Is this (media) guy retarded??? no decent games?? how about gt5, GOW 3, mgs4, killzone, heavy rain and thats just a random few!! also its one of the few decently priced Blu-ray players that can do every offered feature such as update firmware, bd-live ect.
Also you will find that it loads and plays much faster that a $60 bit of trash with no display no bd-live no netflix and no firmware update (If thats your idea of being a "media guy") maybe you should try VHS???
As for 360 being for "good for poor people and the people who are too dumb to operate a pc" could you mean children maybe??? not all gamers are fat lazy 40 year olds that live at home with mummy!
Oh and I am quite sure that PC's used for PS3 development is practicaly a PS3 anyway because of the unique nature of the 8 processor system
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