Capcom Europe’s COO David Reeves has told MCV that he believes the transition between boxed and digital sales may be heading towards a plateau, and that retail will remain a big part of major publishers’ plans for at least ten to 15 years.
He added, however, that the inherent profitability of the digital business model makes it extremely attractive – and vital to increasing profitability during a period in which rising revenues are rare across the board.
He told MCV: “When you’re working for a company like Capcom and you’re talking to the biggest, smartest retailers around, there can be no doubt that they’ll be a big part of this business for at least ten to 15 years.
“You can get such reach and coverage by going with both retail and digital, that you cannot afford, in our position, to give up with physical distribution.
I think you can double your revenue through an integrated digital/physical strategy, such as the prologue/epilogue model we employed for Dead Rising 2.
"I’ve got a feeling digital distribution will actually come up very, very quickly, as it’s doing, and then start to plateau.
“One factor in the transition between physical and digital is profitability. If you’re not producing a disc, you’re not shipping the disc, you don’t have a 35 per cent retail margin and you don’t have to worry about returns, then profitability is way in excess of anything you can do at retail.
"So in the cold light of day, from a publisher point of view, it is very profitable.”
The full interview with Reeves is published in MCV tomorrow and will be reproduced online too.