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Zippy6 said:

Fiscal YearPlayStationNintendo
201619%
201727%15.30%
201832%17.30%
201943%24.80%
202053%34%
202165%42.80%

As we can see, the trend is clear. Physical software is dying, just like the movie/tv and music industries digital will become dominant and physical releases will become extremely niche. The digital ratio will rise high enough that even the biggest releases will not be able to hit the 10m physical sales mark. Even the biggest releases like Mario Kart that sell 40m will be under 10m physical once they reach 80% digital and beyond.

The ratio will continue to rise for all platform holders until the point is reached that the ratio is so high a game would have to sell an astronomical amount to possibly reach 10m physical sales.

Physical is dying, the trend is clear, anyone who thinks physical will continue to be relevant to the point of managing 10m+ sellers is deluding themselves because they want physical to remain relevant. Seeing PlayStation digital go from 19% to 65% in 5 years how could anyone possibly think physical will remain strong enough by 2060 to vote "never". Video Games will follow the other industries in leaving physical behind. The all digital future already happened on PC years ago.

Nintendo confirms 50% digital sales for Animal Crossing: New Horizons | GamesIndustry.biz


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I don't know if you were just lazy or if it's a deliberate attempt to support a conclusion that isn't backed up by the actual numbers. What I want to get out of the way first is that I don't care about Sony's numbers because I can see them following the way of PC gaming, because that's what PS is clearly about since the PS4. I only need to focus on Nintendo for two reasons: For one, the argument I made against the prediction in this thread is about Nintendo, and two, the prediction only needs a single game per decade to hit the milestone, so it's perfectly okay to be narrowly focused.

First off, the percentages you posted for Nintendo are not the digital ratios for games that are available in physical format and that's already a big difference to what the numbers actually mean. What Nintendo talks about is proportion of digital sales to total video game platform software sales, so digital sales include not only the digital versions of packaged software, but also download-only software, add-on content and even Nintendo Switch Online subscriptions. You can view this on page 13 of this document:

https://www.nintendo.co.jp/ir/pdf/2021/210506_3e.pdf

The bars consist of yellow and blue parts of which only the blue parts would be relevant for the digital ratio of software that is available in both physical and digital format. However, Nintendo's graphs are not about unit sales, but revenue and this makes the whole thing a lot less useful. That's because Nintendo earns higher revenue for a digital copy of, say, Mario Kart 8 Deluxe because Nintendo themselves sells it for $60 whereas Nintendo doesn't sell this same game to retailers for $60 because retailers pay less in order to get their own cut from the sale. But essentially it can be said that the blue bars make the digital ratio seem bigger than it really is.

Putting all this information together means that digital versions of packaged games are nowhere near the 42% you posted.

If we look beyond your table into the current fiscal year, we have these numbers from Nintendo on page 12:

https://www.nintendo.co.jp/ir/pdf/2021/211104_4e.pdf

The flawed metric used by you shows a year over year decline of 2.1 percent points during the first half of the compared fiscal years, so your suggested trend has come to a halt for Nintendo.

But it doesn't end here, because I'd like to do comparisons between calendar year 2020 and 2021 while I've opened these documents.

January - March 2020: 60.9b yen from digital versions of packaged games, 45.59m units of software shipped
January - March 2021: 53.6b yen, 54.78m units

2021 had more software units shipped, but digital versions of packaged games fared worse.

April - June 2020: 68.3b yen, 50.53m units
April - June 2021: 39.5b yen, 45.29m units

A decline for both categories, but digital versions of packaged games were hit far worse.

July - September 2020: 40.7b yen, 49.82m units
July - September 2021: 33.5b yen, 48.59m units

Unit sales almost flat, but digital version doing notably worse than the year before.

Now I am not going to be intellectually dishonest, so I'll mention the caveat that applies here: Nintendo gets more revenue from first party game sales than they do from third party game sales, so that changes things a bit. First party game sales of known million-selling software:

Calendar Q1 2020 vs. calendar Q1 2021: 24.01m vs. 19.45m
CQ2 2020 vs. CQ2 2021: 22.45m vs. 14.27m
CQ3 2020 vs. CQ3 2021: 25.09m vs. 14.45m

The caveat with these numbers is that they are a lot more complete during FQ4 (=CQ1) than they are during FQ1 and FQ2 (=CQ2 and CQ3). Regardless, using some necessary estimates here we get roughly in the ballpark that digital ratios of packaged software are either not growing, or if they are, they aren't growing by much anymore. The biggest benefits for growing digital ratios in the recent past have been COVID-19 measures and too low physical stock (such as for Monster Hunter Rise in Japan), but it will take a long time until we see sustained 50%+ digital ratios on a Nintendo console and if we ever see them, it still won't mean the end of physical games. Considering how much at odds Nintendo is with the supposed trends and industry standards, and how successful they are the more they are out of line, how could you think that Nintendo will ever follow the rest of the gaming industry, let alone other industries.

Lastly, I checked to make sure what Sony's numbers mean. Sony's percentages are measured by unit sales, but they do include digital-only games in their "full game" category, so the percentages are skewed and do not represent the actual digital ratio of games that are available in both physical and digital format, and those are the games we are talking about in this thread. Nevertheless, Sony is heading towards an all-digital future because they follow PC gaming. It's just that they aren't as close yet as the numbers you posted suggest.



Legend11 correctly predicted that GTA IV (360+PS3) would outsell SSBB. I was wrong.

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