By using this site, you agree to our Privacy Policy and our Terms of Use. Close

Forums - Sales Discussion - Prediction: This is the last decade a game will sell over 10 million physical copies

 

Which decade will be the last a game sells over 10 million physically?

2020's 12 31.58%
 
2030's 10 26.32%
 
2040's 3 7.89%
 
2050's 0 0%
 
Never, physical will live on forever 13 34.21%
 
Total:38
RolStoppable said:

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.

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.

That decline is a notable data point but it's basically a regression to the mean after the pandemic catapulted digital sales. The overall trend is still big growth so I don't think it'll take that long a time to reach over 50%, if it doesn't happen this decade it'll for sure happen next decade. I think they'll follow the rest of the industry on this aspect since the positives heavily outweigh any negatives for them so I expect the Switch 2 to be when digital starts to become dominant for Nintendo. The only thing I can see preventing this is if a large enough number of Nintendo fans are uniquely predisposed to physical to the extent they won't ever switch to digital.



Around the Network

Well, it could be that this gen is the last which offers a disc drive. It depends if we see flash memory cards as a successor of discs or not. At least Nintendo's next console should offer flash memory cards again.



Zippy6 said:

Fiscal Year PlayStation Nintendo
2016 19%
2017 27% 15.30%
2018 32% 17.30%
2019 43% 24.80%
2020 53% 34%
2021 65% 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

For those curious this is how the music industry has switched away from physical over time: source

Year Digital
2004 2.30%
2005 9.50%
2006 18.10%
2007 25.40%
2008 34.80%
2009 42.60%
2010 49.10%
2011 52.30%
2012 60.60%
2013 65%
2014 68.80%
2015 73.70%
2016 81.60%
2017 83.20%

Do you have actual numbers to support that physical is dying? Such as total sales of physical games? Or all you have to go by is ratio? Ratio means nothing if software sales keeps on increasing year over year as well as the big companies manipulating the numbers to make it look like physical is dying. 
The digital ratio includes stuff like DLC, microtransactions and digital only games.

If we compare ratios to games that have both a physical and digital release, exclude DLC, then we can see it still favors physical.
Physical for video games is here to stay, 10s of millions of physical games are sold year. People need to stop with this nonsense that physical is dying.

We know Switch owners mostly buy physical over digital, but it seems PS5 gamers do as well, once we exclude stuff like DLC and microtransactions from the "ratio"

I'd be curious if we have YOY sales of physical games, but for now the below will do to prove that physical isnt going anywhere.

https://www.gamesindustry.biz/articles/2021-11-19-playstation-5-owners-prefer-boxed-games-to-downloads

"
PlayStation fans across Europe and beyond heavily favour retail for their game purchases, with more than ten million boxed games sold in the console's first ten months on sale.

The figure comes from Global Sales Data's presentation at GI Live: London last month, where the firm's video games consultant Sam Naji took a deeper look at the console's cumulative sales from its launch in November 2020 to the end of August 2021.

GSD tracks full-game boxed sales from 23 countries and digital sales from 49 and covers all the major publishers.

The company found that retail has consistently outsold digital, with 51% more boxed games sold than downloads by the end of August.

November 2020 was the only month where full-game downloads have outperformed retail sales at 950,000 units compared to 840,000. After this, PS5's retail games have consistently outsold digital every month.

And the gap has widened over time. In December 2020, five retail games were sold for every four downloads. By the end of August, this had increased to three boxed games for ever two digital.

In total, 10.14 million boxed games were sold for PS5 between launch and end of August. December, January, June, July and August all saw more than one million games sold within the month.

Meanwhile, 7.51 million digital games were sold during the same period -- and no single month saw more than one million sales."

 



tag:"reviews only matter for the real hardcore gamer"

I voted never.  Nintendo isn't going all digital.  There are too many customers in physical sales.  The "inevitable" all digital future has been talked about for so long now, that it's passe.  It's not coming.



The_Liquid_Laser said:

I voted never.  Nintendo isn't going all digital.  There are too many customers in physical sales.  The "inevitable" all digital future has been talked about for so long now, that it's passe.  It's not coming.

People that say never usually end up wrong. 

Flight by machines heavier than air is unpractical and insignificant, if not utterly impossible.
— Simon Newcomb, 1902



Around the Network
brute said:

Do you have actual numbers to support that physical is dying? Such as total sales of physical games? Or all you have to go by is ratio? Ratio means nothing if software sales keeps on increasing year over year as well as the big companies manipulating the numbers to make it look like physical is dying. 

If we compare ratios to games that have both a physical and digital release, exclude DLC, then we can see it still favors physical.
Physical for video games is here to stay, 10s of millions of physical games are sold year. People need to stop with this nonsense that physical is dying.

We know Switch owners mostly buy physical over digital, but it seems PS5 gamers do as well, once we exclude stuff like DLC and microtransactions from the "ratio"

I'd be curious if we have YOY sales of physical games, but for now the below will do to prove that physical isnt going anywhere.

https://www.gamesindustry.biz/articles/2021-11-19-playstation-5-owners-prefer-boxed-games-to-downloads

"
PlayStation fans across Europe and beyond heavily favour retail for their game purchases, with more than ten million boxed games sold in the console's first ten months on sale.

The figure comes from Global Sales Data's presentation at GI Live: London last month, where the firm's video games consultant Sam Naji took a deeper look at the console's cumulative sales from its launch in November 2020 to the end of August 2021.

GSD tracks full-game boxed sales from 23 countries and digital sales from 49 and covers all the major publishers.

The company found that retail has consistently outsold digital, with 51% more boxed games sold than downloads by the end of August.

November 2020 was the only month where full-game downloads have outperformed retail sales at 950,000 units compared to 840,000. After this, PS5's retail games have consistently outsold digital every month.

And the gap has widened over time. In December 2020, five retail games were sold for every four downloads. By the end of August, this had increased to three boxed games for ever two digital.

In total, 10.14 million boxed games were sold for PS5 between launch and end of August. December, January, June, July and August all saw more than one million games sold within the month.

Meanwhile, 7.51 million digital games were sold during the same period -- and no single month saw more than one million sales."

 

I don't want to spend too long arguing in this thread as the demise of physical is inevitable to me, we live in a digital world now. My mind isn't going to be changed because the growth of digital is clear as day to me and I doubt people championing physical are going to have their minds changed either, that will take a few years for more evidence to stack up. So I don't think there's going to be much point in posting endlessly in debate.

Just want to say that ratio is everything in this discussion. Because as the ratio rises the amount of total sales needed to meet 10m physical exponentially increases. Total sales are irrelevant if digital ratio continue to rise as it has been. I.E once you reach 99% digital sales you would need to sell 1 billion copies to sell 10m physical. The only thing that matters for the end of physical is the continued rise of digital ratio and the only argument for physical not disappearing is the digital ratio will stop rising.

So even if this happens:

2021: 400m physical software, 400m digital software
2022: 410m physical software, 450m digital software.

Yes physical software numerically increased but that's just due to overall software increasing likely due to the specific titles released. The digital ratio is continuing to rise and that's all that matters.

Digital Ratio IS rising for all platform holders and if it continues to rise the end of physical is inevitable. Whether you believe that will take 10 years or 40 years.

But the idea that physical media will even exist in 2060 is a crazy notion. I'd be surprised if the successor to the Switch 2 even has a physical drive, much less their console 6 generations down the road. (Though this is assuming consoles as we know them even exist in 2060).

Publishers and Platform Holders will be pushing digital more and more as the years go by also, they have more control of digital titles and I'm sure they'd love to not have to produce and organise shipping millions of boxes of games around the world for no reason.

So it all boils down to just one thing. If you think digital ratio is increasing now and will keep increasing, physical will die. If you think digital ratio is increasing now but will stop, then you can say physical will survive.

But in 40 years the idea of having to produce and ship millions of physical copies around the world and for users to have to put in a physical object into their consoles and swap discs/cartridges is going to seem archaic and relegated to retro consoles.

People need to remember how far technology has come since 1980 and really ask themselves if they can truly see physical media surviving another 40 years to vote "never". Otherwise we will wait and with every fiscal year that passes and every report of every game like Animal Crossing selling "50% digital!, 60% digital!, 70% digital!" perhaps some will begin to change their mind.

To quickly address the GSD post, from the same article you posted:

"Digital's lead can also be seen in the cumulative sales from January 2019 to August 2021. Across those 32 months, 102 million full games were sold digitally, compared to 81 million boxed games"

Looking at one console, one year, etc isn't enough to see trends. In-fact the data for PS5 physical outselling digital can just as easily be used to support that we are moving towards digital, as the digital ratio is still higher than the PS4 was in it's first year. 

Last edited by Zippy6 - on 21 November 2021

My Xbox Series S is my baby.

Norion said:
RolStoppable said:

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.

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.

That decline is a notable data point but it's basically a regression to the mean after the pandemic catapulted digital sales. The overall trend is still big growth so I don't think it'll take that long a time to reach over 50%, if it doesn't happen this decade it'll for sure happen next decade. I think they'll follow the rest of the industry on this aspect since the positives heavily outweigh any negatives for them so I expect the Switch 2 to be when digital starts to become dominant for Nintendo. The only thing I can see preventing this is if a large enough number of Nintendo fans are uniquely predisposed to physical to the extent they won't ever switch to digital.

When you say "big growth", are you actually focused on the ratio between digital and physical or are you talking about the number that Nintendo presents as digital sales ratio? Because the latter has been largely driven by NSO subscriptions growing in number.

There hasn't been a big uptick in digital being chosen over physical in recent years, outside of the unique combination of Animal Crossing (a game that gets played for a short time every day has much higher acceptance as digital copy than the average game) and the COVID-19 measures that limited the purchasing options of people. You also have to consider that Nintendo has given various benefits to digital over physical, such as 5-10 times as many gold points or vouchers for first party games, but physical remains the prefered option by a large margin and the digital share has been growing at a modest pace at best. The growth of digital won't be continuous until it eventually hits 100%, because it will absolutely hit a brick wall long before that.

The benefits of physical will remain too strong for digital to be seen as an equal alternative. Physical provides actual game ownership including the ability to lend and borrow without hassle as well as the option to sell. Physical also exists in an open marketplace where a lot of retailers compete for attention and therefore offer better discounts than what you'll find on the Nintendo-owned eShop. Physical is also the only viable option for game collectors which have a much stronger presence on Nintendo consoles than on other consoles.

Believing in digital becoming so big on a Nintendo console that it will prevent 10m+ physical copies being sold means to believe that Nintendo's digital policies will become so good that the vast majority of the market will be okay with buying digital over physical.



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

A Biased Review Reloaded / Open Your Eyes / Switch Shipments

Zippy6 said:

(...)

People need to remember how far technology has come since 1980 and really ask themselves if they can truly see physical media surviving another 40 years to vote "never". Otherwise we will wait and with every fiscal year that passes and every report of every game like Animal Crossing selling "50% digital!, 60% digital!, 70% digital!" perhaps some will begin to change their mind.

The music industry was hit the hardest by digital, so let's take a look at that for the United States:

https://edition.cnn.com/2020/09/13/tech/vinyl-records-cd-sales-riaa/index.html

What's interesting is that vinyl sales have been growing consecutively since 2005, so even for music there are people who see value in the physical format. What's even more interesting is that the more modern physical format, the CD, is steadily declining. So when it comes to your question how far technology has come, the answer is that higher value isn't necessarily assigned to the newer technology.

Where music and video games differ greatly is that music is very low cost in comparison to video games, meaning there will naturally be a lot more consideration for purchases among video game customers because they'll pay much more per unit. That's why I don't see video games go in the same direction as music where both physical and digital sales are getting absolutely destroyed by streaming, plus video games are an interactive medium where streaming presents the persistent problem of delayed input. In the first half of 2020, the US music industry had:

$4.8 billion from streaming
$376 million physical sales
$524 million digital sales

In any case, the big takeaway here is that if vinyl isn't going away in the digital-dominated music industry, then the physical medium won't go away in the video games industry either, because it's a given that there will be demand for new physical video games 40 years from now. It's really you who is being unreasonable here.

Another takeaway and logical prediction is that disc-based media will go away in video games. Just like vinyls are seen as a higher value products than CDs, so are cartridges and cards in comparison to CDs, DVDs and Blu-rays. I cannot say if cards will be supplanted by another similar format for physical video games in the next 50 years (cartridges were supplanted by cards), but I can be certain that optical discs will go away because they are perceived as a low quality storage medium.



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

A Biased Review Reloaded / Open Your Eyes / Switch Shipments

RolStoppable said:
Zippy6 said:

(...)

People need to remember how far technology has come since 1980 and really ask themselves if they can truly see physical media surviving another 40 years to vote "never". Otherwise we will wait and with every fiscal year that passes and every report of every game like Animal Crossing selling "50% digital!, 60% digital!, 70% digital!" perhaps some will begin to change their mind.

The music industry was hit the hardest by digital, so let's take a look at that for the United States:

https://edition.cnn.com/2020/09/13/tech/vinyl-records-cd-sales-riaa/index.html

What's interesting is that vinyl sales have been growing consecutively since 2005, so even for music there are people who see value in the physical format. What's even more interesting is that the more modern physical format, the CD, is steadily declining. So when it comes to your question how far technology has come, the answer is that higher value isn't necessarily assigned to the newer technology.

Where music and video games differ greatly is that music is very low cost in comparison to video games, meaning there will naturally be a lot more consideration for purchases among video game customers because they'll pay much more per unit. That's why I don't see video games go in the same direction as music where both physical and digital sales are getting absolutely destroyed by streaming, plus video games are an interactive medium where streaming presents the persistent problem of delayed input. In the first half of 2020, the US music industry had:

$4.8 billion from streaming
$376 million physical sales
$524 million digital sales

In any case, the big takeaway here is that if vinyl isn't going away in the digital-dominated music industry, then the physical medium won't go away in the video games industry either, because it's a given that there will be demand for new physical video games 40 years from now. It's really you who is being unreasonable here.

Another takeaway and logical prediction is that disc-based media will go away in video games. Just like vinyls are seen as a higher value products than CDs, so are cartridges and cards in comparison to CDs, DVDs and Blu-rays. I cannot say if cards will be supplanted by another similar format for physical video games in the next 50 years (cartridges were supplanted by cards), but I can be certain that optical discs will go away because they are perceived as a low quality storage medium.

The problem here is that the niche in the music market can be catered to easily, as the physical media can be played on any compatible device produced by hundreds of different companies allowing this group of people to be supported by many entities. It's not a "Sony Vinyl" that only plays on the "Vinyl Station 5". In the games industry it would require a single player to continue to support it, the platform holder, and the media produced would be playable on only their one device. Making it an even smaller group and the platform holder has to decide if this group remains large enough to warrant continuing support, especially when digital-only offers many advantage to the platform holder.

Also those music figures you posted show physical accounting for only 6.6% of revenue in the music industry and while vinyl may be growing overall physical is falling substantially which you chose not to include from your article?

"However, the boost in vinyl interest hasn't been enough to keep physical sales from dropping. Physical sales plunged 23% to $376 million"

Vinyl grew 4%, Physical overall fell 23%, Streaming grew 12%.

The core of your belief is that physical software remains in demand and is attributed value from a group of consumers that can't be filled by digital releases. This is of course true, the question is how big this group remains and for how long.

You also mention you only focus on Nintendo only, but if MS/PS do switch to Digital only like PC then the result of the rest of the games industry being digital only may erode the fervent demand for physical from those that play on multiple consoles. Equally third parties that are used to only digital releases on PS/XB/PC will likely only release digital versions on Nintendo even if Nintendo offer physical still.

How low does physical revenue have to drop before a platform holder decides physical isn't worth bothering anymore? Before they decide they don't want to produce, store and organise shipping for millions of boxes around the globe? That they don't want to increase manufacturing costs of their devices by including physical media drive? That the space and weight taken up by the physical drive could be used by something else or just reduce the size, weight and cost of the device? That they don't want to have to think about what storage medium they will use for physical games next generation or worse go through the effort of developing their own? How long before Nintendo see's they get the full $60 from every first party game they sell on digital and push further and harder towards it?

Yes there is inherent value in physical games that can't be replaced by digital, but how many people will still continue to care and how long will it be enough people for the "big 3" to continue supporting when an all digital future benefits them the most.

You're absolutely right that disc-based media will be gone first.

Last edited by Zippy6 - on 21 November 2021

My Xbox Series S is my baby.

I would also say that "gifting" a game is much different than gifting music or movies which will continue to drive physical sales.

When parents buy their kids games for their birthdays or holidays or whatever special event they tend to mostly buy physical, as it brings greater joy when a kid opens the package and sees the game case there.

And the whole switching discs to play a different game isnt as inconvenient with Switch as other consoles. Switch games barely have an install and switching the cards takes a few seconds at best.



tag:"reviews only matter for the real hardcore gamer"