I've ended up saying this in quite a few threads, so I'm creating this thread to discuss the main reason digital distribution will not be implemented next gen.

Retailers would not like it. This is the reason.

Elaborating further, we can assume that by the end of their life a console will have an attach rate of 10. This represents perhaps $100 - $150 (figure pulled out of thin air. Does anyone actually know how much the retailer makes per game?) in profits for the retailer. Add in that they deal in used games, and probably make somewhat closer to $200 profit on games for each console.

Note that I am making the assumption that a person buys all their games from the place where they buy the console. For large numbers of people this approximation is valid.

Therefore, retailers will only sell a digital distribution only console for $200 more than they otherwise would have.

And there are perhaps other considerations, about which we usually do not consider. It is quite possible that Sony and MS have a special deal with shipping companies where they get a special price on shipping consoles but pay extra to ship games. This would no longer be possible, and thus prices would increase more.

The only way we can get to digital distribution is by all the console makers making the transition over a number of generations. Wiiware/PSN/XBLA will become more important over the generations and slowly it'll become more possible to kill of retail games

Thoughts?

How come retailers would not like it?

If they can make a profit on it, of course they will sell it.

I'm more clever than I thought I was.

Do you know where I rent my games?

Obviously you don't because asked in your post

Nevermind...

Thread #9620 contains what btw?

PSP, PS3, 360, DS, and Wii are all doing fine as digital distribution consoles atm, whatcutalkinaboutOP?

Haha, nice one Rol

One Touch - retalers don't make much on consoles - they don't quite make them loss leaders, but they make very little. If one console was download only and one wasn't they would be best off supporting thatone - the more people that buy it the more money they get later. If they were to sell the other it'd only be if they could make heaps of money on it

Wiinentdo, I mean purely downloadable games - no way to purchase from retail

I hope that new releases become downloadable in the months to come. I just don’t like going to the store some times. Retailers wouldn’t be that effected cause there is always a market for physical products. I have been thinking about this subject for sometime and one of the major reasons why a console that is only reliant on digital distribution (would fail)is due to the Internet providers. Bandwidth and going over your monthly limit and getting over charged sucks. Some people don’t even know their limit and most do, but have no way to control it. My friend’s bandwidth is only 50GB a month! Downloading like 3 PS3 games could kill his monthly bill along with his movie downloading habits. This brings me back to the retailers. If you have a bandwidth limit and you tend to go over that easily, you might want to just buy the game(music,etc) on a disc. There is always gonna be a market for physical media products.

I agree, actually. The brick-and-mortar retail shops would despise a downloadable console -- they make heaps of money from software, not hardware, and unless the console accrues a ton of sales in a consistant manner, they wouldn't touch it.

If retailers don't carry it, it'll be real hard to sell directly. Downloadable games make the middlemen angry.

Already GameStop has pulled games because they are available on Steam or D2D when they are released. Downloadable games would not only kill their regular retail business, it will kill their used sales as well. They *hate* downloadable stuff.

Ok, I know I have said this before but here it goes again.

There will be a place for DD but I doubt we will ever see complete end to physical media with even the next few generations.

The main reason being is that not everyone is in a city and even fewer of those people have access the broadband needed for DD. Even right now, Comcast caps you at 100 gigs. In this case that would be about 2 and half Blu-ray disks. So basically you would download 2 HD movies or games and then worry about being cut off for the rest of the month.

It gets worse for people outside of cities. The only two options being 56k and Satellite. We all know how horrible 56k is so I will leave you to try and remember it.
Satellite is almost as bad, they have decent rates of download but their caps are ridiculous. Hughesnet cap is somwhere around 500 megs a day, and wildblue is around 12 gigs a month. I am curious what you would really be able to do with something like that as far as a distribution method.

A great deal has to change as far as infrastructure in order to go solely DD. It works for music because there is a smaller amount of data transfer, but there are still plenty of CD's out there in shops

Lost and damned is sold at retail.

As would next gen games be your point is stupid

So you agree with me - a console with no option for retail purchases would fail, and the way to bring about digital distribution is to offer it as an option, one that becomes increasingly important over the generations. Cheers