Woe and lamentations, sorrowful ululations. These are the noises coming from the doom-sayers of gaming, who point to miserable sales of boxed games as proof that we are tumbling down the slippery cobblestones paved to hell itself.
Game sales are down 20% year-on-year. Gaming has “lost” 12 million members. Wring thy hands and await apocalypse ye weeping wretches.
But hark. Rub those tear-stained cheeks. Is that the sound of champagne corks and jolly huzzahs. What devilry is this?
‘Tis none other than Telltale Games celebrating its surprising status as top of the gaming world, and not a box to be seen, not a single digit wobbled or disturbed upon NPD’s brick wall of stats.
The biggest selling boxed game in August, in the U.S, was Darksiders II, which “shifted” an okay-ish 247,000 units across all formats. New stats released to IGN by Telltale tell a, uh, different tale.
The Walking Dead, now into its third episode, managed 315K unique sales in the same month in the U.S. Note that Episode 3 launched on August 28th. Darksiders II launched on August 14th.
Globally and to date, The Walking Dead has managed 3.8 million episodes sold to over 1.2 million unique customers. It’s just a glimpse into how rapidly gamers are adopting digital as a way to buy games. When Minecraft arrived on XBL it sold a million units in five days, and another two million in the next few weeks. Borderlands 2 was launched simultaneously on PSN as in retail stores.
Although boxed sales still vastly outweigh digital sales in the console market, these trends are all great news for those of us who just can’t see the point of having things clutter up our homes, and prefer to consume our games the way we consume music and movies and messages.
Head of publishing Steven Allison told IGN, “What you're seeing is that new titles are showing signs of consumer transition to digital. Of the products that are most interesting to consumers right now, a couple of them are digital only, and not available to retail, like ourselves and possibly Minecraft. Minecraft did better than we did in the month, but I would say that Minecraft and Walking Dead did better than the rest of that NPD list. I don't know of any other digital games that can make that claim. But I think we're seeing a product transition as far as comfort. Those hardcore gamers are getting comfortable with digital, especially if it's not on store shelves.”
Telltale isn’t some mad-eyed revolutionary, thirsting for the end of boxed games. A retail version of The Walking Dead will be released after the final episode launches, and IGN has first news of the release date. Allison said, “We are currently committed to Tuesday December 4th, 2012 at retail on Xbox 360 and PlayStation 3 in North America for the first season of The Walking Dead: The Game including all five episodes. European and other territories for retail release to be confirmed.”
He adds, “Just about every medium has made the transition to digital and we're going to continue to see more growth, probably at the expense of some retail sales. But I don’t think it will be like music, where retail for music just doesn't exist anymore. It’ll probably be more like DVDs and movies, where there's a pretty significant retail footprint for movies still, even though digital is really strong. I think we'll end up, in a few years, maybe 50-50.”
This tallies with Electronic Arts’ view that digital will overtake retail in two or maybe three years time.
But buying games from digital does have its drawbacks. Browsing online retail stores can be a painful experience, a choice between living with a small number of the store’s chosen favorites, and searching for something fairly well defined in one’s mind. At the moment, buying games on PSN and XBL is painless because there are a fairly limited number of titles available. This problem is called ‘discoverability’.
For games companies the challenge is still to let you know that their games are available and that they are worth trying. This almost always costs money
Allison says, “Just because we're coming out on digital doesn't mean we're allowed to drop the need to publicize and market our game to the masses. This is where a lot of digital companies kinda fall apart. We try to take it as seriously as if we were putting a $50-million-dollar game in a box at GameStop. We work the PR hard. We get awareness high. We give people jonesing for it, and then it's our job to point them at Xbox Live or at PSN.
“We're not just hoping that when we launch, the stories about ‘What's coming out this week on PSN?’ drive it enough. The obligation to market, to drive sales, is no different than if it was at retail. It's exactly the same.”
But if the concept of selling things to people is the same, the nuts-and-bolts of doing business with people digitally are vastly different, and, according to Telltale, a whole lot better.
“That whole middleman is gone, more or less, and that's the really great thing about making content digitally. There's all kinds of costs that just go into building products, paying those licensing fees, selling it for wholesale, the retailer getting his cut, and then paying for that [in-store] marketing. That is all gone on the digital side. All our digital partners get, more or less, 30 percent of every sale. But that's it. They don't charge us for promoting it. They get 30 percent, so they like promoting things that are going to move. When you get into that relationship, it's a different dynamic. There's a lot of close collaboration. You have to work that hard as well.
“I’ve worked in this business for 15 years doing retail publishing, and I probably spent 75 percent of my time dealing with issues at retail, issues with shipping stuff, what we were doing for MDF [ads in stores]. Now I spend two percent of my time on that. It's so refreshing.”
Digital dos have its drawbacks for gamers, but it is refreshing too for those of us who don’t want to go into stores, or wait for boxes to turn up at our doorstep. This is why it’s growing so fast, while boxed sales are declining. However, that’s not the same as saying that gaming - even hardcore gaming - is dying. Not the same at all.
I write opinions on games pretty much every weekday. Recently I've been talking about Dishonored, Counter-Strike, Journey, Sound Shapes, Wasteland 2, Virtua Fighter and Miiverse. You can follow me on Twitter to debate and argue about games. Or IGN.
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