OR, HOW I LEARNED TO STOP WORRYING AND LOVE STEAM
Used games are on their deathbed, and most gamers are not happy. Everywhere you can hear the death knell of used games, from whispers of used game restrictions on the next Xbox AND Playstation, to the increased success of digital media distribution via services like XBox Live, Steam, and Amazon.
Further, gamers are increasingly willing to accept severe and even game-breaking Digital Rights Management (DRM) to play a great game, as evidenced by strong sales of Bioshock and Diablo III. The widespread adoption of Steam signals the loss of the DRM wars for consumers. Sales figures don't lie.
Not to put too fine a point on it, but if a game is good enough, to hell with our personal values, we're going to buy it.
Software Piracy, DRM, and Dolla Dolla Bills, Y'all
For the most part console gamers have had the luxury of avoiding DRM - sort of - because they purchased their games at retail stores. You don't (usually) need DRM when there is a mechanical requirement to play a game, such as a cartridge or disc. This is great for developers, since you have some assurances that your game is less likely to be pirated on a console than on a computer. Even though digital distribution services have gained significant popularity, some estimates of PC game piracy are as high as 93% to 95%. That's probably a bit far-fetched, but consider that in 2011 Crysis 2 was downloaded approximately 3.9 million times. Granted, Crysis 2 is only about $10 today, but back in March 2011 when it was released it was $60, dropping to about $30 by Christmas. Assuming the lower of the two, a $30 sale is about $117mm in lost gross revenue to Gamestop, Crytek, and their distribution partners. Now, include CoD:MW3, Battlefield 3, Fifa 12, and Portal 2 - each of which had over three million downloads via Torrent themselves, and you hit a half-billion in lost revenue pretty fast. Now expand this to thousands of games over the past three decades, including console games that have since been ported to emulators, the Playstation discs that were copied, etc. and you get into multiple billions of dollars in lost revenue.
It is important to discuss piracy in the context of used games because it highlights the financial motivation to move to digital distribution. The incentives are there and the technology exists to enable developers and distributors to almost completely eliminate the viability of used games, but there is some hesitancy due to the probable backlash from gamers. Honestly, though, it doesn't matter: Pure digital distribution is coming. There is too much money involved for the industry to notmake the move.
Artax represents physical game distribution. Atreyu represents gamers. The Swamp represents the gaming industry.
What to expect
Arbitrary prognostication has its pitfalls, but we can make some logical conclusions based on existing industry rhetoric and sales numbers to prepare ourselves for the future.
Cheap storage and significantly greater internet adoption since the introduction of the current generation of platforms virtually assures at least the availability of retail titles both online and in stores in the next console generation, with brick and mortar outlets eventually going the way of Circuit City. Expect the next generation of consoles to have gigantic hard drives and additional "cloud" storage. An ambitious manufacturer might even go solid state (faster than traditional platter drives, but still more expensive). Expect titles like Call of Duty and Assassin's Creed to be available for download on next-gen consoles, as a result, and downloadable content, or "DLC," to go away in favor of the more marketing-friendly "expansion content."
This will certainly be a problem for many gamers living in areas with restricted or spotty internet access. It's also going to be very annoying for military personnel overseas. Downloading a multi-gigabyte file via a 56k connection - which many people still use - is just not feasible. But with more (many more) consumers gaining access to high speed internet connections (source) it becomes easier for developers and distributors to stomach the loss of sales to a percentage of its base with spotty internet in order to retain more control of that distribution, reduce opportunity loss from piracy, and reduce manufacturing costs for packaging, shipping, etc.
The industry will spin it in a positive light; at first it will be a convenience: Why go to Gamestop when you can order the game right now from your console with a credit card? Shortly thereafter games purchased in the store will require an online connection for "updates," though what it really means is authentication servers (e.g. Diablo 3, and some of this is already happening today). Finally, you'll get download exclusives, followed by the elimination of retail distribution entirely.
Will it happen overnight? No, it will happen over the course of many years, just as Steam and other online outlets have slowly taken over the PC gaming marketplace this past decade. And it's not all bad: Anyone who uses Steam regularly will tell you that there are also a host of conveniences to online distribution, not least of which is the actual delivery method of the game. You have online sales, instant tech support, community tools, contests, and occasionally special events. There's also fierce competition in online distribution right now, leading to some pretty amazing sales through Steam and Amazon, in particular.
All of this still isn't quite the same as reaching up on the shelf and dusting off that old copy of Super Mario Brothers 3 or, in my case, Frogger. You can't swing by your local store to get a discounted used title, either. But I firmly believe that it isinevitable. Just as the vast majority of consumers now purchase their music online and increasingly view their entertainment via streaming services like Hulu and Netflix, so too shall video games soon be delivered exclusively via the internet, eliminating the used game marketplace, and fattening the margins of developers and publishers.
Resistance is futile. Your life as it has been is over. From this time forward, you will download all game purchases.
Sources
Defective by Design
Gamespot News
Akamai State of the Internet
Ubisoft CEO claims 93-95 percent piracy rate on its PC games
Kotaku
Torrent Freak
Defective by Design
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