Couple of quick things before I get into the meat of what I want to say. I bought Geometry Wars 2, and after owning my Xbox 360 for a couple of years, I finally found a game that makes me feel like adding some friends so I can compare scores. So if you have the game, send me a friend request, my username is 'bacchi' (Note : I don't really play online so don't expect me to play other games with you, at least for the time being).

I mentioned the difficulty of Devil May Cry 4 in my review... then I played Ninja Gaiden 2. Lost 80% of my life in my first encounter, and died in my second. Died a number of times before getting to the first boss, and then got annihilated about 5 times by said boss. I can see that the game is good and I wanted to like it, but no thanks. Call me weak or bad at games, but if a game is making me frustrated, it is not fulfilling its purpose.

Anyways, on with the topic. I had my recent discussion about piracy, and someone from EA discussed the apparent problem with second hand game sales. He was having a whinge about the fact that if people buy second hand games, no money goes to developers (a similar argument some people made that second hand games are just as bad if using the 'no money goes to the developer' argument in my piracy topic). Second hand markets exist for just about everything else, so why not games? Apparently because it is data, and the quality never deteriorates like furniture or books might.

We are already seeing the start to addressing both of these problems; digital downloads. I've bought some XBLA games and Virtual Console games. I can't sell them back or to anybody else, and there doesn't seem to be an easy way to illegally copy them should I want to. Most of these have been small games, but we have seen Warhawk and Burnout Paradise as full priced games from this generation available for download. I suspect we will begin to see more and more games released as both digital downloads and on-disc simultaneously for the rest of this generation. But what about next generation? What if download is the only way to get games?

What if you buy your console, and need to be connected to the internet to get your games? What if they also had a rental model? For example, you download the full game for free. One would hope that you get to play the game for half an hour for free, as a demo. If you keep playing after that, you start paying by the hour, where money gets taken from your account (like Live points, or the PSN Wallet), until you have played the game for long enough that you have paid retail, and thus can play it whenever you want after that for free.

Does that sound compelling? Here are some potential advantages and disadvantages for publuishers/developers and consumers

Developer Pros
Inhibits Piracy - I've not heard of any downloaded games being pirated this generation on consoles. Even if they are cracked, it is unlikely that it will be anywhere near as widespread as being able to copy a disc like we currently can.

No second hand sales - This addresses developers concerns that each copy sold into the market place might be played by a number of gamers, as they can't be sold or traded to someone else.

No need for production - Publishers get rid of the physical costs associated with duplication.

Sell direct to the customer - Publishers take out costs associated with distribution costs and retain the retail mark-up.

Earn all rentals - As well as getting rid of all second hand game sales, they earn all of the rentals that ay currently go to other services.

Longevity - Some games lose their steam after a while, at which point it is no longer cost effective to keep them in production. Once a game starts to sell very slowly, it will only take minimal server space to keep it available at all times for those late comers that do want it.

Developer Cons
Initial Server Requirement - If a game is expected to sell big, it is likely to need a lot of server space in it's first week or month. If they get the expected demand wrong, they may not be able to get the game into the customers hands quickly. I don't know how much server space costs; the costs here may more than outweigh duplication costs.

Customer Pros
Availability - Any game is always going to be available. You never have to worry about your local store not stocking a lesser known game. Every game is also available for rental, where that game may not have been offered via any rental service available to you.

Customer Cons
Hard Drive Space - Every game is going to take up hard drive space, and we would need to buy additional hard drives (which I imagine would be 'installed' to a console so the games can't be taken anywhere else).

Bandwidth - Perhaps most importantly, game downloads are going to suck up bandwidth, and in all likelihood the next generation are going to be larger than they are now. Some consumers may require internet plans with larger download limits to cater to their hobby.

Price probably won't go down - Despite using up extra bandwidth, and us needing to pay for storage space, I doubt very much that savings publishers may make from absorbing the retailers margin and distribution costs, and extra revenue from less piracy and second hand sales, is going to translate into lower prices for consumers.

No physical products - Some people simply like physical products. It would also mean the end of collectors editions. I guess those associated products could still be available, but you would have to buy them online if the retail market died out.

Can't sell - Once you have paid for a game, you can't sell it.

Gone Forever - While I put in the developer pros that games can be available forever, if they decide to pull them or the services eventually go under, those games can never be acquired by someone else, unless they buy a console with the game already on it.

I think I'm going to stop there. When I started writing this, I thought it was an interesting business model. Now I'm depressed. It seems like all potential upside for developer, not so much for the consumer. I'm also wondering about my current downloadable games. What if the current slate of XBLA games go by the wayside come next generation and my hard drive stuffs up? Does that mean I can never acquire that game again? I'd never thought about that before.