Retro STrife wrote:bluenote wrote:I disagree with this point. All you need to do is look at the music industry. Cds are no longer in Best Buy, and there's very few now in Target, Walmart, etc. Has this hurt the record labels? Not at all. They have embraced the streaming model and record labels are making record (excuse the pun) profits. Yes, bands are struggling but the record labels are now flush with cash, with very little retailer presence.
I partially agree, but I think there are two key differences for the video game industry compared to the music industry:
1. You can't sell consoles digitally. You need the help of brick-and-mortar stores to sell your consoles. (Whereas in the music industry, the record labels are entirely separate from the electronics companies that make the listening devices.) Wal-Mart only wants to sell an Xbox One if it will also have the chance to sell games and accessories with it. Then again, I guess Wal-Mart could still have a wall of "download code" versions of games, even when physical releases are gone. Just little cards you buy to get each game online. GameStop, though, relies more heavily on physical media for its business model.
2. In the gaming industry (unlike the music industry), publishers rely heavily on retail stores for their marketing. GameStop is always pushing games for companies. Best Buy makes their own commercials about various games and systems that you can buy at their store. You might even see a big cardboard sign for a new Nintendo game as you walk into Wal-Mart. So the publishers need to cultivate that relationship.. whereas the music industry relies more on radio and TV to market its artists and music, rather than retailers.
Very good points!
It will be interesting to see what happens in the next 5 years or so.