Take-Two CEO: Digital distribution Not the Holy Grail of Gaming - News
by William D'Angelo , posted on 03 December 2014 / 5,116 Views
Take-Two CEO Strauss Zelnick in a talk at the Credit Suisse Annual Technology Conference, attended by GamesIndustry, stated that digital distribution is changing the gaming industry. However, the amount of profits in digital sales is not that much higher than games sold at retail.
"We're indifferent, because we can't choose how a consumer wants to consume," said Zelnick. "We need to be everywhere. We need to be flexible to make our products available. The margin dollars are a bit higher, but not so much higher I can say in good conscience to you, 'Here is the holy grail of our business. In addition to all of the great stuff--new generation, wind at our back, high quality, a vastly more rapidly growing area of entertainment consumption than anything else. All of that good news would be even better news, which is that our entire model switched from one to another that has a higher margin.' That's what people want me to say, but it just doesn't have the benefit of being true."
"It is almost certainly true that people will consume more and more digitally, as they do, for example, with music. But right now, physical distribution is still 70-80 percent of our business. And physical distribution partners are our primary distribution partners, and happily so."
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A life-long and avid gamer, William D'Angelo was first introduced to VGChartz in 2007. After years of supporting the site, he was brought on in 2010 as a junior analyst, working his way up to lead analyst in 2012. He has expanded his involvement in the gaming community by producing content on his own YouTube channel and Twitch channel dedicated to gaming Let's Plays and tutorials. Outside, in the real world, he has a passion for the outdoors which includes everything from hiking to having received his B.A. in Environmental Studies. You can contact the author at wdangelo@vgchartz.com or on Twitter @TrunksWD.
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no surprise these steam sales are bad for the industry they let consumers hord their money and wait for the next sales instead just buy it when they want. Retail is more flexible to lower the price and adjust to market condition and different regions. Steam is very monopolistic because its only one distributor after all.
I like digital, it's convenient and lets me not have to worry about storing my games. HOWEVER, many digital games are bound to services and when they're on systems, you have to hope that there's BC and/or the hosting servers for the old systems never go down, otherwise you can lose content to the old stuff.
Digital is a risk tbh, which is why I prefer physical in most cases.
digital market place to trade and sell games, that is what is needed
Good points. Plus when steam is eating 1 / 3 of your cash its not perfect. Digital only future will screw us.
Because Sony/MS/Nintendo doesn't take a cut from all the games on their systems...
