Games retail will dry up

High Street retailers will soon realise that rapid uptake of digital downloads renders console sales unprofitable – and destroy the hardware business by refusing to stock major platforms.

That’s the vision of the boss of online games network WildTangent – which reaches 15 million gamers each month and counts Sony as an investor.

Alex St. John – who was pivotal in the development of Microsoft’s DirectX technology – talked at Leipzig on his ‘heretical’ vision that there will be no console market by 2020.

St. John believes that the struggle between retail and publishers will leave the way clear for PC to become the ‘home console’ of choice – with ad-funded gaming propelling the market forward.

It’s obvious that we’re looking at the last generation of consoles,” St. John told MCV. The game market will be dominated by ad-funding, micropayments and massively multiplayer games. The retail business for boxed games will completely dry up.

Sony is a small investor in WildTangent. I’ve spent lots of time explaining how our business works, and they asked me who my main competitor was. I said: ‘You are.’

The only reason a retailer carries a console is because of all the games they sell. If the platform holders are monetising games online, the retailers don’t have a reason to give them shelf space. So the online model puts you out of business because retailers don’t need you. That puts the power in the hands of developers.”