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Market facts > Digital distribution
Digital distribution - can we learn from the mistakes of the music industry?

The music industry shunned this delivery mechanism for a couple years, however music fans got DSL and downloaded in their droves. We have all witnessed what happened when fans could not buy their favorite song online but they could download an illegal copy for free. Your game is going to end up on the net very shortly after release, make sure that you are making money from that copy!

Digital distribution of games is a great advancement and one that both developers and publishers can capitalize on. Nothing beats the ease or convenience of playing a demo, finding that you really like the game and then purchasing and unlocking the full game. Retail stores selling boxed copies of a game will always play a part in the distribution chain but digital distribution will be the channel that will see the largest growth.

A report by Point Topic estimated that there were 150 million broadband lines in the world in December 2004, Asia/Pacific has 42%, EMEA has 28% and the Americas have 29%. These figures are expected to rise to 215 million broadband lines by the end of 2005.

Digital distribution offers a lot of promise to the games industry. It certainly offers publishers a way to reduce the COGS (cost of goods sold). It ensures that a publisher's full catalogue of games is available for purchase, 24 hours a day, 7 days a week, in all countries around the world, forever! It allows for minute by minute sales tracking and it means that your game will never be out-of-stock to a player living in any small town anywhere in the world.

Game designers and developers have found that digital distribution offers a channel for smaller games, episodic games or more niche and original games. These are exactly the types of game that a publisher will not green light in the current retail dominated model. While a developer will always need a publisher (or at least someone with commitment to their game and with money for advertising and marketing), they do not necessarily need a publisher with a small army of people involved in getting physical boxes onto real world shelves.

Game players should also benefit from digital distribution. A reduced price point would be good, no box/disks/manual is great (and environmentally friendly), but the real key is the ability to try a demo that can be instantly unlocked into the full game. Instantly unlockable demos are the ultimate impulse purchase system for games, as a gamer I just hope it does not spawn a wave of fantastic demos and disappointing full games.

Will digital distribution happen on next-gen consoles? Well Microsoft already have Xbox Live™ Arcade up and running with some classic and casual games available. Sony has been tightlipped, but you have to expect a greater role for online in their next system. Both companies should give more information on their plans at E3 2005.

If you are interested in finding out more about digital distribution in foreign markets then send an email to

Digital distribution systems Information
Akamai Akamai Media Delivery™ will be used by Turbine to deliver games, trailers, demos, etc.
Exent The EXEtender™ Product Suite is widely used by portal sites and by publisher sites. Customers include Yahoo! Games and Atari.
Trymedia Systems ActiveMARK™ is a suite of technologies is used by IGN Entertainment, Cartoon Network Power Play games and Novalogic.
Softwrap Softwrap™ has been used for some games by SEGA-Europe, Atari and Eidos.
Steam The system from Valve that delivered Half-Life 2
Phantom Game Service Infinium Labs™, Inc. plan to introduce this service in 2005, players will need a Phantom™ Game Receiver, a TV, broadband and a subscription to the Phantom™ Game Service to play.
Boonty Digital distribution system and casual game aggregator.
Ztorm.Digital Store Customizable internet store-front with anti-piracy features, currently used by publisher Paradox Interactive.


Online distribution portals Information
Direct2Drive IGN ENTERTAINMENT, INC. is the provider of the Direct2Drive store, with hundreds of core games available for download. The Electronic Arts casual game site.
Big Fish Games The Big Fish Games casual game site.
RealArcade The RealNetworks Inc. casual game site.
MSN Games The Microsoft casual game site
Yahoo! Games The Yahoo! casual game site offers hundreds of casual and mobile games the Yahoo! Games on Demand service offers more than 175 core games for download. features some complex and impressive games created with Macromedia's Director authoring system.

Game Tap A new offering from Turner Broadcasting System, Inc. launching in fall 2005.


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