Thursday, August 13, 2009

LoadDown Special Edition: The Turning Point

There are lots of subtle turning points in technology -- moments when a novel, initially tentative approach to doing things becomes credible enough to start taking over from the reliable, tried-and-true approach.

I believe one such moment occurred this week on Tuesday, August 11th, when Microsoft distributed an XBox 360 dashboard update that allows the purchase and download of full-scale retail games. It's an incremental step, as these changes always are, a small step forward from the existing XBLA and classic XBox games already available for download. But there are two significant changes here worth noting.

One, it's no longer necessary to use Microsoft store points to make a purchase -- a regular credit card with a real dollars-and-cents retail price is also an option. This means that gift cards, virtual points and the under-$20 purchases generally associated with them are no longer the only model considered viable for downloadable gaming. Standard e-commerce has come to the console, making the whole "points" concept seem suddenly rather quaint.

Two, many of the first wave of XBox 360 downloadables are major games that are still viable at retail -- for example, Assassin's Creed, Bioshock, Elder Scrolls IV: Oblivion, and Mass Effect. These aren't the very latest, hottest titles, but they are excellent games that still move units at a discounted retail price. With this technological and business decision, Microsoft and its licensees are seriously cutting out the middleman. No disc manufacture, no transportation and distribution costs, no Wal-Mart or Best Buy or Gamestop retail markup taking a cut. No used discs floating around in the aftermarket, absorbing ongoing demand without producing any new revenue for the publishers. No worthwhile titles marked down to fire-sale prices because too many physical copies were produced, no lousy games clogging the racks or the bargain bins.

I'm a big fan of downloadable games, largely because the small retro-style games I love are only viable in the $5-$15 world of the download. But I have plenty of space on my 360's hard drive at the moment, and when I'm hankering for a full-blown experience, the XBox Game Marketplace is the first place I'm going to look from here on out.

This, my friends, is a sea change for the videogame industry. Instant gratification for gamers, a cleaner/purer business model for publishers, and a necessarily more hardware-centric model for retailers. Economics are all about efficiency -- there's no real reason a videogame needs to exist as a disc in a plastic case with a paper manual, supported by a chain of people and vehicles moving it from one place to another. If Microsoft's experiment works, and I am very confident that it will, we may soon see new releases available for download on release day. I look optimistically forward to a new era, when no great game is in short supply, or ever goes out of print.

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