Ditching the physical: 16% of consumers play digital only

Publisher Electronic Arts isn’t planning to abandon its online store/platform, Origin, any time soon. That’s because more gamers than ever are purchasing their games digitally.

Around 36 percent of U.S. consumers play downloaded games, according to an NPD Group survey of 6,000 U.S. residents 13 and older. They’re purchasing and playing games through established distribution networks like Steam, but they’re increasingly using the downloadable services like Xbox Games Store, PlayStation Network, and Nintendo’s eShop on consoles, handhelds, as well as mobile. Around 16 percent of respondents confirmed that they have dropped physical packaged games altogether.

“Most digital players, regardless of device, don’t plan their purchases,” NPD analyst Liam Callahan said. “They purchase simply when they find something they like.”

The console audience, however, is more likely to preorder games. Callahan thinks that the new systems from Microsoft, Sony, and Nintendo — with their expanded digital offerings — will see more gamers turn to downloads as an option.

“As more consumers purchase the new consoles, we expect to see greater digital spending from console gamers as consumers indicated that purchasing these consoles will most likely increase their digital spending,” he said.

Electronic Arts chief operating officer Peter Moore also spoke on this topic at the Digital Entertainment World conference in Los Angeles this morning, according to GamesIndustry International. He said he foresees digital sales overtaking traditional physical revenue within two years, and Moore explained that the people making games need to adapt to that.

“The games industry must embrace ‘creative destruction,'” said Moore. “There’s nothing an industry can do to stop a shift in consumer tastes and habits. The most important thing for EA — and much of the industry is headed this way with the digital transition — is that games are becoming live operations. That means they require massive infrastructure with customer service and global billing.”

EA has a number of mobile games like The Simpsons: Tapped Out that it runs as a service. That means the publisher gives it away and sells in-app items and goods while continually improving the overall experience with new features and updates. EA also has its PC digital-distribution service Origin that it sells premium games through. While different from the free-to-play model, the company uses Origin to run services for its PC games like Battlefield Premium. This $50 membership gets players access to additional downloadable content like new maps as well as expanded customization and support features in EA’s modern-military shooter.

In terms of digital gaming on consoles, Microsoft was planning some interesting ideas for its Xbox One console to get out ahead of the digital transition. It originally planned to release the new console with a suite of digital-rights-management options that would have enabled gamers to install their physical games to the system and then never need the disc again. The company also had forward-looking features that would have enabled game sharing across its Xbox Live network, but these ideas were also going to introduce restrictions to selling used games as well as renting.

Gamers were not happy with Microsoft’s plans for the Xbox One, and the company eventually withdrew them. The Xbox One today has a full digital store that has all of its games available for purchase, even if they’re available on disc, but it otherwise operates much like the Xbox 360.