Retail still the main revenue source for development

Retail still the main revenue source for development
Michael French

By Michael French

November 15th 2007 at 12:19PM

Despite digital distribution's rise, retail still accounts for 82% of global market

We've just published the last installment in our exclusive research pulled from UKTi's Playing for Keeps report - data which reveals that retail accounts for some 72 per cent of the global software sales market.

Available to read here, the research profiles the seven major revenue streams available to developers and publishers, and gives their total market value.

Retail is the clear winner, claiming 72 per cent of the market. Despite the much talked about rise of digitial distribution, full game downloads to PC and console title downloads only account for 0.5 per cent of the market (0.4 per cent and 0.1 per cent respectively).

At the same time, while casual PC games do claim 3.2 per cent, this means the total for 'boxless' game content sold direct to consumers to still just 5.2 per cent of the global software market.

That figure is outstripped by MMO subscriptions, at 6.7 per cent of the market, and even downloadable content and item sales, which take 7.3 per cent. Mobile wins out above all the other non-retail channels, however, accounting for 10 per cent of the global software market.

But it is retail's dominance and inherent inflexible structure which has allowed all the above new sales channels for developer to have come from nothing in recent years.

Says the research: "Retail is (and will remain for the foreseeable future) the dominant sales and distribution channel for games. The mechanisms behind retail – manufacturing, infrastructure, POS, inventory, sale or return agreements – are the foundations of the industry’s most common commercial models, whose rigidity is reflected in common commercial models but is also driving innovation in digital distribution."

The report was compiled by Games Investor Consulting.

Click here for the full market breakdown, with profiles of each distribution channel, including benefits and advantages plus how they may evolve.