EA Predicts End of Buying Games In Stores

Video games publisher Electronic Arts says that the end is coming for brick-and-mortar video games stores.

Speaking to Eurogamer in an interview yesterday, EA Sports Vice President Andrew Wilson made clear his thoughts on the future of game purchases.

"There will come a day where I think that people will stop going into GAME and GameStop. And I use those purely as examples of retail," said Wilson. "It's important for retailers and us to understand what the consumer wants in the future."

EA, of course, has something to gain in the possible demise of chains such as GameStop, as the company just launched a direct-download service named Origin last month. Compounded with the publisher's recent acquisition of PopCap Games, the evidence is pointing towards an intended bolstering of digital services. 

This falls in line with recent statements by CEO John Riccitiello that the company intends to move away from the traditional packaged goods model. "Over the coming years, we will transform EA from a packaged goods company to a fully integrated digital entertainment company," Riccitiello told investors.

Even GameStop itself seems to be preparing for such a future: the company launched a direct-download service last year and purchased the Kongregate.com gaming website. More recently the company acquired a streaming technology company as well as another digital distribution platform.

The move to digital seems to be paying off for both companies. EA's digital-games revenue grew by 46 percent year-over-year to more than $800 million with a projected revenue of over $1 billion in the next fiscal year, while GameStop's digital storefront generated $300 million in revenue with a projected growth to $1.5 billion in four years.

Many recent EA customers have seen the beginnings of this move to digital with the company's "Online Pass" system, which requires gamers with new copies of games to register online with an included non-transferable code in order to play online. Those that buy used games must pay a pre-determined amount (about $15) for a digital pass, which means that EA is now able to profit off of used game sales and even pirates that want to play their games online. Combined with constant downloadable content releases and cycling out servers for old games, EA seems to have their digital strategy set.