Report: Digital game sales to surpass retail sales by 2013

By Jeff Mattas, Sep 07, 2011 6:00pm PDT

Market research firm DFC Intelligence predicts a sea-change in the video game industry. Their projections put digital sales above traditional retail sales by 2013. This coincides with the organization's estimate that it expects worldwide video game sales to grow to $81 billion by 2016--up from $66 billion generated in 2010. DFC's revenue projections take into account "console hardware, software, portable hardware and software, PC games, games for mobile devices such as phones, tablets, music players, and other devices that play games as a secondary feature."

In a recent interview with VentureBeat, DFC analyst David Cole asserts that physical software sales actually peaked in 2008 ($58 billion), and sites the global financial crisis that struck towards the end of that year as the cause of "a big shift from $60 console games to free-to-play games played online via PCs."

With the next generation of home consoles not expected from Microsoft or Sony until 2014, Cole sees even more opportunities for the digital sales front to gain more momentum. "The issue is Sony and Microsoft don't feel like they're in a hurry to introduce new consoles," he said, adding that while the Wii U is expected much sooner, the firm doesn't expect it to achieve the same market penetration as its predecessor. Strong initial sales of Nintendo's new console are anticipated, however.

DHC Intelligence also expects the industry to grow just three percent in 2011, but that the overall revenue attributed to physical sales will drop to $43 billion by 2016. Conversely, digital sales for PC, console, and mobile games are expected to boom during this same period, rising from $19.3 billion in 2010 to $37.9 billion.

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