Friday, November 13

Gamestop looks to take on Sony and MS at the DLC game.

Fresh from the BMO Capital Management Digital Entertainment conference, Reuters is reporting that Gamestop is getting into the DLC game. Through the new service, shoppers will be able to pay for a game in the store and it will be available for download once they get home. Consumers will also be able to prepay for any confirmed DLC that is set to come out with a game, and once complete it will be available for download.

With overall sales in stores down year-on-year 6 to 11 percent, Gamestop is definitely in need of alternate sources to bring in revenue. However this whole announcement stinks of desperation from the US's largest game retailer. What motivation will people have to go to a store to pay for a down-loadable copy of a game as opposed to a hard copy? With Sony and MS having their own DLC offerings on their respective consoles and other competitors such as Steam and Direct2Drive on the PC end of the gaming frontier, there doesn't seem much reason to go to a brick an mortar store to buy a download version of a game. Gamestop has already seen sales slide due to the current economic crisis as well as a reduction in their in house peripherals due to increased constraints by the big three console makers. This generation all three console makers severely limited the creation of 3rd party controllers by adding patent locked features such as motion control and blue-tooth connectivity which makes it increasingly expensive for Gamestop to continue slapping there name on cheap 3rd party devices to generate peripheral revenue. With the current push for more DLC only content, they see revenue growth deteriorating in front of them.

The pilot program is set to debut early next year so we will have to wait and see if Gamestop has taken any of the aforementioned concerns into consideration. You don't get to be the largest player in any market without having a good business strategy, so we will have to give them the benefit of the doubt until then. Can Gametop offer up enough of a unique experience that can really draw people into stores and get them to buy there instead off of Live or the PSN? We'll know early next year.

11.13.09 David Allison

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