SXSW: Digital Distribution: The Way of the Future for Gaming

Almost everyone who has gone online with the computer or a game console has probably downloaded something at one time or another, whether it's been a song, a photo, a game, or a set of horse armor for their equine friend. But are digital downloads the wave of the future for full-on distribution? Developers are hoping so, because it will cut down tremendously on competing for shelf space at the local Mega-Lo-Mart, not to mention all those costs for printing games, manuals, boxes, shipping, and the like.

The panel consisted of Craig Allen, CEO of Spark Unlimted one of the big "shelf" retailers, especially with their newly announced mega-game Turning Point: Fall of Liberty due this coming November. From the other end of things was Dan Conners, CEO of Telltale productions who is in the middle of releasing Sam & Max as an episodic game, before packaging everything up into a retail edition. In the middle (and sadly, without much to offer) was David Burks, the marketing manager for Seagate Technology. You gotta store the downloads somewhere, right? In all fairness, Seagate was one of the SXSW sponsors, and he probably felt a bit shoehorned into this panel.
Everyone on the panel (especially storage media guy) agreed that digital distribution is definitely where games are heading, but they differ on how far off it is. Connors, for obvious reasons, feels that we're already there, whereas Allen feels that we are still several years away. Everyone pointed to the success of the iTunes store, and how digital downloads have really come to replace the traditional brick & mortar sales of albums.

Allen took things a step farther and pointed out that people like using digital downloads for music, because they can pick and choose their songs. You aren't forced to buy 15 bad songs just to get the one you want anymore. He hopes there's a day where games will be made available by level as downloads, and you might read on a forum that the best level in a new game are levels one, five, and seven ... and you could just download those. It does sound a big goofy right now, but who knows what the future holds.

The major hurdles are that big shelf retailers are where the vast majority of hardware sales come from, and they obviously don't want to see software go digital, because they want to have hard copies on-hand to sell to people walking home with a new PlayStation 3. That's the main reason we won't see digital downloads replace hard copies anytime soon, but we might start seeing both be made available, as is already true with many major software applications.

Everyone agreed that Microsoft has really taken huge steps ahead of Nintendo and Sony with Xbox Live, and pointed out that you've been able to download extra content and game demos through that service for a long time now. Allen is eager to see what happens with Sony's Playstation Home network, while Connors feels like Nintendo has a leg up on Sony because of the number of Wii consoles sold, and the nostalgic value of the Virtual Console. Storage man feels like you should use Seagate storage. The poor guy.

Interesting sidenote: they brought up Steam and Half-Life a couple of times, as did some folks during the Q&A session. While everyone seems to be happy with the new Half-Life episodes, no one was exactly thrilled with the Steam network.

This article was originally published on Joystiq.