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Now that services like Xbox Live, PSN, Steam and the iPhone App Store have proven digital distribution as a market force to be reckoned with, it's time to start examining what this change means to publishers and developers. Four game industry veteran got up on stage at the Develop Conference in Brighton this week to do just that.

On the one hand, some saw the increasing influence of digital distribution as having a democratizing effect on the market, letting big publishers and small indie developers compete on even footing. BioWare's Greg Zeschuk argued that, these days, a well-known brand isn't enough to sell a low-quality game on its own. "EA hasn't been throwing out half-assed content [on digital platforms]," he said. "You not only have to have the franchise but also the quality."

Of course there are still some benefits to having a big publisher and brand behind you -- for instance, getting Commander Shephard's face on millions of Dr. Pepper cans. Get Games Managing Director Bill Struthers warned the developers who try to self-publish online might be neglecting all the experience a publisher can bring in areas like age ratings, translations and public relations. "Many developers struggle to make the leap [to self-publishing] because they don't have the people and the experience," he said. "There are lots of opportunities for indie developers, but also lots of challenges the publishers have been working at for years."

"There are lots of opportunities for indie developers, but also lots of challenges the publishers have been working at for years."- Get Games' Bill Struthers

Many on the panel were worried about the effect digital distribution was having on game prices and the perceived value of their products. "We have to be very careful if the iPhone effect migrates to other platforms," Renegade PR Director Tim Ponting said of the seeming inability to market a successful iPhone game for more than $1.99. Ponting said he was afraid the effect was already spreading to Steam, where regular price reductions have trained many users to just sit back and wait for a game to drop to a rock-bottom price before buying. "It can, on the short-term, have a big effect on profit and turnover, but the question we all have to ask is if this is a good thing in the long term," he said.

Even as prices are coming down, the panel agreed that people are expecting more and more value from their games. HB Studios' Alastair Jarvis described the vicious circle started when games become long-term services rather than consumable products. "Because people are playing [each game] longer, games have a higher perceived value, so people playing each game longer buy fewer games, so fewer games get greenlighted [by publishers], so developers have more problems getting publisher attention, because publishers are focusing their bets."

"Dragon Age was enormous, so not many people traded it in in the first week, unless they didn't like the game."- BioWare's Greg Zeschuk

While piracy was a concern for the panel, second-hand game sales seemed to draw just as much ire, if not more. "It makes me upset when I see torrents for my game on day one," Jarvis said, "but it makes me equally upset when I go to the store to buy my game on the first week and someone offers me a used copy instead of a new one." Ponting said digital distribution's real potential for developers was as "a fracture point that locks out the second-hand market, which is why retail won't continue in its current form. It will continue in some form, because it's effective, but there are so many forces driving it in a decreasing circle."

But Zeschuk argued that digital distribution wasn't the only way to comat the second-hand sales problem. "We have to give players a positive incentive to keep the game," he said. "Dragon Age was enormous, so not many people traded it in in the first week, unless they didn't like the game. If they did like the game, it'd be years before it got traded. ... The key thing for us is creating perception of value in consumer on long term basis."

[Image source: targophoto]

This article was originally published on Joystiq.

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