How digital is the video games market in 2024?

gamesindustry.biz:

The vast majority of the games industry is digital. This has been the case for quite some time.

Overall, when we factor in downloads, microtransactions, DLC, subscription, PC, mobile, and so on, the physical games market represents a very small share of the video games business.

However, when we are talking about the sale of brand new video games, the physical business can actually prove to be an important way to distribute and sell video games.

Let's take 2023. Across Europe according to GSD (which tracks physical and digital sales), 72.4 million video games were sold via physical retailers. And if we just look at brand new games (so games released in 2023 only), we can see that 42% of all new games sold in 2023 were sold via physical stores. That's quite the market share.

But how has that changed in 2024?

Now, GSD's data is very good, but it isn't complete. It tracks physical retail sales for all major European countries, but it doesn't quite track every retailer and there are smaller European nations it doesn't track (such as Greece, for instance).

Also, while its digital data tracks sales from most major publishers (so Ubisoft, EA, Activision, Sega, Capcom, Microsoft, Sony, Plaion, Warner Bros etc…), it doesn't track the thousands of self-published titles, and it is missing a few publishers – the most significant being Nintendo. For this analysis, we've had to discount Nintendo first-party games from the report.

So when I say statements like '42% of games sold in 2023 were sold at boxed retail', I am mostly talking about AA and AAA video games (except for those made by Nintendo).

With those caveats in mind, back to the analysis.

For the first 40 weeks of 2024, we have seen a dramatic shift towards digital when it comes to new game sales. Across Europe, 75% of 'new games' (games released this year) have been sold as digital downloads (25% via physical retailers). That is a 12 percentage point shift over this time last year, when just 63% of games were sold via the likes