Why Aren’t Digital Games Cheaper Than Physical Ones?

howtogeek.com:

Digital games are quickly overtaking physical video games as the preferred way to buy gaming titles. However, despite being free of many physical game distribution costs, digital games often cost the same or even more than their physical disc counterparts. But why?

In the early days of digital gaming, when many of us looked at our paltry dial-up modems and believed it was impossible, one of the benefits of digital games touted was a reduction in cost.

After all, putting a boxed game on store shelves is expensive. The final price you paid at the cash register combines manufacturing, transport, and the retailer’s profit margin. So it’s only reasonable to expect that those cost savings should be passed on to gamers.

In practice, this hasn’t really materialized. You can expect to pay the same price for a digital copy of a game as you would in a brick-and-mortar store. At launch, a game might even be cheaper in-store, as retailers cut into their own profit margin to get feet through the door and perhaps sell a few other items besides a hot new game.

Paradoxically, the main reason you pay the same for a digital version of a game has to do with those same physical stores. For the moment, retailers remain a crucial part of the sales network for video games and video game hardware. If digital storefronts from Sony, Microsoft, and Nintendo undercut retailers by a large margin, those same retailers may choose not to stock physical games at all. Even worse, they may also stop putting related items such as gaming consoles and accessories on their shelves.

Digital gaming is growing quickly, but it’s far from being the de facto way to buy video games. If retailers shut out console makers, they’d see half their sales evaporate in territories