Australian Game Sales Down At Retail, But Does The Growth In Digital Make Up For It?

Australian Game Sales Down At Retail, But Does The Growth In Digital Make Up For It?

According to the latest data from NPD Australia, the Australian Games Industry raked in $1.5 billion at retail in 2011, that’s a 12.8 per cent contraction compared to 2010, but that figure doesn’t account for the growth in digital sales, says Ron Curry, CEO of iGEA.

“As Australians continue to access video games through a host of different channels, it’s becoming more challenging to aggregate sales data through a single source,” said Curry. “Whilst the NPD data has revealed a dip in ‘traditional retail’ sales, which according to our latest Digital Australia report still represents the lion’s share of the games industry, other research has pointed to the growth in digital downloads, multi-player online games, in game purchases and online subscriptions.

“Overall, we’re seeing a lot of evidence point towards a continuing healthy interactive games industry. The incredible success of games such as Call of Duty: Modern Warfare 3 which became the fastest entertainment property to hit the $1 billion milestone globally, eclipsing the previous record set in 2009 by the film Avatar, is only one example of this.”

According to Antony Reed, CEO of the Games Development Association of Australia, digital growth is partly enabled by the hard work of local development studios.

“In 2011, Australian made games featured highly across multiple digital platforms,” said Reed. “For example, Brisbane’s Halfbrick Studios recorded over 120 million downloads of their smash-hit, Fruit Ninja, and 11 million for the recently released, Jetpack Joyride, and Melbourne-based IronMonkey Studios won Apple’s coveted ‘Game of the Year’ award with DeadSpace. Into 2012 we will see many more innovative and creative properties made by Australian studios releasing to a global audience.”

But if an increasing amount of cash is now coming through digital sources, why are we still being given figures that don’t include digital revenue?

The answer is simple: it’s very difficult to collate those numbers.

“We’d love to add the digital numbers,” said Ron Curry, “but we can’t get them.

“Firstly, the numbers are so vast. With traditional retail we have the retailers to help us and give us the numbers; Secondly, we’d need to be able to break them down, and it can be hard to track who bought what from where. Thirdly there’s the Apple factor, and they don’t provide the numbers to us.

“Because digital distribution is such a new thing, we find that people are more reluctant to share the data.”

It’s a strange situation — the games industry as a whole is growing, but publishers typically don’t have the numbers that reflect that growth.

“We’d love to have those numbers, because it helps us for a number of reasons, but we don’t want to publish them unless we can hand on heart say that it’s the truth.”


  • I suspect it’s more a shift to off-shore websites like ozgameshop than a shift to digital sales, especially in the case of consoles.

  • You guys (Richard and Braaains) are ignoring the AppStore entirely, which I guarantee is the most significant thing to happen to the economics of the games industry in the last 10 years. Far more significant than importing console games.

    • And Steam.

      Both providing a cheap, convenient source of hassle free games. Steam might be more of a niche (especially here) but when you hear stories from people who will buy a game from Steam because they’re too lazy to find the disc they bought years ago, you know that there’s something right with the service.

      Other factors could be the year to year variation in games being released and the fact that game prices seem to finally be heading down.

      • Ohhh steam is great when they charge $30-40 more for a game in Australia then USA. Yeah buddy aint nothing but a peanut.

        • Firstly its not Steam who sets the prices, its the publishers. Secondly, how “good” you think it is as a service is pretty much irrelevant here. A lot of people use it, which diverts cash away from the places that can be easily tracked through these kinds of studies.

          I still stand by the AppStore though, its audience (iDevice owners) is magnitude of scale larger than Steam or any other service like Direct2Drive or Origin etc.

          • Stop being an idiot and consider the following:
            Valve own Steam. Steam is theirs, and they own it, and it is their property.
            Valve make games. Big games. Games that, when announced, both you and they know that this shit is going to make a lot of money.
            When these games are released, they are sold in Australia AT THE SAME PRICE they are sold in the US. The only difference is our exchange rate.

            Now consider:
            There are other games that are cost the same price on Steam as you would find in say EB Games or GAME.
            These games are consistently overpriced by the same publishers (THQ, Activision, Ubisoft).
            Not every game on Steam is overpriced.

            So with that in mind, it’s pretty goddamn obvious that:
            Valve are required to sell games by certain publishers at a premium. They’ll do their best to sell it as cheap as possible as to get more sales, because that’s how Valve make more money. None of this “believing the shit they shoveled you” bullshit.

          • Richard, you are blatantly making things up here. Cling to your conspiracy theories if you like, but what you suggest is just not how retail (of various sorts) works in Australia.

        • Good thing there are more than a few people out there who simply use US accounts to get the lower pricing.

          Even with the more expensive prices we have here, Steam sales tend to be rather well priced. Normally at the point where people will buy games on impulse, with no knowledge about the game itself just that it is costing them <$5.

          So yeah, Steam sucks!

      • Duke Nukem Forever – I imported the PC version on disk from the UK for $40 cheaper than what Steam was selling it for.

    • I don’t think the App store is taking money away from boxed retail products. I think they serve very different markets… people aren’t saying “Oh, I’m going to spend a dollar on Angry Birds instead of $90 on Gears of War” or whatever. They’ll still buy just as many full-scale products and the cheap little Apps are a bonus on top of that. Quite possibly paid for by the money they save buy importing their boxed retail games.

      • I doesnt matter if they are taking away from any product , the point iss there is HUGE revenue from these cheap games and as a whole the gaming industry would have increased. Its just in a different form than the previous model.

    • I disagree on that – people aren’t replacing PC/console games with Angry Birds. At most it’s cutting sales from the DS and PSP.

  • 80% of my games in the last year have come from overseas.

    Even some of my digital Steam purchases have come from ‘overseas’ because I’ve bypassed the higher Australia price by using greenmangaming.

    • I haven’t bought a game from a physical shop in years except for maybe Super Street Fighter 4 and Marvel Vs Capcom 3. All the stuff I want can be gotten from steam. I don’t need to leave the house, I get my game instantly and I can wait if I want for sales prices that are aren’t hideous.

  • Its really just not worth buying games here when you have ozgameshop saving so much money and earning points. The only negative thing i will say about it is with the introduction of online passes and region locked dlc…. Sony are special like that, they region free the console and lock everything else herp derp.

  • Maybe if digital pricing here wasn’t so ridiculously high, it might have a higher adoption rate.

    Maybe they are aware of the numbers, but because they are so embarrassingly low and people have such a poor opinion of digital pricing here they aren’t willing to share them.

    I don’t know about the rest of you, but I don’t want to pay $110 for a game on my PS3 or $89+ for a game on Steam which I can import or even buy at retail cheaper.

  • I bought my ‘first’ Retail game in almost 2 years at JB last week.
    In the space of those 2 years I’ve probably bought:
    80+ Steam,
    20+ iOS,
    10+ Ozgameshop.

    After my experience with JB last week, I was reminded why I digital and importing is so much better. I wont buy another game retail in Australia again.

    • Exactly my experience i was actually surprised because i always thought jb were cheap bahaha how wrong was i.

  • amusingly, they just want growth in the $$$$ numbers.
    omg! 12.8% less profit than last years ridiculously high amount of profit!

    what they never stop to consider is outside factors… like maybe the games just weren’t as good as previous years, but nah! couldn’t possibly be that right?

  • What sucks is that it has appeared for some time that publishers rely on sales figures to justify developers budgets. The fact that there appears to be a shift towards digital sales and that these figures cannot be accurately quantified shows that some devs may be hit hard by their owners because of failing reveniew, when if fact the information they are getting is not accurate.

    Hey Mark, I don’t suppose you would be able to get a publishers take on the disparity between retail and digital sales figures and how much of an impact these figures have on their decisions regarding which of their developers to support?

    • I don’t think publishers find it hard to access sales figures from various sources, just people outside of the system trying to get a peek in.

      After all, the publishers are the ones receiving the money.

  • The only retail purchased games I have in this country recently have been gifts from members of my family. As soon as we get charged fairly, I might consider giving the retailers some money.

  • My friends and I buy all our games in retail stores.
    Wouldn’t the price drop in games cause 12% less total. I bet they sold the approx same amount of units they are just selling games at a more comparable price to overseas.
    I still have never bought a digitally distributed game – neither have any of my firends.
    I keep saying it, my games collection is worth $10-20K all you people with digial games have zero $$ value in your game collection.

  • If Australian retailers want to retain their sales figures, they had better learn to compete with imports. I’m sick to death of walking into eb games and seeing a the same game I bought 6 months ago from ozgameshop for 50 bucks going for $99. Australian retailers can suck ny balls. I don’t mind waiting a few days for my games, at least I’m not paying 15-20% of my weekly wage for a fucking videogame.

  • I couldn’t tell you the last time I bought a physical copy of a game. The physical copy of a game I was given was Space Marine from the missus who got it via Ozgameshop.

  • Forgive me if I’m wrong, but I thought it was the middle-men, the guys who sell the games to EB/JB/GAME that were the ones raking in the profits? As much as I despise the prices I see in these stores, if you looked at the prices they pay for thier stock, they usually are MORE than it costs for us to import our selves.

  • UNless its a console game i try to avoid anything but Digital games 🙂

    Much better to manage and removed the issue of CD’s manuals etc 🙂

    • Digital is terrible, you use your own internet, storage space, get no disc, manual, box, have no resell options or can even lend to someone, are more subject to dev/pub rights telling you when you can play and how and in some cases lose your rights completely to play at all if you dont access your accounts in a year or 2 for example as evidenced on places like EA’s origin. Plus in most cases it costs more than the physical copy. I think Ill stay with the disc based versions.

  • I think a fair chunk of that 12.8% drop in Australian video game profits can now be found in the equivalent British video game profits.

  • You don’t say.. I’m fairly certain that importing + digital importing (aka Steam, etc) is where you’ll find the market has vanished to.

    Why go to EB Games/GAME/JB Hifi to get Arkham City for $99 when you can get it on Steam for like.. $60. Its upto the retaillers to do something about it.

    • ??? I brought Arkham City for $79 day one at JB HiFi, last i saw it was $69 there. It’s $99.95 on steam. Where are you getting your info from dude?

    • In their defence though you get more rights to lend to people and have more options for resell later if you wish too. Plus the more likelyhood that the physcial copy in time may be worth more.

  • No surprises here given that bricks and mortar retail adds little to no value compared to online retail. I would cease buying discs completely if I could download Xbox 360 titles from Xbox Live.

    Without all the data it is difficult to pin-point where the sales have been diverted to, but someone above made an interesting point in regards to the App Store. In the last 12 months i’ve chosen to purchase games for my iPhone rather than my Xbox due to lifestyle time restraints… not saying that it is as all reflective of the population, just an interesting consideration. It would be interesting to see where that 12% is now being spent and why.

    • Uh you can download disc titles through Games on Demand in the Xbox Live Dashboard – having said that they follow the Steam pricing policy of matching (and sometimes doubling) the retail price.

  • I can only think of one game that I bought last year from an Aus retailer, that game was Uncharted 3.

    Got a few PS3 games from ozgameshop and the rest were PC games from either steam or greenmangaming.

    • Or in other words, you can’t dispute what I’ve just said, so you thguoht you’d attack my character instead? BTW, there’s someone in the DAB industry that your description also fits to the letter, but I’ve never mentioned it on my website.And on the subject of my success or otherwise, I totally disagree that if I were sweetness and light at each and every opportunity that I came into contact with anybody in the DAB industry it would make a blind bit of difference to my success . Members of the DAB industry, whether it be through personal, professional or financial vested interests, will always show preference to DAB, and my behaviour would never stop that.What I can do, though, and what I feel I’m pretty good at, is holding a mirror up to the DAB industry, and exposing things that they’d prefer were left covered up examples being: DAB audio quality, DAB+, and more recently the various issues concerning the BBC’s motives for their decision-making for the Internet radio streams.My success, therefore, is based on things like the number of people who’re made aware of the issues I cover, and not whether I’m able to actually change policy. And presumably you wouldn’t deny that I’ve been successful in spreading the word about DAB’s audio quality problems and the fact that DAB+ exists when the broadcasters dearly wanted absolutely nodoby to find out about it?

  • I find the prices that distributors set for regional Australian prices completely insulting.

    I can afford to buy games from regional retailers (online or otherwise), but I get all my games/cd keys from overseas because: F*CK YOU 2K! You’re not charging me more when the rest of the world pays less.

  • Late last year I made the decision to only buy games at retail when I felt they were must haves on day one. Everything else I’m buying from ozgameshop. Things would need to change drastically for me to go back to buying all my games at retail.

    That said, JB gets enough of my money anyway. Sometimes I have a hard time leaving one of their stores without buying something. It’s beginning to become a real problem.

  • I have a feeling a lot of that money is going towards imports as well. I know all of my recent hard copy purchases have been imports.

  • To me retail is pretty much dead, I bought 4 games at retail last year compared to maybe 15-20 a year in the rfew years before that.

  • Now see if I buy an Xbox Live points card to purchase my online games doesn’t that count as retail sales anyway?

    I think their contraction stems from
    a) Import Sales
    b) More rapid Price Reductions locally due to import competition.

  • I think there may be more to the sales of the App Store; as someone above pointed out, changes in lifestyle may have prompted buying of cheaper, quicker games. As the average age of game players gets older, there is less time to spend hours on Skyrim but enough time to have a quick go on Zoo Keeper or PvZ.

  • EB is quite competetive but still retail products have the worst shelf life ever a year on and the game has dropped maybe $10. DVD’s are great I can go out and buy all the ones I want but with games theres no way I can do this! So I dont buy retail I wait for deals online etc.

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