Internet killed the music, video, and book stores

Something happened in the mid 1990's: the internet became available commercially to the general public. Several years later, the first e-commerce sites went online, together with the availability of bootleg copies of music in the form of MP3 files. Despite the crash of many internet companies post-2000, retailers (both old and new start-ups) realized the power of e-commerce and invested in developing the infrastructure and systems. With the growing adoption of MP3 as the storage format for music files, and the accompanying devices, even CDs were losing their appeal. Traditional music retail stores began taking casualties in closures and bankruptcies.

Internet bandwidth increased significantly throughout the 2000's, so much so that most people could find it viable to stream entire movies without having to go to their local video store for rentals. Blockbuster, a major US video rental store franchise, declared bankruptcy in 2010 and was finally bought over by another company. In the book publishing industry, e-books and readers were becoming commonplace. The effects were significant as another major retail franchise, Borders Bookstores, has gone into liquidation.

Two words can be used to describe the downfall (or downsizing) of the traditional retail store: digital distribution. If a product could be delivered in digital form rather than physically, it will eventually be adopted in the e-commerce world. In e-commerce, there is no need for shelf spaces. E-retailers do not need to pay land leases or rents, only the necessary costs to maintain the sales portals and hardware. This translates to savings for the consumers, or bigger profit margins for the retailers.

Why am I talking about music, video, and books in my gaming blog? Because I believe the future of video game sales also lies in digital distribution. Some people will still tell me: "but I like the feel of the game box packaging, and the new smell!". I personally think it's not necessary to be holding on to a physical box or storage media to appreciate the game. All I care is getting the data files into my hard drive and start playing. Looking at the 3 console makers: Microsoft, Sony, and Nintendo, all of them have created online game stores, giving indication to the growth of digital distribution. Big name publishers like Valve and EA now have their own online stores, allowing them to cut the traditional middle-men supply chain and sell direct to customers, even throwing in occasional deals and promotions. If there is no news of any game retail stores closing, it's only a matter of time.