It might not be a good time to be Gamestop. Or Best Buy. Or Sears or any other retailer for that matter, but the video game sector is being hit exceptionally hard.
So, it should come as no surprise that EA's executive VP Patrick Soderlund doesn't see very big silver linings for the industry moving forward.
"We know that packaged goods work today, and the majority of our current revenue comes from that. That's still a viable business model. But in the long term we'll see more and more people gravitate to downloaded content," Soderlund said in a CVG interview.
He said the collapse will happen sooner than we all think.
"I still want physical content but I'm not part of the new generation of gamers. I remember a time when I bought a cartridge and excitedly read the manual on my way home, imagining what the game was going to be like. Maybe kids don't have that anymore," he added.
Soderlund noted these are his personal opinions and not necessarily indicative of what EA feels, or at least what it is comfortable saying.
Gamestop and Best Buy are very worried, but they have tried to offer value-added materials like free content if you buy a game from them, but that won't be enough to survive in the digital era. At least, not according to Soderlund.