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Interview: The state of indie game retail

Interview: The state of indie game retail

January 16, 2017 | By Thomas Faust

January 16, 2017 | By Thomas Faust
More: Console/PC, Indie, Business/Marketing

Digital distribution and, more specifically, the ever-increasing number of digital storefronts as well as the success of Steam as a platform, gave rise to the vibrant and varied indiegaming landscape we've got today.

A similar success would be inconceivable if it was tied to retail releases, which now seem to be a thing of the past for most indie and mid-tier titles. Retail is the domain of AAA blockbusters, firmly in the hands of big publishers. Meanwhile, niche products have mostly gone digital, and a lot of them thrive this way.

However, this doesn't mean that indie games have completely departed the retail space. There are a few companies still trying to brave the increasingly harsher market conditions.

I talked to Gregor Ebert (Headup Games), Hans van Brakel (Soedesco), and Josh Fairhurst (Limited Run Games) about their approach to retail publishing.

Both Headup Games and Soedesco pursue traditional brick and mortar distribution for PC and consoles, respectively, and also act as digital distributors and publishers. Limited Run Games, on the other hand, carved out a niche by producing small quantities of acclaimed console games and exclusively selling these boxed versions online, targeting an even smaller customer subset: collectors of limited retail editions.

"We offer developers a way to increase their discoverability enormously. You are getting your game in thousands of stores all over the world, which means a huge amount of people will see your game."

Since the viability of retail sales in a world that is increasingly turning towards digital distribution is an issue, I wanted to know how these publishers perceive their role on the market. For Headup Games, there is a distinct trend away from retail: "Digital is [our] main source of income, while retail is getting less and less important. It is more a matter of recognition [...] but in regards to sales, it's not worth mentioning anymore if you don't sell AAA titles."

For Soedesco, having a retail presence is more about adding value and visibility: "[Retail releases are] important for us because with an increasing amount of releases, discoverability becomes an issue. We offer developers a way to increase their discoverability enormously by adding retail in the mix. You are getting your game in thousands of stores all over the world, [which means] a huge amount of people will see your game. So it's a great combination of marketing and extra income."

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Limited Run Games have a slightly more positive outlook on the state of retail. However, that might be due to their particular distribution model and smaller scope. "It's been very successful so far, with every release having sold out within the course of a single weekend (and some selling out within minutes of launch)," says Fairhurst. 

"When your game exists on a physical format like a PlayStation 4 disc, no one can revoke your right to play that game. You own it and you own it for as long as you have the hardware to play it. Look at Scott Pilgrim, After Burner Climax, P.T. - these games can't really be picked up anymore."

"Customers have been sticking around, and it seems like we've got a pretty sustainable business model, so long as we continue to keep things small and run light," he adds. "It's definitely sustainable for the developers we work with, as we're creating a new stream of revenue for their previously released titles that in some cases could finance a huge portion of their next project."

Some regional markets supposedly favor of digital over retail distribution, but when asked about that, all three publishers couldn't quite agree on specific countries. The strong presence of videogame retail in Germany seems to be a safe bet for every publisher going retail, and the US compensates lower interest with sheer sales numbers; it is the largest market by far.

Apart from that, other European countries, the Middle East and Australia were mentioned as worth publishing for, while Japan apparently has little interest in Western retail indie releases. Overall, all publishers considered the worldwide market to be pretty healthy, but Gregor Ebert couldn't help but lament the effect of convenient downloading and rampant race-to-the-bottom pricing, which hurts smaller publishers the most.

Even so, there are strong arguments in favor of maintaining a healthy retail landscape, even for smaller publishers and, by extension, developers. Apart from the obvious interest to diehard collectors, retail releases can sway the average gamer with added value and other gimmicks.

Some of Headup Games' releases contain extra material like posters, key chains, bonus movies, or 3D glasses (in the Special Edition of LIMBO). Their boxed version of Fullbright's Gone Home, for instance, actually complements the experience with actual items from the game world, adding something tangible to an already immersive game.


There are technical and licensing issues to consider, as well. "Digital games can disappear at the whim of a platform holder," Fairhurst points out. "There's no way to say that in five or six years, my games will still be available on Steam or PSN or Xbox Live. Businesses go under, platforms die - there are so many things that could happen that could cause my games to disappear forever."

"When your game exists on a physical format like a PlayStation 4 disc, no one can revoke your right to play that game," he adds. "You own it and you own it for as long as you have the hardware to play it. Look at Scott Pilgrim, After Burner Climax, P.T. - these games can't really be picked up anymore. They don't have a legacy outside of pirate sites. This bothers me as a player, consumer, and developer. This desire for real, true, ownership will never fade, so physical media will always have its place."


Even if digital distribution is making it harder for publishers to justify retail releases, everyone we spoke to is mildly optimistic that boxed videogames are here to stay. Fairhurst ventures that mainly "game collectors or people who just really want true physical ownership" will drive most of the retail market.

However, Fairhurst doesn't think that "retail will ever be mainstream again. Younger people will embrace digital and more and more adults are for the convenience. There's only ever going to be a fixed audience for physical media, but they're not going to go anywhere and they're a strong market worthy of support and focus." Van Brakel thinks along similar lines, seeing a shrinking, but still important market for boxed indie games.

According to Ebert, there will definitely be a market in the future, mainly due to increasingly draconic drm-schemes and an increase in download sizes, which might lead to disc-based installations offering more convenience for a lot of users. At the end of the day, Ebert concludes, "it's still great putting games in beautiful boxes on your shelf" - and that hopefully won't change anytime soon.

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