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We've been seeing a gradual shift in software sales in the last couple of years towards digital distribution. Full retail games have been available for the Xbox 360 and PlayStation 3 over that time and, although the digital library is but a fraction of the retail library, digital has been catching up. Now, a circulating rumor about software for the PlayStation Vita takes this one step further as the price structure may be significantly different for physical versus digital games.

As with any shift, there are positives and negatives to consider.

The biggest positive to the rumored Vita plan is the lower cost to the consumer. Digital games could be as much as 40% cheaper if consumers buy digitally than if they buy a physical copy. Leaving the expensive proprietary memory cards out of the equation for a moment, these savings would add up before long.  Imagine paying $25 for a game that sells for $40 at GameStop or Walmart. If you bought six games in a year, that's a savings of $90. Granted, the savings would be offset by the exorbitant cost of the memory cards, but it could pay for itself within the first year if you buy enough games.

This move is long overdue and makes sense. Publishers can eliminate overhead like packaging and printing, plus they can eliminate the "middle man" that is the retail chain. Consumers would stand to gain from this cost-cutting measure more consistently in this system, as opposed to the on-demand retail titles that we've seen on the Xbox Live Marketplace and the PlayStation Store. In many cases, pricing for full retail titles mirrors MSRP (Manufacturer's Suggested Retail Price) in spite of sacrificing tangibles. It doesn't benefit a consumer to buy digitally in many cases under the current system… but the rumored Vita software pricing scheme most certainly provides a benefit. The loss of the physical product and tangibles is arguably more than offset by the lower price, which could be very important for staying competitive. If consumers can get past the high cost of the hardware and the necessary expense for a large memory card, the Vita can be perceived as a good value in the long run. That's provided, of course, that Sony and its third-party partners deliver consistent and quality software.

There are other positives to digitally downloaded software, which remain for the Vita. Not having to carry (and potentially misplace or damage) physical games makes the platform all the more portable. If consumers buy a large memory card, like the 32GB model, a fair number of games can follow the user wherever he or she goes. Cutting out retail also adds a level of convenience for some consumers. If you want to buy a new game at 3am, digital distribution allows this instead of being out of luck until the next day. Digital distribution eliminates shipping errors or damaged packages from Amazon or any other retailer, as well.

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There are drawbacks to digital distribution, as well. Perhaps the biggest one of these is the inability to trade in, sell, or allow a friend to borrow a game. Once you buy a digitally distributed game, it's yours. Beat a game 100%? Your only recourse, aside from keeping it and occupying valuable storage space on your memory card, is to delete it. In most cases, you can re-download the game later if desired, but you won't be able to recoup anything. This is most problematic if you buy a game and wind up not liking it. Physical copies of games give consumers a few options in these cases. They can be sold to friends or online, can be traded in at GameStop or Best Buy, and listed at a tag sale. Even if you got $10 for a game that you spent $40 for and hated, you still get something back. Not so in digital distribution for consoles. All it could take is a few clunkers for some consumers to get cold feet.

Demos are usually cited by defenders of digital distribution as methods of ensuring that consumers don't buy "the wrong game", but these are unreliable in at least some cases. Demos can sometimes misrepresent what the actual game is like. One example of this was the demo for Brutal Legend back in 2009. The demo came across as a straight-up action game, with some vehicle sequences thrown in. The demo sold me, leading to a preorder and purchase. My delight turned sour quickly when the game added real-time strategy sequences, which I hated. Nowhere in the demo—or in any pre-release articles on the game—was the RTS content mentioned. I wound up trading the game in the next day. If I'd bought it digitally, I'd have been stuck with it and been much more angry about the misrepresentation.

The other major drawback to digital distribution is the limitation of the internet. Some people have great speeds and performance, where downloading even a 1GB game isn't an all-day affair. For many others, speed and reliability are problems that make digital distribution a futile practice. In cases like we see now with full retail games for the PS3 and Xbox 360, buying physical copies is the best solution since it's the same price in most cases and provides more timely gratification and experience. In the Vita's case, potentially, a tougher decision lies ahead for consumers like that. Are they willing to pay what amounts to a penalty for buying physical copies, or do they just ignore the Vita altogether based on its apparent online focus? Sony seems willing to risk alienating a certain segment of their prospective Vita consumer base this way, but it's arguably indicative of what's to come as the industry seems to take for granted that consumers have reliable high-speed connections… and may be willing to sacrifice a few users in the name of advancing their online strategies. This remains to be seen, of course.

If this pricing strategy rumor for Vita winds up being correct, the industry will be watching it very closely. If consumers buy into it and sales numbers support it enough, publishers may start talking to Sony and Microsoft about how it can be applied to the next generation of consoles. Although I'm not a proponent of killing physical media in favor of digital distribution, it's hard to argue against the business side of the decision. It's financially advantageous to the industry to cut back on physical copies and the overhead associated with the practice. Logistics would become easier and street dates would be easier to enforce. On the flip side, however, I'd be on the outside looking in as a consumer and would likely be forced out of a form of entertainment that I've enjoyed for so many years… and that's obviously not an outcome that I want to see take place.

Time will tell, of course, but I believe that we're about to see the future—and it's digital.

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