EA has decided to restructure its local German contracts and gradually end the sale of physical game copies in Germany, Austria, and Switzerland.
FIFA 23 and Need For Speed Unbound will be among the last games to get a boxed release in German-speaking countries. As of May 2022, EA “will no longer generate sales of packaged goods” in Germany, Austria, and Switzerland, it explained in a statement shared by Games Wirtschaft. This decision was taken shortly after EA decided to stop selling physical copies of games from its in-house store Origins.
This decision hasn’t come out of the blue. EA stated in its annual report that “the ongoing shift from physical goods to digital downloads continues to have a negative impact on revenue development”. The decline in physical copies sold can be seen across the board. In the US, the sale of physical copies has dropped from 80% of total copies sold in 2009 to 17% in 2018.
Looking towards the future, EA says it had to move on from physical sales to prevent financial losses caused by selling physical products in a market that didn’t want them. “The Company’s ability to develop and support digital products and services”, is the most important thing to EA, according to its annual financial report.
Not the first
EA isn’t the only publisher looking to downgrade its physical games distribution. Activision Blizzard dissolved its German subsidiary in May, with business operations ending in March 2021. While the entire staff based in Germany were let go, the publishing activities are being controlled in Activision Blizzard’s European Headquarters in London.
As digital sales increased steadily, Activision Blizzard’s local physical sales in Germany had sunk from €55m ($55.1m / £47.7m / AUS$85.5m) in 2018 to €35m ($35.1m / £30.4m / AUS$54.5m) in 2020. Due to digital sales taking precedence over physical, a localized approach to sales and marketing became increasingly redundant. Therefore, regional headquarters like that found in Germany became less beneficial for selling products.
Auf Wiedersehen
This may be the beginning of the end for the sale of physical video games; over the past decade, across the game industry, we’ve seen publishers reporting a shift from predominantly physical sales to digital sales. The decisions of EA and Activision Blizzard to withdraw from Germany and scale back their approach to physical copies may be the first major examples of a step away from boxed games, with other publishers following suit in other regions.
Though, we may also see an increase in physical collector’s editions and limited-release runs, such as the special edition of The Force Unleashed produced by Limited Run Games.
As fewer people buy physical copies, publishers will have less incentive to sell them and so may follow in EA’s footsteps. Although this may upset fans of physical video games or dedicated collectors, I have a feeling that this ball won’t stop rolling.