US spending on physical video games has dropped by half since 2021, according to new data from market research firm Circana.
Gamers’ spending habits have steadily migrated digital for more than a decade, driven by faster internet speeds, the emergence of online marketplaces on consoles, and live-service games funded by microtransactions.
Data from Circana, CEO Mat Piscatella provided this week, suggests the migration to digital has accelerated since the pandemic.
According to a graph showing the last 25 years of American video game software spending, physical games have dropped by more than half since 2021, and are now more than 85% below the 2008 peak.
Overall content spending, including physical and digital (including subscriptions and microtransactions), has increased since 2019, according to Circana data.
It’s worth noting that a key reason for the acceleration towards digital gaming during 2024 will have been a weaker-than-usual release schedule for the Nintendo Switch, which typically contributes a significant portion of physical game sales.
While the general trend of video game sales is increasingly migrating to digital, it’s not even about platforms or game series. For example, in Europe last year, overall digital participation was 68%, up from 60%. However, Xbox’s digital share was 75% (up from 70%), while the PS5 was at 64% (up from 55%), and Nintendo remained stable at 22%.
And while more Europeans bought Astro Bot as a physical boxed game, sales of Warhammer 40k: Space Marine were overwhelmingly digital.
It was a quiet year for new releases overall, with only six new games in the European Top 20 by 2024 (in 2023, there were 10). In fact, sales of new launches fell 21% in 2024 compared to new launches in 2023.
game-spend-has-halved-since-2021/”>Source link