The ever-growing market of digitally-distributed games has had GameStop jockeying for a position in this changing space since the latest generations of consoles launched. Gamers are becoming increasingly more aware and comfortable with either downloading their games from digital storefronts or ordering their merchandise from online retailers such as Amazon. The truth of the matter is, the market in which Gamestop found their success in, disc-based video games, is trending steadily in the opposite direction.
Evidence of this truth can be seen in changes that have recently been either explored or implemented by the company in the last year: searching for a way to sell second-hand digital content, telling Microsoft that they refuse to sell bundles that don’t include physical copies of games, and dedicating an increasing amount of store space to the sale of collectibles.
It is clear that without a radical change in the way that GameStop does business, their chances of becoming the next Blockbuster increase. It’s no wonder that the game retailer’s latest move to stay relevant is by far its most out-of-box to date.
On January 28, it was announced that GameStop would be partnering with Insomniac (the studio behind Ratchet and Clank and Sunset Overdrive) to bring their latest project, Song of the Deep, to both digital storefronts and GameStop shelves. The partnership is a publisher/developer one in nature, with Gamestop handling the marketing and promotion of the title while Insomniac maintains creative control and IP ownership.
As part of the deal, Gamestop will retain exclusive retailer rights to the physical distribution of the game. This means that any player wishing to get their hands on a new physical copy of Song of the Deep must do so at their local GameStop or on GameStop.com.
Can publishing really be the path to GameStop’s continued relevancy and success?
To start, it is unclear if GameStop will be publishing any more titles after Song of the Deep. According to GameStop Global Lead, Mark Stanley, future projects are contingent upon the success of this current partnership. It would be hard to imagine a future where GameStop doesn’t continue the practice if Song of the Deep turns out to be a successful endeavor.
There has been no better time to be an indie development studio than now. The advent of digital distribution has meant logistics costs plummet. There is no warehouse space to be bought, no shipping to be coordinated, and no discs to be pressed. Some games selling at a price point well below the standard $60 have seen similar success to their high dollar AAA counterparts. Indie games are thriving in 2016. Without this middle man it means even more of the profits are being funneled directly back into the pockets of the studios that make the games.
However, games are not cheap to make. Without the initial start-up cash to get a project off the ground, many games fail to even move past the ‘pen and paper’ phase let alone make it onto platforms. Independently developed games must often rely either on private investors, developer backed funding, or crowdsourcing to bring their project to life. Publishing agreements such as GameStop’s have become the attractive 4th option.
The middle-man publishing position for indie titles is a market that has seen greater competition since the launch of the 8th generation consoles. Take PT spiritual successor Allison Road, for example. After raising over $224,000 of its $380,000 goal in only 9 days of crowdfunding, developer Lilith Ltd. decided to drop their Kickstarter campaign and partner with indie publisher, Team17. This allows the studio resources and time that developing with publisher backing can give.
Team17 isn’t the only publishing house willing to take on indie projects while allowing their creators to maintain creative control and IP ownership. Devolver Digital, Double Fine Presents, and Paradox Interactive are just a few others that have found success in this model.
Now, GameStop throws their hat into the ring with a well-known studio, Insomniac. The scheme has proven profitable to some degree or another in the past, and GameStop is hoping that they will find similar success. If GameStop can manage to gain a foothold in these sorts of projects — whether it be small passion projects for well-established studios or ground floor-level start-ups — the entire trajectory of the company could change.
GameStop’s Global Lead, Mark Stanley, is no stranger to taking companies to places they have never been before. In 2009, Stanley took on the responsibility of taking the PlayStation brand to Latin America. In that time, the PlayStation brand grew across 18 countries in Latin America, and in 2011 the PlayStation digital store launched in Brazil.
In much the same way, this partnership with Insomniac could launch GameStop into just the right space to grow their brand.
The second part of the publishing deal, the agreement to retail-exclusive physical copies, is perhaps most interesting. It has become commonplace to see retail-exclusive bundles or pre-order bonuses, but retail-exclusive games are something entirely new.
There may be a day, maybe not this year or next, but in the not-so-distant future, where physical copies of games are not the mainstream way to distribute content. Limited physical runs of major titles could become commodities for those seeking to fill their shelves with game cases.
GameStop has already established itself as the go to place for physical games, and lately they have been trying to establish themselves in the same way with merchandise and collectibles. In 2015 they acquired GeekNet, the parent company of ThinkGeek and ThinkGeek solutions, in an attempt to solidify their position in the collectibles market.
Establishing exclusive publishing deals with companies for retail distribution rights could pave the way for GameStop as the go-to store for buying disc-based games should they become far less common.
Obviously, there are no guarantees in any of this. The market can be a fickle thing, and old habits tend to die hard, but GameStop is at least attempting to be creative with their branding as gaming forges ahead into the digital-era. Publishing along with retail-exclusive physical distribution may very well be the path that keeps GameStop from going the way of video rental stores.
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