Physical console games are quickly becoming a relatively niche market – Ars Technica

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In terms of distinct game titles released in the United States, the raw number of new games available on physical media (i.e., discs or cartridges) dropped from 321 in 2018 to just 226 in 2021, a nearly 30 percent decline (games released on multiple consoles are counted as a single title in this measure).
The number of digital games released each year, on the other hand, remained relatively flat from 2018 through 2020. Then, in 2021, that number exploded to nearly 2,200 digital titles, a 64 percent increase from 2020.
All told, the proportion of all new console games available exclusively as digital downloads increased from 75 percent in 2018 to nearly 90 percent in 2021.
The decline in distinct physical releases is not being felt equally across major consoles. Across PlayStation consoles, the total number of new physical releases declined over 38 percent from 2018 to 2021, echoing a nearly 31 percent decline on Xbox consoles. On the Switch, meanwhile, the total number of new physical releases decreased by less than 7 percent over the same period.
The number of distinct downloadable titles, on the other hand, increased significantly on all three console families in 2021. That was especially true on the Switch, which saw a 63 percent increase in the number of new digital releases from 2020 to 2021.
These divergent trends suggest that the decline in new physical releases is not simply an artifact of consoles like the Xbox One and PS4 nearing the end of their lifecycles. Instead, as a whole, publishers seem to see a physical release as a less relevant market for an increasing proportion of titles.
But the transition away from physical console games is not distributed evenly across all publishers. The largest publishers are much more likely to go through the hassle and expense of a physical release for their marquee titles.
Among major publishers, a slight majority (56.4 percent) of distinct titles released in 2021 were available as physical releases. That’s still a major decline from 2018, though, when nearly 80 percent of titles from those publishers merited a physical launch.
(For this analysis, we defined major publishers as those with the most total annual revenue, including: Activision Blizzard, Bandai Namco, Capcom, EA, Konami, Microsoft/Bethesda, Nintendo, Sega, Sony, Square Enix, Take-Two, Ubisoft, and Warner Bros. Interactive.)
When those large publishers are filtered out, though, physical game releases quickly become a very minor part of the market. Just 8.1 percent of new games from those smaller companies were available on physical media in 2021, down in terms of both proportion and raw numbers from 2018.
Looking solely at the number of unique titles released gives an incomplete picture of the console gaming market, of course. Games that merit a physical release tend to be some of the most popular titles of the year and probably attract more total sales than the vast majority of bottom-of-the-barrel digital releases. These release numbers also don’t give any visibility into what proportion of sales go to the physical versions of games that are available as both discs and downloads.
But data from elsewhere also supports the idea that games on physical media are quickly becoming a smaller and smaller part of the console market. Capcom said last year that a full 80 percent of its new game sales were digital downloads, while Sony’s 2020 fiscal year results showed a majority of PlayStation full game sales were coming as digital downloads.
There is plenty of other data going back years pointing in the same direction. The wide availability of cheaper, disc drive-free console options from Sony and Microsoft in recent years also suggests physical releases are becoming relatively less important.

Physical games aren’t going to go completely extinct any time soon. As long as there’s a market of game collectors who value a tangible product, there will be physical discs and cartridges to satisfy that market, akin to vinyl records in the music business (sales of which have actually been growing of late).
But the physical release data makes clear that console gaming’s digital transition is quickly approaching its end game. In the coming years, games released on physical media seem poised to become an increasingly niche concern.
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