A games industry analyst reacted to Sony‘s decision to discontinue physical disc releases by saying that the industry has an opportunity to reduce production costs even further. On July 1, Sony officially announced that it will stop releasing new video game discs for PlayStation consoles starting in January 2028.
The decision has led many to believe that Sony’s next-gen console will be digital-only or include a separately sold disc drive. However, it is not yet clear how discontinuing discs will affect physical game releases. An expert now believes that, although the future is not fully certain, one thing that seems clear is that companies like Sony can now achieve better margins on sales by reducing costs.
PlayStation’s Biggest Disc Producing Site Is Already Being Repurposed
While disc-based PlayStation games will still be releasing until 2028, Sony is already starting to cut back on its production of physical copies.
Pre-paid Game Cards Might Soon Replace Physical Boxes
“There is an opportunity to reduce costs further,” says Piers Harding-Rolls, a games industry analyst at Ampere Analysis. He suggests this could come through prepaid game cards or similar alternatives. Harding-Rolls says publishers are currently forced to take on added risk by investing in disc production and paying a royalty fee to Sony “before any payments are received.” Therefore, the analyst believes that removing the costs associated with producing physical media could potentially help publishers achieve better profit margins and ultimately offset increases in other areas, such as development and staffing budgets.
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According to Harding-Rolls, the decline of physical game releases poses a direct threat to retailers that specialize in selling video games. To reduce that risk, he believes companies must develop more creative ways to still offer some form of physical product. “Calling time on physical media will mean innovating around digital games sales in-store to try and replace lost business,” he says. One such “solution” could be a shift to prepaid game cards that many gamers are already familiar with and that are cheaper to produce.
After Losing Discs, Game Boxes Could Shrink Too
Harding-Rolls believes that, aside from Sony’s no-disc policy, Take-Two’s decision to replace GTA 6 discs with codes in boxes will likely encourage more major video game publishers to follow suit. “[The] move will hasten a trend towards digital codes being sold at retail versus physical media,” he says. However, what remains uncertain is whether publishers will continue releasing these “physical codes for a digital game” inside full-size cases. If the primary motive behind the no-disc movement is to reduce production costs, it would make sense for publishers to either abandon physical boxes as well or shrink their sizes to cut costs.
In theory, a no-disc, all-digital gaming industry should be more sustainable given how ongoing RAM shortages and similar production hurdles have negatively affected video game companies. However, the concerning aspect is that a digital-only ecosystem endangers ownership rights, and as Harding-Rolls explains, it also “undermines the pre-owned games market.” Sony’s track record of removing users’ digitally owned products without notice or refunds also does not help inspire optimism about how things are currently progressing.
Unsurprisingly, gamers’ reactions to Sony’s announcement have been largely negative, and there is even a petition calling on Sony to reconsider the abandonment of discs. That said, many experts, including Harding-Rolls, believe that “physical product has been declining in importance,” and see the shift toward no-disc policies as inevitable for major companies like Sony.
Source: Ampere Analysis
