GameStop: Nintendo’s next system will support physical retail games

NX won’t be the first major home console to go download-only.

Kyle Orland – Jun 20, 2016 12:48 pm | 75

Pretty much every part of that "Buy Sell Trade" sign is suffering recently.

Since its off-handed announcement more than a year ago, Nintendo has released precious few details about its upcoming NX console, currently set for a March release. That has left the press to speculate wildly about “the new hardware system with a brand-new concept.”

So it qualifies as news when GameStop CEO Paul Raines confirms publicly that, yes, NX will sell games on physical media, just like pretty much every other home console ever made.

Raines’ statement in a recent earnings conference call comes about a year after patent-filing-based rumors suggested the NX might eschew retail games entirely in favor of a download-based business model. Don’t believe everything you read, Raines said.

“I would say that the fact that there are rumors of that type just confirms for you that this is an important console for next year,” Raines said in the call. “[NX] will have physical media, we will play a role in it, our preowned business will also play a role. So we’re excited about that.”

More recently, a financial report from a Japanese chip manufacturer suggested that the system might use NOR flash-based game storage rather than the now-standard optical discs. Raines and fellow GameStop executives said they didn’t have any specific knowledge on that score.

Aside from niche consoles like the struggling Steam Machines line and Ouya, there has yet to be a major home game console that has completely done away with games distributed on physical media. Sony released the download-only PSP Go portable in 2009, but the redesigned handheld failed to have much impact on the market.

That hasn’t stopped people from assuming a download-only home console is coming, though. Back in 2012, early rumors suggested that Microsoft might get rid of discs on the Xbox One as a way to control profits “lost” to used game resellers. Even when disc-based Xbox One games were later confirmed, Microsoft had to do a quick 180 to prevent backlash against proposed restrictions on used game sales, suggesting console players might not be ready to give up the idea of fully tradable physical media.

In any case, GameStop thinks the NX’s continued support for physical retail games will be good news for the retailer’s bottom line. “Should the new NX perform only slightly better than the Wii U, it would still generate $2.7 billion of incremental sales over the first two years,” GameStop EVP of Strategy and Business Development Mike Hogan said on the call. “Should it perform at even half of the level of the Wii, it would generate $7.5 billion in incremental sales over that timeframe.”