GAME to sell contracts, not hardware

The CEO of videogame retailer GAME has said that the future of the high-street retailer isn't in the sale of hardware and games, but in contracts.

This idea of where the company is going comes from consultant Nick Parker, who says this is the direction CEO Ian Shepherd wishes to take the gaming firm.

"With OnLive and GAME it's no coincidence that they're going into business. I sat down with Ian Shepherd a couple of weeks ago and his vision is seeing GAME like Carphone Warehouse, whereby Carphone Warehouse doesn't actually sell anything at all, no product, no hardware, it just sells contracts," he said at the London Game Conferance.

The strategy has been reported by Gamesindustry.biz (free account needed to read article), who described how GAME were the first UK partner for US firm OnLive, a game streaming service that utilises a cloud-like platform to allow users to play titles that they wouldn't otherwise be able to.

Other companies are following a similar business model, Amazon for example. While it's still selling hardware, it's actually making a loss on several products, recouping its costs on the content that they sell to customers after they have the kit they need.

When discussing how consoles would feature in this future streaming market, Mr Parker was less certain, but stated that everyone had a role to play.

"These guys are already developing compression technologies - you may say they are the old console guys - but they still have an installed base."

"It could be a hybrid expansion of their current core processing technology with some internet connectivity, perhaps not disc-based but certainly with a disc as an add-on peripheral. So there's something to sell at retail. They are certainly going to be big players and 2014 is the tipping point when these consoles will be out," he added.

He also said publishers wanted more of a direct connection with their customer base and that efforts like EA game's Origin was a good example of this.