I’ve always been a bit uneasy with the idea of digital distribution. Now with details surfacing about Onlive, a new “console killer” that is digital distribution only, I’m downright frightened.
With Onlive, all of your games are hosted on and processed on a server. The device merely connects to the server and communicates back and forth video signal and controller input. Because the processing isn’t happening locally, this has the potential to eliminate the need to ever buy a new console, ever. Any time the system needs an upgrade, it wouldn’t be your responsibility to do so. Sounds great, right? Well, there’s no denying that this is some incredibly impressive technology. However, what scares me is the distribution of software. All games have to be bought digitally, which essentially means you only buy the ability to play this game. But for how long? You’d hope for forever, but the truth is, if Onlive suddenly tanked and had to pull the plug on their servers; bye bye video game collection. I realize that even disc based games are only licensed to the users (you don’t actually own them), but no company is going to come into your house and take back a disc. While it’s highly unlikely that a big company like Nintendo will suddenly say “You can’t play all those Virtual Console games you downloaded now, kthnxbai!”, it’s still a possibility.
At the risk of letting my true nerd form shine through, I really like to have the physical copy and packaging of a video game. I like to admire my collection, smell the discs, and rub the booklets all over my body… Okay, so I don’t actually do that, but I still like having the physical media because it feels like I really own the game. I will admit digitally distributed software is more convenient because there is no disc swapping involved, but it’s a small enhancement. You would think that without the need to manufacture packaging and discs that digitally distributed software would be cheaper, but this is not the case. Steam games often cost just as much as retail games if not more. Where games usually go on sale after being in stores for a while, digital copies don’t see much love in the sales department.
Perhaps my biggest concern with digital distribution is that what you get is what you’re stuck with. Meaning when you buy something you better be damn sure you want it, because you aren’t getting rid of it. I have a tendency to sell most of the games I buy. I will more than likely never play the game again, so if I sell it I will have money to buy more games. You can’t sell a digital copy, so once you pay for it, that money’s gone forever. Some people like to keep all of the games they buy, but you have to admit there are some games that just suck. I’ve bought some real stinkers off the Virtual Console for Wii that I’m stuck with now. A console with solely digitally distributed software would make me nervous to buy anything because I know I’d have to keep it.
I don’t mean to suggestion that digital distribution is always a bad thing. It was an absolute necessary move for the music industry. I have no problem dropping 99 cents for a song, and I’d never buy a physical CD again because I’d just rip it anyway. It becomes a problem, though, when the asking price gets out of hand. I’m not about to throw down 50 bucks for something that I only kind of own and can’t get rid of. Unfortunately, digital distribution is the way everything is headed. It makes sense for businesses because it’s cheaper to distribute and, especially in the case of Onlive, it’s easier to regulate piracy. It’ll be a sad day When consoles finally do make the switch, and may be the day I give up on the industry.

Finally, an update! As usually, I fully agree. I’ve always said it would be nice if these digitally distributed games had some kind of trade-in value, but the companies behind them will never do that. They got your money, and they know they’ll get it again and again.
Interesting concept. I’m interested to see how long it will take for companies to start doing this. I have heard that iTunes, for example, could have digital distribution in the future where you don’t even download the songs onto your computer. Its all in the “cloud”. You just use your iTunes account to access all of your music. It is scary, but it is a cool idea. You could access all of your music from any computer, and it wouldn’t take up space on your hard drive.
Internet access will probably be a necessity for most new video games anyway, so maybe digital distribution isn’t such a bad idea. I could play MY games from anywhere that has high speed internet without physically hooking up a console or messing with disks.