In one of today's main Gamasutra features, and this edition of Game Law, noted video game lawyer Tom Buscaglia discusses some of the advantages of digital distribution for today's video game developer, particularly citing Tripwire's Red Orchestra: Ostfront 41-45
, which he helped to negotiate a deal for.
In his conclusion to the piece, Buscaglia discusses, from both a legal and practical perspective, what digital distribution of video games can do for the developer:
"So, I have become a believer in the digital distribution of games. The developer's royalties are usually two to four times greater than what they are in a traditional publisher deal. This means you can sell fewer units and get by and if you get a hit, you get much more return, even at a significantly lower price point.
Also, in most cases the developer retains the IP. This help builds long term value in the studio, something you cannot get otherwise unless you develop some sort of patentable technology or other licensable tools and technology while your making your game.
The digital distribution model also opens the door to pure funding deals that do not involve publishers who, frankly, charge much more than the value of the money for the funding they provide. But most important, digital distribution means more ways to get your games directly to the players with as little “middle man” action as possible."
You can now read the full Gamasutra feature on the subject
, including plenty more on the practical advantages of digital distribution (no registration required, please feel free to link to the article from external websites).