Gamers taught PlayStation to kill game discs, analyst says

One analyst says that gamers inadvertently led Sony to the decision to retire physical PlayStation game discs.

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Yesterday, Sony shocked the world by announcing it would stop producing new physical PlayStation game discs in January 2028. Sony was immediately vilified, leading to millions of negative responses--the tweet alone has nearly 80 million views at the time of writing.

In reality, gamers have essentially taught Sony to come to this conclusion by shifting more to digital, although the company certainly fed, accelerated, and encouraged this process through significant multi-year investment. Bernstein analyst Robin Zhu asserts this accurate view in a recent interview with The Financial Times.

"If gamers and preservationists had bought more physical games, Sony wouldn't have seen the digital sales ratios that justify this decision," Bernstein analyst Robin Zhu tells FT.

"Digital game sales carry essentially 100 per cent incremental margin . . . the cost of the physical package, shipping and retailer margins can be more than 20 per cent of sticker price,"

Sony's own data--the same information that shapes analysts' opinions--clearly reinforce Zhu's words.

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The numbers show that physical game disc sales have a negative CAGR of -9.26%, meaning that gamers are buying tens of millions of fewer games throughout the last 9 years. In Sony's FY17 period, physical game shipments were at 168 million, dropping to a much more paltry 70 million by FY25.

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Consumer activity and behavior will often dictate what a company does--and in this case, doesn't do--and ultimately these trends reflect years of digital-oriented growth across the PlayStation ecosystem. These developments were ushered along by Sony and its partners through various beneficial initiatives, including major discounts on the PlayStation Store, no-travel access to games and content, and teaching users new patterns of engagement with subscriptions, microtransactions, and other digital-oriented models.