> "Shares of GameStop fell more than 13 percent Friday after the company reported sales declines in almost all of its segments during the fourth quarter.
> GameStop reported Thursday that hardware sales declined 29.1 percent, and new software sales fell by 19.3 percent for the quarter — two categories that were once key in boosting revenue for the retailer."
> Wonder if online gaming is cutting into that?
You mean online like HTML5 games or digital downloads? I would certainly say digital content is cutting into that. Steam, GOG, Direct2Drive, Humble Bundle, etc. Soooo much easier to buy a game online and use it right away than having to run down to you nearest GameStop to pickup a game. I'm sure sites like Amazon have something to do with GameStop's profit losses too. As technology improves, people become lazier.
Digital downloads are also no overhead for the distributor.
I went to ebooks and digital downloading for my books because it costs me $15 to produce a 355 page book and I have to charge twice that to cover shipping but an ebook of the same material costs me nothing except for a website and dropbox to store the files so I can charge $10 for the same materials and my customers get a great deal and I make more per sale.
Brick and mortar stores have huge overhead and require insurance and employees so everything they sell costs more.
I think stores like gamestop will probably go out of business like the Blockbusters did before long unless they find a new angle.