Sony recently announced that they will cease publication of physical game discs for all future PlayStation titles starting in January 2028. Many are heralding this as the death of the physical era for the video game Industry. Sony may be the first but they definitely wont' be the last. 80% of Sony's PlayStation game sales last year were digital. Making the move seem like a logical evolution of the market.
That's not what's going on here.
On first blush it appears that Sony only makes 20% more when they sell a digital product over a physical one. Keep in mind that if they self publish (i.e. The Last of Us) that 70% number essentially jumps to 100%. doing some quick envelope math, Sony could more or less look to expand their yearly sales by about $4 billion by getting rid of physical media. Again, envelope math.
The "Leakage" Problem Video game manufacturers sell their consoles at a loss the real money is made in game sales. Something that has been getting in the way of that is the secondary market. Used video game sales. You play a game bring it to your local video game store trade it in for another game. Play that game. Finish it. Trade it in. Lather, rinse, repeat. By the time the cycle completes the same video game could've changed owners many many times. Each time is a lost sale for Sony. This is what the industry calls leakage. And lately it's been leaking like a sieve. The Global second hand game platform market was valued at 7.2 billion in 2025, and is expected to hit 13.8 billion by 2034 at a compounded annual growth rate of 7.5%
Sony's a worst case scenario would be somebody buying a second hand console, then getting all their games through the secondary market model. That would be a PlayStation customer that Sony not only hasn't made any revenue on but cost them money due to subsidizing the cost of the console.
Killing the physical market puts an end to leakage in one fell swoop, with ripple effects that will forever affect the customer and the industry
Killing the used market kills the only price competition in console gaming. When it comes to physical media, Brick and mortar retailers like target, Walmart, and Best Buy, try to undercut each other on price. Sometimes resulting in a loss leader of their own. Once all games go digital and you can only get them from one source. the sky is the limit as far as pricing goes.
You never "owned" the digital copy anyway. Sony is a major offender when it comes to this. Most recently they have removed 551 movies from the PlayStation store. Meaning if you "purchased" them they're gone. They did the same thing with Discovery TV programs back in 2023, with the Coup de grâce of removeing inactive PlayStation network accounts after 36 months and all of your digital content with it
Manufacturers can now fully force end of life Sony announced that it's closing the PS3 and Vita digital stores in 2027. Users cannot purchase any additional content but can still download the content they've already purchased (for now). This stifles the second hand hardware market, in an all digital landscape You can't sell or pass a hardware console down once it's past it's manufacturer EOL. Any games are tied to your PSN account and not the unit. Essentially making it a doorstop.
The transaction away from physical games is being framed as progress. And in some ways it may be. But something larger is going on here.This isn't just about nostalgia. This is about digital rights. Buying something digitally should come with the same rights and protections as buying something physically. Industries should not be allowed to just pull the plug on your digital purchases any more than they would be allowed to burst into your home and snatch back your media off the shelf.
Sony is messing with the video game ecosystem. It's changing the relationship between the consumer and the manufacturer while squashing any leverage we may have had as customers. Video games are starting to shift from a product to a service. And history has shown that when we move from product to service, we usually lose more than we gain.