Dubai: Like movies and books before them, video game sales are making the jump from the physical into the digital world.

For PC gamers, that isn’t anything new. Services such as Stream, which allows players to download video games for their PCs, have recently gained mainstream popularity, but console games — especially on initial release — are still largely distributed on physical media.

However, a number of companies here in the Middle East are looking at ways to make selling digital console content a viable business model.

“[The retail game market] is still physical at the moment, but it’s definitely shifting,” said Ryan O’Rourke, the e-commerce manager for meplay.com, which is based in Fujariah and operates in all six GCC countries. The company launched only four months ago.

The company currently allows customers to purchase their games on the company’s website and then delivers the physical disk free of charge. Meplay’s competitive advantage comes its ability — through working with the game’s developer’s — to give its customers exclusive downloadable content, also called DLC.

O’Rourke, who is from the UK and has been a gamer since he was 10-years old, said the key to developing an online company is not just to focus on sales. Relationships need to be built with customers.

Significantly interested

One of the reasons O’Rourke and his partners started their company in the Middle East was because there where very few companies catering to gamers in this region.

“The Middle East is not being utilised and people are being neglected,” he said. “We wanted to start giving people something that is not just commercially based.”

Mohammad Hamedi, CEO of AIDO.com, a Dubai-based e-retailer, said his company is “significantly interested” in delivering digital content and it currently looking at what it would take to make the shift.

“The Middle East is behind the US and Europe in digital distribution, and we’ve been monitoring that, especially for games, electronics and books,” he said.

AIDO started as a company whose primary focus with DVD distribution, but over the past two years has expanded to include books, toys and “geek fashion.” He said games make up between 20 and 25 per cent of the company’s sales. Hamedi said the company plans to double or triple his staff over the next year, although he declined to provide current figures.

Hamedi also believes building relationships is key to building an e-commerce business, especially in the hyper-competitive Middle East market.

“We need to build relationships. I don’t just want to win the battle on one sale. I want you to come back.”

He said the only time most e-retailers are talking with their consumers is when they’re delivering the sold product and when the customers is angry. Hamedi, who has been part of several startups in the Middle East and US, says he actually takes time to call his customers directly. He said customers are usually surprised to hear from a CEO.

Still dominant

“It’s sad that its just a strange thing,” he said.

Geekay, a physical retailer that specialises in games, consoles and accessories, also says physical games sales are still dominant.

“We still see strong retail box sales going on,” said Geekay General Manager Nimit Deepak Palija. He said the company is prepared to make the shift to digital distribution, which Palija predicts will come in 2 to 3 years.

“We’re coming up with a model to sell digital goods through our stores.”

The company has already made some inroads with digital distribution, teaming up with Steam about 9 months ago Palija said. It has also offered exclusive DLC.

Palija said that retail sales have increased about 70 per cent over the last year, due to the launch of the PlayStation 4 and the Xbox One consoles. He said about 30 to 40 per cent of the revenue comes from games sales.