How new console digital will slowly but surely erode GME's margins and earnings
First the big one, the news that MS controls the used game market and any scraps they give to retailers (which are margin negative) are of MS' choosing and they can end the used market any time they want. Others:
1. Launch day digital releases for all games. MS already confirmed this, I'm sure SNE will do same. It isn't a stretch to presume pre-installing like on Steam. Games go Gold up to 5 weeks before retail release, that's plenty of time to casually download a big new game then start playing at 12.01am.
2. Rental and borrowing. These require installing the game. From there a purchase any time in the future is one click away and start playing immediately, rather than driving to a store or waiting for delivery.
3. Streamlined PSN and Live store experiences to encourage more digital buying. I would expect background pre-installing of games recommended by the system or by your Friends, and from there it's one click to buy. You get a message from your buddy, "You might like this game. Press A to play. Then it's would you like to buy? Press A."
4. Partial downloading. Start playing the game when maybe just 10% or 20% of the whole game has downloaded. Even sooner perhaps via Gaikai.
All of the above are about maximizing convenience and transferring new sales to digital, which is a double hit for GME because of the hit to used inventory.
5. More F2P games, with all revenue being digital. We already have some on 360, I expect we'll see a lot more. Crytek already said this is their route, Epic will probably do same.
6. Other digital living room moves like Ouya and probably Apple before long.