JB Hi-Fi’s latest financial results have revealed a marked drop in software sales (music, movies and games), with the business category down 11.9 per cent compared to same period in 2012. This is despite the hotly-anticipated release of next-generation video games for the PlayStation 4 and Xbox One. Could the balance be shifting towards digital media as more consumers embrace tricked-out media centres? Is piracy to blame? Or has the quality of software just been a bit crap this year?
CD picture from Shutterstock
If JB Hi-Fi’s latest sales figures are anything to go by, it would appear that more and more consumers are finally ditching physical media for the convenience of digital libraries. In its latest half year results presentation, the company reported a 7.9 per cent drop in music, game and DVD/Blu-ray sales since its last financial report and an 11.9 per cent drop compared to the previous year.
Interestingly, despite investing in a fairly robust online store, the vast majority of JB Hi-Fi’s profits still come from traditional brick-and-mortar. While online sales grew 15.4 per cent last year, the category only represents 2.2 per cent of total sales for the business. Online visitations also grew significantly, with an average of 1.2 million customers visiting the site every week.
The rest of the results are fairly predictable with hardware sales up 11 per cent with the fledgling home appliance category helping to boost its profits. You can peruse the full report here.
Personally, the slump in software sales came as a slight surprise — we would have thought the pre-Christmas launch of the Xbox One and PS4 would have helped to boost software sales in Q4, despite the continuing decline of CDs and DVDs. Then again, the current crop of next-gen video games are old ports or samey sequels, so perhaps gamers are just biding their time.
What’s your take on JB Hi-Fi’s software sales? If any readers have recently ditched physical media, we’d love to hear the reason why. Share your thoughts in the comments section below.