Say goodbye to physical discs once and for all! SONY.US (SONY.US) PS platform announced full digitalization in 2028, and the $7 billion second-hand market faces the risk of “zeroing out”

In June 2013, Sony (SONY.US) PlayStation released a short video showing how easy it is to share games on PlayStation.

Shuhei Yoshida, a Sony executive at the time, handed a CD to his colleague Adam Boyce, and that was all. But this was seen as more than a simple demonstration, but more as a mockery of competitor Microsoft's Xbox's strict game sharing policies.

Jack Trayton, then president and CEO of Sony Computer Entertainment North America, said at a conference in the same year that “sell it at retail stores, sell it to others, lend it to a friend, or keep it forever,” and “when a player buys a PS4 CD, they have the right to use a copy of the game.”

The statement drew a standing ovation and fueled the subsequent backlash, which eventually led Xbox to withdraw its restrictive policies.

Today, in the eyes of some, Sony is becoming the tyrant it once mocked.

The Zhitong Finance App learned that PlayStation announced that from January 2028, it will stop producing physical CDs for new unreleased games released on its console, so that newly released games will be fully digital.

Even if the boxed retail version is sold, it will contain a download redemption code, not a CD.

One of the first games to adopt this model is Take-Two Interactive's highly anticipated Grand Theft Auto 6 (GTA6) published by Rockstar Games and scheduled to be released this year.

The business logic favors Sony. By selling more digital games, the company reduced the need to manufacture physical boxes and completely eliminated physical CDs, thereby increasing profit margins.

Michael Puckett, managing director of strategic planning at Wedbush Securities, said the move would save Sony some money, but “there is no doubt that consumers are paying a price for less choice.”

A CD can be used for resale, discounted, loaned to a friend, given as a gift, placed on a bookshelf, or kept after a digital store closes. However, downloading a redemption code doesn't do any of these.

Without physical CDs, players lost the ability to buy cheaper used games or recover funds by selling playthrough games. This change will give Sony closer control over game sales channels, discount timing, and how long consumers can access games.

“This is an extremely ironic turn,” said Kazunori Ito, director of research at Morningstar Equities, and Sony earned a reputation in 2013 for portraying physical discs as a “simple, consumer-friendly” choice.

On YouTube, players retracted Sony's old video and left a bitter comment: “It's like watching a wedding video after a divorce,” one netizen wrote. “Alas, the giants of yesteryear have now fallen to this point,” another wrote.

Existing physical games and games released on CD before the deadline will not be affected.

Michael Foote, founder of game industry consulting firm F-Squared, said, “This is a decision that harms the interests of consumers extremely, without any justification, and reflects disdain for players in our own ecosystem.”

For Foote, the problem is that the host is a closed ecosystem controlled by the platform. On PC, players can buy games through other marketplaces like Steam or Epic Games Store.

“Sony is happy to convince us that the transformation of the PC market to digitalization is exactly the same thing as putting consoles on this path. But that's completely different,” Foote said.

The second-hand market is in decline

Sony's move has had a direct impact on the second-hand gaming economy. Dataintelo estimates that the global used gaming platform market, which includes used games, consoles, accessories, and peripherals, will be worth $7.2 billion in 2025 and will reach $13.8 billion by 2034.

Wedbush's Puckett said, “Realistically speaking, at least 1/3 of games in history were sold as used, and players who sold used games also received funds to pay for new games.” “Physical game retail is bound to end.”

While old games can continue to circulate even after CD production is discontinued, this is impossible with digital games.

Morningstar's Ito anticipates that the second-hand game market will “continue to shrink and eventually disappear.”

According to Foote, developers will be less flexible in terms of discounts compared to PC platforms where games can be sold on Steam, Epic Games Store, GOG, and others.

Sony supporters may argue, however, that the market has changed since 2013. Sony's fiscal year 2025 results showed that revenue from physical PlayStation 4 and 5 games was nearly 10 times lower than revenue from digital downloads of full games.

Sony stated in the announcement that the decision was “a natural direction for Sony Interactive Entertainment in line with consumer trends, as the overall preference for digital media significantly exceeds that of physical CDs.”

Ubisoft executive Philip Tremblay said in 2024 that players should get used to “not owning your game,” which caused great indignation among players.

Sony also recently announced that the PlayStation Store purchase feature on PS3 and PS Vita will be closed in most countries in July 2027.

Also, due to the license agreement, more than 500 previously purchased movies will be removed from users' PlayStation media libraries, and Sony's notice doesn't mention compensation at all.

Still, some are wary of the consequences this move may eventually lead to.

“What's stopping PlayStation from doing the same thing with the games we buy?” Foote asked a question.

Ito also expressed concern. “There's an essential difference between players accepting this transformation because they see value in it, and imposing it on them by stripping away other choices,” he said.

“Most people would rather complete this transition in their own way and at their own pace rather than being driven by the end of physical discs,” he added.