British games retailer Game has gone into administration, resulting in 277 of its more-than 600 stores being closed immediately, and more than 2,100 employees being laid off. Game had a turnover of £1.6bn ($2.6bn) for its 2011 financial year, but has been struggling for some time in the face of the transition from physical to digital sales, as well as what administrator PricewaterhouseCoopers describes as “serious cashflow and profit issues”. PaidContent has some good detail on the seeds of Game’s downfall, claiming that three years ago strategic proposals within Game pointed to 2012 as a tipping point from physical to digital sales, and suggested ways its business could shift to capitalise. It didn’t. Now PwC must search for a buyer for a network of high-street stores to take on the task of wrenching the Game brand into the digital world, or managing a more-graceful decline. A tough call. What’s the music angle? The obvious parallel is HMV: can it avoid a similar fate with its diversification into hardware?
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Tools: Kaiber
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