Small business titles, akin to Ragdoll Kung-Fu or Darwinia have always had one big problem in trying to get published - finding shelf space on the retail store fronts. I've mentioned about how developers are lamenting the current delivery methods and craving new ones, but the problem is more complex than securing a domain name to host downloads for your title. You have to worry about rights management, registration, managing credit card transactions (which isn't exactly easy and risk-free) and customer support.
Think about how iTunes has changed the music space. Instead of augmenting sales channels they started replacing them, much to the chagrin of their brick-and-mortar counterparts. Instant delivery, cheaper costs, more portability, centralized DRM, and a single payment gateway to eat all your money. Valve's Steam deliver system hopes to be the iTunes of gaming - where titles are encrypted and assigned to only entitled machines. Vivendi's fight with Valve just reinforces the analogy... they fear that retail distribution will take a hit in lieu of digital delivery, just as iTunes has made dowloading music a palattable alternative to hopping in the car and burning petrol.
Online gaming sales & delivery have the obvious benefit for independant game developers in that they're easily accessible by the masses, easy(ish) to use and easy to publish to. With digital delivery publishers are also more likely to take risks with unknown titles... if it doesn't sell, it will just sit there taking up drive space on some dusty server. That's a much better condition than boxes sitting in inventory, taking up space and eating up production costs. A billion titles in-stock is a "feature" when you're an online retail presence, a liability if you're a warehouse.
It appears Microsoft's Live! service hopes to accomplish the same thing as Steam, except in the console space. Sony has the same thing lined up for the PS3 - there are signs that they're betting digital delivery to their modest hard drives could reap some possible benefits. If the 360's DirectX development continues to encourage developer participation, and Sony opens up its specs to the world at large, selling a vast catalog of even small titles opens up a whole new revenue stream. Episodic content now becomes that much easier... you can subscribe to the latest $15 quarterly release of your favorite title and have it delivered before it hits the presses. It's like having the latest Archie delivered magically to your breakfast table by mystical lil' wood nymphs.
But it doesn't just stop at home my friends... no siree... because Microsoft is all about the "connected household." They've also announced plans to extend Live! to other platforms, such as your lovely cell phone. This has merits beyond Penny Arcade's target users; imagine a game that's persistent beyond just your console. Complete a quest on your console, solve a mini-game on your cell, and finish it off on your PC - all for the same game. A single title could have playable "fragments" that can travel with you, mayhaps sync'd to a central repository at home or on Live!
It's a clever idea - one that's a good compliment to existing titles. Imagine working on your alchemy skill with Oblivion on your cell phone, then having your inventory reflect your changes when you sit back down on your PC. This sort of pervasive - nay, incessive - environment would keep people addicted to your title for endless hours.
On second thought... maybe society should take a pass on that idea...