Gaming is an ever-evolving industry that seems to shift and reinvent itself every day. Big news or changes in industry conditions can directly impact publishing deals, so publishers, developers and content creators will want to look at any deals they have in place (or that they’re negotiating) when that news hits.

One event impacting the industry took place on July 1, 2026, when Sony publicly announced that it would cease supporting physical releases of discs for PlayStation 5 starting January 1, 2028. After that date, it will only distribute PlayStation games through the PlayStation Store and digital retailers.

Because of this, publishing deals written with PS5 as a channel may need to be renegotiated or adapted.

Note that while it’s good practice to assess agreements after any major news, the below information is meant as general advice on what to consider for a change in distribution channels specifically.

Who’s Impacted and How

Everyone in the deal chain has a stake in this type of change, but what that stake looks like depends on where the party is in that chain.

Publishers & Distributors

As a publisher, the party likely relies on physical distribution as a piece of revenue and associated forecast. If the party deals heavily in physical publishing and regularly publishes for PS5, that party would likely be thinking about what the shift means for its finances by weighing the reduction in costs for materials, labor, and associated goods against the downturn in income from distribution through the removed channel.

Key questions might include:

1. What do any current deals look like with developers of existing games? What about agreements for future releases?
2. Will deals with third party warehouses or suppliers be impacted?
3. Is any party tied to a certain warehouse capacity that won’t be used unless that party increases production for another channel?

Developers with Games Already Published

Developers working with third-party publishers for their distribution would want to consider:

1. How long their current agreement runs with that game publisher, and
2. Whether that agreement says anything about what happens if the publisher simply decides to cease distribution for the affected channel before the agreement term ends.  (Chances are, the “what happens” is not specifically written for the situation. The situation may be covered by conditions in the termination language or even “Force Majeure” language.)

Note that for the Sony situation, there’s some good news: Sony is not discontinuing distribution for existing discs. It has also stated that physical discs for games which have released or are slated to release before the cutoff can be re-ordered before that cutoff. Developers would still want to consider the questions above.

Developers with Games Not Yet Published

Developers whose titles aren’t scheduled for release until after a change takes place may need to amend publisher deals to remove references to the affected distribution channel, while accounting for the fact that removing that channel will impact projected net revenue.

This includes thinking seriously about overall value of the agreement, especially if there’s a minimum guarantee or recoupment language.

Key questions:

1. If there’s a minimum guarantee, how was that calculated?
2. How much has the developer relied on distribution through the affected channel in the past?
3. If revenue share is different between channels or types of channels (i.e., physical and digital), does losing the affected channel mean a different share should be increased?

More Food for Thought

While the above are good places to start thinking about what happens next, there are a few more things to consider.

Third Parties

Games often contain some form of third-party materials, either under license or being created as works-made-for-hire or for assignment. Licensors might want reasonable changes to their royalties based on a shift in distribution. Overall investment in licensed or assigned materials might need to be adjusted if projected revenue is going to be lower than expected.

Considering Alternate Options

Major changes are felt throughout the industry, so it’s not uncommon to see options crop up following initial announcements. For example, in the above Sony scenario, Sony indicated that publishers would have the option to release new games in physical stores using digital codes after the shift to digital-only. This news means that developers and publishers can update their contracts to account for codes, which might look like adding a new “Code Sales” revenue share split if a business is heavily tied to retail or reworking the definition of “Digital” sales to include purchase of codes at retail.

What’s Next

Understanding where deals stand and what timeframes look like is always the first step when hearing news that could impact publishing deals. Following that, it’s important to consider what risks exist and how to mitigate them based on business needs. Odin Law and Media regularly navigates industry developments and can help developers and publishers address any needed changes in their deals.