Civ VII on Switch 2 - game key or full physical game?

It would of course make sense for Nintendo to provide smaller sizes.

But I guess Nintendo also has a big incentive to make the publishers happy in this regard. Because after all, Nintendo is still in fierce competiton with Sony and Microsoft, and I am pretty sure they do not want to have a smaller presence in bricks and mortar stores compared to them. And I guess they also sell a lot of consoles in these stores, so they have a strong incentive to maintain the physical edition, from the perspective of brand visibility alone.
 
I think Nintendo anticipated this cost issue. That is why they created the game key card version, which is basically a physical key to a digitally distributed game and substantially cheaper to produce, since it does not require the expensive SSD storage. Contrary to regular eShop purchases, which are bound to a specific account and cannot be resold on a secondary market, those game key cards are not bound to a specific account, making it possible to share or resell the game. This is very likely also the intention behind the "game share" feature, which allows you to loan digital games within your family group for up to 14 days. They want to overcome some of the disadvantages people see in a digitally distributed games.
So a "key card" game is essentially the ownership licence that allows buyers of the physical "key card" game to resell it or lend, keeping
intact the tradition of family friendly brand that got associated with Nintendo over all these years.

I didn't see that coming.

It's a smart decision, basically saying NO to the business practice of selling games as a service typical of all other game distributors, leaving the PC market in its
own War field for all of the worst possible tactics being forced-passively implemented by the magic combo MS-XBox and all other Digital shops Steam, Epic, etc.

How would they guarantee the Digital download of a game on "key card" 20-40 years from now it's another topic for another day...
 
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