Music's already there, video is beginning to arrive, the next step for the games industry is online distribution.

Attendees at giant LA games convention E3 are discussing such a move. As high-speed broadband becomes the norm, larger games companies are considering selling games online, just like many smaller developers already do.

IGN Entertainment vice president Sutton Trout told JS Online: "The incubator (to do this) has been the music."

Trout explained that his company's game download service has seen sales grow significantly since it began in September 2005.

"We're not talking about downloading Tic-Tac-Toe or "Tetris." Try "Tom Clancy's Ghost Recon Advanced Warfighter" or "Dungeons & Dragons Online,"" he explained.

Customers get immediate gratification, there's no waiting for the post to arrive and no need to head to a local games shop, he added.

The report also explains that, just like music, legitimate games purchases online don't appear to detract much from conventional retail games sales, though the mix is heading toward a 50:50 split.

Online games distribution reached a value of $835 million in the US last year, according to Jupiter Research.

In future, games companies are considering developing episodic titles, in which games are expanded by acquiring new games modules. They are also looking to create more online gaming communities for their titles, the report adds.