Chatting with the great and good of the at the Edinburgh Interactive Conference, Edward Williams of BMO Capital Markets said that the games industry is under threat, the sector facing big changes to its business model.

"For Western publishers, profitability hasn't grown at all in the past few years and that's before we take 2009 into account," Williams offered, noting that on the other hand, Chinese firms have continued strong growth.

Digital distribution was seemingly key to Chinese firms, delivering titles via downloads, rather than worrying about DVD releases in traditional stores.

Western developed games, meanwhile, are now too complicated and hard to make, resulting in epic production costs. Multi-platform is also putting the squeeze on profits, while official licenses such as or are more costly than ever.

Commenting on this news, Sports boss admitted that mobile and PC games are tops in China, and was quick to add that in places like the publisher is keen to push ahead with releases.

By Luke Guttridge