The video game console industry is regarded as a content industry, in which Japan is a strong international competitor. Prior research into content-generating companies has examined aspects such as industry structure, software production, and HR systems. However, there has been little examination of the distribution structure for delivering products to the consumer. This paper outlines the historical transition of video game software distribution system, initially developed alongside toy distribution. This study points out that this structure, with retailers carrying the inventory risk, subsequently led to a shrinking market.