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Videogame Industry: Is the Sky Really Falling?

isn't the industry as a whole growing?

Depends on where you draw the line on where 'industry' is and what exactly are qualifying gaming devices. Phones and tablets are arguably the largest expansion for gaming seen in some time...while everything dedicated has, I believe, actually shrunk from a huge expansion when sales across the board were better a few years back.
 
No, the industry just reached its maturity. It has been growing last decades (specially the last one ). So now its a mature enterteining option similar to movie, music industry
 
I agree with the fact that this has been slowly happening for a while. The success of the Wii is no longer around to mask the situation.

That said, what's coming is not a crash. It's a culling of badly run publishing houses. The "AAA" market is too small to sustain itself, and it only takes a couple bombs to put companies on the ropes. Costs are out of control and frankly very few games are worth the $60+ price tag.
 
Star Citizen is close to cracking $9,MIL,LIO.N in crowd funding.
The Oculus Rift is getting rave reviews when paired with space combat games.
You trying to tell me this isn't the end of gaming days?
I'm not buying it. This is clearly the Apocalypse.
Where's my poster-board?

The old business model is what is dying out and unfortunately it's tanking a lot of developers with it.

This really comes down to management as well. Expecting a game to sell 3 million to real even is kid of insane. Devs have been blaming the HD console switch, but despite that increase in cost, management has to step in at these companies and say "we can't keep doing things as we are". Marketing budgets shouldn't be the same amount as development.

There's a lot more I have to say on this that I'll post up when I'm on break if I have a chance.
 
Would you still feel that way if they were HD capable and could be hooked up to TV's? If not, I got no other hope for you. :(

That might be something...but I doubt a game like Skyrim or Fallout could be made on a handheld?
I mean, even the portable version of Lego LOTR had the open world edited out.
 
The AAA and console side of gaming is going to go through some rather major shakeups in the next few years due to soaring budgets and no effort to improve the development pipeline.

Can't keep pushing for games to sell multi-million copies just to retain profitability, and given how fickle the consumers are, it's a definitive road to failure.

Gaming as a hobby will never go away, there's too many games out there currently and people will want to keep making them. However the landscape of the industry might have to go through an ice age before the next golden age.
 
Gaming isn't going away, but it will certainly change dramatically over the next few years.

Unfortunately I do think this will be the last generation of consoles. We already have incredibly capable tablets that were barely conceivable when this generation began in 2005/2006.

In 2018/2019, Xbox 720 and PS4 will have been out for quite a few years and we'll probably have gadgets that will make dedicated game consoles pointless to produce.

VR is coming back - the potential is there to just fire up a game on your tablet and then don your Oculus Rift equivalent for "comfy couch", AAA gaming anywhere.

"AAA" games aren't going away, but I do believe they will change significantly in terms of how they are produced. Developers have to find a way to make them cheaper and less risky, whether it's smaller teams, using no-name actors, or whatever. Look at Dark Souls - it's one of the best games ever made, a huge, epic adventure, and yet it cost far, far less to make than many other AAA titles.

I really just want devs to focus on making games for specific groups of fans and making them as good as they can be in that area, instead of spending a fortune trying to appeal to everyone and having the game bomb as a result.

Physical media is dying out, not sure whether it will stick around or not. We may get to the point where game stores can no longer stay open.

Basically the industry is just very, very volatile at the moment. Losses will be posted, studios will close, people will lose their jobs. But games will still get made by someone, and I'm sure we'll find a way towards a sustainable future.
 
The AAA and console side of gaming is going to go through some rather major shakeups in the next few years due to soaring budgets and no effort to improve the development pipeline.

Can't keep pushing for games to sell multi-million copies just to retain profitability, and given how fickle the consumers are, it's a definitive road to failure.

Gaming as a hobby will never go away, there's too many games out there currently and people will want to keep making them. However the landscape of the industry might have to go through an ice age before the next golden age.

I liken the history of 3D console video game consoles to the classical Ovid model of the Ages of Man:

Golden Age:
Saturn, PlayStation 1, Nintendo 64, Atari Jaguar, 3DO
----The age of innocence and boundless innovation

Silver Age:
PlayStation 2, Xbox, GameCube, Dreamcast
----Maturation and refinement, but still a strong desire for innovation

Bronze Age:
PlayStation 3, Xbox 360, Wii
----Innovation begins to stagnate

Iron Age:
PlayStation 4, Durango, Wii U
----Innovation fully stagnates and the cycle ends


I just can't help but wonder how the "rebirth" / next Golden Age will manifest itself.
 
No, the industry is fine, it´s just on waiting period for a new console. Some people think since the WiiU is bombing it means the PS4 and Nextbox will bomb as well. It won´t happen, at least not as bad as the WiiU. I don´t think that they PS4 and Nextbox will bomb.

With games like upcoming games Destiny, and holiday releasing games like Watch_Dogs, Fifa, COD, AC, etc.... not ot mention the exclusives of both new consoles ,this holiday will set both the PS4 and Nextbox on fire in case they launch.
 
System releases

There will be a lot on the market. To varying degrees, these consoles do fight for the same markets. However, I think the greatest threat to new consoles are the current gen of consoles. MS and Sony may well cannibalize their first few years of sales if they plan on continuing to support, deeply discount, or even offer new skus of these old systems. If the grand business scheme is looking for big numbers and immediate gratification, they will probably find it here rather than in the new consoles, but I think that will harm the companies going forward if it slows adoption.

Publisher losses/closures

I don't think this is anything to cry fire about. A lot of publishers have become over-bloated behemoths and a reckoning was due. It was going to happen sooner or later, and the area between generations is as good a place as any for it to occur. I think there are too many factors to claim it is a sickness of the whole industry.

Major blockbusters underperforming

I'm not certain of the veracity of your claims about a lot of those games, but there certainly is a lot of fatigue for a lot of gamers in relation to the seemingly endless, sequel-driven business model. Should that continue, then this lack of innovation may well bore people to the degree that they stop buying said games, but that doesn't mean they won't keep gaming. New titles like Tomb Raider failing to meet expectations are a symptom of unrealistic expectations for an IP reboot. I don't think there is much here.

Major competition from Tablet/mobile gaming/resurgence of PC gaming

I'm going to contest your suggestions here. If you're talking about a crash in handheld gaming, then I think tablet and mobile phones are a serious competitor, but the people looking to buy an Xbox Next or PS4 aren't going to be satisfied with what is on offer on mobile platforms. Not the same market. As far as a "resurgence of PC gaming," I think that has yet to be seen. Have a substantial number of people picked up PCs over the last few years? Certainly, but is that because consoles are so long in the tooth as to be easily overcome by affordable hardware, or because PC gaming is being viewed as a better alternative? I'm not convinced its the latter for most consumers. PCs that overcome what you see in the next consoles, at least for the next few years, are still going to be very expensive, and offering your general consumer a choice between something that costs $500~ and works out of the box or $1000+, requires assembly, and gets marginal improvements over consoles seems like a tough proposition. There are certainly people who have been "converted" from consoles to PCs, but I doubt that populations is very large.

Even if though both your contentions are true, mobile platforms and PCs are entirely capable of playing the full spectrum of video games. Their existence may well buoy the industry if enough people have them. Ergo, no crash, just a movement to different platforms.

So, my ultimate conclusion is that your smoke is questionable at best, and there certainly isn't any fire; not yet. There is plenty to be said about market saturation and many feeling like this generation is "good enough," but I think the rest of your extrapolation goes too far.
 
The old business model is what is dying out and unfortunately it's tanking a lot of developers with it.

I agree with this. I don't think the video games industry as a whole is going to crash, but the big developers and their AAA expectations are going to have to be reeled in. Things like expecting Dead Space 3 to sell 5 million just for a profit and to be considered worthwhile is insane, considering how few million sellers are even in the market. Once the AAA model shifts to something more reasonable, the industry will end up stabilizing. Then again, there are people like Kotick who would rather use the AAA model to run the industry into the ground before abandoning ship and moving on to another way to get rich, so who knows.
 
It's more growing pains than anything. The industry is reshuffling itself and morphing to meet demand, but that also means some bad fallout.
 
honestly i dont see the sky falling...yes maybe the big publishers are hurting a bit, resulting in dev houses closing...

but the ease for indie development, coupled with mobile/ smaller digital downloads has created such a boom.

maybe the industry is plateauing in terms of the limits that can be pushed.

but this business is still going strong.
 
For me this last console generation has devalued the price of both videogames and consoles a lot, an AAA game doesnt worth 60-70 dollars at all... not even close.
 
Gaming isn't going away, but it will certainly change dramatically over the next few years.

Unfortunately I do think this will be the last generation of consoles. We already have incredibly capable tablets that were barely conceivable when this generation began in 2005/2006.

In 2018/2019, Xbox 720 and PS4 will have been out for quite a few years and we'll probably have gadgets that will make dedicated game consoles pointless to produce.

VR is coming back - the potential is there to just fire up a game on your tablet and then don your Oculus Rift equivalent for "comfy couch", AAA gaming anywhere.

"AAA" games aren't going away, but I do believe they will change significantly in terms of how they are produced. Developers have to find a way to make them cheaper and less risky, whether it's smaller teams, using no-name actors, or whatever. Look at Dark Souls - it's one of the best games ever made, a huge, epic adventure, and yet it cost far, far less to make than many other AAA titles.

I really just want devs to focus on making games for specific groups of fans and making them as good as they can be in that area, instead of spending a fortune trying to appeal to everyone and having the game bomb as a result.

Physical media is dying out, not sure whether it will stick around or not. We may get to the point where game stores can no longer stay open.

Basically the industry is just very, very volatile at the moment. Losses will be posted, studios will close, people will lose their jobs. But games will still get made by someone, and I'm sure we'll find a way towards a sustainable future.
I actually think the complete opposite to all your main points, especially when you say gamers will move onto tablets. It just won't happen imo, they just don't have the power and probably will never have the power due to them being portable and you're never going to get the COD's, Halo's and GTA's etc on tablets that will sell anywhere close the numbers you will on consoles.
Tablets are good for quick throw away games but i very much doub't you will get hardcore gamers (or even many casual gamers) that will spend 7 or 8 hours playing a game on a tablet resting on their knees. The whole tablet angle always makes me laugh and if Laptops couldn't destory consoles then i don't see how tablets will when they are pretty much the same thing minus a keyboard.
PC gaming was supposed to 'die' for the past 20 years but it hasn't happened, phones were supposed to destroy handheld gaming but it didn't happen and tablets are supposed to destroy console gaming but it won't happen imo.
 
No, the industry is fine, it´s just on waiting period for a new console. Some people think since the WiiU is bombing it means the PS4 and Nextbox will bomb as well. It won´t happen, at least not as bad as the WiiU. I don´t think that they PS4 and Nextbox will bomb.

PS4 and 720 probably won't bomb like the WiiU has.

However I do not agree that the industry is "waiting" on a new console. They have more than enough to innovate with now, and they have to find a way to reduce cost and risk.
 
In the USA, the retail game industry (software sales + hardware sales) is contracting year-over-year thanks to the diminishing momentum of PS3 + 360, consoles that have overstayed their welcome in terms of industry health.

Releasing the PS4 and Nextbox will solve this problem by having higher entry price alone. $400-500 consoles will upset the diminishing consoles sales and most likely price cut for the PS360. Not to mention massive titles like GTA5, COD, AC, Fifa, BF4 will ignite software sales especially since most of these games will have next console version.

PS4 and 720 probably won't bomb like the WiiU has.

However I do not agree that the industry is "waiting" on a new console. They have more than enough to innovate with now, and they have to find a way to reduce cost and risk.

Most definitely won´t bomb like the WiiU. They are getting every single multiplatform block buster out there (GTA5 is not confirmed yet). And no new consoles prices will balance and surpass the slowdown that happening in the industry. Most of these mp titles will be coming to the PS4 and Nextbox which will have software sales rise.
 
For me this last console generation has devalued the price of both videogames and consoles a lot, an AAA game doesnt worth 60-70 dollars at all... not even close.

I think people moaning about game prices are harsh, games were just as expensive (and sometimes more for certain games) in the 16-bit days 20 years ago, i think we have done well to not have any major hikes for game prices in that time, especially with developers constantly moaning about development costs.
 
I'm not certain of the veracity of your claims about a lot of those games, but there certainly is a lot of fatigue for a lot of gamers in relation to the seemingly endless, sequel-driven business model. Should that continue, then this lack of innovation may well bore people to the degree that they stop buying said games, but that doesn't mean they won't keep gaming. New titles like Tomb Raider failing to meet expectations are a symptom of unrealistic expectations for an IP reboot. I don't think there is much here.



I'm going to contest your suggestions here. If you're talking about a crash in handheld gaming, then I think tablet and mobile phones are a serious competitor, but the people looking to buy an Xbox Next or PS4 aren't going to be satisfied with what is on offer on mobile platforms. Not the same market. As far as a "resurgence of PC gaming," I think that has yet to be seen. Have a substantial number of people picked up PCs over the last few years? Certainly, but is that because consoles are so long in the tooth as to be easily overcome by affordable hardware, or because PC gaming is being viewed as a better alternative? I'm not convinced its the latter for most consumers. PCs that overcome what you see in the next consoles, at least for the next few years, are still going to be very expensive, and offering your general consumer a choice between something that costs $500~ and works out of the box or $1000+, requires assembly, and gets marginal improvements over consoles seems like a tough proposition. There are certainly people who have been "converted" from consoles to PCs, but I doubt that populations is very large.

Even if though both your contentions are true, mobile platforms and PCs are entirely capable of playing the full spectrum of video games. Their existence may well buoy the industry if enough people have them. Ergo, no crash, just a movement to different platforms.

So, my ultimate conclusion is that your smoke is questionable at best, and there certainly isn't any fire; not yet. There is plenty to be said about market saturation and many feeling like this generation is "good enough," but I think the rest of your extrapolation goes too far.

People around here tend to see PC's as competitor for console AAA games. However the biggest and most profitable PC games are exclusives and have nothing to do with consoles. That is the part of the market that is growing most on PC and these games do not require beefy machines.
 
No, the sky is not falling. You can look towards the tail end of every generation of hardware and see the same concerns being raised. Somehow the industry keeps getting bigger.
 
PS4 and 720 probably won't bomb like the WiiU has.

However I do not agree that the industry is "waiting" on a new console. They have more than enough to innovate with now, and they have to find a way to reduce cost and risk.

This gen has gone on way too long though, even gamers who don't care about graphics say the same many times. Things like this happen in certain industrys and a major new product can 'relight the fire' so to speak and i expect this will happen with the PS4/720, maybe not instantly as people still don't have as much disposable cash as they used to but i expect sales to build as the months and years go by.
 
This gen has gone on way too long though, even gamers who don't care about graphics say the same many times. Things like this happen in certain industrys and a major new product can 'relight the fire' so to speak and i expect this will happen with the PS4/720, maybe not instantly as people still don't have as much disposable cash as they used to but i expect sales to build as the months and years go by.

The PS4 and Nextbox will have next gen features that will sell the console. It´s not just about graphics. It´s about features, services, online functionality, price etc.... Games will sell on next gen consoles because these games will be well integrated into next gen consoles and features.
 
The PS4 and Nextbox will have next gen features that will sell the console. It´s not just about graphics. It´s about features, services, online functionality, price etc.... Games will sell on next gen consoles because these games will be well integrated into next gen consoles and features.

Well a lot of gamers don't care about that side to it but i'm sure a lot of casuals will so yeah thats another angle that will be in their favour. I only mentioned graphics as thats always been the biggest change between generations usually.
 
People around here tend to see PC's as competitor for console AAA games. However the biggest and most profitable PC games are exclusives and have nothing to do with consoles. That is the part of the market that is growing most on PC and these games do not require beefy machines.

True. Your Starcrafts and LoLs are a big market. I also think it's a decidedly different market than what our current industry exists as. I think of it as this: if I say I'm into gaming, it doesn't mean I'm into LoL, just as if I'm into sports, it doesn't mean I'm into baseball.

I could imagine a segment of people into gaming who are mostly into these titles who can't be reliably counted on to buy other games. I don't know what that means for gaming at large, but I don't think that part of the market growing will lead to the overall market collapsing. I think they're two different audiences.
 
While I don't think you can make direct parallels I can see there being reduced consumer confidence, whenever you see a videogame story in the mass-media it's usually about poor sales, faulty hardware, botched launches, murder simulators or kids running up huge bills on ipads.
That's without an increasingly alienated hardcore of gamers and those that feel burnt by buying too early while new adopters get all the benefits, this has always applied to hardware but now it increasingly applies to software too, I think there will be increasing number of people taking a wait and see approach.

It's interesting to note that many people will ignored the crash and played significantly cheaper indie games on their computers.
Last time that group was Europeans playing on their C64s and Spectrums, now we're seeing more and more people playing indie games on Steam.
 
The sky isn't falling for anyone, people are tired of these systems. Give them new exciting hardware and games will start selling again. People are ready for a graphics jump.
 
Big publishers are in their death throes right now. They are in an environment of their own design: they inflated budgets through high production values to choke out smaller competition. They did not think that they'd choke themselves out. Now they are trying any and every strategy, most of them aggressively anti-consumer, in order to make their ridiculous business model sustainable. It won't last.

The funny thing is that it doesn't have to be this way. Smaller Japanese companies like Atlus, Grasshopper, and From Software still know how to make profitable console retail games on small to medium budgets. Big publishers seem to have forgotten how or simply refuse to do that.
 
Well a lot of gamers don't care about that side to it but i'm sure a lot of casuals will so yeah thats another angle that will be in their favour. I only mentioned graphics as thats always been the biggest change between generations usually.

False. See how many games that have multiplayer on the market. Plenty of people care about next gen online features, and services. Plenty of people bought the PS3 for BR. Plenty of people bought 360 for Live. So yeah, next features matter to many many gamers, and none gamers.
 
No, publishers just need to learn how to budget their game accordingly. Alan Wake, Witcher 2, Dark Souls and Dishonored were suspenseful games and didn't cost a arm and a leg to make.

I liken the history of 3D console video game consoles to the classical Ovid model of the Ages of Man:

I just can't help but wonder how the "rebirth" / next Golden Age will manifest itself.


Innovation doesn't mean a healthy console.

I would much rather have developers do something well rather than innovate for the sake of innovation. Also indie games completely destroy your argument.
 
I disagree with OPs statement.

This is why:

- Demand for games is high. The sheer amount of people that are interested in gaming is getting bigger and bigger. As a dev, you are definitly able to make a lot of money with the right idea (see, for example, minecraft)

- The market is changing and adopting to the challenges it faces. Things like kickstarter, indie games, steam or the ps4's "transparency philosophy" help to keep the costs/risk factor at a manageable level. Some devs even mentioned that they do not expect an exceptional growth in dev costs next gen.

- Its not like the big crash in the 80s, where everything got fucked up by the commercial failure of basically one game. The market nowadays may go through some strong phases and some weaker phases, but there will be no second big crash in the next couple of years. Particular titles bomb, others do better then expected. Although, I do agree that the amount of titles that do well should increase a bit, but like in every other industry, there will always be losers and winners.
 
False. See how many games that have multiplayer on the market. Plenty of people care about next gen online features, and services. Plenty of people bought the PS3 for BR. Plenty of people bought 360 for Live. So yeah, next features matter to many many gamers, and none gamers.

Don't take it the wrong way, all people on this and other forums have moaned about is all the social stuff and "i don't care about that shit, just let me play a game" etc, i wasn't actually talking about multiplayer or online, just all the gimmicky stuff and a lot of gamers dont care about that.
 
I disagree with OPs statement.

This is why:

- Demand for games is high. The sheer amount of people that are interested in gaming is getting bigger and bigger. As a dev, you are definitly able to make a lot of money with the right idea (see, for example, minecraft)

- The market is changing and adopting to the challenges it faces. Things like kickstarter, indie games, steam or the ps4's "transparency philosophy" help to keep the costs/risk factor at a manageable level. Some devs even mentioned that they do not expect an exceptional growth in dev costs next gen.

- Its not like the big crash in the 80s, where everything got fucked up by the commercial failure of basically one game. The market nowadays may go through some strong phases and some weaker phases, but there will be no second big crash in the next couple of years. Particular titles bomb, others do better then expected. Although, I do agree that the amount of titles that do well should increase a bit, but like in every other industry, there will always be losers and winners.
Yeah i agree fully. Just look at the sales of the consoles this gen and its been the biggest gen yet in terms of overall hardware sales, then look at the amount of games that sell in the millions, some in the tens of millions, that never used to happen in gaming apart from a rare game every now and then.
Gaming is so big now, much bigger than the music AND the movie industry.
 
The sky isn't falling for anyone, people are tired of these systems. Give them new exciting hardware and games will start selling again. People are ready for a graphics jump.

Give me good new games for the 360 and I'll buy them. I'll also buy them on the Genesis, PS1, PS2, Dreamcast, PC, or whatever platform you're making it for. There's a difference between being "tired" of a certain system and being curious about a new one.

Anyway, the whole idea of people being "tired" of a system, especially one capable of the kind of visuals, depth and immersion we can get right now, is laughable to me. You're not tired of the system, you're just bored with the games you have and can't think what to play next.

This weekend, for example, I decided that for the rest of the year I'm going to make an effort to try games that I've always been meaning to try. I wrote a list from the top of my head and came up with a list of 25 games spanning 6 systems. Only about a quarter of those are on a current gen system.

Personally I believe that if you think the industry is going to be "saved" by a new generation of consoles, then you're in for a big surprise. Lots of things are going to change.
 
The video game crash in 1983 was due to horrible games on the Atari before the Nintendo arrived. The Atari did not have a single good game.

I can't tell if you are serious here, but... Atari 2600 (and other video game machines) had many good games. There were some mis-steps, sure (you mentioned Pac-Man and Pong), but there were certainly some really good games, even leading right up to and even after the crash.
 
If I had to put money on it Id predict the new 499 consoles bombing as well as the AAA model crashing and burning. But you never know, maybe in a few years people are sick of tablets and just want to use their tv again.
 
Probably not. Though game publisher's will need to get smarter about the expectations of games.

Not every game can command the Madden or Call of Duty numbers.

Sure, tech is great with big fancy graphics, but as Nintendo has shown us, a great game with solid gameplay can still make alot of money.

Another great example is the Souls series. (Now a series). Certainly not the prettiest games ever created, but a solid art design, vision, and rock solid gameplay can produce good numbers.
 
The standards have just changed. Apparently 3.5 million in sales in your first month is not considered a success for AAA title. 3.5 mill is still 3.5 mill, but what these publishers want to show for a profit is unreasonable and once those expectations are tempered, they should see much greater success with AAA titles.
 
The standards have just changed. Apparently 3.5 million in sales in your first month is not considered a success for AAA title. 3.5 mill is still 3.5 mill, but what these publishers want to show for a profit is unreasonable and once those expectations are tempered, they should see much greater success with AAA titles.

It wouldnt have been 3.5 million without the expensive marketing campaign. Thats the issue, when you cut down on that, sales will also drop.
 
Sorry can't take the Ouya seriously. Despite some people masturbating to the thought of a crash, they won't be. Major restructuring for some companys, yes. But no crash.
 
I can see companies restructuring games to not be so much of an overloaded production. Too many companies now, during the Xbox 360 generation, spend enough money on Voice Work alone to fund an entire OG Xbox game. Despite the abilities of the PS3, they spend tens of millions on CG and trying to bring gaming closer to the movie going experience. It brings back tales of that lipsync engine devs used in the PS2/Xbox days to have in game models lips move more realistically, that dev houses licensed for some exorbitant sum, only to have similar and better tech be standard next gen.
 
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