Game Industry Optimistic About Surviving Economic Crisis 52
CNet is running a story about how the gaming industry is looking at the recent economic troubles. Despite their status as luxury items, games and game systems have seen strong sales numbers in recent months, and that trend is expected to continue into the holiday season. Most companies are optimistic, despite the fact that many of their stock values have been hit hard and that analysts' views are divided on whether game-related purchases will be one of the first things cut from consumers' budgets.
"'I do think that the video game industry is going to do reasonably well in this time of recession because video games are a pretty damned efficient use of time,' said Bridges. 'That said, the...industry has some other problems that it has been ignoring for awhile and that are creeping up on it.' Essentially, Bridges explained, he thinks that the dominance of giant publishers like EA and their general reliance on physical, in-the-box, units, can't hold up. Instead, he said, new tools, ubiquitous broadband and hungry independent developers are going to all combine to eat away at the continued supremacy of the $60 big-name title. And that could spell big trouble for the industry."
A damp and steamy future. (Score:5, Insightful)
"'I do think that the video game industry is going to do reasonably well in this time of recession because video games are a pretty damned efficient use of time,' said Bridges."
Now if we could only convince our parents of this.
"Essentially, Bridges explained, he thinks that the dominance of giant publishers like EA and their general reliance on physical, in-the-box, units, can't hold up. Instead, he said, new tools, ubiquitous broadband and hungry independent developers are going to all combine to eat away at the continued supremacy of the $60 big-name title. And that could spell big trouble for the industry.""
Does Valve count as a "big name"?
It will survive, sure, but how good are the games? (Score:3, Insightful)
Re:A damp and steamy future. (Score:3, Insightful)
Valve could do better with the whole episodic gaming thing.
Step one: shorten the time between releases of half life 2 episodes.
Step two: you don't have to package episode two with another copy of episode one.
Step three: please for the love of god keep bundling stuff with new innovative brilliant games like portal.
"Big trouble for the industry"? (Score:3, Insightful)
Re:simpler explanation (Score:5, Insightful)
Teenagers have not bought the most video games in quite a long time. In fact, the average age is 30 [archive.org] with 65% of game players over the age of 18. If the video game industry were to see a drop in buyers over the age of 18, they would suffer just as greatly as the rest of the economy.
I know the entertainment aspect may seem like too easy of an answer, but the historical data does support it.
During the beginning of the Great Depression, one of the most popular forms of entertainment was dancing. It usually only cost a few cents to get into a dance hall. Once there, the dancer could remain for most of the night. This was so economical that it led to a new form of sport: Marathon Dancing [historylink.org].
At first this extreme form of dancing was done to achieve new records. Then the dance halls started to get in on the act, and began promoting competitions. Soon, dancers would be on the floor for months at a time, with only 15 minute breaks every hour or so. (Yes, 24x7 on the floor. They slept like wolves at best!) These long marathons gave dance halls the opportunity to encourage or stage situations worthy of a soap-opera. Fights broke out, relationships came and went, people struggled not to lose their cool over the grinding months, and even weddings were performed on the floor!
The public just ate this stuff up. They spent their nickels to visit these dance halls for entertainment. If they were hungry enough, they might even try their hand at a marathon. While the lack of sleep was a killer, dance halls regularly served 12 meals a day! Quite a difference from standing in a bread line for a meager meal.
Eventually, dance was replaced with another non-stop form of entertainment: Movies.
You know the stereotype of the Bell Boy with his flashlight leading people into the dark theater? Well, there's good reason for that. Back during the depression, the movies never stopped! For a mere nickel you could visit the movies and watch for hours before it looped back to something you had seen before. News reels, Comedies, Cartoons, Features, etc. It was a true potpourri of entertainment. And since there was no television to compete, visiting the theater was one of the best ways of keeping abreast of the latest news and entertainment.
Speaking of television, yet another form of entertainment took a bite out of the market during the Depression. Radio saw a surge in public life. From comedy, to the original soap operas, to FDR's Fireside Chats, to Late Breaking News, to Orson Wells' War of The Worlds broadcast, radio was an incredible escape from the ugliness of everyday life. And every family who could manage to scrape together enough money had one.
I won't bore you with further details, but such a trend for escapist entertainment is seen throughout modern history. The worse things get, the more we turn to outlets for escape. With television on the decline, I see absolutely no reason why consumers would not find value in Video Games. They are the newest and hottest form of escapist medium. Eventually they too will be replaced by a new medium, but for now it's reasonably safe to bet on video games during any period of strong economic downturn. :-)
What?? (Score:5, Insightful)
"Essentially, Bridges explained, he thinks that the dominance of giant publishers like EA and their general reliance on physical, in-the-box, units, can't hold up. Instead, he said, new tools, ubiquitous broadband and hungry independent developers are going to all combine to eat away at the continued supremacy of the $60 big-name title. And that could spell big trouble for the industry."
That doesn't make any sense, independent game developers are still part of the industry, so if there is simply a rebalancing of cash flow from the big companies to the indies the industry hasn't been harmed in the slightest, it's dynamic has simply changed.
EA and co. could completely die and the industry wouldn't be harmed if more games were being sold by indies at lower prices to make up the same level of profits.
Re:It will survive, sure, but how good are the gam (Score:2, Insightful)
Then again they have a completely fucked up view of low-risk which apparently involves spending most of the company's money on a single game and hoping it sells enough to make the money back.
Well... (Score:5, Insightful)
Well, he's just trying to sound smart, basically.
There's this thing about the future: nobody knows it. All you can say is, basically: something will happen, but heck if I know what, when or by how much.
But that doesn't make for much of an article, and sure doesn't make one a well paid "analyst". So essentially you have to do the old trick: tell them an event (e.g., that the indies are going to eat EA's lunch) or a date, but never both. Notice how here he didn't give you a time frame of when will the indies beat EA, nor a quantitative estimate. There is no deadline when you can say, "hah, the date came and went and your prophecy didn't happen." Even in one year, or ten years or a hundred years, you could still nod through the rationale and wait for it to happen any day now.
Now pack it with a few profound sounding truisms (you can at least nod through the idea that better tools and broadband should make some kind of a difference in some way), and you too can be a pundit or analyst.
And as an example: it's been proven before that all the analysts in the world can't, for example, pick stocks better than throwing darts at a list of them. For all that handwaving and sounding smart and in the know, they don't know what will happen. But there the big broker names have the advantage of being able to pull self-fulfilling prophecies: if Merril-Lynch tells you to buy Pets.com stock, they must know something, so a lot of people do. Price goes up, yay, they were so smart. The best illustration of this was during the dot-con crash when they told people to buy stock they internally rated as crap and were selling as fast as possible. But they still influenced the market enough to make money even out of companies which were in free fall.
But in the game industry they just don't have this kind of influence. Just because pundit X and analyst Y say that indies must overtake EA due to better tools and broadband, it doesn't mean that anyone will go and write those better tools overnight.
So we're back to that thing about the future: they have no flipping clue. But they sound smart, people read the article, and they get advertising revenue for it.
Re:It will survive, sure, but how good are the gam (Score:3, Insightful)
I'm an independent, professional game developer. I don't mean to attack you directly, but you're saying some things that seem logical but that the market doesn't really follow up on. I am one of the few people for whom graphics truly do not matter, and the game I run, Meridian 59 [meridian59.com], is a game where I hoped fun would matter more than graphics.
A lot of people say, "Graphics don't matter!" when they actually do. Many people judge a game based on graphical presentation; many people buy games based on the screenshots, for example. And, while a game's graphics may not mean much once you get into the middle of the game, they certainly do color most people's impressions at the beginning. A lot of people have a really hard time getting into a game if it's not visually stunning.
I think what a lot of people mean is that they don't buy games based on graphical advancement. The problem is that once the envelope is pushed, then expectations adjust to accommodate them. Using your examples of the Quake engines, the games based on those engines weren't necessarily pushing the envelope on graphics. But, there was a specific minimum expectations set by the engine. Most people wouldn't play a game based on the old Quake 1 engine these days, even though that engine was quite impressive for the time. In a few years, people will look at the Quake 2 engine the same way we might look at the DOOM engine now. Expectations will have changed.
The reason why you have the "ooh, pretty!" games is because some developers are trying to sell engines. The makers of Quake, id, made a lot of their money licensing the engine to other developers. They made the original games those were based on in order to sell the engine. Crysis is the same way: FarCry or Crysis may not be particularly engaging games, but the graphical presentation moves the expectations and this in turn requires developers to license the engines from the company. It's how they make their money.
And, that's not going to happen. The problem is that these shifting expectations have driven up the costs of developing games. As the price to develop a game increases, the amount of money needed to recoup costs increases as well. The reason why the large publishers are talking about reducing the secondary market is because their profit margins are becoming razor thin. They need people to buy the newer games to continue to stay in business. A lot of larger companies are feeling the pinch, especially during these economic times, and they know people aren't willing to pay more and more per game.
Here's some perspective, when I started developing games professionally a little over 10 years ago, the budget for a large game was one or two million dollars. These days it can easily reach $10 million or more. The biggest issue is that games are a hit-driven industry; the big, profitable games make the money that covers the failures. Unfortunately, that only covers the publisher and often a developer will go out of business even when they have a hit game. Check out the fate of Iron Lore studios, the makers of Titan Quest: they went out of business despite having a rather popular game title and expansion.
Some thoughts from someone who works on the inside of the beast known as the game industry.