Cutscenes are non-interactive sequences used by many games to provide backstory, advance the plot, or illustrate objectives for the player to complete. They've been used in gaming since the 1980s and have steadily become more complex, expanding the role of storytelling in video games. The first games to use cutscenes were early arcade classics such as Space Invaders Part II, Sheriff, Pac-Man, Donkey Kong, and Bega's Battle. However, the first game to actively use the term 'cutscene' was Lucasarts' Maniac Mansion.
There are three basic types of cutscene: In-engine, pre-rendered, and live-action. Each type of cutscene has various costs associated, and each can deliver a different experience.
Rendered in real-time within a game's engine, in-engine cutscenes are the most prevalent type. As the graphical fidelity of video games has improved, so too has the complexity and detail of in-engine cutscenes. This is also the cheapest method of producing cutscenes, as they can take advantage of existing game assets. However, these types of cutscenes can also be the most problematic to produce since they usually require extra coding, animation, level geometry, and hi-res character models.
Often created by separate in-house teams or farmed out to outside animation studios, pre-rendered cutscenes are generally created to provide extremely high-quality, nearly cinematic content. Usually the production of these cutscenes takes so long that only a few can be produced during the development of a game.
Live-action cutscenes use real actors, sets, and props, effectively producing short-form films that are then digitized and inserted into the game. During the early-to-mid 1990s, this was the most prevalent method for creating cutscenes, though live-action cutscenes, perhaps more than the other forms, suffered the most from poor production values, hammy acting, and clumsy scriptwriting.