Over the last few years I have started to notice more and more signs that their might be another video games crash like the one in 1983.
Here are some examples :-
(1) The recent spate of studio closures such as Realtime Worlds, Bizzare Creations, Propaganda Games and Cohort Sudios.
(2) Saturated and divided market due too the plethora of formats/consoles (PC/Sony/Nintendo/Microsoft/Apple/mobile)
(3) A (general) lack of innovation and an over reliance on sequels eg [ another Bond game] [ call of duty] Killzone 3, Resistance 3, Dirt 3 etc
(4) high-profile disasters for the industry such as the current PSN hacking (and subsequent loss of personal data) and the after effects from the Japanese earthquake and tsunami. [ source]
(5) The rising cost of developing games "estimated to be roughly $10 million as compared to $3-$5 million for the Xbox, PlayStation 2 and GameCube" [ source]
(6)And although April looks set to see growth in games sales of up to 15% (due mainly to the release of several major games) it will still be "only the fourth month of growth in the past year". [source]
While it,s not all bad news in the industry ( China's online game industry to grow $5.8 billion) I do still think that there will be some form of crash/slump which will also see some major casualties or with drawls, (possibly such as Sony).
What are your views on the state of play at the moment and for the future ?
[edits]
(1) added Propaganda Games to list of studios closed. (13.5.11)
(2) Fixed dead link on point No 6 (13.5.11)
Is there going to be another gaming crash soon?
Over the last few years I have started to notice more and more signs that their might be another video games crash like the one in 1983.
Here are some examples :-
(1) The recent spate of studio closures such as Realtime Worlds, Bizzare Creations, Propaganda Games and Cohort Sudios.
(2) Saturated and divided market due too the plethora of formats/consoles (PC/Sony/Nintendo/Microsoft/Apple/mobile)
(3) A (general) lack of innovation and an over reliance on sequels eg [ another Bond game] [ call of duty] Killzone 3, Resistance 3, Dirt 3 etc
(4) high-profile disasters for the industry such as the current PSN hacking (and subsequent loss of personal data) and the after effects from the Japanese earthquake and tsunami. [ source]
(5) The rising cost of developing games "estimated to be roughly $10 million as compared to $3-$5 million for the Xbox, PlayStation 2 and GameCube" [ source]
(6)And although April looks set to see growth in games sales of up to 15% (due mainly to the release of several major games) it will still be "only the fourth month of growth in the past year". [source]
While it,s not all bad news in the industry ( China's online game industry to grow $5.8 billion) I do still think that there will be some form of crash/slump which will also see some major casualties or with drawls, (possibly such as Sony).
What are your views on the state of play at the moment and for the future ?
[edits]
(1) added Propaganda Games to list of studios closed. (13.5.11)
(2) Fixed dead link on point No 6 (13.5.11)
If there is another gaming crash, it won't be because of the things you listed, but because of the $60 game model. And with a new generation of consoles looming on the horizon, the cost of production (which drives the cost of games) is only going to go up.
I don't really feel like the industry has formed any kind of increasing reliance on sequels. Sequels have kind of been the industry's bread and butter for a very long time, I do think you're noticing them more because of how far we are into this current system cycle. I'd wager you'd be likely to see more original titles once the next lot of systems come around.
No, to see a crash like in the 80's it would be because of some electronic disaster. With the internet even if there was a lot of big name game companies that closed down gaming could still thrive on indie games. Although you listed great points, I dont think its a sign of a gaming crash.
I don't think a crash is likely, but I am really losing interest in modern gaming due to a lot of reasons you mentioned above.
No. Once 50000 developers start pumping out 15 minute, broken-ass 50 dollar games for every platform, you can start worrying.
One of the main issues that caused the last crash was the over saturation of the marketplace and the inability for consumers to differentiate between products. (good games v. bad games/Intellevision v. Atari 2600)
There's going to be a crash in 2019. It just came to me in a dream. But it's due to a global economic crash caused by terrorist organizations getting their hands on nuclear and dirty bombs. The Pakistan and India war is terrible. The Middle East is a mess and oil shipments become harder to come by. Without oil, economies just collapse into a type of barter mentality. China is hit hard as their economy collapses when investors lose trillions of dollars. Scary stuff.
This is the biggest the video game industry has ever been, and it doesn't seem to show any signs of slowing down.
I'm sure there weren't many of us around when the industry "crashed" in 1983, but I know I was and just because Atari went under and the home console market seemed to be over, the video game industry as a whole never really crashed. Arcades were huge in the early to mid-'80's and many of our favorite studios nowadays came out of that time period.
Companies are always going to lay people off, get shut down, open new studios and create new games. The only way for any of it to "crash" is if people stop playing video games and given the current market trends, that just is not happening.
" Over the last few years I have started to notice more and more signs that their might be another videogames crash like the one in 1983.1. Those studios weren't important.
Here are some examples :-
(1) The recent spate of studio closures such as Realtime Worlds, Bizzare Creations and Cohort Sudios.
(2) Saturaturated and divided market due too the plethora of formats/consoles (PC/Sony/Nintendo/Miscrosoft/Apple/mobile)
(3) A (general) lack of inovation and an over reliance on sequels eg [ another Bond game] [ call of duty] Killzone 3, Resistance 3, Dirt 3 etc
(4) high-profile disasters for the industry such as the current PSN hacking (and subsequent loss of personal data) and the affter effects fromf the Japanese earthquake and tsunami. [ source]
(5) The rising cost of developing games "estimated to be roughly $10 million as compared to $3-$5 million for the Xbox, PlayStation 2 and GameCube" [ source]
(6) Although April looks set to see growth in games sales of up to 15% (due mainly to the release of several major games) it will still be "only the fourth month of growth in the past year". [source]
And while its not all bad news in the industry ( China's online game industry to grow $5.8 billion) I do still think that there will be some form of crash/slump which will also see some major casualties or withdrawls, possibly such as Sony!What are your view on the state of play and the future ? "
it's possible that the huge budget games may crash but there will always be small groups of people making games without intention of hitting it huge. games like minecraft and shit.
Your primary argument for why it will crash seems to be a list of similarities between now and the crash of 82 (or therebouts), but they have a couple of real differences. The market back then was as yet unsaturated, without a significant developed "core audience" that were really into games (like us basically), and the plethora of games that were being released were really shitty. There are a lot of quality games out now, with franchises that build loyalty, and there are organized, developed ways for people to track the quality of games (like gaming websites such as these). Competition just means that times are tougher for the big publishers, and the pressure is on them to deliver to the goods to their stockholders. That doesn't mean that people will in general stop buying games like in the E.T crash.
I think someone mentioned above that there will be a shift to indie games, but that's not true either. I think that's a secondary effect--companies will continue to produce very high quality expensive games, just like how Hollywood shifted towards big-budget high concept entertainment. This is for a couple of reasons: as I said earlier, as competition increases the onus is on the publishers to find hit products that will sell millions of copies. Also, due to network effects (i.e. people want to play each other on Xbox live, word-of-mouth) and limited disposable income for gamers (they'll only buy one console and a couple of games), this means that there will be a couple of huge hit games and a lot of quality ones that don't sell well. We've been seeing this. This means that the market is getting riskier, and companies will invest heavily in 1) sequels and 2) franchises that might be the "next big thing."
However, not all companies can afford that kind of risk, which leads to integration. Only companies with deep pockets can afford to fund multiple expensive projects and hope that at least one will be a hit. This is why the industry is dominated by companies like Activision and EA, and why even id sold themselves to Bethesda. The era of the garage developers for AAA titles is over.
Of course there's niche stuff and a burgeoning indie marketplace, but again think of that as the indie circuit in Hollywood. It can foster a lot of creativity and great games, but it isn't the primary source of profit and thus not the primary point of interest for most publishers. As the scene develops no doubt we'll continue to see more great games, but the big gaming companies and the other conglomerates to follow aren't going to disband and suddenly shift their efforts to indie gaming.
I don't think there's going to be a crash at all but am concerned for the rising costs for creating titles. Home consoles will continue to evolve and create higher production costs than today which will lead to more sequels and less risk-taking. I'm extremely curious as to what Nintendo will present at E3. A more powerful system than the PS3 with a (rumored) price tag of around only $400? What will they do to help pubs and devs keep costs down?
I was there for the last one, and I can pretty confidently say it's apples and oranges; we won't see that happen again.
There were a lot of reasons for the downfall, but the biggest one was simply shovelware. There were SO many consoles and SO many games, nothing could really succeed. On top of that, there were no licensing rules on most of those old consoles, so any Shmoe could cobble together a game in their garage and slap it on a shelf. This led to just pantloads of bad games that never should have seen the light of day.
Atari put the nail in the coffin themselves by just firing awful console ports of arcade games out the door one after another and "gamers" ("vidiots" in 80s parlance) just had enough and went back to arcades. Thats another reason you wont see the crash now, console games are on-par or better then coin-ops. In my childhood, that was simply not the case; you had to go to an aracde to play anything state of the art, and your home versions were always crap in comparison.
Lastly, the media coverage nowadays will stop that from ever happening again as well. There is simply too much converage of gaming and game culture for the kind of crap that spilled onto shelves to ever happen again. If we had the internet in 1982, people would have known what to expect from a lot of the crap titles and avoided them. It might not have saved the industry, but it would have helped keep people playing longer.
I worry about the price points of games as development costs continue to skyrocket, but as some others have said, I think thats just going to lead to fewer dev houses, more Madden type games being cranked out yearly, and a lot more indie development.
I don't think there will be a crash. I think there will be a shift in what is going to be popular soon. I can see that maybe FPS games will start to decline, but the big ones like CoD and such will still be the fps of choice. I think there will be more free to play games and microtransactions will take over the market.
Think that the crash in the 80s was more due to Atari & Nintendo letting lots of places make their own games flooding the market excessively without much quality control on what's going out plus it was a really new avenue of entertainment. Now we know better or at least there will always be games on one console/pc/handheld that will be worth playing if another section wanes.
" Think that the crash in the 80s was more due to Atari & Nintendo letting lots of places make their own games flooding the market excessively without much quality control on what's going out plus it was a really new avenue of entertainment. Now we know better or at least there will always be games on one console/pc/handheld that will be worth playing if another section wanes. "Remove Nintendo from that post and it's pretty well correct. Nintendo really started the resurgence of the home video game console with the NES and it's been all uphill since there (in terms of sales anyway).
I'm going to say yes, it will crash before too much longer. I'll make a few bold predictions about how I see the industry going. First thing to realize though, is that hardcore game players that post on forums like this can't keep the industry going. It has gotten too large and costly and this is too small a group. The many casual fans that plonk down money for Call of Duty and Wii Sports could disappear real fast. I think we'll see that before the end of the year.
With a rapidly falling US Dollar, and with conflicts expanding in the Middle East, expect much higher gas and food prices before the end of the year and these casual fans will dry up as times get tougher. Companies like Blizzard will survive because their fans are very loyal, who will scrimp and save to get their Warcraft and Diablo fix if they need to. Also Blizzard don't have to spend up big on research & development and fund product launches like Sony and Microsoft will have to do to release new consoles. If Nintendo doesn't do well with their next console Sony and Microsoft may just hold off for a really long time on any new console - so the games industry will likely shrink and get split between budget casual gamers on iPhones and a hardcore resurgence on the PC. I see the PC doing well because hardcore gamers will want to play games like Battlefield 3 on a proper gaming PC, but this will also make the PS3 and Xbox 360 start to look second rate and not worth buying new games for.
So yes I think there will be a crash because the days of the mega budget console game are numbered. I mean, does anyone here think that the next Call of Duty game will outsell Black Ops?? No way!!
Edit - Just another point. The crash in the 80s happened to companies like Atari that were solely invested in the games industry. I don't think companies like Sony and Microsoft are going to suddenly go out of business, but they may just choose to quietly exit the industry, and concentrate on their other interests. This wouldn't surprise me one bit if they do this in the next 3 or 4 years.
I hope so.
If there were to be anything happening in terms of crashing, I think it would be specific, like mobile gaming goes belly up, or handheld gaming gets taken by mobile. I can see a sector of gaming going away, but I can't see a collapse of gaming, it's just so diverse now.
" I don't think companies like Sony and Microsoft are going to suddenly go out of business, but they may just choose to quietly exit the industry, and concentrate on their other interests. This wouldn't surprise me one bit if they do this in the next 3 or 4 years. "Im really starting to think that we could see Sony exiting the industry (as a console manufacturer) . At the moment the PS3 is damaging the Sony brand as a whole with its negative news stories. Plus I think Microsoft could really squeeze Sonys profit margins in the next generation of consoles similar to how Sony did with Sega.
Over the last 15 or so years the Playstation has been a success but the brand seems to be going through a slump that has little sign of ending i.m.o
" I hope so.This.•Preorder bonuses that make it impossible to get everything•day one dlc•$60 pc games•shovelware all over the placeGame market needs to crash and let only the strong survive."
" Over the last few years I have started to notice more and more signs that their might be another videogames crash like the one in 1983.1. Studios always close. But of course more will close when there was a recession.
Here are some examples :-
(1) The recent spate of studio closures such as Realtime Worlds, Bizzare Creations and Cohort Sudios.
(2) Saturaturated and divided market due too the plethora of formats/consoles (PC/Sony/Nintendo/Miscrosoft/Apple/mobile)
(3) A (general) lack of inovation and an over reliance on sequels eg [ another Bond game] [ call of duty] Killzone 3, Resistance 3, Dirt 3 etc
(4) high-profile disasters for the industry such as the current PSN hacking (and subsequent loss of personal data) and the affter effects from the Japanese earthquake and tsunami. [ source]
(5) The rising cost of developing games "estimated to be roughly $10 million as compared to $3-$5 million for the Xbox, PlayStation 2 and GameCube" [ source]
(6)And although April looks set to see growth in games sales of up to 15% (due mainly to the release of several major games) it will still be "only the fourth month of growth in the past year". [source]
While it,s not all bad news in the industry ( China's online game industry to grow $5.8 billion) I do still think that there will be some form of crash/slump which will also see some major casualties or withdrawls, (possibly such as Sony).What are your views on the state of play at the moment and for the future ? "
I hope your right and my gut feeling is wrong! although since I wrote this blog I have read the following news in recent days:-I think that we've seen most of the "crash/slump" that we're going to see, and most of that was due to recessions all over the world. As the economy gets better throughout the world, people will be buying more games again."
( 1) Publisher [Konami] cites "difficult business climate" for 2.9% fall in revenues and 1.6% dip in net income ( 2) Square Enix warns investors of $148 million loss
( 3) Disney game division loses $115 million
I am becoming one of the many people here who has bigger things to worry about than games, like being able to afford food for my family.
No, the market is much more diverse than it was back in 1982. Back then, there were the arcades earning income one quarter at a time and a few consoles who most people considered "toys". Almost no one had a personal computer in their home and so their familiarity with games was just from things like Pac-Man and Space Invaders. Those might be an amusing time waster while you wait for your pizza to bake, but it's not something you'd spend hours playing or spend a few hundred dollars to experience. These days, even grandmothers are playing computer games like the Sims or off Facebook, so they are much more integrated into our culture. Hell, cities offer game studios incentives to come to their towns. So, it is a far more significant portion of the entertainment industry than it was three decades ago. The video game industry may evolve into something different than it is today, but you won't see a "crash" again.
Personal opinion: companies need to budget for their audience, not for Call of Duty's audience. I think EA, Ubisoft and the rest are in real danger of eventually having serious financial problems if they don't stop trying to sell 10 million copies of every game. Roll back budgets, enhance actual gameplay quality and serve your core fanbase... that's my suggestion (hope).
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