In 2008 the games industry was worth an estimated $22 billion, that’s a lot of dollars! When you consider that Hollywood in 2008 could only muster (a relatively paltry) $10 billion it’s truly incredible to see how far these ‘toys’ have come. With the CEO of Activision Bobby Kotick declaring recently that he would like to charge more for video games, is he actually in any position to do so? Is the video game industry infact headed towards an early demise?
It’s interesting to equate the state of video games today to the state of video games in 1983 – 84, the years in which the great video games crash took place in. When you line up events and circumstances from then and now, disturbingly distinct parallels can be drawn. For example, one of the main causes of the crash, quite simply, was ‘too many games, not enough buyers’; Anyone could publish a title for a relatively small amount of money, with cereal company Quaker Oats even getting in on the action at one point! With the rise of digital distribution, and the subsequent lower costs involved, we may see this happen again with the online retail space, spaces such as XBOX Live Arcade. It’s already happening with the iPod App Store, the largest complaint often levied at iPhone gaming being that it’s easy for quality products to be buried amongst thousands of fart buttons, baby shakers, light sabres and other apps created to capitalize on the overnight success story that is Apple’s mobile phone effort. The same could be said of the Wii, it’s widespread popularity being met with cheap to produce minigame collections, product tie ins and quickly produced pet games turning off the ‘core gamer’ and disenfranchising the soccer mum. Without widespread consumer knowledge, picking a decent game off the store shelf from the tides of shovelware produced is almost entirely hit and miss for a large portion of the game buying public. As with the situation in the age of Atari, you can only break a consumer’s trust so many times before the medium is seen as gimmicky and faddish, creating an economic vacuum when their money is spent elsewhere. As gamers we think it’s incredible that titles like Mario Kart DS constantly makes the worldwide top 10 sellers lists, but honestly, what else would you buy for a system that is abundant with poorly designed cash-in products? After a while, everyone who is going to buy Mario Kart will have done so, move on, and interest will begin to die out in it’s host platform unless there is a new product to take it’s place, just like the Wii is currently experiencing.
On the other end of the spectrum, as I mentioned in my previous article, many analysts believe game production costs are set to rise dramatically over the coming years. The recently bankrupted GRIN studios are testament to how, with just a handful of ill received products, these spiralling costs can destroy a companies financial standing. What with this and when the money from the lucrative and fairly new ‘casual’ market dries up, the industry sets to be a lot smaller than it currently is…
As a result of the crash in ‘83, Nintendo fiercely limited companies to relasing just 5 games a year for it’s Entertainment System, wanting to avoid this situation from being repeated. Ironic then when you take a quick look at how many Guitar Hero games have been, or are being, released this year for just Nintendo’s current home platform; Guitar Hero 5, Smash Hits, Van Halen, Metallica, all published by just one company. And which company is that? Bobby Kotick’s Activision. With this amount of saturation in just one of the most popular franchise series of all time, it’s easy to see why rhythm action games are losing popularity amongst gamers. 1st person shooters, 3rd person adventures, MMOs, puzzle games, casual games; all of these and many more genres are experiencing a glut of titles, all competing for your money, in exactly the same way as music games, in exactly the same way as 26 years ago.
Right now interactive entertainment is riding a wave of popularity it hasn’t seen since the ‘Golden Age’ of home consoles, but how bright is the future of video gaming? Will the mistakes made a quarter of a century ago, that are being made now, have their effects repeated? More importantly and most pressing, can the industry survive another crash?