midnightAI
Member
looks to me more like there was an unusual bump in 2020/2021 (most likely due to the pandemic) and we are now back to normal growth (it may be slowing slightly, but its still currently growing)
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Game over? Industry suffers slowdown after decades-long winning streak — Financial Times
- Thread starter Thick Thighs Save Lives
- Start date
- Business Analysis
SportsFan581
Member
This is where I fail business 101. If all the employees are getting paid, including some big compensation for the those at the top, I don't see where the never ending push for more and more dollars comes from. Must be the pressure from the stock holders.
The graph in the OP shows 2023 just slightly off peak and still way higher than just 4 or 5 years ago. Doesn't seem like they need to make a huge amount of changes just because they have started to bump the ceiling.
The graph in the OP shows 2023 just slightly off peak and still way higher than just 4 or 5 years ago. Doesn't seem like they need to make a huge amount of changes just because they have started to bump the ceiling.
StereoVsn
Gold Member
They won't be able to sell $70/€70 8-10 hour games in quantities that they would want.
As long as that's understood and publishers are willing to be more flexible with pricing, it could work.
Majima Everywhere System
Member
Hard truth, new angle: 2 or 3 game of the decades evenly distributed across last year left no time or reason to try anything else. A combined experience 180 plus hours means fuck you flavor of the month, and thus the segment in focus contracts.
The question is why did it not generate sales? These hits sold to the core who already own a means to play them. No one got hyped about a new game that reached the mass market that would encourage those outside to jump in. Sports suck, COD was panned (probably enough to slow the industry compared to COVID COD), Fortnite hit record numbers on older platforms.
The problem last year may have been riches and the availability of users time. This year, people will try, buy, hype something per month and get things on track, even if there is nothing nearly as great as last year.
The question is why did it not generate sales? These hits sold to the core who already own a means to play them. No one got hyped about a new game that reached the mass market that would encourage those outside to jump in. Sports suck, COD was panned (probably enough to slow the industry compared to COVID COD), Fortnite hit record numbers on older platforms.
The problem last year may have been riches and the availability of users time. This year, people will try, buy, hype something per month and get things on track, even if there is nothing nearly as great as last year.
SmokedMeat
Gamer™
The AAA industry is in a bad place and it's only going to get worse.
We really need a reset, or accept that the future will be almost entirely GaaS/FTP.
We really need a reset, or accept that the future will be almost entirely GaaS/FTP.
SmokedMeat
Gamer™
Those graphs you see increasing are because of an explosion in mobile gaming, and increase in PC gaming - not console gaming.
The best mobile games of 2012
Every year, as the technology advances and attracts more developers, mobile games become even better. Here are some of the best mobile games released in 2012.
www.cnet.com
For reference the above is what the mobile market looked like in 2012.
rofif
Banned
OH NO A CORPORATION doesn't note an increase as huge as expected for this fiscal year !!!
With corporations it doesn't matter if you make the bank. It doesn't even matter you make 15% more bank than last year... because some idiot expected you to make 17%. All hands on deck, we are burning.
With corporations it doesn't matter if you make the bank. It doesn't even matter you make 15% more bank than last year... because some idiot expected you to make 17%. All hands on deck, we are burning.
Mibu no ookami
Banned
Those graphs you see increasing are because of an explosion in mobile gaming, and increase in PC gaming - not console gaming.
The best mobile games of 2012
Every year, as the technology advances and attracts more developers, mobile games become even better. Here are some of the best mobile games released in 2012.
For reference the above is what the mobile market looked like in 2012.
My point is people have been saying things for years. Single player gaming is dying, console gaming is dying... it's just not true.
Shake Your Rump
Banned
Apparently, people only spending the same amount of money as the prior year is "game over" for an entire industry?
Wow, the movie and cable comment aged about as well a mold infested flophouse.
This might be a result of Mucinex induced confusion but:
Significant discounting where? The main SKU stayed at $499 (three years into the hardware cycle) with either MW III or Spiderman thrown in. The digital SKU is now $50 higher, though more consumer friendly in the long run since anyone unhappy with PSN walled garden pricing can add an optical drive and get back to enjoying some actual price competition with Amazon, Best Buy, etc. Is he talking about foreign markets?
Anyway, I think the problem facing the industry is that the combined 75 - 80 million install base of PS5 / XSX / XSS doesn't mean what it used to. With games being $75 after tax in most states (I miss you, Salem, NH), popular new releases being loaded to the gills with content, and the select few games / franchises that maintain an audience for 10+ years, subscription services, etc. there is less and less room for people's leisure time. And this is before getting into how inexpensive it can be to watch movies and premium network TV these days.
I think Game Pass, PS+, and publisher sanctioned key sites are a way to navigate the issues of "visibility" and the deluge of content, though those have all seen varying degrees of success. It isn't really a coincidence you don't see too many "post your February haul" photo threads like you would have in 2005. Developers and publishers are chasing trends, trying to pry players away from ongoing successes, and trying to survive in an overcrowded market. They created this scenario, they will have to figure out the best path through it. I hope for the sake of content variety, that they manage to.
FunkMiller
Banned
For the executives, it kind of is. You have to remember none of these cunts are video games fans. They're in it to maximise their own profits as quickly as possible. They see gamers as marks to be fleeced for as much cash as possible, for whatever shit they can put out. The second things slow down on their gravy train, it's a disaster. That's when you see a lot of them jump ship with their millions… after they've sacked most of the workforce first, of course.
All of this applies to the entire entertainment industry. It's infested with a cancer of stupid, greedy idiots at executive level.
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{insert code here}
Member
There's a lot of rot in this industry (and the entertainment industry as a whole) that needs to be culled. Some companies like EA or Ubisoft really don't even need to exist anymore. There will be a day of reckoning for all these folks who tried to shove their politics and agendas into our games and its coming soon.
Pejo
Member
I cannot wait for the 2nd great videogame crash. Give the hobby back to the enthusiasts, hobbyists, and fans. Take it away from the megacorporations, mass media, and social agenda politics pushers. Bring game budgets back down to earth, increase effective management at the game director level and stick to more realistic release schedules. 5-7 years per game is not sustainable, especially when it's a game with a huge budget that flops.
Gaming has more money tied to it than ever, yet the games are not reflecting that at all. Make things that people want instead of making things designed to siphon the most money long term out of the players' wallets.
Anyways, I've been cheering on a crash for a few years now, and with the layoffs, constant bombs, and a few unforeseen surprises, it seems more than likely that it's gonna happen in the next ~5 years. BRING IT!
Gaming has more money tied to it than ever, yet the games are not reflecting that at all. Make things that people want instead of making things designed to siphon the most money long term out of the players' wallets.
Anyways, I've been cheering on a crash for a few years now, and with the layoffs, constant bombs, and a few unforeseen surprises, it seems more than likely that it's gonna happen in the next ~5 years. BRING IT!
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Salty Popsicle
Banned
One of the biggest flaws undermining most of the world's Capitalist systems and ideologies is the thought that if a company or business sector is not growing year-after-year, then it is by default failing.
It's the reason why once the cost of acquiring new customers becomes too expensive or time consuming, businesses simply tend to nickel and dime the ones they already have while at the same time reducing costs by laying off a percentage of employees.
It's the reason why once the cost of acquiring new customers becomes too expensive or time consuming, businesses simply tend to nickel and dime the ones they already have while at the same time reducing costs by laying off a percentage of employees.
Salty Popsicle
Banned
It's all about human psychology and how a dip on a graph has adverse effects on how stockholders and potential investors view the outlook of a company. It makes absolutely no sense when viewed by individuals with some degree of common sense and context about each company's situation, but unfortunately the stock market is completely influenced by sheep who always flock in large herds and CEOs who's entire job is to appease those sheep.
Clear
CliffyB's Cock Holster
I just think the primary markets are already saturated.
Gaming and TV are not the same. The time and attention demands of most any console game make it a type of entertainment that suits only a certain demographic. So expecting it to have the same appeal as the thing that traditionally just sat burbling away in the living room is a mistake.
Folding in mobile gave the size of the gaming world a big boost primarily because it suited different usage patterns, and drew in people who would never otherwise bother with classic videogames.
Basically my take is that right now in 2024, in major markets like the US, anyone with an interest in videogames is already playing or is at least aware of the option to play already. I just don't see there being that many more people to sell to in the future!
New markets are obviously emerging globally, and I think serving their tastes and budgets is going to be increasingly important for growth.
Honestly the only way AAA get better is if the incorporate AI but we know that comes with job losses. Or we continue with large amounts of GAAS.
StreetsofBeige
Gold Member
True.
Every business is similar. When the company is ramping up or gets lucky with rocketing sales and profits, people turn a blind eye to costs and efficiencies because the company is blowing away targets anyway. Everyone is happy, gets bonuses and they hope the lucky streak keeps going next year.
At some point every company starts to level off and that sky high revenue acceleration of +20% every year becomes... 15%..... 10%..... 5%. When the big growth sinks, that's when eyes are focused on cost cutting, hiking prices, substituting shittier ingredients etc....
That's why in all those big stodgy companies that have been around for ever, if they beat expectations with whopping +3% targets, thats good enough. Expectations are saturation so as long as they can keep up with inflation and population growth it can be good enough. It becomes so steady they all pay 3% dividend yield because they are huge diversified companies with 1000 products across 30 brands so they can always coast.
What hurts tech is that their expectations are giant, most companies have a lot of their sales hinged on a small number of product lines. So when things are zooming it's awesome. But if there's a whiff, it's major bad news. 1 or 2 stinkers can sink the company's annual numbers. On the other hand, it'll take a lot to sink Procter & Gamble or Unilever. You'd need a lot of key brands all sinking at the same time which is harder to screw up at once.
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Mortisfacio
Member
Industry tried going the niche Nintendo had where they remake the same game for 30 years and charge top dollar for it. Minimal cost for maximum profit. Now the whole industry is remakes and continually rehashing the same games and the industry is stagnating.
Shut0wen
Banned
Been saying this for years, a majority of developers should of stuck with double A games or eithin 360/ps3 era budget, the saddest thing is its totally possible, we have had great mid budget games such as control, hellblade (the dmc maker game forgot what its called) a whole dark souls trilogy plus sekiro and even plague tales 1 and 2 but instead ceos crunch staff to make shitty games, even bladursgate 3 a game with a modest 120 million is doing well, instead were seeing games being made well over 160 million budget with impossible returns, look ubisoft that doesnt have a scooby of what to do and its ashame because they employ thousands of people which right not could be making a unique indie game or something decent on a smaller budget
Shut0wen
Banned
This article is rather click baity doom and gloom, it peaked during covid, now prices have sky rockted people are buying less luxury items such as next gen consoles, it bound to happen, unfortunately cant see ms/sony affording price cuts and cant see them making much of a difference
StreetsofBeige
Gold Member
I think what a lot of the budget busters assume in their games development involving big dollars is that the GAAS backend money will save the day.
If gamers are amped up spending billions on mtx, as long as the game gets their share of mtx spenders everything will come out fine.
StreetsofBeige
Gold Member
It shouldnt be game over. But if costs of game making are skying higher and higher, then it is a problem.
It's like movies. A long time ago, a movie hitting $100M was considered great. Now thats considered shit unless it's a low budget horror or rom com that hit it big.
Who would ever think a movie getting $500M gate receipts would be bad? On paper it shouldnt be. It should be akin to hitting the lottery. But, if that movie is a superhero CGI movie with highly paid actors, $500M box office haul (movie company only gets 50% tops) it might actually be a money loser.
WitchHunter
Banned
Problem solved by... listening?
Do not make 40+ hour games. Make two 20 hour games for 60 buck each, and release them 1 year apart, you get it? There is your growth potential.
Do not make 40+ hour games. Make two 20 hour games for 60 buck each, and release them 1 year apart, you get it? There is your growth potential.
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{insert code here}
Member
This has nothing to do with capitalism and everything to do with the currency backing everything. They need constant growth because fiat currency is, and always will be, a melting ice cube. You could switch over to any economic system you wanted and it would make no difference if said system is not backed with hard money.
64gigabyteram
Reverse groomer.
*On NeoGAF.
Go onto places like discord, youtube, twitter, Steam, etc. You will see people dredging up crazy new indie/AA games all the time. Indie gamers are digging for gems and finding stockpiles of them as usual.
It's just that on GAF as usual there's this hyperfocus on AAA and AAA only which means that other games are sort of just not prioritized here. Minecraft is one of the most popular and beloved games of all time and even here hardly anybody talks about it. We're a very specific bubble of very specific enthusiasts who are enthusiast enough to own all 4 systems but not enthusiast enough to really dig for interesting games in our hobby. It's weird.
DownLikeBCPowder
Member
Post.
64gigabyteram
Reverse groomer.
What ideas do you have? VR? cuz that's the biggest revelation I could think of and I'd frankly love that for the 10th gen consoles to all come with their own VR headset alongside the box
64gigabyteram
Reverse groomer.
Not everyone's a gamer and not everyone's into gaming. Ignoring that, half of the world doesn't even have functioning internet, consistent water and good electricity.
We're always going to have a hard cap of people who are invested into gaming.
64gigabyteram
Reverse groomer.
Plenty of boxes are being sold in Asia. Africa's a bit questionable though but there's also the indian market.
64gigabyteram
Reverse groomer.
those games back then had AA production values now. Something like Metal Gear Solid 2 with its production values could easily be accomplished by a modern AA studio with some mocap and talented VAs, from a technical standpoint.
what AAA studios are working on today are far more complex and grandiose to an unsustainable extent.
NecrosaroIII
Banned
Lower the work week to 28 hours so I can actually have time to play the games I buy
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Hero of Spielberg
Member
So many businesses banked in 'the new normal'. Look at Dyson with their stupid fucking air purifier headphones mask … be amazed if they sold double figures of them
Men_in_Boxes
Snake Oil Salesman
The best selling games are 60+ hour experiences though.
Short 20 hour games don't sell like they did 20 years ago.
StreetsofBeige
Gold Member
Just about every company was caught flat footed. Maybe some companies saw it coming (when covid stories and old age home deaths were published in Jan 2020), but I'm pretty sure most companies just did status quo until shit hit the fan in March 2020, governments start issuing lock down and then a lot of companies with desk jobbers told staff to pack up and go home with zero notice.
We had literally that day's notice. Our CEO told staff that morning the immediate call is for everyone to pack up and WFH until further notice. Grab all your desk gear, grab your monitor, etc.... The company will figure out the rest later (ie. someone needs a new office chair for WFH etc...).
Right when that happened is when the whole covid hoarding shit happened and every store amped up ordering tons of stuff people were filling shopping carts with. While not surprisingly, any products outdoors based pretty much sunk like a rock.
It was for a good 1-2 years. Our company didn't normalize in full till probably late 2022 or early 2023 when a lot of people got lives back to normal and people asked to go back to the office.
During that time, all the brand managers and supply chain people were panicking as it's impossible to fulfill orders with such little lead time that whys there was so much shortages at stores. Even though every big company should had been accommodating, any brand manager or sales rep in charge of the hot selling products looked like god, and the workers stuck with the products nobody wanted to touch had bad numbers. But thats ok. The company should understand that and nobody should be getting grilled because their product line got gimped due to covid.
Never the less, as things slowly trended back, everyone knew that the giant sales spikes for home based products would get back to normal, while all the plummeting sales of outdoorsy stuff would increase. Its 2024 and everything is back to normal for a while. Supply chain did their best to add more factory shifts back then, but thats the extent of it. Some product lines did basically no changes. The boon was smiply maxing out orders. I dont think one consumer goods company (that I know of speaking with people) went ape shit building more factories or hiring +5000 permanent blue collar guys to work the production lines thinking this would last forever. And low and behold things normalized. Thats why despite usual cost cutting articles you can see from any company or industry at any time, you didn't really see any of the big traditional companies go gonzo adding 30% more people and then firing 30% back years later. The line chart of sales was a roller coaster like tech, but the employee count line charts were a lot smoother.
These companies took Covid as a weather the storm approach. Tech companies took Covid as perma-boost acceleration. Not just in game making studios, but buy outs too. Embracer used covid as the time in their history to go nuts buying up tons of studios when interest rates for loan were rock bottom thinking it's free money. Well, right now in 2024 your typical business loan or mortgage rate is probably triple what it was in 2020 or 2021. Good luck Embracer at variable loan rates or renewing loans at current rates.
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Icymanipulator
Member
While the industry as a whole might suffer, there are still winners individually, good games will still get made. It's not all doom and gloom.
I also think it's strange to assume such a quick bounce back after Covid.
I also think it's strange to assume such a quick bounce back after Covid.
WitchHunter
Banned
Did anyone try?
LavitzSlambert
Member
The slowdown is not exclusive to games, it's pretty much across the board in the consumer discretionary sector.
I sure hope so, but wouldn't hold my breath. Nvidia is the market leader and they're focused on their AI products. Until AMD or Intel can actually challenge them in the mid range GPU market, I don't see this changing.
Certainly have stagnated. The diminishing returns on graphical fidelity is being reached. Look at the credits of any game and just see how many assets need to be created and polished. Games have become incredibly visually striking, but it costs a lot to do so.
Playstation will stick around, but they won't be growing like they have unless they can get costs under control or significantly expand their market. This is probably the reason behind the GAAS push. They're also looking to bring their gaming franchises to other media and cash in on people who will never play games (see TLOU TV series). Shawn Layden was right, ultimately.
It's a decline in real spending. This is a FT article so obviously the audience is investors who are looking for growth. Gaming as a form of entertainment is going nowhere, we aren't going to have another 80s industry crash. We are looking at a return to normal and sustainability after an incredible jump that happened since the pandemic. I'd argue this was overdue even prior to the pandemic. Near zero interest rates and the rise of F2P games really fueled this fire and resulted in a race to the bottom. Years ago a F2P game was an impossible thought, and nobody would be able to imagine a F2P game with visual fidelity like Genshin Impact. Now this model is expected, and people really don't have the capacity to pay a subscription for an MMO or live service game (despite being fine getting nickeled and dimed for DLC). How can any non-AAA game compete? And the AAA games that compete do so at significant cost.
I'd argue this is part of the problem with industry growth. It's twofold:
1. There are so many games being released now, and so many of them are actually really good.
2. With so many platforms having backwards compatibility and companies selling cheap digital games (and offering subscription services that offer excellent value) you are no longer locked into just playing what is being released now. You can look back and buy some of the best games of the past 10 years for pennies on the dollar, and those games will entertain you a long time.
When you have so many options but limited attention and money, there are going to be winners and losers. But with costs increasing so much and the gaming userbase not increasing as much, you have diminishing returns.
Demographics will play a huge role in industry growth, it's the elephant in the room. I would argue saturation happened in terms of game releases. Companies are not only competing against other games being released around the same timeframe, but existing games from years ago that you can purchase cheaply. They're also competing against other forms of entertainment, and that is with a smaller pool of money considering inflation's effects on cost of basic needs. Publishers need to expand the market or find ways to reduce costs (they are doing the latter already).
Somewhere along the way, gamers became sick. They started looking to maximize time spent vs cost of the game. Game development has become so expensive that AAA games are easier to continue working on and support (and sell DLC) rather than starting another from scratch. People seem to think they get more value simply because the game is longer.
Men_in_Boxes
Snake Oil Salesman
Yeah, the industry has made a billion 20 hours games over the last 25 years. Big games are what sell, not little games.