Game Industry in recession now – PS3, Xbox 360, Wii
For quite some time now, analysts, industry veterans and writers have been boastfully stating that the video game industry is recession proof. However, not too long ago we witnessed several companies going through some turbulent times due to the state of the economy. The final verdict seems to be that the video game industry is smack right in the middle of a recession.
The odd thing is that the video game industry experienced growth this past year. You may be asking – how can the video game industry be in a recession if it experienced growth? The answer is quite simple; the video game industry has gone mainstream yet experienced mediocre growth.
The industry has experienced tremendous growth within the past few years with the market saturation of the PS2 and the phenomenal exposure of the Nintendo Wii. One segment that seems to have slowed down a bit is the hardcore market.
Currently, studios such as Ensemble and Free Radical Design have one leg in the grave while breathing their last gasp for air. Giant publishers such as EA have also laid-off a decent percentage of its workforce. These events signify the impact of the economic turmoil as well as the reduction in the hardcore market.
According to GameDaily, NPD sr. account manager, Michael Klotz, indicated that Americans are spending one out of every four entertainment dollars on video games. This definitely reflects the significant growth the video game industry has gone through. However, according to Klotz, the growth isn’t as much as it should be considering the mainstream exposure the industry has received as of late.
One of the things that I am worried about going into 2009 is what direction the hardcore market will head towards in the coming years. The question that has always bugged me is – will we see many more casual games being released with fewer hardcore titles? It is only a matter of time before we know, but my gut is telling ‘yes.’
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22 Responses to “Game Industry in recession now – PS3, Xbox 360, Wii”
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January 15th, 2009
It’s hard to say what will happen in a recession. I don’t think we will see any new consoles until there is a feeling we are coming out of a recession or we are completely back on our feet. It wouldn’t surprise me if gaming went back more to its roots. After all, consoles were developed for casual gamers. The hardcore gamers were always on the computer.
January 15th, 2009
Wasn’t it just argued that too many hardcore titles were coming out at once and that they didn’t sell as well as they could have?
January 15th, 2009
In a slowing economy, having even moderate growth is still impressive. Given how many business closed doors, and how many business posted negative growth – I think the game industry is still ok. Economies have fluctuated though out history, things will end up getting better.
I think we’ve already started to see a slow drop in hardcore titles. Creating a decent game takes a lot of time and money and is a huge risk. It’s easier for companies to quickly through together a crappy Wii game and the chances of it selling well are pretty good. Case in point – look at Amazon’s top sellers in Video Games Ubisoft has about 10 shovelware titles in the top 50. Also Jillian Michaels Fitness Ultimatum 2009 – has been consistently a top seller for months now.
January 15th, 2009
Times are tough for a lot of people and I’m happy I’m in a government job but I thing the game industry isn’t going to die and there will be more hard core gamers coming from the wave of casuals.
People that didn’t know they liked gaming until they tried the wii and will move on to the PS3 and 360.
The Wii is like a gateway drug lol.
January 15th, 2009
Carl B – That’s because there were more releases in Q4 then Q1, 2, & 3 combined. I don’t really understand the logic myself. If even a few of the Q4 releases were released in a slow month, they would have had better sales. Maybe that atrocity of a game, The Force Unleashed wouldn’t have sold so well, if it had another decent release to compete with it that month.
January 15th, 2009
Ncaissie – I’ve actually been looking at the government jobs. Good pay, great benefits, job security, and every holiday you can imagine off – sounds like my kind of gig.
January 15th, 2009
It’s great. Here in Canada we have unbelievable job security. And our job is guaranteed for life even if they run out of work for you.
January 15th, 2009
That’s like a dream come true.
January 15th, 2009
Yep, same with my government job. I travel a bit more though. Not always the prettiest places, but it keeps me balanced.
Barnabe,
I think it has something to do with holiday sales being better for a title than those other quarters.
January 15th, 2009
Yeah, I’m sure it is. It seems like they over saturated the market though. I would think – less competition means your game would have a better chance of selling.
Also I’m looking at the FBI’s openings near where I live. It looks like the have a huge selection. I do have one arrest on my record from when I was younger though…
January 15th, 2009
If it wasn’t a felony conviction then you should be alright… where do you live?
January 15th, 2009
Well I wasn’t even convicted of anything (Post trial Intervention). I was thinking that the FBI would do a pretty intensive, thorough check though.
At the time I was living in Jersey. I know live outside of Philly.
January 15th, 2009
Philly huh. I like watching that show Parking Wars. The people of Philly sure hate the Parking Authority! I love how people going down the street yell obscenities at them.
January 15th, 2009
I had two FBI agents do a background check before I got my TS… you should do alright. Don’t forget about the lie detector and hair follicle tests.
Yes, those people yelling the obscenities… they really have something to complain about. I’d like to bring them out here for a few weeks of fun in the sun.
January 15th, 2009
That’s pretty funny. I have seen that show… they always manage to find the biggest a-holes in the city.
January 15th, 2009
Well, a-holes make for good t.v. If it was just people taking the ticket and saying thank you I know I wouldn’t watch. That show just shows how stupid some people can be.
January 15th, 2009
“good t.v.” = Dexter, Heroes, New Battlestar Galactica, etc. Reality shows “just show how stupid some people can be” and are a sad reminder of reality. Yes, I respect your opinion, I just find it more sad than humorous.
January 15th, 2009
You both have a good points… Please and thank you do not equal ratings.
The only TV I really watch is the History Channel before I go to sleep…. I’m sad like that.
January 15th, 2009
CarlB,
I hate the so called “Reality TV”. Taking people, putting them in some environment and filming it. But the shows that follow real people around while they try to do their jobs are kinda fun. Whether it be Deadliest Catch, First 48, Parking Wars. I’m not saying I Tivo them, but if their on I will check them out. I like to see what other people have to put up with in their jobs.
January 16th, 2009
Sorry, I wasn’t trying to disrespect either of you or call you sad. I just see enough people at their worst (“how stupid they can be”) in real life in dangerous situations that I do not particularly enjoy watching it on TV. I can understand the attraction it has for some people to contrast their own jobs or see what others have to go through though.
January 16th, 2009
o worries Carl… I was basically just trying to say I don’t watch very much TV. I try to spend what little free time I have gamming.
January 16th, 2009
alright. Say, does anybody else here agree that videogames are still in their relative infancy as far as media goes? Relative to movies in their early years (talkies, overacting, etc.), and as such will evolve not just gameplay, but transition, flow, artistry, production, etc.?