Gaming Crash up Ahead

Milktoast writes "Joystick101.org has posted a story predicting an upcoming gaming crash. They claim that a crowded marketplace in conjunction with the large number of ports will lead today's consoles down the same road as the Atari 2600. Will gaming consoles go out the window like before, or will we pull out of this?"

Comments

It's all in the pricing.

[Richy_T]

Back when consoles first died out, you could buy 8-bit computers for ~200-400 UKP (300-600 dollars) which were in the same price range as consoles. The games were of a similar quality, often incorporated greater complexity and were cheaper. Consoles lost

Then came the rise of the PC. A typical entry level PC has always been around 1000 UKP (that's $1500). Prices have stayed stable for a long time. But finally they are starting to creap down and with inflation over the intervening couple of decades, $1500 now is probably not worth much more than $600 was then. PCs have become cheap, real cheap and while the games cost more than the 8 bit ones did, the prices for those are coming down and budget games just put the icing on the cake.

I'm not saying consoles won't make it but they have a struggle ahead and the x-box (though I hate the idea) will probably just make things more complex.

Rich

Won't happen.

[ddt]

People have been predicting a game crash for years. Won't happen. Trust me. There is excellent content in the pipe. There are excellent platforms in the pipe. Sales are brisk, even if they aren't uniform.

Even if sales disappeared, you would still find people working on the next epic title. It goes beyond profits. Game developers write games because they're passionate about it and addicted to it. Just as film-making is a dumb idea for turning a buck, so is game-making. It's not a sensible business to be in, but people get hooked even though it is extremely risky.

VC's generally avoid game investments because it falls in the class of "hit-driven" industries. I had a friend who wrote what I consider to be one of the finest business plans I've ever read, but it was for a game company. He shopped it to over 200 VC's. No one bit. He eventually got backed by one of the few game publishers that has managed to stay afloat (surprise, surprise).

This is the way the game industry tends to work. Whoever is winning often ends up being the next big publisher.

So in a sense, you could say the game industry has always been in a slump because no one wants to invest directly in start-ups, but in a way, its own incestuous investments are more stable because the winning game developers end up investing in the other game developers.

Amateur game developers are the angel investors that infuse new money into the industry. They work for months - sometimes even years - without pay, draining their savings because they believe in the title.

It may be the case that many developers continue to suffer the marketing politics, the retailer shelf-space bribes, project cancellations, poor back-end compensation, artificial milestones, moving target libraries, and turnover. However, the consumers will not.

Ask yourself if the film industry or music industry or book industry has ever really "crashed". There are lots of starving, passionate actors, musicians, and writers, but consumers continue to see great selection year after year.

It would take something really major, like the repeal of copyright law or a way for pirates to have access to considerably higher bandwidth media and connections than the developers have access to in order to cause serious damage to the game, movie, music, or book industries.

Death of Consoles

[crgrace]

Someone said s/he thinks gaming won't die, but consoles will. I agree strongly with both that statement and with the substance of the article. There are many parallels between 1984 and 2001 (sounds like a book review!). But remember, computer gaming did NOT die in 1984, just consoles (Atari 2600/5200, Intellivision, Colecovision, etc)

In 1984 my brother and I were both turned off by the crap being sold for consoles and turned to the commodore 64, which had a very healthy gaming market, and never skipped a beat (plus, you could actually PROGRAM it. What a beautiful assembly language it had!). People shouldn't talk about the video game crash of 1984 but rather about the console crash of 1984, because all my friends at the time were playing tons of games on their commodores and apple IIs and we were all lusting after the AMIGA!

Video games didn't crash in 1984; consoles did. I think the same statement may be applicable in 2002, as the author of the article indicates.

A crash is possible, but for different reasons

[Junks Jerzey]

One of the great hidden secrets of the video game industry is that 50% of all products lose money, 40% break even, and 10% make a profit. Of those 10%, only a handful make what could be considered a spectacular profit.

I think the author is off base about what would cause another video game crash (something that comes up every couple of years, going back to at least 1990). This time around the issue that development is hugely expensive, takes two to three years, and games have to do exceptionally well just to make up development costs. The next time you read a poor or mediocre review of a game, consider that a team of 20 was slaving away on that game, day in and day out, since 1998. This is in a different class than a band spending two months to write and record a weak album. Daikatana is a high profile example of a failed game, but the sad truth is that most games follow the same path; it's just that they don't have a well-known figure managing the team.