Gaming?s Great Recession

Sparrow

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KDR_11k said:
Sparrow Tag said:
All this tied with the fact that the only thing that sells nowadays are sequels, means the indie side of gaming will slowly cease to exist.
Do you have some data showing that indie games are selling less? I'm not sure that is the case.
Just a large set of Escapist articles, general views at IGN and Shamus's articles.

But, I don't have any rough numbers. Just seems to be what everyone is saying.
 

bluepilot

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Its not that I CAN`T afford to buy games, it is just that for months and months, there have been no games that I WANT to buy.

The market is oversaturated with terrible unamusing games

Plus it is natural for profits to go up and down in cycles with new consoles. Given current technological trends, what could they possibly do to improve current consoles enough so that people would buy them?
 

Bigeyez

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KDR_11k said:
Bigeyez said:
Looking at the Wii specifically I can't say some people didn't expect this to happen. The rush of casual gamers to the Wii created a bubble that finally burst. Sure the Wii basically printed money for Nintendo but I see rough times ahead for the company. A lot of people I know who were never really into gaming went out and bought a Wii but now it sits unused in their homes. They certainly won't be buying any games for it and if that ends up being a trend the Wii and Nintendo is in a real bad spot for the forseeable future.
Nonsense, there are just no games to sell to Wii owners. The attach rate is still decent, about 1 lower than the PS3's but about twice the DS's and noone's proclaiming that the DS is a bubble. People do buy games, the publishers just aren't making it easy for them.
I believe you missed the point of my post. The Wii sold so well because it pulled in a large crowd of people who were previously not interested in gaming. I call that a bubble because I figured that eventually the Wii would stop being the "IT" item to buy and people would lose interest and stop dropping money into games for it. Casual players who bought a Wii and find that they don't use it have no real reason to drop money into games for it. Chances are they won't know games are coming out unless they happen to see an ad somewhere. They don't follow gaming news or visit websites.

Sure part of the reason "real" gamers aren't buying Wii games is because yes there isn't that many worthwhile games to buy but I was talking about the people who got a Wii, had never played videogames before, bought a game or two then got over the fad and won't buy another game again. Which from what I have read/seen/heard is quite a lot of people. Like I said I know several people like that IRL so if theres enough of em out there Nintendo is indeed in trouble.
 

KDR_11k

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Bigeyez said:
I believe you missed the point of my post. The Wii sold so well because it pulled in a large crowd of people who were previously not interested in gaming. I call that a bubble because I figured that eventually the Wii would stop being the "IT" item to buy and people would lose interest and stop dropping money into games for it. Casual players who bought a Wii and find that they don't use it have no real reason to drop money into games for it. Chances are they won't know games are coming out unless they happen to see an ad somewhere. They don't follow gaming news or visit websites.
They still react to new games coming out. Many people are still not interested in getting a Wii and the proper killer apps would change that. The new gamers react to killer apps just as much as long time gamers do.

Sure part of the reason "real" gamers aren't buying Wii games is because yes there isn't that many worthwhile games to buy but I was talking about the people who got a Wii, had never played videogames before, bought a game or two then got over the fad and won't buy another game again. Which from what I have read/seen/heard is quite a lot of people. Like I said I know several people like that IRL so if theres enough of em out there Nintendo is indeed in trouble.
You know what the attach rate means, right? On average Wii owners have something like 6 (or was it 7?) games. That's 1 game less than PS3 owners. Either the people who own more than 1-2 games buy disproportionately many games (why would they?) or your stereotype of new gamers as buying only 1-2 games is flawed and the actual numbers of those people are quite low. For reference, the DS has an attach rate between 2 and 3 and noone's calling that a bubble.
 

Silva

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It's amusing that I actually predicted this in one of my older posts, while it comes as a surprise to The Escapist, a magazine which often catches industry trends early. At the time, I said basically what this article is pointing out now: that the hardcore would be needed in a recession, and that this Wii-induced shift to the casual would be harmful in the context of the financial downturn. I concluded at that time that the industry would essentially "come crawling back" to the hardcore audience on some levels.

To me, it's obvious that no industry is "recession-proof", except the industry of gold-plated pianos constructed solely for Bill Gates. And such products should not count as an "industry".

Let's look at the consuming audience of gaming, because that's really the reason behind all of this. As I've just demonstrated, the upper class, particularly the very rich, are not high in number, and don't consume ordinary resources to a disproportionate enough degree thanks to limits on the time they can spend playing games; when you're running Microsoft, do you really kick back and play a 360 when you get home? Will you really have time? Exactly. And even if you did, there's just not enough hours in the day to use all of that income on media and see it all.

That leaves the lower class and middle class. Lower class is out as well. The reason why this is isn't always obvious to the middle class, especially after a long economic boom like the one we just had for ten odd years, but in essence: games cost far too much. In Australia, it's $100AUD ($82.32US) for a full-price game. That's a whole day's work for our minimum wagers, before tax. There's just not enough for games to be accessible to them, particularly when considering that groceries for three people go for about twice that, weekly.

So the industry is left with the middle-class, who get tight with money when they're paid less, when they suffer the chance of losing their job or already HAVE lost their job, and have plenty of essential things to spend money on, like mortgages in Australia or health care in the US. And all of these pressures are focused on that class right now.

This "bottlenecking" of the wallet flow will always hit every single creative industry aimed at that economic class, even if the products are very expensive and intended for the upper echelons of that class. So, the hit might be less powerful with games than with the cinema, but that's only if there remains a hardcore audience. And unfortunately, the hardcore has had very little reason to be impressed with what the industry's been releasing in the last generation.

"Eternal growth", as the industry giants who called themselves "recession-proof" dared to postulate, never abided anyone as an economic philosophy. I wish the industry luck crawling back to stability.
 

Gyrefalcon

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jonnypistolshot said:
I don't see this news as horribly bad for us the Gamer. Companies being more careful about what they produce? This sounds good to me. Maybe some of those second rate and buggy games that used to get foisted on us will get dropped. Indie developers, with their lower production costs might actually have a competitive edge. And finally I'm hoping that the Big companies that have developed a reputation for horrible customer service (UBI and EA, I'm looking at you) might actually rethink policies to try and bring gamers back into the fold.

As for me, I will continue to be very careful with my money. This is why the escapist is very important to me, the reviews and news will hopefully help me to avoid some of the game stinkers and I can spend my money and time on a more rewarding game experience.
I rather agree with this. But I never believed the game industry was recession proof. I'm sorry, but when people are losing their homes and starving on the street, they are NOT worried about a new game system. No home=no electricity and very possibly no food either. Most industries depend on a quantity of sales as opposed to a few high quality sales. That being so, when something this harsh and wide-spread hits it affects everything.

Worse, it has a domino effect. The more companies that fail, the more people without jobs and thus with less money to spend causing the companies they support to fail and wash-rinse-repeat. Once we hit a leveling off point and stop hemorrhaging jobs, we should see the gaming industry recover rather quickly. People DO want entertainment and games offer more of that than movies, plays, opera, etc. But people are going to be very selective. Their money is precious so they aren't going to jump on just anything. And the reviews of trustworthy critics like those here on Escapist receive a lot more value!

So I do believe we will see an upturn for the industry by 2011-2012. It should begin to be felt a bit this year but it will take time for it to gain momentum. Although not recession-proof, the games industry has the best spring in it to allow fast recovery.