Is the AAA Console Games Market Heading for a Crash?

[Atmos Duality]

The company to "worry" about in this case is actually Microsoft but the Xbox One nonsense is fixable, and it's Microsoft.

Actually, Microsoft would be one of the last companies I'd worry about now.
For one, the Xbox division is surprisingly inconsequential to Microsoft's operations. Historically, it doesn't make all that much money directly for the company.

There's been back-and-forth between the new CEO (and former CEO candidates) and investors about what to do with the Xbox division; and attitudes have been leaning towards selling it off along with Bing.

http://metro.co.uk/2014/02/11/investors-call-for-microsoft-to-abandon-xbox-4299255/

Now, CEO Nadella said they're not selling it off right now, but that doesn't mean it's off the table for good. Lets just say it wasn't just investors suggesting to sell it.

In any case, should the Xbox division be sold; it would depend heavily on who buys it that determines how it would survive or function.

 

[mrdude2010]

I personally have been very selective about my major video game purposes, but I'm just one person. Other people either don't have to worry about it, or like things different from me (being skilled in the few genres of my choosing means I'm an outlier rather than what companies cater to: a game like Halo: Reach is incredibly infuriating to me because of how little skill it takes, but it still sells like hotcakes because it makes mediocre players feel good about themselves.
The problem is that the companies that sell video games have a lot of power over forcing us to upgrade. Since online multiplayer is generally free or a simple subscription, companies have a lot of incentives to stop supporting good games and re-release them (see: the call of duty franchise) rather than maintaining servers for people they aren't going to be getting as much money from. If they straight up stop running the game and don't let anyone use the old framework, people either have to buy the next installment or stop playing a game they like. The obvious disadvantage to this is that one of the largest game markets, the U.S., is currently in the middle of creating two separate societies: the working poor and the comfortably rich. The comfortably rich will always be small in number, so it's kind of a gamble to cater to them, but so far it has worked out well enough to keep AAA studios afloat.

 

[Kameburger]

The company to "worry" about in this case is actually Microsoft but the Xbox One nonsense is fixable, and it's Microsoft.

Actually, Microsoft would be one of the last companies I'd worry about now.
For one, the Xbox division is surprisingly inconsequential to Microsoft's operations. Historically, it doesn't make all that much money directly for the company.

There's been back-and-forth between the new CEO (and former CEO candidates) and investors about what to do with the Xbox division; and attitudes have been leaning towards selling it off along with Bing.

http://metro.co.uk/2014/02/11/investors-call-for-microsoft-to-abandon-xbox-4299255/

Now, CEO Nadella said they're not selling it off right now, but that doesn't mean it's off the table for good. Lets just say it wasn't just investors suggesting to sell it.

In any case, should the Xbox division be sold; it would depend heavily on who buys it that determines how it would survive or function.

Well this was kind of what I was getting at. Microsoft is such a large company that even if the Xbox and game business were to fall apart it isn't the end of the world for them. But of all the game related ventures currently on the market I think Xbox One has the potential (keyword) to fail the largest. It was expensive and this kind of hardware venture is massively costly, and theirs in particular had a lot of miscalculations of the market, but I think you're absolutely right, It's a drop in the bucket for them.

 

[Webb Myers]

Umm...the crash already happened and Nintendo is suffering for it. They made a super-new, must have content box that everyone and their grandmother had to go out and buy. Then they couldn't keep enough quality content coming out for it so eventually everyone unplugged it and tossed it in the closet.

Then the next generation came out without anything terribly compelling to offer in gameplay (ooo...is that a number-pad on the joystick?) or content (has there been a non-sequal game for the WiiU beside the Lego one?), and no one bothered to buy it.

 

[ExtraDebit]

If it was ran by EA and Ubisoft then yes, it will. Just like atari back in the days. The problem is: they don't see games as games, they see it as just another product.

 

[warmachine]

I think there'll be a partial crash of the big publishers, such as EA, 2K and Ubisoft. Mediocre, really famous titles will continue to sell well but the insistence on ever better graphics and other gimmicks at the expense of gameplay for all games will continue, with ever rising costs. Consider Dead Space 3. As such companies continue with ever bigger budgets and ever more mediocre games, more releases each year will become unprofitable. Then executives will realise the CoD clones are what's propping up failing profits. Then they will see the massive upfront costs, long development times and no income till completion of games and realise it's too late to fix it.

Except cut costs by dumping everything but the CoD clones. Even profitable niche games will be cut in the panic. No more new game ideas that need a good budget, such as the likes of Bioshock Infinite, Deus Ex or Saints Row, as they can't demonstrate a known market. Just CoD clones, film tie-ins and low budget indie games.

 

[Callate]

Again, not accurate as far as the development and certainly not accurate as far as the released product. The one man programmer was a certain era of 2600 development, by the early 80s that included additional programmers and artists (Atari Inc. was the first company to start a graphics group to assist with both their console, coin, and computer game graphics) and even sometimes people for the music. Perfect example is E.T., where the graphics and intro were done by another person who assisted Howard. As far as the released product, there's project managers, graphic artists (box, label, and manual), writers (box, manual, other material), marketing specialists, etc., etc. all involved in getting the finished product (the cartridge, the box, the artwork, the manual, the manufacturing and assembly, etc.) out the door and onto store shelves as well, which was Ray's point, and he was right on that as well. The Activision guys were also right that credit should be given. However, it should have been given to everyone. What should have been done was what's done now as I said, where everyone involved in the entire product overall is credited.

That's not true. Many later games were designed and programmed by one person, including games from Atari spin-off studios like Imagic (Dragon Fire, Atlantis, Demon Attack, Cosmic Ark...), Activision (Beam Rider, Barnstorming, Laser Blast, Pitfall...), as well as Atari in-house products like Haunted House, Warlords, Berzerk, and Kangaroo.

Some later products had two to four people working on the games themselves, but E.T. makes for a poor example; at an alleged six weeks of development, it can hardly be considered typical of the working conditions for the cartridges as a whole.

Given alleged comments such as "You are no more important to that game than the guy on the assembly line who puts it together," it's difficult to take Kassar's excuse as a serious argument so much as a "If I gave one to you, I'd have to give one to everyone" negotiating tactic; there seems to be little evidence he was interested in giving anyone more leverage within the process of game design, and high turnover rates at Atari during his overwatch support this. That is, Ray didn't have a point- he was merely trying to keep the worker bees in line.

And if your point is to draw a parallel to the present day, it seems more than a little odd to cite a suggestion that the packaging and manual's creators deserved credit as much as the designers of the software, as the conventional wisdom in modern distribution of both physical and digital formats seems to be that both are largely disposable.

Nope, you'd need to dig up better sources than that, as what you're trying to state is wrong not to mention the sources are both suspect by normal research standards. One's Wikipedia, which isn't really known for accuracy and quotes two book sources for sales that are in turn questionable with their own original sources for said material. The other is the Internet Archive which just presents a summation of materials presented elsewhere for a blurb next to a game ROM they have up and in no way represents an actual reference.

In comparison, by actual internal documents donated by ex-Atari employees including the person in charge of manufacturing and distribution, and direct interviews with said people(which were all for Atari Inc. - Business Is Fun, ataribook.com) Pac-Man was planned as the pack-in title from the beginning. Specifically for the "darth vader" 2600 model that was being introduced in '82. What it became the pack-in cartridge for in 1983 was the Atari 5200. Additionally, the manufacturing figures are for a period of time not all at once. Pac-Man was manufactured from November '81 through December '82, at which point the directive to stop manufacturing them came through. (For a short time at that time after that in '84, Space Invaders was the pack-in).

As no portion of Atari Inc. that allegedly supports this point is available online, I'd have to suggest that any source that is actually available to viewing is preferable to a "source" relying on uncorroborated second-hand hearsay. It's certainly not impossible that the under-selling is a myth, but if so it's a myth reported by IGN, Giant Bomb, Gama Sutra, and Snopes. The last of which is apparently at least aware of Atari, Inc., but did not come to a similar conclusion.

One actual, visible, corroborated source is worth a pound of unsupported off-hand dismissal, especially if you aren't going to provide an actual source for disproving or discrediting the "myth".

 

[Magmarock]

Yes I do think the AAA industry is heading for another crash. It won't be as big as the 1980 crash, but I do think it will be the biggest nice.

I don't expect the home consoles to survive this one but I'm sure the hand helds and PC variants will be fine.

With too much over spending on graphics and not enough on the fun I think a massive shack up is what this industry needs.

 

[Deacon Cole]

It was simply because people stopped buying the damn games.

Actually, overall sales of games were up in 1983, the year of the crash. There was just such a glut of product that everyone got a much smaller piece of a larger pie.

 

[LoneWolf83]

The tipple A industry can not continue as it has been. All it will take is one failure (actual failures not the "Oh no, we only sold two million copies launch weekend!") for a major publisher to have financial trouble. Spending a hundred million dollars on every game is insane and will lead to bad things for the industry if they do not stop.

Instead of making hundred million dollar games, they could make ten million dollar games. Spending the same amount of money on more games gives them the opportunity to experiment and the opportunity to find new franchises to run into the ground. They could make their big blockbuster games every once in a while but they need to focus on cheaper games and long term profit. There is the main issue, the suits that run these companies don't care about long term profit, they want short term prophet to appeal to shareholders, and most of those are dunces.

I don't think there will be a crash, but the bubble the triple A video game industry is in will burst, the major publishers, if they survive, will shrink, they will be forced to make cheaper games or go under.

 

[Melon-Pans worshippe]

Hi. I found this thread through Google and I'm interested in giving my two cents here.

I do believe a crash for big budget games will happen but it won't be due to interest, it will be because of corporate greed. These companies are pulling dirtier and dirtier tricks by the day to get our cash. The problem is (as some of you pointed out) people aren't aware enough to vote against their obvious nickel and diming. Except I do believe gamers have more power than some of you give them credit. Look at Ultimate Marvel vs Capcom 3. This was an attempt to milk something while it was giving gold, except it failed. We all know a third version would have happened if it had been successful. It then further hurt Capcom with Street Fighter X Tekken, which is infamous for DLC abuse. Websites reported the characters found on disc as being incomplete but the hackers who uncovered them found they were all finished and fully working.

What happened to these two games due to the extremely fast re-releasing and gargantuan amount of on disc DLC? They failed. Gamers were promised true DLC with MVC3 and when Capcom acknowledged half the UMVC3 content was planned for DLC gamers decided not to be hustled and forced to buy a re-release, so the game flopped. If you believe Capcom planned some content for DLC is up to you. I personally think a re-release was planned anyway but who can tell?

Point in case: these two games have given Capcom a backlash they have yet to recover from. Granted those are two games aimed at a specific audience in the game market but it proves people do wisen up and retaliate to a company's tactics eventually. Granted Call of Duty and Madden are different beasts altogether but take a look at several companies when their stock crashed in 2008. Notice something? Nobody recovered (apart from Microsoft).

EA and Ubisoft are arguably the worst offenders for the types of tactics in this industry. They are pushing games towards a service rather than a product, which is what people are used to. The thing is I believe it is their desire to control everything that will corrupt them and do them in. This is not the same reason the game crash in 1983 happened. I think it is wrong to say they are making the same mistakes they were, they are making new ones.

It is the growth of video games and online distribution that has corrupted video game companies like this. The problem is when EA in particular see it is this "gaming as a service" push that is hurting them the damage will be done and it will be too late. It will be a combination of money hunger and power hunger. Only those not corrupt by greedy eyes will remain standing.

 

[Dismal purple]

It's true, I have stopped buying AAA games because they are always mediocre and way too expensive. The industry needs to deflate a bit but, although not before kicking and screaming first. Much like how the oil industry doesn't want electric cars and lightbulbs are designed to break often.