There have been several analysts who’ve predicted various things for the future of the industry, and one of these predictions is that the game industry is running the risk of heading into another crash. Of course many older gamers know of the crash a few decades ago that nearly killed gaming altogether (and was mostly saved by the NES and a slew of great games), due to market oversaturation. So why is another crash on the horizon?
According to the analysts there are two key areas that are evolving to make it happen again. The first being the massive install base of console owners. According to the stats, almost 80 percent of the target base already own a console that is on the market. So why would the entire install base be willing to put even more hardware under the TV? That seems to be the problem. While pre-orders are sold out, and each company reported a good interest in their new consoles, it seems the issue comes after the launch anticipation dies down. These people are not yet interested in buying a new console, or adding to the one they already own. So basically, again, it leads to the second issue.
The idea behind the prediction is that the market is oversaturated and these new consoles are making it worse. In short, there are too many choices on the market and too many people trying to sell a video game. In the previous gaming crash, the major problem was shovelware. Back then games were simple to make and anyone that had time was getting some shelf time. You had key consoles, with tons of knockoffs, combined with tons of games, and it went nowhere, so people stopped buying and what was left was divided into a pool of companies.
The issue with this is that the market isn’t being oversaturated by the core gaming companies. Looking at it, when you walk down a gaming aisle or walk into a gaming store, what do you see? Nintendo, Sony, and Microsoft. These are the leaders, and these are the guys people go to buy games from (unless you’re a PC gamer). Now who makes games for these companies? A few small publishers that only greenlight so many titles a year, and a majority of the main releases are of top quality with millions of dollars spent on them. These big budgets have built a barrier of protection in a way.
The problem comes from the fact these same analysts are the same people that have been calling Apple a game company for years now. Mobile games have somehow become added to the industry, and they are the culprit of a possible downfall. People are afraid of over saturation and the mobile market is a perfect example of it. Each company has a new product almost every month, and the core leaders have a new main product every 6 to 8 months. You can’t find a decent game on the app stores without scrolling through pages and pages of absolute crap. Like the previous gaming crash, anyone and everyone can make a mobile game at this point. There are no big budgets, and the crowd is a bunch of casuals that want to waste time.
A great example of that interfering with the game industry is the recent announcement of all the Android based consoles. It started with one Kickstarter idea, and now everyone is making small boxes that play Android games. Tablets boomed, and now these same games are hitting tablets. Then the analysts turn around and say these devices will kill the console market, yet cry when they see it’s over saturating things.
The question comes down to this, would you give up your console to play on a mobile device? They track the numbers, but never ask the question. How many people own a mobile device AND a console, or have a console they use in their home? A family only needs one or two consoles, while each person would need a phone and probably buys separate titles for each device. How many of these people that own both would give up consoles to play mobile games? How many mobile “gamers” are actually interested in playing games and not wasting time?
The core gaming space has values set in it to prevent the crash. Games release at a certain price, and out of respect they stay that price for a while. People are not making quick knockoffs and rush them to shelves for half the price. The only instance of this happening is with mobile games. In the mobile world, they want to be cheap, and its filled with shovelware or cheap knockoffs. One of mobile gaming’s biggest publishers makes nothing but console knockoffs…..
To a core gamer, the answer is clear. Mobile games are good time wasters, while consoles and PC gaming is where we love to stay. I’ve never personally sat at work all day thinking “man I can’t wait for work to be over so I can go play some Angry Birds!” Yet my download of Angry Birds added to the numbers somehow proving that mobile gaming is taking over the market.
In terms of current consoles adding to it, I think this is just some analysts crying wolf to say something negative. People will not be adding to these consoles, they will be replacing them. The new consoles are upgrades, and upgrades only happen once every 8 to 10 years. The gaming market is an entirely different dynamic than many other industries, and this needs to be noted.
Plus last time I checked, none of the major publishers or console makers are on the verge of bankruptcy. In fact, the gaming industry still seems to be booming. Need proof? Why not head over to Rockstar and ask them about a few records Grand Theft Auto just broke?