Thousands of layoffs, triple-A games cancelled, studios unable to read the market – this is a reckoning for the gaming industry.
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33 Comments
The shareholders. These layoffs happen because the shareholders are more important than the employees
Greed. That's what it boils down to. It's how the first crash happened.
Embracer has reaffirmed its unrelenting and only commitment, to "maximizing shareholder value" after laying off almost 1,400 workers in six months. There's the problem
$70 for broken games! That is the reason for the downfall
Just make GOOD GAMES. Focus on GAMEplay.
We are in late stage capitalism, corporations rule society with never ending growth at all costs. Wanna kill a creative successful company let it go public or bought out by a big corp. The gaming industry is just a reflection of that.
You don’t understand, the corporation by law has a fiduciary responsibility to make more money. Let’s keep politics out of gaming though. People play games to escape. Not have political ideologies thrown in their face.
I haven't bought a triple A game in 4 years and have never felt happier while gaming. Indie games is where it's at.
This is what happens when you give games 300-million-dollar budget. At that point you need to sell at least 5 million copies assuming you get the full price, if you say were only getting 30% of the sale price you will need even more. And just because you give a project a massive budget doesn't guarantee that it will be a success, but businessmen don't see that, they rely exclusively on analytics like that is a good way to measure how successful a game will be. Games are art, can't argue that anymore. With that information it follows the same rules as all other art it completely comes down to taste some will say Mozart is amazing, some will say they hate it. You can't predict that. Sure, you can have an idea, but the moment you use that as your business model you effectively start gambling. After all taste change and what is popular today might not be tomorrow. So, stop throwing giant budgets so that you can give devs more freedom to express their artistic talents without the necessity for a return on the investment. Would allow for more risks more opportunities to make something spectacular. As Lethal Company, Palworld and those are just recent examples you don't need a giant budget to be successful.
Shareholders demanding infinite growth to their stocks, this is crippling the industry. It's not about making games it's about making money. So, if profit margins aren't where they need them, they do like any other corporation. They cut cost by any means. The idea behind infinite growth is innately flawed it is unsustainable.
Corporations consider themselves to be losing money if they didn't make more than last quarter even if they are still making a profit. So, you ended up with the monster eating everything it can to sustain more and more profit it isn't enough to make money gotta make more money than last time. It will never be sustainable.
Get rid of sweet baby.
Guys, you need to read some Engels and Marx.
I graduated video game design and animation school 2 years ago and a bca in december, i waited out the demic time because i seen the mass hiring and knew mass lay offs were coming. now im just focused on indie dev work of my own. With these layoffs, which are going to continue through out the year, the competition for work in the industry has never been so harsh. New devs are now competing for low end positions with people that have worked in the industry for a decade or more…this is most industries to some extent, the empire is falling
The mergers that have taken place over the last 5-10 years are to blame for this. These publicly traded conglomerates are slaves to shareholders, and must be profitable at all costs. That includes dumping the people who have made these AAA games possible, just to pad stats at the end of fiscal periods. The Codemasters layoffs break my heart. They had a really unique thing going for decades, then EA buys them and gets rid of most of the staff inside two years.
We are quick to blame corporate greed but we ignore the roll gamers play in all of this… the thing is gamers want those high end high performance games… they want interesting stories with varying perspectives and alternate endings…they want fully voiced characters…they want 60FPS and 4k resolution… and they want it all for under 60 dollars…
All the things gamers want cost money and it is not getting any cheaper…
Sure there are some indie darlings out there but most indie games dont grab the attention of the masses and typically those small studios either have to come under the flag of a larger studio to sustain themselves or close down becuase they are not making enough money to support production costs
Gamers are just as greedy as corporations becuase they want more and more for the cheapest price possible.
Gamers will literally complain about about additional content taking too long to release and then when it does release will speed run through it and complain it was too short …meanwhile some poor developers spent the better part of a year tryong to put that DLC together…
Gaming is a business though…gamers are the customers…and ultimately what is happening is to satisfy the customers to keep the lights on…
Womder why CoD and Fortnite keep doing so well…its because they print money…why take risks on new IPs and potential losses when you already have IPs that continue to print money…Maybe the companies are greedy as some say but we cant just pretend we the gsmers dont have a role to play in this…
For those at the top there's never enough slop in the trough, there's a reason satirists always portray certain classes as pigs.
Unfairly so, pigs have more self-restraint.
I kind of feel like all domains of Nerddom have started being taken over by executives ever since being a Nerd became cool, and now the rift is starting to show ever more clearly. There has been a steady rise in identifiable money decisions(as opposed to balance, creative or fun) in my media, that seems to be accelerating. There are a bunch of factors, but I'd say the top brass losing touch is a big one.
Well I have 900+ games on Steam and a huge backlog 80%+ of that size so I’m not so concerned with a reduced volume of content. Good for me, it gives me a bit more time to actually finish one before the next big thing comes out.
Alot of the problem is corporate greed and money for the shareholders screwing everyone else
AAA Games cost too much to make. They are too big, too ambitious and take too long. So the ROI on these is almost impossible to achieve. And that assumes a $70 game is worth it and not a buggy, unfinished mess. Studios should scale back on these projects.
The problem is the executives who didn't plan properly during pandemic hiring and planning never plan on being in the same place to be "impacted" by the decisions. They try to make their resume look amazing, use the great numbers to go from financial guy #6 at studio a to financial guy #2 at company 2. If anything fails at company 2, it was the guy I replaced fault for xyz.
It looks like all that ESG and Black Rock money is starting to run out. These companies destroyed their legacy for a quick buck.
Spiderman 2 one of the most successful games of the last year had a budget of 315 million dollars, 212 million of which were development costs, and needed to sell an estimated 7.2 million copies at full price to *break even*. Almost every major studio right now is banking on an AAA title that will have been in development for between 5-10 years and would need to make hundreds of millions for them to make any money. This is not a sustainable model.
Josh is completely right with his assumptions regarding the gaming industry. It's been an ongoing trend in all industries in the last 20 years. Companies today either don't want to or know how to create a realistic business plan that is substantial over a long period of time
I like you guys but this video isn't that good. You double talk on quite a few points in this video. You criticize the execs about getting IP licenses and then you're amazed that they canceled mandalorian which is an IP license. It's almost like you just rambling for 30 minutes straight.
Unfortunately a lot of games are considered gambled. Horizon zero Dawn wasn't made for only 5 million dollars.
Really hard to make a good video game when stock shareholders are the biggest focus
It’s seams like every industry in the world is just tryna create a money racket, instead of products with integrity being the focus.
The problem is these morons are doing it to themselves, instead of making games that are fun and enjoyable, they are paying 3rd party compainies to tell them what should and shouldn't be in the game (inclusion and exclustion IE good looking female charcacters or sexy bodies, LGBTQA messaging) ruining the game and making people not want to buy the game that cost 100+ million to make so sales are terrible which leads to layoffs and the only people who win are the progressive moron companies who don't lose a penny in destroying studios.
Once you admit exclusives don't make money……
You're not in gaming for gaming….. you're in it to make money
It's not the "industry" it's padding numbers for stock value, the people with money, want more money
Gaming died when they replaced the gamers with executives and suits ..
weird how this only seems to affect AAA studios, maybe they should stop being greedy?
The gaming industry is a project based industry. A company in this industry will need a constant stream of incoming project contracts to continually employing people. They likely hired contractors to work on games like spider-man and ratchet and clank, which they then let go once the game is finished. People who work in this industry should approach work with the mindset that it’s a project and you’re there for only x time and don’t expect transitioning to a FT employee. It sucks, but if you have this mindset, you can better prepare yourself.
While i agree the suits are paid too much you also have to admit there is a LOT of bloat in the AAA industry. Im not talking about the coders and such, im talking about sensitivity readers and such. Studios are gonna have to run leaner and meaner from now on.