It's been 2,000 posts already for me, so it's time for another personal observation on the industry.
The big news and concern in the industry is the economy and its impact. There's a lot of different trains of thought on this issue.
First, are the layoffs occuring at development studios and publishers overexaggerated? For those of you not familiar with the development process, people are hired mostly on contract basis, when their task is done, the contract ends. For modern HD gaming, it takes many more artists per title to keep development times to a minimum. These numbers could be anywhere from 30-100 artists (character modelers, object modelers, level designers, texture artists, animators). In a large studio with many projects, it may be common to have contracts terminate up to hundreds at a time.This is not to argue that there is some economic scaling back, but some of these layoffs are routine contract terminations.
Second, HD gaming and the economy. Are studios being hurt by jumping into HD game development followed by a crumbling economy? In a time where HD game development costs start at 15 Mil and can soar close to 100 mil for very large projects, there is an increased risk for the developer to turn a profit. A title that sells a million copies might not be much of a proft for the studio, depending on their royalty arrangement with the publisher. With only a select few games breaking the 3 mil copies sold mark, this puts a financial risk to the studio.
The problem becomes compounded with the economic issues that are still expanding. How will studios react? Do they continue making HD games as is, shrink their projects down to reduce HD development costs, stop HD development and turn to the Wii and digitally distributed games? It will be interesting to see the decisions studios make in upcoming months.
Lastly, how is the gamer affected by the economy, and in turn how do their decisions affect the industry. With people trying to scale back on costs and save money, will people still shell out money for HD consoles, or decide on the more economical options, keeping their old systems or purchasing one of the cheaper current gen consoles? Will people keep up with their game purchase trends, or learn to be content, or even switch to a game rental system like GameFly, and make no purchases at all?
Personally, I don't feel that the economy will recover in 2009, and we've only begun to see the tumble. I think by July we should feel the full impact, between the failing economy compounded with greedy oil companies that constantly overprice oil for summer travel.
At the end of it all, will the Wii come out even more ahead with their decision, to not join the HD game market? Will the HD systems continue to sell as consistently? Will games that have the potential to be million + sellers not reach the mark, due to a frugal consumer base trying to save their money? An interesting year awaits us.
