Article: What's Killing the Video Game Industry?

[Aiemond]

jammy2211 said:
I'm thinking that publishers are just sort of going to have to bite the bullet now, and accept this is how it is and get on with it. Keep investing money into the HD systems, keep building engines, middleware, get their franchises selling, get more studio's equipped to make HD games and more employees trained to it. Once it's all set up and ready to go costs will fall, eventually, just got to hope Sony and Microsoft don't keep pushing graphics even further with their next consoles. Can't see that happening.

Of course doing that costs money, which to me is why the model of using DS and Wii games to fund HD projects sort of makes sense. They don't bring in huge streams of revenue but when you're releasing stupid amounts of PetZ and MySims spin offs it soon adds up.

In the short-term it'd make more sense just to invest everything into the Wii and DS where profits are easier, but I guess the inevitability is that HD gaming will be a standard accross all consoles next gen and handhelds are getting more expensive too. IT's better getting yourself prepared for HD developement, and getting it as cheap as possible, while you've still got profit streams from other systems.

I can't really see the industry going else where until Digital Distribution becomes the standard, if that happens, and that's a long way off. I do think this article does push hyperbole at points, but the sentiment is accurate.

 

But they are laying off and closing down studios due to the HD projects. How can they afford to keep investing in it if they are being killed by it?