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I don't think the game industry will crash, because the market is still growing.

What's strange though is why the publishers are losing money off an industry that has seen phenomenal growth for at least a decade. Usually growing industries are accompanied by companies that make great money. How come that people in the gaming industry are so stupid to erase all the potential for great profit by having these increasing game development costs (not just in the HD gen, EA, Take Two and others started to lose money way before this gen).