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Video game genres exist to separate and group games with similarities to make talking about those groups of games easier.

If you have too few genres, your groups aren't meaningful.  If you have too many genres, your groups aren't useful.

So let's say you have the power to throw out all the existing genres and write your own.  What would you keep?  What would you throw out?  Would you keep some genres but change their meaning and redefine them?  What new ones would you create?