The Video Game Industry is Dying!!!

[The Ghost of RubangB]

The costs to make games are going up while prices to buy them are going down, so each purchase makes less profit than it used to.

The solution is to either lower your costs... or find a way to get millions of new customers. (Or raise your prices, but that would be suicide in this business.)

Nintendo did both. They lowered costs by opting out of HD graphics and finding exciting new ways to use older cheaper technology that nobody was paying attention to (cheap motion controls), and they found new customers by aggressively targeting non-gamers, casual gamers, and ex-gamers.

The other big companies are trying to make BIG GIANT SUPER HUMONGOUS SUPER GAMES which cost $40-$100 million apiece. So they're trying to lower costs by firing half their work force, and trying to find new customers by drastically increasing their marketing budgets. They are losing money.

The industry won't die, but most of the companies that refuse to adapt will die.