The Video Game Industry is Dying!!!

[NJ5]

theprof00 said:

NJ5 said:

theprof00 said:
Complete failure of an article.
Not only does it fail to notice that we are in a recession, but also that it isn't the enthusiasts who have been buying less, but the casuals who have no real vested interest in gaming as an entertainment source.

The recession is more of an excuse, actually... At most you can say it accelerated the industry's collapse, by tightening lending to studios of questionable profitability.

 

Well, let's take into account the unemployment rate.

Let's take into account lower wages, and higher costs. It's not an excuse.

 

Let me break it down for both you and killergran.

The reason the industry was so high last year (2008) was because of Nintendo. Nintendo made a killing that year and brought in millions of new gamers through wii fit and similar software/hardware sales. 12 months later, a lot of those people already had wii fit and the board. There was some saturation, on top of a 50$ price cut for the holidays. The price cuts of this past year (2009) and slightly lower sales numbers are what contribute to the graph that the OP shows.

The economy contributes to lower sales, and the price cut contributes to lower revenue. You can't measure revenue as being the deciding factor if you aren't going to realize these variables. It's completely foolish. Additionally, OP blames the enthusiasts, calling the VG industry a "hit-based" industry. Hits have always made tons of money, and lots of great games have sold poorly in the past. It's always been that way.

 

Your analysis suffers from at least two fatal flaws:

1- Many publishers were already losing money before 2009. Even before 2008. Even for companies posting record revenues. Therefore, revenue is not the problem. Record revenues and record losses can only mean one thing... record expenses. It's simple subtraction.

2- The graph does not include revenue from online distribution and other things which are increasing (as many people have stated before). Therefore, revenue is certainly not as low as the graph indicates (and the graph doesn't show a big decrease in the first place). Actually revenue could even be up, given the small differences involved between 2008 and 2009.