The Video Game Industry is Dying!!!

[Gamerace]

This is not anything new. Pundant were saying the same thing back in 2004-5. And except for Nintendo making more money than the rest of the industry combined nothing much has changed since.

The writing was on the wall then. Nintendo (and maybe Majesco) was the only company to heed it. EA has been losing money since then too. It's amazing they have lasted this long. And they aren't the only ones in deep financial trouble. Take Two, Capcom, Sega, THQ, even Activision without Blizzard would be having trouble maintaining profit margins, especially with GH going out of style, buying Blizzard the the cash cow WoW was the second smartest move anyone has made this generation.

The recession has nothing to do with a problem that's been around for 6 or more years. It's the industry mentality that's killing it. Always going for bigger, badder, better, more epic games that cost more and more to make but they aren't charging more and more to sell them.

From PS2/Xbox to PS3/360 development costs have doubled to tripled (and a lot of studios were having trouble last gen already), but selling costs have barely risen. It doesn't matter to you that you're getting a game that cost $20m to make for $60 but it sure matters to the publishers/developers that use to only spend $5-10m to make the same game and sell at the same price in the same amounts (more or less). So what if they're losing all that profit margin? So what if a flop puts them tens of millions in the hole?

A booming economy won't help the industry (except to make Nintendo richer). Nothing will except a radical change of thinking. For most, that will come too late.