The video game market as a whole is growing, but...

[Bodhesatva]

That Guy said:
I like this thread. Good job Bodhesatva. Maybe its the kitten avatar that has me intrigued.

Maybe that's what Nintendo was trying to tell us oh so many years ago. RPGs and Racing Simulators are in a decline, so it would be silly to gear the next system to have better looking RPGs and Racing simulators, since the market for those are clearly shrinking.

As for games like Madden, the sales remain the same every year, but the investment developing a next generation console continues to rise, thus the bottom line takes a hit every time a new system comes out.

 Your explanation of Madden seems valid, and really gets to the heart of what I'm talking about. It would be one thing if Madden's increasing development costs were being offset by increasing demand.

But generally, we see that X number of people want Madden. That X has been about the same for 5 years. In those 5 years, the cost of producing Madden on a yearly basis has clearly increased profoundly -- perhaps two fold. I expect that Madden is still making a VERY good profit, and will for years to come, but that doesn't change the fact that trouble lays ahead.

If a stable "X" amount of people want Madden year after year, but the game's cost, Z, keeps increasing, eventually Z will be greater than X, and increasing the graphics/complexity/technical power of Madden will no longer be worthwhile. It does not mean that people will stop buying Madden -- I expect football games will sell until the video game medium has entirely gone under -- but it does mean that at some point, we'll stop seeing significant technical improvements in the genre. At some point, improving the graphics any further results in losses, and companies have to say: "That's it, no more."