Having now read your linked article full of misinformation, bullshit and what can only be described as Nintendo fanboyism. I can only disagree more a crash would by very definition mean a catastrophic reduction in consumer and investor confidence which would lead to less games with lower budgets. The loss of the marketing and promotion muscle of AAA games alone would be catastrophic for core games especially the already ailing console business. Without those tent-pole releases and their marketing budgets consumer awareness of gaming as a whole would drop and with it hardware adoption. user base, and investment across the board.
The loss of major publishers like EA, Ubisoft, Square Enix, Take-Two, Capcom etc would leave a massive hole in the videogame release schedule that just wouldn't be filled. THQ was a mid tier publisher and even with the loss of that small player will mean the loss of several studios and found many IPs struggling to find buyers and ended up being sold off at bargain prices to small publishers that do not have the resources to develop even half of them. The fall of THQ is still being felt across the industry in terms of investment and led to a lot of cancellations. And also left dozens of creditors and independent developers out of pocket including the likes of Double Fine, and left hundreds out of work. EA is over 8X bigger than THQ their loss alone would be catastrophic, there would just not be enough investment money in gaming to even pick up a tenth of what would flood the market and alone would mean thousands of devs unemployed.
And the shaking of investor confidence (which is already drying up) of even one of the major players would have drastic effects on developers across the board from indies to AAA. You see most so called indie devs these days get funding from various private sources as well as major publisher. Publishers like EA fund many smaller developers in publishing smaller games in addition to their own AAA releases. Even Nintendo would be struck extremely hard by the loss of major 3rd party publishers even with the little support they get it's still key to their business model, and they would not be immune to a lack of investor confidence ether.
And of course a major retraction in investment would of course also lead to more conservative decision making. If you think the current climate is bad of original IPs and risk taking it would only get worse with the collapse of top tier development. Only the surest of sure fire bets would be taken with a greater increase in recycled content and focus tested design. And of course prices and exploitative business models would be even more appealing to investors. With the age of F2P, freemium and $0.99 apps plus the indie scene pushing compelling experiences for budget prices, you just can't expect people outside of a small niche market to pay for mid tier games at full prices anymore. And going low budget super niche can't work for the majority of the market.
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