Is shrinking market size all that bad?

[Dr.Henry_Killinger]

sundin13 said:

Dr.Henry_Killinger said:

sundin13 said:
Larger market size is always better, the problems were tied to the increased cost of game making which makes it more difficult to take risks (which is partly due to the fact that publishers stopped caring about the AA market to chase COD-like success...). A smaller market doesn't mean anything will improve for consumers, it just means things will get more difficult for producers

Smaller market size means that focus consumers increases, and a larger market size doesn't necessarily mean more money. 1 million sales for a 60$ game is just as good as 60million sales for a 1$ game.

One of my favorite quotes was on another forum:

"While From Software was popping Champagne about Dark Soul's selling 2 million, Square Enix was crying about Tomb Raider selling 10 million"

But smaller market size means less potential customers....if a Dark Souls game can sell 2million with a 160mil install base, how much can it sell with a 60mil install base at the same point in a generation? Install bases aren't everything, but if the market was smaller than it was, would Dark Souls have still sold as well as it did?

I agree that developers need to find ways to cut costs (Dark Souls would have been the same example I would have used of someone doing it right), but smaller market size doesn't really have much to do with that. Its all about development philosophies and business goals...

On the same note it might not change at all. If the entire market size is 40 million and Dark's Souls niche market is 4 million gamers, it might barely increase even if the entire marketsize is 100 million. Niche markets are extremely dedicated. Even if you go from 2 million on 80 million, to 1 million of 40 million thats the same ratio, but its a loss of 1 million from a loss of 40 million.

Larger games that need more money are harmed more from shrinking market sizes, but I feel like thats a self-perpetuating problem.