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Several factors caused the crash in the 1980s, and the "flood of bad games" did not cause the crash simply because the games were bad ...

To put this in a modern perspective, imagine that there were no advertisements, gaming magazines, game websites, or pretty much any (easy) way to get information on what games were good and what games were bad. Now, on the day Grand Theft Auto 4 was released the following games were released:

Grand Theft Vehicle
GTA 4
Grand Larceny Auto
Auto Theft 4
Super Theft Auto
Super Theft Auto

All of the boxes look (pretty much) identical, and all you were told by your friend was the title "Grand Theft Auto 4" which you're not sure if that is correct.