I'm curious as to how much of this is because of lockdown when gaming went through astronomical levels, but has now leveled out and game companies are still trying to expect lockdown numbers. 

That is probably part of it and the industry expected the growth to continue. Other issue is how much AAA games cost now. 

It seemed to go like...

• "Oh, budgets are increasing, we'll be fine though"
• "Oh, this looks a little concerning but hey, it's fine right now"
• "Hmm, concerning, but that's a future problem"
• "Oh shit shit shit, what do we do, how do we fix this"

Developers making the actual games been trying to warn those at the top for years though...

Yeah, the other issue is company shareholders do NOT want to see decline or even stagnation, they require endless growth, it ain't sustainable but that's the world we live in and then workers get punished as a result.

But AAA costs are rising far quicker than what profits you make out of them.

Gaming as we know it simply won’t exist by the end of this decade. Disgusting.

Yeah, I'm starting to see why even Sony is talking about multiplat releases. The market conditions seem bleak, and with the kind of AAA budgets Sony has (every AAA in recent years at least $200m, some ovee $300m), multiplat actually makes alot of sense even if hardware and accessory spend is impacted somewhat by losing exclusives.

At least for the big 3, both Microsoft and Sony had record revenue despite Microsoft not moving consoles and Sony not releasing many games.  Nintendo did very well considering the Switch is 7 years old.

When a game needs to sell 10 million units at full price to break even we have a problem. 

And a lot of companies trying to get into live service games when in reality most people only have time to do 1 or 2 live service games at a time. 

As long as native hardware gaming continues to exist, I will likely still be gaming. I just worry about an all-cloud gaming future, something major is going to have to change to fix the latency issues there for Cloud to ever be viable imo. Even streaming from console to phone over my home wifi (which is Wifi 6 Mesh) has considerable lag, if there is that much lag added by a signal traveling a dozen feet from console to router to phone, how much latency does the nearest Xbox Cloud server being 300 miles away introduce? I don't know if that limitation of Cloud gaming can ever be overcome.

Japanese game companies seem to have their budgets in check. Seeing releases such as Like A Dragon: Infinite Wealth, Persona 3 Reload, and Granblue Fantasy: Relink selling 1 million copies and have it be cause for celebration whereas in the west numbers like that would be deemed as a complete failure. 

Then again, idk the cost of living in Japan. I know in places like NYC, $100K has the same buying power as having $35K. A lot of major companies are based in California where like Ryuu mentioned, has an absurd cost of living. So if you want to bring on a good developer, that's six figures for just one. Then multiply that by hundreds, if not thousands.