Recession = Gaming recession?

Fantastic discussion taking place in this thread. This is why I visit VGChartz.

I don't have anything too special to add, aside from the fact that many of us have seen this problem building over the past few years. And the "living beyond their means" comment seems very accurate to me.

They invested heavily in platforms that are not meeting initial sales expectations.

I think you grossly overestimate the cost of HD games.

I agree but at the same time a company like EA, with close to 15 000 employee need to sell a shit load of game to get enough revenue to pay for all the expense. They need blockbuster title and the only way they know how is to push up the graphic and the feature.

The problem is that after a certain number of feature and a certain degree of graphic are reached less and less people in the mass market care about the next incremental upgrade, but a certain subset of gamer, the "hardcore" if you want, alway want more but this group simply isn't big enough anymore to justify the million put into game develepoment, they don't generate enough revenue.

Simply put adding more is the only way some company know how to make big game and the market for those simply isn't growing (maybe even shrinking) fast enough to cover the expense. They need to stop doing more and do different and they need to do it on a platform that can support it. BTW different doesn't mean new, Mirror edge and Dead Space may be new but aren't different, to use EA as an example

Microsoft is working on expending it's audience (look at the bundle), the new price point will help but it's really much a work in progress and it's audience still consist mainly of the "fratboy" demographic.

PS3 got a more diverse audience, Playstation follower and technophile ,who like many genres, mainly but it's doesn't really help because the audience simply isn't big enough. A diverse audience is good when you sell 100 million console but when you sell 20 million it's more avantagous to have an uniform one. That why it's harder for it to have big blockbuster like the 360 even if it comparativly sell the same amount of software. The fact that it's probably the more graphic hungry of the 3 don't help either. Big graphic, low and fragmented userbase really isn't the best for developer.

Wii got the mass market audience but not the traditional gamer one (except for marioboy) a situation that cause publisher problem because they can't install themself on it by bringing there traditional gaming franchise. Once that happen publisher start to have problem. As I say different is not the same as new, you can make whole new football gaming franchise with a different name and change a few feature here and there it's not going to change anything, only traditional gamer wll be interested in it, much less just additioning All Play at the end of the name. Same thing with EA Fit and that cart game EA is making, again, it's new not different, it's the equivalent of the GTA clones, good to bring in some revenue but it's not going to become your next blockbuster, something EA really need.

Alternative explanations for the companies' bad finances (even prior to this recession) are not forthcoming.

I don't see how some can be selling so many games yet still have such low profits. Where is all the money going then?

There are lots of good sources for a $20 million ballpark figure for a medium HD game. Then you have the outliers like GTA4 at $100 million (source = developers themselves) or Gears of War at $10 million (which was partly outsourced to China and doesn't include the engine licensing fee since Epic made it).

Just as a hypothetical.. if the developers decided to only make a wii version of World at War, what would have happened?

My best guess is that the people who bought world of war on 360 or ps3, would have purchased it on wii if that were the only option.. sure, not all of them would, but i'm willing the bet the amount of profit would have been much higher than making a wii, 360, ps3 and pc version, and having the cheapest-to-make version selling the least because of those higher end (graphically) versions

(Note - the reason 360 and PS3 owners choose the versions on 360 and PS3 is another topic, this is purely from the perspective of the developers in the interest of staying in business)

My point:
1. I don't believe World at War is a good game to look at when making that sort of assessment
2. If developers are serious about making profits, they shouldn't be making games on both the wii and ps360/pc, big franchises (like Call of Duty) need to be exclusively on the wii (remember, this is purely in the interest of making profits), because I think if, lets say Call of Duty 6 were to be exclusively wii, many of those who would have bought the ps360/pc versions would buy the wii version instead, meaning more profits, whether or not every single one of them do