February 11, 2009
Weathering the Storm: Videogames
and the Economic Crunch
by Steven Hopper
A look at what the video-game
industry may do in the tough years to come.
Even in the face of the current
economical crunch, many analysts considered the video-game industry to be
untouchable. However, the recent woes of several big name publishers like Sony
and Square-Enix (whose shares were revealed to be at a six-year low last week)
as well as the closure of several talented development studios seem to indicate
otherwise, to say nothing of recent outlets within the video-game journalism
field getting the axe as well.
Still, however bleak the situation
may be, the video-game industry has outlasted dire economic forecasts before,
only to emerge even stronger on the other end. However, while the video-game
industry is quite resilient on the whole, what is the ultimate cost and what
implications does it have?
Games like Mirror’s Edge were creative and original
IPs, but performed below expectations commercially.
For starters, I think we’ll begin to
see more of a shift to the Wii from several different big-name publishers. The
Wii is a runaway success that is currently in more homes than the PS3 and Xbox
360 despite being the last one to the market (arriving a year after the Xbox
360).
Additionally, the system is quite
cheap to make games for, not requiring nearly the high budgets of its high-def
competitors. However, Wii development is not without its caveats. Currently,
Nintendo’s first-party efforts are outselling third-party games by a huge
margin, largely due to the fact that a sizable chunk of third-party games on the
system aren’t terribly great (read: downright shovelware).
Not to say that there aren’t some
truly standout third-party games on the Wii, as there are a lot. But it seems
that for every unique and compelling third-party title, there are about five
weak titles that don’t represent what the system is truly capable of. Hopefully
as focus shifts towards the system, publishers will be cognizant of quality and
refrain from simply trying to cash-in on the easy-to-develop-for system and
create compelling experiences on the level of Nintendo’s first-party titles.
Games like No More Heroes show how third-party
development can be done well on the Wii.
Secondly, we’ll be seeing that more
publishers will be leery to develop brand-new IPs across systems. Creating a new
IP can be a risky and costly endeavor, as established franchises are quite the
big business and can generally sell on name alone, while new IPs don’t have such
a luxury.
Case in point, EA took some risks
last fall, with several brand new multi-million dollar titles. While these games
(like Mirror’s Edge and Dead Space) were solid titles, they ultimately didn’t
meet sales expectations, leading to financial problems for the big publisher.
Meanwhile, several franchise titles, like Gears of War 2 and Guitar Hero World
Tour, far outsold any new IP game that launched last fall.
Ultimately, while the situation
looks pretty harsh economically and the videogame industry is taking a hit, the
industry is bound to whether the storm. However, we can remain hopeful that the
overall quality and level of standard stays intact for the entertainment medium
that we love.
