Gaming market defies "recession"
I know this doesn't help those who recently lost their jobs, but I guess as a whole it shows the strength of the industry.
http://www.gamespot.com/news/6201094.html?tag=latestheadlines;title;1
http://www.gamespot.com/news/6201094.html?tag=latestheadlines;title;1
US gaming industry sees 18 percent year-over-year growth to $1.31 billion; Fable II tops software, Wii retains hardware crown.
US VIDEO GAMES INDUSTRY - OCTOBER 2008
Software: $697M (+35%)
Hardware: $495M (+5%)
Accessories: $120M (-8%)
Total Games: $1.31B (18%)
TOP-SELLING HARDWARE - OCTOBER 2008
Wii--803,000
Nintendo DS--491,000
Xbox 360--371,000
PlayStation Portable--193,000
PlayStation 3--190,000
PlayStation 2--136,000
TOP-SELLING SOFTWARE - OCTOBER 2008
Title / Publisher / Units*
1) Fable II (Xbox 360) / Microsoft / 790,000
2) Wii Fit w/ Balance Board (WII) / Nintendo / 487,000
3) Fallout 3 (Xbox 360) / Bethesda Softworks / 375,000
4) Mario Kart Wii w/ Wheel (WII) / Nintendo / 290,000
5) Wii Play w/ Remote (WII) / Nintendo / 282,000
6) Saints Row 2 (Xbox 360) / THQ / 270,000
7) SOCOM: US Navy SEALs Confrontation (PS3) / Sony / 231,000
8 ) Little Big Planet (PS3) / Sony / 215,000
9) NBA 2K9 (360) / Take-Two Interactive / 202,000
10) Dead Space (360) / Electronic Arts / 193,000
Replies
Or is it that PC is such a small chunk now that its easily overshadowed?
I thought WoW and Warhammer Online would have made stronger showings...
It won't be so pretty when people start pawning their consoles and PC's to make rent.
History has shown this to be true. Entertainment mediums tend to thrive in periods of economic recession. Even if $60 seems like a lot for a game, how many of you have dropped that and more at a bar or taking a date to the movies? These are also forms of escapism but the number of hours of entertainment one derives from a video game tends to be several times longer.
I think this is misleading. The industry, as a whole global industry, will do well. The large companies will continue. Studios with a loyal fanbase will continue. While many in other professionas are lining up for unemployment benefits, nerds of the world are waiting in longer lines for Wrath of the Lich King. Blizzard isn't going anywhere, obviously.
It looks like many studios are still shutting down. Investors are less likely to invest. or pulling out. Smaller studios will lose out. The word from some friends of mine, who are business owners, is that it's nearly impossible to get a small business loan. It will be more difficult for start-ups to get rolling.
The industry is being affected. But, I believe it will be more of a shift in structure. Customers won't notice. There are plenty of games to choose from. I'm still picking up PS2 games for cheap, that I never got around to playing years ago. But those inside will see it happen. And, already, it may be becoming oversaturated with layoffs, making it somewhat more difficult for entry level folks and students to find jobs. Just my opinion.
I think the PS2 keeps going because the games are cheaper and theres a massive back catalog.
This nails it. If people are poor, they stay at home. If they stay at home, they play games and watch movies and TV. One game at $60 can provide you with dozens to hundreds of hours of entertainment. $60 at most clubs/bars will probably barely get you through one evening.
I know the numbers in the original post show money++ too but it doesn't break things down. For instance, software is +35%, but it doesn't show how that breaks down. So say EA has record profits, but someone else has massive losses. I mean, look at the games listed... many are Microsoft and EA.
On the hardware end, look at the PS3 sales. They still fail compared to the Wii or 360. So the 5% increase in hardware is probably Nintendo's profits offset by Sony's losses
http://www.gamasutra.com/php-bin/news_index.php?story=21116
Despite our industry's success stocks are down anyways, partially due to the strong sales still not meeting projections. Anyone else think Michael Pachter comes off as a big douche that's not in touch with the average gamer?
Cant tell ya how true this has been for myself, and classmates of mine as well
The problem I see with the games industry is very big players financing a large number of small subsidiaries, when time gets tough the top bosses slash what they can where they can because they are listed on the stock exchange, and reporting losses to shareholders is not allowed. If shareholders decided the company is no longer profitable they dump the shares. The value of the company drops like a stone. All the loans the company took out with banks based on their share value or net asset value suddenly look very dangerous to the banks, so they pull the loans, the company cant pay the bank back, so the bank calls in the liquidators, and the whole thing dies. Again this can apply to alot of different businesses.
times like these best to be small and independent, get good people and keep good people and sit out the storm the best you can.
EDIT This is just my opinion.. just incase anyone wants to chew my ass.. you're most welcomed to chew my ass if you wish.. it has gotten fatter.. so might take a while.
/EDIT
ive been looking for a new job for a while now and nothing,
Exactly what I was thinking Vig. Industry needs consumers to buy their shit, if consumers have to choose to pay rent and feed their family or get a new game... well family hopefully comes first.
We'll see what happens.
As to the recession, I think everyone is looking at the wrong place when it comes to the difficulties that game companies have been having. Everyone is saying that this industry is largely recession-proof, and at worst will still fare better than most other industries. And yet game companies are closing up shop or laying off huge numbers of employees. Things don't seem to jive. People are still buying games. Sales of games and hardware are expected to be even higher than last year. So where's the problem?
The problem is with the investors. Major game companies don't just spring out of the ground. You need investment capital to start up a decent-sized company. Investors are pulling out, and they are doing it in droves. But why would this be necessary? Games are big money, and only getting bigger! You'd think investors would flock to a more secure opportunity like the game's industry.
And that's the final catch. Games are big money. And games will keep making good money, even through economically depressed times. But the current structure of the game industry has made games a very high-risk proposition. This doesn't effect huge publishers as much, since they can pad their portfolios with numerous titles. But this is devastating for development houses, whose very existence can hinge on the success or failure of a single game. Investors are pulling out because games represent a very high risk. During this recession, investors are going to want to safeguard their money. Only the most daring and opportunistic will invest heavily in game developers. And once they have it will be a roll of the dice to see if they get their money back.
The current round of lay offs is a result of the industry's inflexibility. More game developers should have seen this sort of situation coming, and worked towards developing procedures for producing more economically feasible games. Expect the casual and portable gaming markets to make an even bigger splash during the recession. If you thought they were getting big before, they are really going to explode soon. Handheld titles, cell-phone games, iPhone games, and web-based games are going to really take off, thanks to their lower development costs and lower hardware expectations.
But for now... sucks for all of us trying to get into the industry :P But I have faith that things will pick up again (sooner than later, I hope) and then lots of companies will need a bunch of new people, and then, hopefully, a lot of us looking now will be able to get in.
And if not.... I'm sure burger-flipping is a very satisfying job...
Small teams with small dreams. That's the way to go right now. Get a few friends together and work on a good idea in your free time. Build it for the iPhone store, or for XNA, any portal that will provide a secure method of selling your game. Worst case scenario, you have a decent project to pimp to employers next time you go in for a job interview. And if you manage to make some cash from your first effort, you can put that money towards developing a more robust title.
But still, it'd be nice to hear more about companies hiring to companies firing
exactly right.
take a look at the Wii, being the highest selling console. now walk into your local games store, and see which titles are bundled with the console, you got it right, it's mariokart, wii play, or wii fit. the "top sellers" list, is a complete farce, as 90% of the time it's software that comes WITH the hardware.
a perfect example is that one of phones4u top selling mobiles, is a complete piece of crap motorola that costs £9.99. the reason it's a top seller? the salesperson uses some of the cashback on the contract you just bought, to give you a "free phone". that phone still gets rung through the till and connected, you just don't pay for it yourself.
exactly right.
take a look at the Wii, being the highest selling console. now walk into your local games store, and see which titles are bundled with the console, you got it right, it's mariokart, wii play, or wii fit. the "top sellers" list, is a complete farce, as 90% of the time it's software that comes WITH the hardware.
a perfect example is that one of phones4u top selling mobiles, is a complete piece of crap motorola that costs £9.99. the reason it's a top seller? the salesperson uses some of the cashback on the contract you just bought, to give you a "free phone". that phone still gets rung through the till and connected, you just don't pay for it yourself.
Now's the time for bargain hunting.