Four Reasons The Gaming Industry May Be Nearing Another Crash

October 17, 2014

It’s hard to believe that only thirty years ago we almost saw the complete demise of the video game industry in North America.

The now-infamous crash saw the plummeting of consumer confidence due to several reasons, resulting in publishers with piles of games they couldn’t sell. You may have heard about Atari’s mass burial of nearly a million cartridges that nobody wanted to buy, forcing them to bury them in a New Mexico landfill.

Unfortunately the gaming industry is currently seeing a few of the same symptoms that led to the original 1980s crash. Will games come full circle and suffer a tremendous market crash before rising in popularity again? Here are a few reasons this could be the case.

Too Many Bad Games, Not Enough Good Games

Back in the 1980s, it reached the point where people were no longer willing to pay their hard-earned cash for games that, quite frankly, were terrible.

The famous example is E.T., a highly-anticipated game that was supposed to be amazing considering it was based on a beloved movie. Of course, it turned out to be one of the biggest commercial failures in gaming history. Too many high-profile failures resulted in a loss of trust from consumers, leading them to spend their cash on other forms of entertainment.

Today, there’s a huge variety of games that all have the same price tag, making it hard to decide which games are worth buying. Worse still, many games that players expect to be amazing end up a disappointment.

Destiny is an example of a game that ended up being less than what people were expecting for a game with a massive budget and half a decade of development time. It’s possible we will see consumers lose faith in games again, leading them to buying less titles a year and putting in less money into the industry.

The Downside of Self-publishing

An interesting turning point in the gaming industry back in the 1980s was when developers realized they could hire a few programmers for a few weeks to make a game, slap it onto an Atari cartridge, and sell it without problems. If this sounds similar to the exploding indie scene of today, that’s because it is.

Although some amazing games have been made by indie developers, there’s a ton that are just plain bad.

Simply going through the App Store to find the good games among the clones and shovelware is a difficult task. Sadly, the same is occurring on Steam, the most popular digital distribution platform.

Hundreds of games are being approved on Steam Greenlight via an arguably poor voting system before ending up on the Steam store. This means that a terrible game can make it onto the market without the need for a publisher, making it harder for people to find a good game on the Steam store.

This is why Nintendo, to avoid this happening again in the 90s, added many restrictions for publishers that wanted to release games on their system. In fact, they even placed a five-game-a-year limit so that developers focus on creating high-quality titles rather than churning out dozens of terrible games in a short time.

Publishers Have Their Hand in Reviews

But surely you can simply tell a good game from a bad one based on reviews, right?

Actually, publishers are influencing the reviews of games more than ever, and to deny this takes a good level of naivety. If you recently dropped $60 for a heavily-marketed game that got amazing reviews on several sites only to discover that it’s actually pretty mediocre, you can thank publishers for that.

A simple comparison of professional reviews vs. user reviews on Metacritic is enough to shed light on this practice. How does Watch Dogs for PS4 hold an 80 Critic score vs. a 6.3 User score? Mass Effect 3, which is published by none other than EA, has an 89 Critic score vs. a much lower 5.2 User score.

Since money talks, it’s no secret many websites are accepting cash from publishers to have their games receive better reviews than they deserve.

Game Industry Still Makes Money, Just Like Before the 80’s Crash

Ironically, the gaming industry was exploding just before the crash. Like today, games were a huge moneymaker in the 80’s as holidays saw parents fighting for new games to be played on the console under almost every living room. Games were flying off store shelves and the gaming industry looked like it was only going to keep growing and growing.

Of course, the same can be said today. More people are buying more games than ever, both indie and AAA titles, physical and digital games.

The problem is, why should publishers change what they’re doing if people are buying whatever they put out?

Just like before, consumers are helping publishers find success despite a market of over-hyped games with price tags much higher than they’re worth, and that’s not including DLC.

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