Crunch Time
I read with interest GC's comment that the gaming industry believes it is recession proof. I doubt that very much, writes viewer Clavers (gamertag/PS3 ID).
As the recession starts to bite it will affect our disposable income.
Prices are already on the rise. I'm afraid that gaming is a luxury and less important than food on the table and a roof over our heads.
We are likely to be more selective in our choice of games rather than stop our hobby altogether, so compulsive purchases are likely to go.
We may limit our spend.
Either way, sales overall will go down and some publishers and hence developers will feel the pinch on revenues. It will be survival of the fittest.
Marketing is instrumental to success. Did Grand Theft Auto IV achieve its success on quality alone?
What about the adverts and the tie-in with a soft drink.
What about poor old Okami. Did it sell by the truck load? Not an ad in sight. Even Nintendo continue to advertise despite their success.
But marketing costs money up front and is usually one of the first budgets to get the chop.
So publishers will focus on key titles to promote and others will be deferred.
These key titles will be the established franchises that have a proven record of sales. So more sequels and less risk and innovation. This will simply reduce choice.
In the longer term I expect game prices to tumble shortly after release.
Without marketing one way to stimulate demand is to reduce price. Since we will be price sensitive, games will get discounted to maintain sales and income. Good news for us gamers then. In the short term yes. But there is a darker side to this story.
The gaming industry will consolidate and we see signs of this already.
Reduced production as studios go down the tubes will simply lead to a future drought of games.
It could take years for the games market to pick up again given the design cycle for games.
My point is that the current credit crunch is likely to have a lasting impact on the future of our hobby. Some negative, some positive. I wonder if my predictions will come true.