Hindsight is always 20/20, and no more is that axiom more appropriate than a look back at how the gaming industry got to the state it is now as it struggles with layoffs, limited investment, fad chasing, and inequity between the executives calling the shots and the workers laboring under bad leadership. That’s the overall analysis from a GamesIndustry article that collects data and expert insight from across the games industry.
The piece looks at several factors that have moved to the situation gaming faces now, including an unexpectedly high correction that saw previously low interest rate investment bets sour post-pandemic, studio execs pulling the layoff lever multiple times in order to account for said correction, and the so-called “GaaSacre” (games as a service massacre) as the live service model bubble began to burst. The report even notes how these waves have crossed the entire games industry globe, including China and Japan.
This analysis suggests that much of the blame unsurprisingly rests on investor boards. Investors are placing additional pressure on companies to do more with less and requiring studios provide full vertical slices of a game out of pocket before they see a single cent of investment capital, all while demanding that profits rise year-on-year. “In some ways, shareholders and institutional investors are like looter-shooter players; investments are a never-ending quest for ‘number go up,’ they want it to go up forever – and it simply cannot,” the article reasons.
The mass layoffs of workers are also pointed out as an ongoing problem: The article posits that industry brain drain from a lack of longtime devs will be felt for years while there’s no room for junior-level devs to take their place, and fired workers are moving to other tech jobs instead of circling back to gaming.
Despite all of the effects of “cheap money and bad bets” laid bare, there does appear to be some reason to hope for improvement. Reporting from a venture capital firm seems to suggest early-stage investment is beginning to recover, which could point to an upturn in 2025 particularly for the indie scene, and the ebb and flow nature of economics always means that stabilization can happen, particularly if executives and game companies reach out to more players of all kinds and focus on people instead of trends like VR, Web3, and AI.
“When and how this stabilization will happen is hazy,” the article concludes. “For the game industry to stabilize and thrive again, it must continue to expand efforts to reach as many players as possible where people play. That means lifting up underserved voices, leaning into representation, and fostering teams of all sizes.”
