Videogames and World Crysis: Connection?

There's no need to be an economist or having an inside knowledge of the financial world to realize that the biennium 2008-2009 was disastrous in the economic point of view all over the world. Developed countries have entered into open recession, unemployment rised up, banks and credit institutions with names perfectly solid had a total collapsed confidence of the consumer , governments had to make speeches without parallel in recent history ... one of the obvious consequences was the sharp drop in private consumption, one of the vital elements of the economies of developed countries. Obviously, if there are more unemployed, the remaining jobs have become more insecure, the business went into decline, it is much more difficult for credit and for much less money available, the consumption of goods decreases and the majority of people try to increase the savings rate so you can buy the essentials of daily life.

 

In an article published by the British magazine The Economist on 18 December 2008, was concerned that video games had not yet felt the effects of the economic storm that crossed the world - the renowned magazine stated that the video games appeared to be "recession-proof" and that the industry had its own cycles, independent of economic cycles that companies go through and that 2008 would be another record year with turnover of video games reaching almost 50 billion dollars. However, that article did not fail to indicate that names such as EA, Activision and THQ were in the red line between 100 and 300 million dollars, but without establishing a direct connection with the economic outlook.

 

Let's look at some of the charts worldwide- August and December, the first being a holiday month and usually associated with a decrease of major releases, the latest being the month that focuses a tremendous amount of sales in this industry. The years chosen were 2007 (before the crysis to settle), 2008 (the crysis has already started in August and fully installed in December) and 2009.

 

 

 

 

 

 

August 2008 - I recall that at this time, since the theme of the economic crysis was on the agenda, especially in the U.S., had started a wave of bankruptcies and many people were seeing their homes expropriated by banks after they can not regulate their mortgages. Europe still had not realized what was to come and many minimized the possible effects of the storm that was to reach.

 

 

 

 

Christmas Day 2008

 

 

 

 August to October 2009

 

 

 

 

 

 

 

In early November 2009, BBC pointed to the difficulty of producing, saddled with huge production costs and the global crysis is felt in the lack of originality in games and the growing use of sequels and remakes:


"In America, (...) September's sales were the first for six months that did not decline compared to 2008.

"It's very hard to get publishers interested in original products", says Jeremiah Slaczka, creative director at US developer 5TH Cell.

"For us it's getting easier, because publishers look at our track record of producing hit original games. But for the industry as a whole, it's very difficult, especially for new companies or companies with no background in original games."

"The biggest impact due to the rising cost of game development is self-funding, we self-funded Scribblenauts, we're self-funding our Xbox Live Arcade title," he adds.

"It's impossible for us at this stage to fully self-fund a full retail console game, so we're slowly building up to that."


It seems that after all the game industry has grown enough to be affected by world economic crysis. Use of the dismissal by EA, and has recorded a loss of $ 391 million in the third quarter of 2009 seems to reinforce this idea. However, sales, despite having gone through a weak period certainly seem to be thrust back the launch of Modern Warfare 2 shows that, the market remains receptive. Moreover, since the crash of 1983 that this industry does not know a serious crysis and factors in addition to sales, games become more vulnerable to effects- the growing interdependence of the global economy means that a major problem in the bank sector as what happened in 2008, quickly spans multiple industries and not only because of the consumer but also the investor, less prone to risk.

 

If we want to draw conclusions, we say yes, games also suffer from economic circumstances, but this indicates that the industry is properly installed. Plus, we are in a time that investors will not, by any means spend money on projects where they feared would suffer losses, at least for now...