Bad ending routes for the video game industry

[ggx2ac]

Link to all bad ending threads: https://www.installbaseforum.com/fo...-for-the-video-game-industry.1998/post-228671

I mainly wanted to talk about rent-seeking in this thread, when I got to the other bad endings, I couldn't be bothered to come up with any more expositions, so I just threw bad endings in that sounded good enough. I have put these as predictions meaning that they probably won't happen, but I wanted to point out how bad it could get since some of these scenarios are like, "We're already halfway there!"

Bad Ending 1: Everything is a subscription

Rent-seeking (click link for explanation of what it is if you don't know.)

Here's a perfect example of rent-seeking, the Unity Runtime fee. Unity as a company has not been making profits since they went public on the New York Stock Exchange, I made a post showing how much losses they've made in case you were wondering. The Unity Runtime fee did nothing to make the service better, all it was made for was to extract more wealth from the developers that use their product. This is why some developers (especially indies) have decided to move to FOSS (free and open-source software) game engines to avoid such rent-seeking behavior.

The subscription-based model is becoming the most common form of rent-seeking and not just in video games. Why is that? Capitalism baby! Shareholders don't like businesses that have cyclic business models, the dream of every investor is to have infinite growth in their investments. (Optional video that talks about why Adobe went from selling products that had a lifetime license to a subscription model.)

The video game console makers used to have very cyclic business models until Xbox arrived onto the scene with a subscription-based model for playing games online. Hardware cycles are still cyclic yes, but what happened was that the subscription model for online gaming kept recurring revenue coming in for Microsoft which meant less downturns especially when a new console generation appears. The PS3 and Wii U were the last consoles to have free online gaming, but the respective console makers couldn't ignore the revenue Microsoft was making from a subscription for online gaming so that's how we ended up with all console makers having online gaming tied behind a subscription service.

DLC is also a form of rent-seeking depending on how it is used. The most common one is how games used to have unlockable cosmetics for your character if you completed something, now instead you just pay money to get that cosmetic.

Remember when some secondhand games required you to pay a fee to be able to play the game? That's rent-seeking. Remember when EA did that? Remember when Xbox One was going to have that too? Just like how developers are fleeing Unity, that policy from the Xbox One also had an effect on gamers choosing the PS4 over Xbox One.

Imagine if third parties were requesting a console maker to not allow Backwards Compatibility on their next-gen console so those third parties could re-release the same games again on that next-gen console with that new $70 price tag? Or how about an unlock fee to play your BC games on a next-gen console so those third parties can get that rent-seeking money?

The point of going through all that was, how much worse could it get in the future?

(Bad Ending 1) It is the year 2XXX, Google Stadia may have failed embarrassingly but that didn't stop its competitors from looking at cloud gaming as the future. Due to how expensive the hardware R&D costs have been increasing every generation and the increasing cost of consoles for the consumer, the console makers decided to remove the generational hardware cycle from their business model. They transitioned to cloud gaming, you no longer own a piece of hardware to play games and you must now pay a subscription to have access to their cloud gaming service. Any time you are not on the subscription you will not have access to the service to play games. The initial subscription is for access to the cloud gaming service, it does not include access to any games, if you want to play games, there is a different tiered subscription for that. You pay for a higher tier subscription and you start up a game, you notice that there is a queue, because of how cloud gaming works, it means you have to wait for other people to stop playing for you to access the hardware that will let you play a game. While you are waiting in the queue, you are getting repeated video advertisements (like Youtube Ads) while you wait to get to the end of the queue. Suddenly, an option appears, you can pay for an even higher tier subscription to get priority queueing to get to the front of the queue even faster.

The only thing stopping this bad ending is the literal rent-seeking that comes from your internet service provider which is why cloud gaming is not going to be affordable for decades.

Bad Ending 2: Monopolization of the industry

There used to be so many console makers back in the 90s: Nintendo, Sega, SNK, NEC, Sony, Panasonic, Atari. Then for the last two decades it's been Sony, Microsoft and Nintendo. It's obviously expensive to be a hardware maker if you are competing against those companies.

It is the year 2XXX, Nintendo is no longer in the console industry after a trillionaire bought the company as a joke and then fired 90% of the staff in the first year of owning it to cut down on costs because he needs to make profits, it didn't take long for the company to file for bankruptcy after it had burned through its billions in assets after it had released the failing console Wii U2. The video game console industry was then left with the twins, they were called the twins because the consoles were identical in function and third-party game support. This led to a stagnation in the industry as 60-year-old gamers proclaimed, "This console generation doesn't excite me anymore!", don't you worry gamers, capitalism is so innovative... a new console from a massive tech company has appeared! The video game industry was then left with the triplets.

Bad Ending 3: The same AAA games forever

It is the year 2XXX, the biggest publishers could not sustain their ballooning budgets on their iterative sequels due to stagnation in sales. They then switched to the live service model which included subscriptions to access content, now gamers invested all their time in FIFA Unlimited, NBA Infinite, COD Forever and GTA 5. With a recurring revenue model that was not cyclic, publishers pooled all resources into these projects that no new IP was ever made after and any other IP they did have was rendered obsolete. Any other live service games that entered the market could not sustain itself for long due to lack of audience retention. Bad Ending 1 then occurred after the console makers realized it would be cheaper for them to do cloud gaming with subscriptions since they were not making any money on physical game releases like they used to, and live service games were online only anyway.

 

[Lelouch0612]

Interesting thread idea.

Echoing what you said, there will further pressure to break the cyclical nature of the industry.

The current limiting factor is the increasingly high entry barrier called "hardware".

There will be incentives to kill hardware once and for all, in order to deliver games through cloud, to an ever bigger audience.

It can be seen as a net positive, but there are two big cons with that approach:

- Being hardware agnostic means less potential specifities put into a game (which already happens to an extent).

- Cloud gaming is costly, the platform holder loses money when you play a game.

This last point is crucial because it is a paradigm shift compared to what we have now. It might influence game design and how subs work.

I can very well see a future with queues and how paying extra would grant you direct access and more graphical power.

 

[Xbro]

They then switched to the live service model which included subscriptions to access content, now gamers invested all their time in FIFA Unlimited, NBA Infinite, COD Forever and GTA 5.

I chuckled pretty hard at this one. We really are heading down this road already

 

[Mekanos]

I was talking about this to a friend last night - I think entertainment industries are more competitive than ever because all these forms of media are competing for people’s free time. I don’t know where it ends up but it can’t be good. Gaming is more popular than ever but more and more the industry feels unsustainable, especially with these constant layoffs.

 

[Koni]

Bad Ending 2: Monopolization of the industry

There used to be so many console makers back in the 90s: Nintendo, Sega, SNK, NEC, Sony, Panasonic, Atari. Then for the last two decades it's been Sony, Microsoft and Nintendo. It's obviously expensive to be a hardware maker if you are competing against those companies.

It is the year 2XXX, Nintendo is no longer in the console industry after a trillionaire bought the company as a joke and then fired 90% of the staff in the first year of owning it to cut down on costs because he needs to make profits, it didn't take long for the company to file for bankruptcy after it had burned through its billions in assets after it had released the failing console Wii U2. The video game console industry was then left with the twins, they were called the twins because the consoles were identical in function and third-party game support. This led to a stagnation in the industry as 60-year-old gamers proclaimed, "This console generation doesn't excite me anymore!", don't you worry gamers, capitalism is so innovative... a new console from a massive tech company has appeared! The video game industry was then left with the triplets.

I thought the bolded was completely outlandish stuff that you would make up only for me to just now realize that this is pretty much what happened to Twitter...

Holy shit, reality is stranger than fiction sometimes. xD

 

[Terrell]

I’ll add to this: I see the current (mostly Western) parts of the industry engaged in value-inflating behaviours without consideration of long-term industry health, because that is not their angle.
Just gonna clip what I wrote in the ABK acquisition thread:

Western publishers in particular (and a fair amount in Asia, as well) are being run no differently than most other tech businesses in the West, driving growth to attract a sale before profitability dips or the business craters from no long-term prospects for profitability; they get rich, other businesses grossly over-paid for a company based on a mirage. The circle of life for Wall St. right now.

And because there's enough warning signals between the threat of IAP regulation, ballooning costs, unionization efforts, the failed attempt to drive revenue generation with NFTs, etc., publishers know they won't be able to drive profit growth the way they have been for that much longer. So they have 2 choices: sell the business at a high premium before the bottom falls out, or ride the wave just long enough that they hope for the biggest possible golden parachute before the bottom falls out and leave the austerity budgeting to whoever the unlucky one is to inherit their mess.

And I see this as a trend because ABK isn't the only one shopping around for an opportunity to "get off the ride", so to speak, they were just the first one to run into the kind of trouble that risked the big executive payday they were after and had to cash out early.

WB was already trying to sell their games division in the worst way possible even before the AT&T selloff to Discovery, with no takers. EA has been trying to sell outside of the games industry and getting no takers, because most other media companies have already been through this cycle before with the dot-com bubble (among others) and recognize a bubble when they see one, or have already been on this particular ride and got off.

This revenue-at-all-costs approach of several of the current businesses in the industry is so self-evident, particularly in (but not limited to) the mobile space where that type of behaviour is prolific (and a lot of mobile business owners have already cashed out and moved on, even some of the most popular ones like Rovio and King).
It’s not revenue-generating for the sake of long-term profitability or the health and longevity of the industry, because that’s simply not ever going to be possible the way that some of them are generating it, it’s for the sake of selling the business before anyone realizes how the current model of revenue generation is careening the business into a brick wall or off a cliff (and the industry being dragged into it in the process).

 

[kimbo99]

Everything becoming cloud media. I would hate that end game, because when I travel back home to Nigeria, I don't wanna have to always be in the city to play games. I also wanna be in the village and show games to my relatives too

 

[Tokuiten]

Great thread. I'll write more after giving it some thought. For now: feels like bad ending #3 is already in the making :/

 

[Nanashrew]

I think we're already leading down a combination of 1 and 3.

Constantly moving forward in technological advancement and refusing to even stop for a moment and make the conscious decision to take a step back is not healthy for the industry. And we see how not healthy it is by the amount of manpower required to make a game, development time soon becoming half a decade to finish, and then the amount of manpower that is laid off so a company can save a couple of pennies while never making enough money back, so they start increasing game prices. And the cycle repeats with endless labor abuse. There's a senior level employee shortage in the industry right now because nobody has any forward momentum, and nobody is hiring on temp contract workers full time so that they can one day become senior level employees. So, we're going to see a great deal more stagnation in the AAA space.

They're also clearly not making enough money I guess in rent seeking so we see price increases for subscription services for short term profitability, all while developers and publishers who put their games in their services are starting to see a reduction in payouts from these companies. Honestly, I've been calling that out since I used to follow the music industry pretty diligently at one point in time and often heard complaints from musicians and how little they get paid from streaming services. The honeymoon period for all those music and video services in the beginning was great, now the leading platforms don't pay artists, directors, producers, actors, etc. very much at all and that trend is not likely to be broken in the gaming sector.

As a mini rant of an even worse service-based future than in the OP. I absolutely despise Spotify with my whole being and they are the number 1 music streaming service in the world because they were one of the earliest able to make so much music quickly accessible around the world when all others failed, and they are also the worst in the industry at paying artists. The CEO is on record calling artists entitled for asking for better rates, and that Spotify was never made to make artists money, only to stop piracy.

Spotify Exec Calls Artist 'Entitled' for Requesting One Penny Per Stream

How much should Spotify pay per stream? Artists have been demanding one penny per play, something a former Spotify exec called 'entitled'.

www.digitalmusicnews.com

The constant push to streaming in various industries has led to further rent seeking and nobody making money anymore that it's actively harming their businesses. Also, things are likely to get worse for musicians all because of Epic buying and then selling Bandcamp to Songtradr, a licensing and distributor platform that charges artists and licensors a monthly fee. That despite all the money coming in from their rent seeking, revenue has been sluggish and has delayed their IPO goals.

I just look at all the other industries and see where games can/could/are heading. Nothing will ever be 1:1 but we'll get there eventually.

 

[NobsPlaystation]

Can this be nominated for Post of the year in the "Installers awards" ?

 

[salesguy]

I dont think sub services are bad per se. Is netflix bad?

They're not my cup of tea though.

Outcomes 2 and 3 are kinda already here...

Overall all these things are overblown. I've been around videogames since SNES era and people have always said the same things and predicted doom for the industry. Probably using most of the same arguments. Games are fun, the game companies are doing a good job, things are good. The fact you can go on your console and download any game you want is just crazy alone. And you can play everything from insanely deep games you can lose your life too to simple SNES style indies. For me, the constant endless youtube industry (an industry driven by clickbait titles and greed, oh so ironically) of complaining over microtransactions is an order of magnitude more of a problem than actual microtransactions, which have never affected me negatively. Never. And I main a GAAS, Destiny.

 

[Tiddums]

No industry is going to remain static forever and we've already seen radical changes in the types of games that were being put out by mainstream developers three or four times in my gaming life (and I wasn't even gaming until the N64 and PS1 were on the market). Genres have come and gone, cohorts of developers and gamers have too.

In hardware, we've lived through the death of Dennard Scaling around 2005-2006, and we're closing in on the point where even though we can still improve computer process nodes, they are becoming prohibitively expensive to produce at the cutting edge, and costs are not dropping over time quickly, or to the same levels.

While we know that Microsoft is plotting it's next generation, and we can assume that Sony is too, the beyond-2030 prospects for consoles looks very bad from where I'm sitting, and it's mostly because of economic/technological factors.

I do not know what the games industry looks like when the cost of rolling out a new console becomes cost prohibitive. The mass market appeal is heavily tied to their affordability, and we're already stretching the limits of what we can do there. Certainly, I do not expect the current AAA console+PC games industry to be healthy in a future like that.

 

[K samedi]

I can see the industry moving to hybrids and add the additional computation power with the help of the cloud for those who want the best graphics. Something like a middle ground where you have capable base hybrids that can perform better with cloud computing as an option. That should keep the cost down at least. The cost of game development is still high though but could also be brought down by AI coding in the future.

 

[Gimmick]

What worries me on the gamer side is how remakes are becoming the norm because it cut costs and are easy to market to previous players of the game.

On the business side, I think it's almost inevitable that Xbox's strategy and I assume Sony's future strategy is going to lean on big titles more than ever, and that they will flood their services with small games since they are cheaper to get, and AA games will die out. I wonder if there is a place for the Double Fine type studios down the line.

 

[Astrogamer]

I dont think sub services are bad per se. Is netflix bad?

They're not my cup of tea though.

Outcomes 2 and 3 are kinda already here...

Overall all these things are overblown. I've been around videogames since SNES era and people have always said the same things and predicted doom for the industry. Probably using most of the same arguments. Games are fun, the game companies are doing a good job, things are good. The fact you can go on your console and download any game you want is just crazy alone. And you can play everything from insanely deep games you can lose your life too to simple SNES style indies. For me, the constant endless youtube industry (an industry driven by clickbait titles and greed, oh so ironically) of complaining over microtransactions is an order of magnitude more of a problem than actual microtransactions, which have never affected me negatively. Never. And I main a GAAS, Destiny.

This is a long term discussion. Subs aren't bad per se, but the infinite growth model will try to eventually cripple the pipeline and fuck up most of the industry. The end goal of subs is that you pay Netflix a sub who pays the licensor holder a sub who pays the actor likeness holder a sub and the camera software a sub - subs all the way down. The corporations are all rent-seeking each other that they end up cutting out all the profit.
2 and 3 haven't happened yet either. What we're seeing in more late stages. Consolidation though the recent acquisitions by Microsoft and Sony pushed in way closer but, there's still a number of independent publishers. The end scenario will have every major publisher under a major corporation i.e no Sega, Ubisoft or Marvelous but, like Microsoft, Amazon and Tencent. Instead of indie publishers, most of it becomes subbrands of the major publishers like Private Division in TakeTwo or Plaion's Prime Matter.
3 is not annual entries of major franchises with minor changes but, a continuous product that gets regular updates. It's like the GTA Online for every major franchise. Some smaller ones have moved to this model like eFootball and Destiny but the second part is key - that publishers cannot afford to make new IPs. Like they might try and break out a new game every once in a while but, the profit margins of doing something like Saint's Row or Tales that isn't a long term platform become insufficient and unreliable. Currently, it's just small projects that major publishers are incapable of releasing but, it's going to go that the minimum viable project is reliant on big gambles of AAAA games.

 

[Lite_Agent]

The CEO is on record calling artists entitled for asking for better rates, and that Spotify was never made to make artists money, only to stop piracy

Didn't know about those "entitled artists" comments, and while I can't say I'm surprise, it's just... wow.

Though to his credit, he no doubt said what most (if not all) CEO of streaming companies think deep down.

 

[Nanashrew]

Yeah. Netflix is often reluctant to put their top shows and movies on DVD and Blu-ray, just as Crunchyroll is always reluctant to ever put the physical anime releases, they distribute on sale beyond a measly 10% off. Crunchyroll has also begun scaling back on physical releases too. It's because it could likely eat into their primary business, streaming. It could mean people have a chance to watch their shows elsewhere, outside of their subscriber-based ecosystem.

It's also bad for the business. its why movies depend so heavily now on name brand IPs and franchises, constant reboots, etc. And we also see the strikes that have been going on for even a pittance of money and basic protections for their labor. All this stuff is accessible now, but hardly anyone seems to be making money but the execs through these services.

A good, short succinct point made by Matt Damon during Hot Ones of all places about how DVD sales were a large part of the business in making back money so a film could reach profitability.


I'll also add that the game industry is very unique in how open they have been for years of their dislike of the 2nd hand market with used sales rhetoric, game rentals and comparing them to piracy and lost sales.

EDIT: I pressed send too early. To be fair, it's 4am where I am and I should be in bed lol.

 

[Lite_Agent]

Hey, I remember seeing that video before!

And yeah, streaming/subs has serious sustainability issues. I fear what this will mean for gaming, especially if it catches on there too. There's already some big diversity issues in the AAA space, and it will only make it worse imo (though as someone who almost exclusively plays on Nintendo consoles, I'm fairly insulated... for now).

As for second-hand market, I really dislike it myself (for several reasons, like not being able to pay the creators or how scummy stores can be), but I hate anti-piracy and other protection measures faaaaaar more (mainly because it's always those buying stuff legally that are hit the worst). I can see how appealing something like streaming and subs must be for big publishers who could get rid of those pesky non-paying users.

And hey, used market has its uses. Would never have been able to play the original Another Code on DS without that one seller on eBay (Nintendo had already stopped printing new copies by then). It going away would be bad news for a whole lot of people.

 

[Kanann]

Good ending: year 3XXX, Human live in humble and frugality with nature, us in unity (no pun) pirate all games in 19xx-20xx and play the shit out of them forever.

 

[K samedi]

What worries me on the gamer side is how remakes are becoming the norm because it cut costs and are easy to market to previous players of the game.

On the business side, I think it's almost inevitable that Xbox's strategy and I assume Sony's future strategy is going to lean on big titles more than ever, and that they will flood their services with small games since they are cheaper to get, and AA games will die out. I wonder if there is a place for the Double Fine type studios down the line.

We already witnessed the death of AA in the PS3 era and onward. The most successful indies will further add to their budgets and make bigger games to the point that no one will call them indie anymore. I think the Switch is and will be so in the future, a pretty good option for smaller games to flourish because people accept that kind of content on a portable and there are loads of indie IP waiting to be developed even further.

 

[WestEgg]

Agreed with a combination of 1 and 3, though you will occasionally get relaunches of the forever games once the current iteration has stagnated to the point that something is needed to shake up interest. I think there's also the possibility for an external influence to disrupt everything altogether in unexpected ways, such as a new huge video game crash that reshuffles the major publishers, one of the big 3 withdrawing from video games, actual governmental interference or war creating extreme disruptions in all tech, including games, etc.

Having said all that, I do think that AAA stagnation will lead to better growth of the Indie scene, especially as open source tools like Godot become more widely adopted.

 

[Nanashrew]

So gameindustry dot biz weighed in on the ongoing layoffs today with interviews from various investors, recruiters, and analysts.

What the current wave of layoffs means for the games industry

Sign up for the GI Daily here to get the biggest news straight to your inbox 2023 continues to be a difficult year when…

www.gamesindustry.biz

"As money started to dry out, firms were forced to reassess the ways funds were allocated, with layoffs emerging as an immediate solution to cut expenses," she explains. "The short-term vision of chasing aggressive growth, often at the expense of sustainable profitability was exacerbated by investors — lured by the promise of rapid returns, many pursued hasty acquisitions, often without sufficient diligence paired with poor budget management. This frantic approach, driven partly by a 'fear of missing out,' had the unintended effect of bruising the industry they had aimed to prop up."

Avera compares this to the entertainment sector, where streaming platforms prioritised audience expansion over profitability. Just as the streaming space is now recalibrating by increasing prices to "mend their unsustainable model," the games industry is going through "a comparable reckoning."
Avera adds another factor: consumers are buying fewer games and spending more time with select franchises, a trend likely to accelerate as the market continues to shift towards live service titles. Even single-player titles are demanding more of players' time, with Avera noting that some of the biggest recent hits, including Baldur's Gate 3 and Zelda: Tears of the Kingdom, take 50 or more hours simply to get through the main story.

"These lengthy games, combined with a labor/talent shortage among developers, engineers and designers, place immense pressure on an industry striving to capture as much mindshare as possible from a discerning gaming audience," she says.

Midia Research co-founder and senior analyst Karol Severin adds: "The pace of growth for the games industry has peaked. The industry will keep growing in dollar terms, but it is mostly going to be driven by increasing population and better internet connectivity, rather than by strengthening fundamentals of the games business. While in-game spending will still grow, so will games subscriptions. And as cloud gaming subscriptions grow, there will be less of a need to buy high price point individual games.

"The games industry is about to see similar pressures as the music and video industries saw when streaming subscriptions truly took off. There will, of course, be many differences in how these dynamics will play out, but the fact that the value of an individual game in consumers' eyes will decline is inevitable. As such there will be a need for fewer games, therefore fewer developers and publishers."

Way more in the article. We're also not going to see the end of these layoffs for a while. The industry is moving from one unsustainable model to the next.

 

[salesguy]

A good, short succinct point made by Matt Damon during Hot Ones of all places about how DVD sales were a large part of the business in making back money so a film could reach profitability.

That reminds of this wrestler talk about how much wrestlers made. For some reason I found this video fascinating, and this guy makes really good videos.. Anyway point being WWE superstars got a royalty check free in the mailbox even after retirement etc. He said it was like 5k every 3 months, but once DVD sales dried up due to WWE network, it dropped to like 300.



That said I still say these are self correcting problems. As long as video games are still being made, I'm good. I dont see any risk of that stopping. Just like movie, TV shows etc.

I will say I'm a fan of movies way>>>TV shows. And I have tried a couple made for Netflix movies and found them TERRIBLE in every respect, notably the really bad production values. So I do dislike the idea that theatrical movies could go away.

CONSOLES do have some risk IMO. With so much mobile and PC and maybe cloud. But maybe less than we assume. Every gen I say I cant see too far into future, but this gen looks like another console is a go. With Microsoft confirming a 10th gen already, thats 10+ more years at least counting the remainder of this gen.

 

[Evilnemesis8]

Way more in the article. We're also not going to see the end of these layoffs for a while. The industry is moving from one unsustainable model to the next.

I'm pretty irate at all these studios/publishers and other gaming entities in general ( like Esports ) took venture capital money out the ass in 2017-2021~ promising investors the moon when they for sure knew they wouldn't be able to meet whatever returns the investors wanted.

Now these suits and leaders get to keep their yearly bonuses that were no doubt inflated by their "performance" while laying offs the ones under them to cut costs because there was no way they were going to generate the revenue numbers they were projecting on those power points years ago.

 

[adriandlte]

Many of those new studios that were founded by veterans from established companies between 2017 and 2023 are going to shut down soon.

It's over. Amaitu da. Se acabó.

 

[Mekanos]

I'm pretty irate at all these studios/publishers and other gaming entities in general ( like Esports ) took venture capital money out the ass in 2017-2021~ promising investors the moon when they for sure knew they wouldn't be able to meet whatever returns the investors wanted.

Now these suits and leaders get to keep their yearly bonuses that were no doubt inflated by their "performance" while laying offs the ones under them to cut costs because there was no way they were going to generate the revenue numbers they were projecting on those power points years ago.

Yeah, but this is a tale old as time. So many tech fads got talked up by people for venture capitalist money. It's the current problem streaming has. VCs are also marks who put their money on the hot new thing (see NFTs etc.) so it's a bit of a two way street.

You're right though that at the end of the day the people who suffer from this are the workers.

 

[KR_EP]

Wasn't planning on joining the InstallBase collective schwarzmalen until the article from Games Industry with quotes from industry watches appears to post-rationalise large job losses.

So gameindustry dot biz weighed in on the ongoing layoffs today with interviews from various investors, recruiters, and analysts.

What the current wave of layoffs means for the games industry

Sign up for the GI Daily here to get the biggest news straight to your inbox 2023 continues to be a difficult year when…

www.gamesindustry.biz

Way more in the article. We're also not going to see the end of these layoffs for a while. The industry is moving from one unsustainable model to the next.

I'm pretty irate at all these studios/publishers and other gaming entities in general ( like Esports ) took venture capital money out the ass in 2017-2021~ promising investors the moon when they for sure knew they wouldn't be able to meet whatever returns the investors wanted.

Now these suits and leaders get to keep their yearly bonuses that were no doubt inflated by their "performance" while laying offs the ones under them to cut costs because there was no way they were going to generate the revenue numbers they were projecting on those power points years ago.

Many of those new studios that were founded by veterans from established companies between 2017 and 2023 are going to shut down soon.

It's over. Amaitu da. Se acabó.

The industry is still profitable, even if a company were to post a loss or have to manage debt with higher levels of interest, its manageable without large scale job losses (see Japan). Publicly listed companies work for their shareholders, but not all investors are made equal, its ok for companies to resist activist & short sellers to look ahead, making the case for sticking with titles as CAPCOM is doing with Pragmata. There has to have been a reason why the investments were made in the creative industry in the first place, so I'd like to see real leadership.

While I'm here, one bad outcome that is coming to pass is single player content being locked behind online only access & being lost when the online services are discontinued. Single player content in free to play titles is the obvious issue, outlined why I'd never pay for them a year back here *shouting at clouds.gif*. Less said about Destiny 2 phantom pain DLC the better.

Might also be worth comparing the all time peak of eFootball PES2020 if the information is available. People bought eFootball PES 2021 Season Update on PC before delisting last December.

Never liked free to play, due to how it influences game design for the worst, inevitably clouding my views on the question of what is the best approach. Will use Ace Combat Infinity (PS3) & eFootball 2022/23 as examples for why I'd never pay for anything in them as with mobile games they can remove access to content at short notice. In the case of Ace Combat Infinity, even its single player campaign is no longer accessible after the servers were switched off. The online modes were better than in Ace Combat 7 featuring several different modes such as a co-op / competitive hybrid, where two teams of two compete to gain the most points destroying CPU enemies or defeat bosses from earlier games in the series. All lost, not carried over to AC7.

Point I'm making is that you may find yourself enjoying some part of a game only to lose access to it, either due to servers being switched off and/or due to licenses expiring (planes in AC, teams & stadiums in PES). This is certainly the case for PES as Konami routinely gain & lose official licenses. With a PES game you purchased, even if the servers are switched off, you'd only lose access to online modes, keeping the roster for that season, plus any officially licensed kits & stadiums while being able to add community option files. But with this new approach, the 2023 update ends access to 2022 content, alters team rosters, kits - added licenses but also removes them, as with Juventus. Konami FY23 report will tell us if going F2P generates significant revenue.

On the subject of Bungie, combined with SIE are one of, if not the worst offender in the industry now. Gravity Rush 2 inexplicably requiring a login to access costumes but its the online save for Gran Turismo Sport that is alarming for how the end of online services removes liveries & the FAQ seems oblivious to how users can save progress for single player GT League mode...boo! I'm not touching Gran Turismo 7, Forza Motorsport or any other game that has online only saving until there is, at the very least a legal guarantee of a sunset patch to fix. (late edit: typos)

 

[ggx2ac]

The following is relevant to the thread, Yanis Varoufakis released a book recently called Technofeudalism: What Killed Capitalism. Gamers should recognize the name not because Yanis was the former Finance Minister of Greece in 2015, but because he was the person who worked as an Economist-In-Residence at Valve. See his blog which details things he wrote while working at Valve: https://www.yanisvaroufakis.eu/category/essays/valveconomics/

Regarding the new book he released, I am posting one video out of many for which he did interviews about his new book:


If you do not have time to watch a video that's one-hour long, you can read this book review that gives a summary of what it is about: https://www.resilience.org/stories/...akiss-technofeudalism-what-killed-capitalism/

If you want an example of technofeudalism in the gaming space, then you can look at Roblox. Here's a video you may have seen before giving an explanation of how Roblox makes money by having kids make games for other kids who play them. Think about that carefully, it is not the Roblox company that is creating games, other people are creating games for them without being employees of the company. Since the games are made using their tech, I don't think it is easy for you to just decide, "Hey, I want to take my successful Roblox game out of the Roblox environment and make it playable as a stand-alone game that people can buy so that I get more money from it." Not to mention that I wouldn't even know if they own your IP because you made it inside of Roblox which if they did, they could prevent you from taking that game to sell outside of the Roblox platform.





I can't be bothered making a bad ending scenario about Technofeudalism since a lot of it already overlaps with Bad Ending 1 i.e. To make more money, recurring profits are just becoming rent in disguise because you do not have ownership of the product you keep spending money on.

Edit:

I didn't know about this follow-up to the original Roblox video above and it's just as relevant:

 

[Mekanos]

Haven't watched the video yet but I really like what I've read of Varoufakis over the years. The Roblox economy sounds horrifyingly dystopian though.

 

[ggx2ac]

The following is related to Bad Ending 1 in this thread and the Technofeudalism post I posted above.

Link: https://www.theverge.com/2023/10/25...s-news-arcade-one-subscription-price-increase

Apple is raising the prices of several of its services, including Apple TV Plus, Apple Arcade, Apple News Plus, and Apple One. Apple TV Plus is going from $6.99 per month to $9.99 per month, and Apple’s other services are seeing significant hikes, too. MacRumors first spotted the changes.

Instead of $4.99 per month, Apple Arcade will now cost $6.99 per month. Meanwhile, Apple News Plus is increasing from $9.99 per month to $12.99 per month. With all three services getting price increases, that means the Apple One bundle is going up as well.

Here’s a rundown of the new pricing across Apple One’s three tiers:
Individual: $19.95 (previously $16.95)
Family: $25.95 (previously $22.95)
Premier: $37.95 (previously $32.95)

Apple spokesperson Bernadette Simpao confirmed these changes in a statement to The Verge, adding that existing subscribers will see the price increases go into effect “30 days later, on their next renewal date.” Simpao says Apple is also raising prices in “select international markets.”

We last saw a price hike across Apple’s services almost exactly one year ago today, when it raised the prices of Apple Music, Apple TV Plus, and Apple One. It doesn’t look like Apple is raising the price of its Music, Fitness Plus, or iCloud Plus subscriptions this time around, however.

Apple joins several other streaming services that have raised their prices this year, including Netflix, Hulu, Disney Plus, Paramount Plus, Discovery Plus, and Max.

Apple reports its fourth quarter earnings next Thursday. Revenue from subscription services like iCloud and Apple TV Plus has been an important, growing segment for the company, and today’s hikes will help to juice those numbers going forward.

Apple is raising the price of their subscriptions including Apple Arcade, are you getting anything of benefit from the price increase? No. Therefore, it's rent-seeking.

Every other streaming competitor mentioned above has raised their prices as well.

Watch their net profits increase year over year.

They are the landlord, you are the serf. If you don't pay their taxes then you no longer get access to their services and you don't get to own what you paid for because the contents of the subscription is locked inside the Cloud.

Look at Apple Arcade again, does Apple actually make any video games? No. Apple Arcade is all third party games, Apple isn't creating anything, all they are doing is collecting rent because they own the "Land" and that's what gives them their profit.

Voting with your wallet isn't going to do anything. The governments that support these tech giants aren't going to do anything (unless it involves a foreign competitor) because money. Piracy isn't going to do anything because the State is going to help the tech giant crackdown on piracy rather than help your financial situation.

The tech giants will keep amassing wealth which means more acquisitions especially if other companies are looking to sell parts or their whole business.

The giants then monopolize further.

Welcome to your cyberpunk dystopia.

 

[Gimmick]

The following is related to Bad Ending 1 in this thread and the Technofeudalism post I posted above.

Link: https://www.theverge.com/2023/10/25...s-news-arcade-one-subscription-price-increase



Apple is raising the price of their subscriptions including Apple Arcade, are you getting anything of benefit from the price increase? No. Therefore, it's rent-seeking.

Every other streaming competitor mentioned above has raised their prices as well.

Watch their net profits increase year over year.

They are the landlord, you are the serf. If you don't pay their taxes then you no longer get access to their services and you don't get to own what you paid for because the contents of the subscription is locked inside the Cloud.

Look at Apple Arcade again, does Apple actually make any video games? No. Apple Arcade is all third party games, Apple isn't creating anything, all they are doing is collecting rent because they own the "Land" and that's what gives them their profit.

Voting with your wallet isn't going to do anything. The governments that support these tech giants aren't going to do anything (unless it involves a foreign competitor) because money. Piracy isn't going to do anything because the State is going to help the tech giant crackdown on piracy rather help your financial situation.

The tech giants will keep amassing wealth which means more acquisitions especially if other companies are looking to sell parts or their whole business.

The giants then monopolize further.

Welcome to your cyberpunk dystopia.

I think you are overreacting a bit from a price hike. There will always be price adjustments.

 

[SinCityAssassin]

I think you are overreacting a bit from a price hike. There will always be price adjustments.

Adjusted for what. Increased profit margins with no actual alteration to production and distribution?

 

[ggx2ac]

I think you are overreacting a bit from a price hike. There will always be price adjustments.

I disagree.

I've made the example already with Apple Arcade, they've raised the price for the subscription. Apple doesn't make games; they collect rent from subscriptions to Apple Arcade and then the developers who actually make games inside Apple Arcade fight over the scraps of which I remember from articles in the past that Apple wants games with long playtimes. Developers are forced to make games that have long and repeated play sessions because the amount of pay they'll get depends on how many hours are accrued from people playing their games.

Apple isn't a competitor in this space, they've set the rules for how you get paid, and they just collect rent. They're not doing anything to improve the service, they're just milking more money out of the consumer which is very likely to be seen from their segment profits increasing year over year over the next 12 months.

 

[Gimmick]

Adjusted for what. Increased profit margins with no actual alteration to production and distribution?

I assume it's to cover some sort of cost that has changed in their pipeline.

 

[Old sorta fan]

I disagree.

I've made the example already with Apple Arcade, they've raised the price for the subscription. Apple doesn't make games; they collect rent from subscriptions to Apple Arcade and then the developers who actually make games inside Apple Arcade fight over the scraps of which I remember from articles in the past that Apple wants games with long playtimes. Developers are forced to make games that have long and repeated play sessions because the amount of pay they'll get depends on how many hours are accrued from people playing their games.

Apple isn't a competitor in this space, they've set the rules for how you get paid, and they just collect rent. They're not doing anything to improve the service, they're just milking more money out of the consumer which is very likely to be seen from their segment profits increasing year over year over the next 12 months.

You are correct that it is a rent seeking behavior. That’s why the various content providers have been trying so hard to make it work. Doesn’t mean it’ll work.

First, they wanted to get subscribers. Then in 2021 or so they realized they nuked their DVD revenues for unprofitable streaming. So they are now in the process of raising prices to see if they can break even.

However, basic microeconomics still applies where a higher price means fewer customers.

The streaming services have yet to turn cash positive. Netflix has booked some positive net income but they are still behind on cash because they only have net income in years when they don’t expense capital expanses.

Apple etc. keep trying to make streaming and subscriptions happen but they will have their Wile E. Coyote moment when they all look down and noticed they are off the cliff with no hope of profitability. The costs of producing/licensing content are and will always be more than what you can get back on streaming subs, regardless of price point.

The entertainment industry fell for the software industry’s pied piper act of saving them from piracy. They were sold a bill of goods where all they had to do to prevent piracy was to stop selling media and convert all to software. If you can deliver streams like the pirates, then cut out the pirates.

All that has happened is that they engaged in a race to the bottom with the pirates. Now the pirates still pirate and they make no money off their content. Joke is on them for listening to Big Software and the VC Bros.

Apple has been doing all this content streaming because they are looking to grow when their core business of Macs and iPhones is stagnant because their products are stagnant. Rather than trying to figure out how to solve a new problem with a better product that will make customers go wow, they are trying rent seeking in entertainment content. Rent seeking or not, you still need positive cash flow (not Netflix style profits where you get positive net income in years when you don’t expense your capex and negative net income when you do expense your capex).

The movie industry is looking like it’ll crash. At least music still has physical media that is growing. They could sell even more records if they boosted production more. People still want to buy records after they listen to something online. The business hasn’t changed and the industry will get there only after it has tried every other possible path.

I can’t tell how Hollywood gets out of the death cycle of increasingly expense movies, not making movies for a wide variety of tastes, no DVD sales, and taking a bath on streaming. Can’t say I care as they haven’t made a comedy in years.

 

[Mekanos]

You are correct that it is a rent seeking behavior. That’s why the various content providers have been trying so hard to make it work. Doesn’t mean it’ll work.

First, they wanted to get subscribers. Then in 2021 or so they realized they nuked their DVD revenues for unprofitable streaming. So they are now in the process of raising prices to see if they can break even.

However, basic microeconomics still applies where a higher price means fewer customers.

The streaming services have yet to turn cash positive. Netflix has booked some positive net income but they are still behind on cash because they only have net income in years when they don’t expense capital expanses.

Apple etc. keep trying to make streaming and subscriptions happen but they will have their Wile E. Coyote moment when they all look down and noticed they are off the cliff with no hope of profitability. The costs of producing/licensing content are and will always be more than what you can get back on streaming subs, regardless of price point.

The entertainment industry fell for the software industry’s pied piper act of saving them from piracy. They were sold a bill of goods where all they had to do to prevent piracy was to stop selling media and convert all to software. If you can deliver streams like the pirates, then cut out the pirates.

All that has happened is that they engaged in a race to the bottom with the pirates. Now the pirates still pirate and they make no money off their content. Joke is on them for listening to Big Software and the VC Bros.

Apple has been doing all this content streaming because they are looking to grow when their core business of Macs and iPhones is stagnant because their products are stagnant. Rather than trying to figure out how to solve a new problem with a better product that will make customers go wow, they are trying rent seeking in entertainment content. Rent seeking or not, you still need positive cash flow (not Netflix style profits where you get positive net income in years when you don’t expense your capex and negative net income when you do expense your capex).

The movie industry is looking like it’ll crash. At least music still has physical media that is growing. They could sell even more records if they boosted production more. People still want to buy records after they listen to something online. The business hasn’t changed and the industry will get there only after it has tried every other possible path.

I can’t tell how Hollywood gets out of the death cycle of increasingly expense movies, not making movies for a wide variety of tastes, no DVD sales, and taking a bath on streaming. Can’t say I care as they haven’t made a comedy in years.

I think companies with alternate revenue streams like Disney, Amazon and Apple will be able to eat the loss on streaming. The other studios... not so much. It's definitely a nerve wracking time because I don't think the genie is going back in the bottle, even if streaming doesn't turn a profit, audiences won't go back to linear TV and buying DVDs.

Ultimately though it's as you say, tech bros and venture capitalists took these studios for a ride. It's definitely going to be really ugly in the long run, and the strikes have exacerbated the issue multifold. I don't know if the movie industry will crash, but most likely it will contract out of necessity. There are more shows and movies than ever and not enough eyeballs to watch it all.

 

[ggx2ac]

The movie industry is looking like it’ll crash.

I can’t tell how Hollywood gets out of the death cycle of increasingly expense movies, not making movies for a wide variety of tastes, no DVD sales, and taking a bath on streaming. Can’t say I care as they haven’t made a comedy in years.

Going off-topic, the movie industry is reminding me of the video game industry where all the movies you see are "AAA titles" and are iterative sequels and the competition is genre chasers.

There is no room for risking on a new IP because they want to risk $200M+ budgets on a movie to get $1B returns. The majority of the top money-making movies in the last decade are superhero movies which reminds me of FIFA or COD when I think of the top money-making games in the last decade.

There ends up being less genre variety because of the budgets (just like in AAA gaming too) and you have to think, why did it end up like this? Because capitalism is so innovative: "We made money on X movie, so let's make a sequel to X movie to make more money", "They made money creating an IP cinematic universe? We'll do the same thing with our IP!" and then people complain that the movie industry has become creatively bankrupt when it is working as intended because of the economic system, the executives at the top make those decisions because their goal is profit.

The perfect system that the execs will want is when they obtain ownership of an actor's likeness to reuse for eternity so that they can keep an IP running forever to make money. Here's an example, the Simpsons is still around but there's no way the voice actors will continue to be, now that there's AI that can mimic your voice you can keep the Simpsons around for 100+ seasons. This example cuts out a lot of complexity but there's obviously a reason some of those companies have been reusing the likeness of dead actors.

Then you end up with the same shows/movies to watch forever just like Bad Ending 3 in the OP of this thread.

 

[Nanashrew]

To expound on the topic of iPhones, it's really more that they've hit the saturation point a few generations back. Everyone has a mobile phone now and anyone can purchase a new phone from different generations that they can afford because nobody needs to constantly upgrade to the newest phone right away (except for the super dedicated looney Apple fans). This hasn't just caused stagnation, but even regression and removal of features so they can sell them back to you, like the headphone jack accessory.

There's also this whole thing in the tech industry, "gadgetizing", which other fields have also been getting into. Turning useful items, products, appliances, etc. into gadgets which often lowers their life expectancy with planned obsolescence. They can also in turn sell or make you sub to features that used to be the norm. See how electric vehicles are being gadgetized to have you subbed to seat warmers or extra horse power.

Speaking as someone who lives on disability and is poor, there was a time when buying something more expensive did mean you were getting a long-lasting product which would save you money in the long term (there is an actual saying for this, but I forget what it was). Over time that shifted to where the wealthier could afford it, but we've reached a point now where everyone is using the same easily breakable crap. Difference is the wealthier can afford to replace it every time.

 

[Terrell]

I think companies with alternate revenue streams like Disney, Amazon and Apple will be able to eat the loss on streaming. The other studios... not so much. It's definitely a nerve wracking time because I don't think the genie is going back in the bottle, even if streaming doesn't turn a profit, audiences won't go back to linear TV and buying DVDs.

Ultimately though it's as you say, tech bros and venture capitalists took these studios for a ride. It's definitely going to be really ugly in the long run, and the strikes have exacerbated the issue multifold. I don't know if the movie industry will crash, but most likely it will contract out of necessity. There are more shows and movies than ever and not enough eyeballs to watch it all.

And this was, to be blunt, a solveable problem that cable companies made into a continued problem that something like Netflix was made to solve. Little to no investment was done in IPTV, but IPTV could have offered every imaginable business model at once to consumers: live TV for discoverability, pay-as-you-go TV (which they ceded immediately to Apple via iTunes Store in a sense), per-channel subscriptions, you name it, IPTV made it possible to run with and see what worked best. By them wanting to keep things static, Netflix was allowed to become the "pace car", despite it never having a road to any meaningful profitability.
Streaming is and always has been corpos painting themselves into a corner, simply by virtue of there never being a cheaper way to provide content, and once you provide it like that, consumers never want to go backwards to paying cable TV prices simply for an alternate content delivery method, that wasn't what they were sold, they were sold on the basis of cheaper, (usually) ad-free and on-demand.

 

[Old sorta fan]

Going off-topic, the movie industry is reminding me of the video game industry where all the movies you see are "AAA titles" and are iterative sequels and the competition is genre chasers.

There is no room for risking on a new IP because they want to risk $200M+ budgets on a movie to get $1B returns. The majority of the top money-making movies in the last decade are superhero movies which reminds me of FIFA or COD when I think of the top money-making games in the last decade.

There ends up being less genre variety because of the budgets (just like in AAA gaming too) and you have to think, why did it end up like this? Because capitalism is so innovative: "We made money on X movie, so let's make a sequel to X movie to make more money", "They made money creating an IP cinematic universe? We'll do the same thing with our IP!" and then people complain that the movie industry has become creatively bankrupt when it is working as intended because of the economic system, the executives at the top make those decisions because their goal is profit.

The perfect system that the execs will want is when they obtain ownership of an actor's likeness to reuse for eternity so that they can keep an IP running forever to make money. Here's an example, the Simpsons is still around but there's no way the voice actors will continue to be, now that there's AI that can mimic your voice you can keep the Simpsons around for 100+ seasons. This example cuts out a lot of complexity but there's obviously a reason some of those companies have been reusing the likeness of dead actors.

Then you end up with the same shows/movies to watch forever just like Bad Ending 3 in the OP of this thread.

This is a great analogy to the AAA video game industry. It’s also a great description of why Nintendo did the work to take a different path because they saw that game as inherently a losing one. Even if you win it, you still lose it.

----------

I think companies with alternate revenue streams like Disney, Amazon and Apple will be able to eat the loss on streaming. The other studios... not so much. It's definitely a nerve wracking time because I don't think the genie is going back in the bottle, even if streaming doesn't turn a profit, audiences won't go back to linear TV and buying DVDs.

Ultimately though it's as you say, tech bros and venture capitalists took these studios for a ride. It's definitely going to be really ugly in the long run, and the strikes have exacerbated the issue multifold. I don't know if the movie industry will crash, but most likely it will contract out of necessity. There are more shows and movies than ever and not enough eyeballs to watch it all.

I think audiences will go back to buying DVD’s once the streaming services all go away. And they will because nobody will keep losing money forever. Netflix, despite being the least financially unhealthy still requires cash infusions from VC bros.

Next, interest rates returning to more historically normal rates also changes the incentives of the entertainment business, and the software business, among others.

When interest rates were low and then up against the zero lower bound, an investor couldn’t make much return buying a bond. Now they can. The incentive was to borrow cheap, take a big risk for a big possible payoff on some software scheme as you’d make a better return if one of your big swings became a home run even if you struck out on all the others.

Now, investors can make money buying regular financial instruments and the cost of striking out on a VC scheme is higher. They will start to bet on safer, more time tested business strategies that generate cash flow rather than lie in the sky schemes that were hyped up by software bros.

This won’t happen overnight. They’ll get there after they have exhausted all other options. Never underestimate how long overhyped nonsense can stick around. The industry will hold out then all of a sudden they’ll have a Wile E. Coyote moment where they all look down and realize they have to generate cash flow again. Then it won’t change all at once. They’ll have to increase Blu-Ray production, repair retailer relations (retailers are unhappy with the industry for de-emphasizing physical movie sales) and lots more. They’ll also have to make smaller budget movies and comedies again rather than just the same comic book AAAA content over and over as selling DVD’s requires there to be a wide selection on the shelf.

Just like AAA video games. Best Buy is going to stop carrying Xbox products once they release the all digital Series X. What’s in it for the retailer? Xbox will crash out of the market and just be a brand for the online subscription service via a PC. They will whine about not being able to get on Playstation or Nintendo and get nowhere. It’s a shame. But I don’t feel sorry for them for trying to monopolize the video game sector by trying to turn it into a software service rather than an entertainment content busines.

 

[Shadow of the Void]

(DISCLAIMER: I'm going to be getting a bit political here, but this is an inherently political subject, so...)

Any one of those scenarios is possible. Every one of them would be bad for people who actually enjoy video games. And every one of them would be because of basic human avarice. Everything we hate about what's already happened, is currently happening, and possibly will happen to the games, movies, and other entertainment we enjoy is a direct and necessary outcome of the logic of the profit motive. The executives in charge of all the publishers/studios have as their sole goal to generate ever-growing profits for the shareholders, not to produce art & entertainment for the sake of art & entertainment. Creative works of any kind, be it music, film, video games, sculpture, painting, etc., has become just another commodity. The worth of these works in a capitalist system is based purely on how much profit they generate for someone.

Games have content that used to be able to be earned in-game withheld and parceled off as microtransactions because it's more profitable for the publisher.

The increased emphasis on established IPs is something that exists purely for the sake of profit.

The genre-chasing/follow-the-leader bullshit that's resulted in so much homogenization in our entertainment is common because it's seen as the most profitable way of doing things.

The rapid consolidation of big publishers happened because it's profitable to simply buy out the competition.

That critically-acclaimed show you enjoyed was cancelled because it wasn't profitable enough.

Every major shift in how films are made was done because the old ways became less profitable. Some people still lament the end of the auteur-driven "New Hollywood" era, but that happened because movies like Heaven's Gate were costing the studios money and at the same time these newfangled high-concept "blockbuster" films made by these young bucks like Steven Spielberg and George Lucas were making money hand over fist.

Cable TV became the overpriced morass of bundled channels it is because all the parties involved wanted to maximize their profits.

The streaming market became heavily fragmented because it was seen as more profitable to have one's own walled garden.

The push for AI-generated content comes from a desire to replace writers, artists, actors, and other human workers with a machine that won't need a paycheck, won't need benefits, won't take breaks, won't unionize, etc., because it's a computer program and not a sentient being. Every worker is seen as a drain on the bottom line and therefore an obstacle to greater productivity.

The quest for ever-growing profit is also why we're seeing the rapid erosion of the entire concept of personal property.

It used to be that when you bought something, it was yours to own. Period. Now companies want less to offer products and more to offer services. They want more and more things to become subscriptions, where the company can continue to squeeze the customer over the long term. Why sell someone a product they buy once when you can charge them a recurring fee every month to enjoy that thing? That's even better than planned obsolescence. I mean, look at what happened to Photoshop.

That's why there's such a huge push towards digital, especially streaming. At least under U.S. law, physical media is treated as "sold, not licensed" while digital is treated as "licensed, not sold," with all that implies. You really do give up a lot when you eschew physical media, and I don't think the trade-off is worth it. Also, digital is a nightmare for preservation, as we've seen with games having been permanently removed from digital stores and series getting permanently removed from streaming services, with no guarantee they'll ever be available at any time before their copyright expires. For such titles that were only available digitally, they may be gone forever for all intents and purposes (copyrights last an absurdly long 95 years in the U.S.).

The question of whether people get to own what they spend money on extends even beyond entertainment. Disputes over right-to-repair illustrate the battle over whether or not we fully own even the durable goods we buy, and there have been active discussions about having more and more physical goods leased on a subscription basis. It's like the heads of all these big conglomerates looked at cyberpunk dystopias in literature & film and went to themselves "Hey. That's actually a really good idea." Like, my reaction to that episode of Edgerunners where David's laundry machine stops working because the suscription expired shouldn't be "Wow. That's surprisingly plausible."

If I've said it before I've said it a thousand times, but the internet is simultaneously the best and worst invention made since the end of WW2. Also, I've long held the belief that, just perhaps, the profit motive ought not dictate literally everything that happens in society. Sooner or later, it poisons everything it touches.

There are some things that gives me some comfort that physical media may continue to persist, though. Print books still dominate e-books and don't seem to be in decline. The music industry never actually abandoned physical albums despite sales having declined over 90% from 1999 to 2017 (though sales have flattened out since then, so the decline may be over). Also, physical games are still preferred in some regions and/or for some titles. Finally, the streaming market seems to be on the cusp of imploding as it turned out to not be as profitable as hoped, which could incentivize people to go back to buying movies physically as subscription prices are raised more and more, less original content is offered, and more content is removed, all in a deseperate attempt to improve profitability. People will only accept so much bullshit before their patience runs out, and they don't like feeling like they're being stiffed, and they are being stiffed by this push towards an all-digital subscription-based paradigm. It's just Cable TV 2.0 at this point. Different model, same crap.

 

[Nanashrew]

That's why there's such a huge push towards digital, especially streaming. At least under U.S. law, physical media is treated as "sold, not licensed" while digital is treated as "licensed, not sold," with all that implies. You really do give up a lot when you eschew physical media, and I don't think the trade-off is worth it. Also, digital is a nightmare for preservation, as we've seen with games having been permanently removed from digital stores and series getting permanently removed from streaming services, with no guarantee they'll ever be available at any time before their copyright expires. For such titles that were only available digitally, they may be gone forever for all intents and purposes (copyrights last an absurdly long 95 years in the U.S.).

This reminds me. Due to the climate and how people are talking about libraries, they're suffering under a lot of attacks from book burnings and bannings from right wing legislation, book publishers filing lawsuits against libraries, to items being moved digitally. Because of the whole licensed, not sold business, they have to pay per e-books with very strict terms. And libraries are the biggest source of preservation, and laws do not care about preservation, only copyright and they will always side with the copyright holder.

Profit motive and infinite growth can and will kill preservation efforts in the long run if nothing is curtailed. And as you state, this does go for games too, the game industry does not care about preservation, and never has. And as good as people talk about Microsoft's efforts with backwards compatibility, a lot of it will be undone by moving to a digital only system as some games can't even be purchased anymore and are only available physically. Prince of Persia 2008, for example, can only be owned physically on consoles as it's not available to purchase digitally outside of Steam and Ubisoft Store on PC.

 

[ggx2ac]

I am just making a post here to link all the bad ending threads in one place since it's going to keep growing.

List of bad ending threads:
- Bad ending routes for the video game industry: https://www.installbaseforum.com/forums/threads/bad-ending-routes-for-the-video-game-industry.1998/
- Bad ending route for the CEO/Owner/Employer: Workplace Democracy: https://www.installbaseforum.com/fo...-ceo-owner-employer-workplace-democracy.2183/
- Bad ending route for the video game industry part 2: The asset economy: https://www.installbaseforum.com/fo...-game-industry-part-2-the-asset-economy.2243/
- Bad ending route for Sega's "Infinite Wealth": Economic rent: https://www.installbaseforum.com/fo...for-segas-infinite-wealth-economic-rent.2317/
- Bad ending route for the video game industry part 3: No Longer Human: https://www.installbaseforum.com/fo...eo-game-industry-part-3-no-longer-human.2351/
- Bad ending route for the video game industry part 4: Rise of the Prosumers: https://www.installbaseforum.com/fo...e-industry-part-4-rise-of-the-prosumers.2393/

True ending thread:
- True ending route for the video game industry: Economic stagnation

True ending route for the video game industry: Economic stagnation

How do you unlock this true ending route? Simple, here's a flowchart in the form of a table: Thread Unlock condition: Read thread. Bad ending routes for the video game industry No Bad ending route for the CEO/Owner/Employer: Workplace Democracy No Bad ending route for the video game...

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