Video game

Consolidation of the video game industry

The video game industry is currently at a very unique point in its history. Microsoft has announced its intention to acquire Activision Blizzard for $68.7 billionJanuary 18. After the many successes of Activision trial and struggles, Microsoft hopes to save the company from its own internal turmoil. The deal “will play a key role in the development of metaverse platforms,” ​​according to Microsoft CEO Satya Nadella.

While Microsoft says it plans to use its publishing expertise to accelerate the growth of its games business across all gaming platforms, many are wondering what this means for Activision’s games on Playstation platforms. This acquisition could give Xbox better competition within its game libraries.

Sony has since followed suit by to acquire Bungie, the developers behind Destiny and Halo. This is partly to compete with games like Fortnite, owned by Epic Games.

It was a pretty big month in terms of game acquisitions, consolidating the industry to even fewer AAA studio owners.

These acquisitions are not yet set in stone, because the Federal Trade Commission (FTC) Microsoft’s acquisition of Activision-Blizzard is currently being investigated at a time when the FTC is much more aggressive against big tech’s unfettered market powers. However, there appears to be little reason to assume that the acquisition will not go through.

nintendo appeared to be the odd one out, promising fans that he would not participate in the arms acquisition race.

“Our brand has been built on products made with dedication by our employees,” said Nintendo President Shuntaro Furukawa. “Having a lot of people who don’t have Nintendo DNA in our group wouldn’t be good for the company.”

This should come as no surprise, as Nintendo often sticks to the same intellectual properties, as it has since entering the industry in the 80s.

The video game industry is changing, and it is changing fast. The material is always in the grip of Supply Chain misfortunes, making consoles and computer hardware inaccessible. The avid gamer has felt the severe impacts, but video game developers are struggling to find the middle ground between exclusivity in a much smaller market and catering to next-gen hardware that significantly hampers development progress.

It’s not just the hardware, but the nature of the game itself that has been turned upside down. Xbox Game Pass, known as the Netflix of gaming, is changing the way gamers can access video games. Instead of the standard premium business model – where a player purchases a video game for a one-time fee – players instead pay a subscription to gain access to a library full of video games at their disposal, with new games constantly being added to the roster. . . Sony offers a similar, albeit smaller, service known as Playstation now.

If Sony is not outdone, its development model has become increasingly obsolete. The era of AAA titles flooded with millions – now billions – of development dollars to sell for a $50-70 premium is increasingly unsustainable.

During the Playstation and Playstation 2 generations, games could be developed with a fraction of the team required to create graphics-intensive titles now, and $50 went a lot further back then.

This can be best illustrated with Final Fantasy XIV Success. Square Enix was one of many companies to pour money into games intended to be sold individually as books. Titles such as Final Fantasy VII, Final Fantasy X, and Kingdom Hearts have propelled the company through their respective console generations.

However, as the graphics became more demanding, it took more time and money to produce visually appealing games. Quickly, Final Fantasy XIV quickly became the darling that kept Square Enix afloat with financial success, not because of the graphics, but because of its subscription model as an online game. At some point, premium sales drop to next to nothing, while subscriptions create a steady revenue stream that can better fund more creative titles.

Activision and Bungie both own some of the most popular subscription video games in circulation. These games generate revenue that keeps these companies alive in the market and seems to be the reason why these video game acquisitions are so important.

However, smaller indie game studios and startups are often left with table scraps to produce quality games, if they can get the funding. As the premium model crumbles, these independent studios have little choice because they can’t afford full server rooms and specialized teams to create online games, which may or may not succeed. Same New worldAmazon’s attempt to create an online video game got off to a rocky start.

Ultimately, AAA studio acquisitions may satisfy long-term fans, but they also point to a changing market that may make it even harder for new creatives to bring something fun and unique to the world. .

Everyone has to start somewhere, and if there’s no field to let that happen, what will that mean for the future of video games?