Why Console Gaming Is Dying
Electronic Arts and Square Enix lost their CEOs. LucasArts has been shuttered. Big publishers can't stay in the black, and smaller developers are disappearing for failing to meet absurd sales goals.
You don't have to be an industry analyst or hardcore gamer to realize that something is wrong with the gaming business. In this respect, Sony's upcoming PlayStation 4 (and, by extension, Microsoft's inevitable new Xbox) is more than just a new console: It represents the changing tastes of a volatile market, and the potential last gasp of modern big-budget gaming. Lack of user interest and prohibitive development costs may make further console generations impossible.
Sony has revealed relatively few details about the PS4, despite holding an enormous media extravaganza on Feb. 20. It demonstrated a couple of games (largely sequels in established series), demoed its graphics (impressive, but not much better than the PS3's) and promised to be a friendly space for indie developers (without saying how). A controller (that looked a lot like the current one) was on display, but the console itself was nowhere to be seen.
Neither fans nor investors found the display very impressive. Buzz among games journalists and forum denizens was lukewarm, at best, and Sony's stock took a dive almost instantly following the event.
How did gaming arrive in this state?This kind of indifference to consoles is the rule, not the exception. Gamers are seldom excited about console releases anymore, and big-budget titles are often a risky proposition. Mainstream titles already cost tens of millions of dollars to release, and these numbers will only increase as developers navigate the intricacies of the PS4, Wii U and the next Xbox.
Raw system power is not enough to generate either hype or sales. When Sony's handheld PlayStation Vita launched in December 2011, it boasted the most powerful specs ever for a dedicated handheld system, but a relatively weak game lineup. Japanese fans did not consume it in droves. In fact, its predecessor, the PlayStation Portable, continued to outsell it for weeks. Western consumers did not embrace the system much more enthusiastically when it launched in North America and Europe a few months later.
Not even stalwart Nintendo can withstand gamer apathy. Nintendo's latest console, the Wii U, launched in November 2012, may be in trouble as well. By the end of the year, it has sold slightly more than 3 million units — about the same as the original Wii. The story changed a month later, when Wii U sales slowed to a crawl, moving fewer than 60,000 units. With no must-have software on the horizon to bolster it, the Wii U has a rocky road ahead. [See also: The 10 Most Stunning Video Games]
Quality games from major publishers could be in short supply in the coming days, though. Disney shut down LucasArts, the legendary developer behind many of the "Star Wars" titles. Square Enix lost its CEO in Japan, and slashed its North American staff, not even sparing its president.
The games industry does not have a healthy attitude toward keeping studios together in the long-term. High Moon Studios, the developer behind the new Marvel Comics "Deadpool" game, lost 40 staffers immediately upon the game's completion, despite having plenty of funding.
EA, as usual, is in a league of its own. The "SimCity" debacle, which rendered one of its most anticipated games unplayable, is still ongoing one month after release. After EA-owned developer Visceral's "Dead Space 3" failed to meet unrealistic sales expectations, EA fired a number of staffers in Los Angeles and shut down Visceral Games Montreal entirely.
If the PS4 succeeds, it could stave off a sea change in the industry for a few more years: Gamers dropping lots of money on traditional console titles would keep the market viable for the time being. If not, big-budget gaming could be at its end, opening the doors for midsize and independent developers to flourish again.