video game industry is going through his cI laughed the most since the 80’sexperts began to define this phenomenon as “crash 2.0This is reported in the latest issue of the British magazine “Edge”. The magazine’s editor Alex Spencer collected the testimonies of nine industry experts to outline the reasons for the current sharp market decline and its possible evolution.
The most authoritative voice among them is Epic Games CEO Tim Sweeneyit pointed to two main problems: “internal dysfunction” related to the eye-watering costs of developing triple-A games, and external challenges, starting with a severe and chronic shortage of hardware components. Sweeney believes the latter is directly related to the current boom in artificial intelligence.
insurmountable problem
“This is a major and unexpected disruption,” Sweeney explained of the semiconductor crisis. “The wave of construction investment is unprecedented Artificial Intelligence Systems and Data Centerbased on the belief that they will play a truly transformative role in the economy and that the scale of the industry’s economic opportunity means they can surpass what the entire entertainment industry provides to all constituents. “This dynamic is leading to RAM and storage prices quadruple. Sweeney estimates the gaming hardware supply crisis will last three years, stressing that the only long-term solution is Building a “huge new factory” to meet global demand. ”
For Tim Sweeney, Steam commissions slow down big free-to-play games like Genshin Impact
Domestically, core issues still exist economic sustainability. Playable Worlds CEO Raph Koster has been studying this phenomenon since 2005. According to his figures, development costs increase about tenfold every decade: if a console or PC game cost about $1 million in the mid-90s, that number would have risen to $10 million in 2005 and $100 million in 2015 (calculating inflation). Today, Sweeney noted, The budget is between $250 and $400 million.
Shawn Layden, a former senior executive at PlayStation, said the industry must recalibrate its ambitions and reduce costs in order to survive on lower profit margins. “I mean, ‘It’s only going to make $50 million’? Okay, okay. Let’s find a model where $50 million in revenue is a good thing, not a bad thing” commented Layden, before criticizing the tendency to create unnecessarily large games. “Do you need to model an entire world that takes 45 minutes to walk through? If there’s no reason… it’s just a stage trick. You’re spending a lot of time, which means money, on something that makes no sense.”
To escape this cyclical impasse, Coster posits that a complete reset is needed, perhaps guided by the arrival of new platforms, but Eliminating artificial intelligence could reduce development costsdefining it simply as “a computer that gets bigger and more expensive.”
Amir Satvat, former business development director of Tencent, also had the same view. He analyzed the impact of artificial intelligence on team size. Many studios are trying to reduce headcount by relying on tools like Claude, reducing teams from 50 to 20, or from 400 to 100. Results are mixedbeyond the words of those selling these systems.
“I’ve seen companies lay off employees because they thought they could do it with artificial intelligence, but now they realize they laid off too many and are hiring again,” Satwatt revealed. The former Tencent executive concluded that layoffs were first concentrated in specific geographic areas, thus redefining the geography of the industry.
“I think this situation and Dell ’83 crash If you are a game developer in a traditional AAA studio living in North America or Western Europe. There, the phenomenon reaches its most destructive peak. “
