Do you think we’re headed for another American Industry crash out like 1983, or has the digital age changed what was a product of physical media? Is the industry turbulence largely on the back end, or is it also rippling to consumers?

boynextdoornews

There won't be another industry crash like 1983, mostly because most people don't really understand what actually happened in 1983. 1983 wasn't an industry crash, it was an Atari crash because there were too many low-quality games for Atari and the market was totally saturated, causing the players to drop the Atari and go look for something else. The players back then were all penned up on the Atari console only, and post-crash spread out across multiple other platforms that launched at that time like the Commodore 64, Apple 400, Tandy Color Computer (and Color Computer 2), and the Texas Instruments TI-99 4A.

Today's troubles are a combination of many separate variables all causing effects that intersect in very bad ways for industry growth. Interest rate increases make it difficult to borrow money, which makes approving new projects riskier. Tariffs cause economic instability, which can affect projected sales numbers. But the biggest issue is that the industry is effectively correcting itself - there were two years (2020-2021) where the growth in games was taking off like a rocket ship, and many companies saw it and assumed it would continue to grow at that rate. When 2023 rolled around and people realized that the growth projections were totally off, huge numbers of investors pulled their money out to invest it in other things like AI. This meant that publicly traded game companies both lost investment money that they had been expecting to use to pay for new game projects and that they had to cut costs in order to reassure the remaining investors not to follow the early leavers.

This has an overall pendulum swinging back effect of overcorrection where several promising games that would have been successful get cancelled too. That said, this correction will eventually swing toward "good" again as well because it will cause demand for new games left unmet in the market, which will (eventually) entice the game companies to expand and experiment once again. Such things will happen eventually, but it won't happen until things calm down and stabilize first.

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