There is absolutely a ceiling on the size of a game and franchise. The natural ceiling for any tentpole blockbuster franchise is the relative size of the audience who is willing to buy into the game at that point in time. At some point, we’ll run out of people who want to pay for the game no matter how much additional marketing and game we build. When we reach that point, we pull back because spending more to make and build more won’t make financial sense.
We have already hit that ceiling for some games. Square-Enix just recently decided to sell off the Tomb Raider franchise (along with several other studios and IPs) after not being able to grow it to the size they wanted. They were unable to hit the numbers they hoped for with the Marvel’s Avengers and Marvel’s Guardians of the Galaxy games they produced. This naturally results in them (and others) pulling back on the titles that cannot support this kind of expenditure. We’ve also seen it with the workhorse franchises that have a strong niche carved out, but aren’t actively growing - Lego games, non-FIFA non-Madden sports titles, MOBA games, hero shooters, digital card games, MMOGs, and so on.
This isn’t to say that the overall audience can’t grow or shrink over time. Cultivating the franchise/game audience over time is also necessary. One of the biggest examples of failure to cultivate the audience is with Activision’s Guitar Hero blunder. They put out far too many Guitar Hero games too quickly and killed the entire franchise (along with most of the rhythm and beat game genre). Audiences can also grow organically over time if the game/franchise is carefully cultivated - Final Fantasy 14’s growing user base is probably the best example of this.
The overall point here is that these changes have already been happening, you just need to know where to look. Most of it isn’t accompanied by a lot of fanfare by intention, just a quiet pull-back or cap-off in terms of budget for new games in established franchises and genres. A big news hullabaloo about it is basically the nightmare scenario. This kind of directional business change isn’t likely to be made public in large part due to the opacity of project budgeting and team sizes, as well as the overall length of time it takes for these changes to reach the public.
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