Back in 2008, when the recession struck America with a merciless fist, many businesses closed, and almost all industries felt the smarting pain.
There was one notable exception to this trend; the video game industry. Not only did this industry seem to be alone in its immunity to the dire financial straits that plagued the rest of the country, but it seemed to do well. Millions of Nintendo Wii and DS systems were sold during this period of economic downturn, baffling financial experts the world over. Many speculated as to what the reason could be; yes, technology has improved games, but has it improved them enough to make them completely block out the economic climate? Was it because gamers were able to be laser-focused on an achievable goal in a time of stress and uncertainty? Instead of continuing to guess, we listened to what the experts have to say; here’s why we think the video game industry is recession-proof.
Recession-Proof
The gaming industry’s refusal to go under in 2008, even in the most turbulent of circumstances, was truly remarkable. While experts agree that the industry is likely to be almost as resilient now as it was then, they do see a pall over its ability to completely ignore any economic instability: the price of games. In a time when the US economy is contracting once more, the prices of consoles, gaming PC components, and VR equipment have skyrocketed, so why are they still selling, even if they aren’t selling as fast as they once did? Discretionary spending is once again on the downturn: Microsoft, Sony, and Nintendo are all reporting a drop in sales, but that’s hardly a surprise at a time when many Americans can’t even afford life’s basics. Supply chain issues also mean that in-demand items that might otherwise have sold out and represented a boon to the company in question, like the new PS5, are vastly unavailable and, as such, are disrupting sales figures. The costs of creating wares that were already expensive, like VR headsets and graphics cards, have risen exponentially. Game companies all over the world are tightening their belts and putting a freeze on hiring new staff if they are not being forced to let existing staff go.
All these financial burdens that are bearing down on the industry mean that decisions about game creation and releases need to be a lot more thought out. Games are not being green-lit until the chances of them being a success are almost beyond reproach. While this will limit the releases that come from your favorite game companies, it does make sense for their bottom line; and it keeps them recession-proof to a large degree. The more certain a company is that a game release will do well, the more confident they are that they’ll recoup their investment (and then some), and the more certain their fans can be of getting quality products in an uncertain time. All of this makes any wise investor far more likely to bet on the next release that the company puts out, keeping their heads above water yet again. While this means trouble for new companies, it means stability for the ones that already exist.
Sweet Escape
For gamers, gaming is a chance to leave the real world behind and vanish entirely into a world of their choosing. In the same way that bibliophiles use books as escapism and cinephiles use films as a way to forget about the world, gamers take the stories and worlds created for them in games quite seriously. Hours upon hours are put into ensuring that these game worlds, quests, and characters are as realistic or fantastical and as immersive as possible. Hours more are spent by gamers venturing into unknown and unreal places and exploring them either with friends or alone. Video games are, simply put, one of the best forms of escapism that exist in the modern world. In both good times and bad, gamers return time and again to their consoles, computers, or phones to while away their spare time.
No matter the size of the question mark hanging over any industry, the gaming industry included, one thinking that can always be relied upon is humankind’s urge to escape from their surroundings and travel far and wide using nothing but their minds and hands. As long as there are gamers who love the worlds that developers create for them, there will be a way forward for the game industry.
Wrap Up
While nothing in this world is one hundred percent certain, we can say with a reasonable amount of assurance that the video game industry won’t be going anywhere any time soon: recession or not.