I’m a fan of transparency. Because, as the big newspaper says, “Democracy dies in darkness.” There’s an analogy here for the game business where it feels like we’re getting too quiet. I guess it’s time for me to make some noise and rant because we’re losing the voices in our industry.
In the past, we had a lot of people who were all too loud and ready to be heard. Trip Hawkins and John Riccitiello loved to come up with witty criticisms of their rivals. Satoru Iwata of Nintendo didn’t mind saying he thought that Sony’s Kaz Hirai was “arrogant” in saying the console wars were over.
For good and bad, the bad guys of the industry were like James Bond villains, telling us exactly how they were going to kill the good guy before failing to do exactly that.
We don’t need a lot of bluster, for sure. That’s fun, but it’s often like politicians slugging it out and we’ve had enough of that. Yet we do need dialogue in order to make the industry better. We need maps and lighthouses, as Adam Boyes told me as he started his consultancy to fix game companies. I’ll miss Ted Price, CEO of Insomniac Games, who announced his retirement this week. Price was the lone CEO who gave the rhetorical middle finger to Trump in his first presidency when Trump announced the Muslim travel ban. With Ted gone, who is going to do that kind of thing in the next four years?
Now, as the industry is possibly going to face tariffs on game consoles, the industry is too quiet. Big Chinese companies are of course going to lay low because they don’t want to risk the ire of Trump or Elon Musk, who control the MAGA hordes that have retaken the government. Tim Sweeney of Epic Games observed that the big platform companies that pretended to be Democrats are now giving Trump donations and are pretending to be Republicans now, hoping to keep the government away from topics like antitrust enforcement. Who is going to scream at Trump that doubling the price of game consoles through tariffs is going to kill the game industry? Sure, the CTA made its voice loud and clear on this point at CES, I don’t see the tech or game industries rallying to the cause and making noise.
I felt like I got a trove of data this week from some people who enlightened us not because they worked at the biggest companies in the industry. They were just dedicated to transparency.
Some examples. Amir Satvat, the ever diligent champion of game jobs, predicted based on his data that we might see 9,800 layoffs in 2025. That sounds terrible, but it prepares us for what’s ahead and it is a relief compared to the 15,000 or so layoffs in 2024. His data has uncovered an uncomfortable reality: there is ageism in hiring patterns in the game industry.
Matthew Ball, another solo seer and CEO of Epyllion, dropped 223 slides in early access on the state of the game industry. He pointed to 10 drivers that helped gaming grow over a decade, eight initiatives that failed to catch on to keep growth going, 15 challenges that the industry still faces, and 11 possible growth engines that could reignite growth. The insights helped us see the path ahead.
In another rich part of the data trove, the Game Developers Conference issued its annual State of the Industry report, based on a survey of 3,000 game developers. It found that game developers have increasing negative sentiment compared to a year ago toward generative AI. They worry it’s taking away jobs. Unionization sentiment is still at 58% in favor, a sign that people aren’t happy. Yet they’re working more out of fear that they might be laid off, as one in 11 game devs was laid off in 2024.
ChainPlay pointed out that 93% of GameFi projects — Web3 or blockchain games — are dead, with the value of their tokens plummeting 95% from all-time highs. ChainPlay looked at 3,279 Web3 gaming projects and found that most of them were dead and trading at 5% of their peak values. Yet there are survivors. On average, 316 new projects launch each year, but 262 projects disappear, indicating that a significant number struggle to stay afloat for more than a few months. Still, this is no way to start an industry, with so many scams on the way to convincing mainstream consumers to dive in.
The handful of Web3 gaming survivors that make real games may have a real opportunity soon, as the market of Web3 players is growing. DappRadar reported this week that the number of unique active wallets in Web3 gaming grew 421% from a year ago to 7.4 million daily wallets. And while blockchain gaming investments fell 38% in 2024 to $1.8 billion compared to 2023, there are real and fun Web3 games like Off the Grid and Telegram titles getting traction with audiences.
These are all insightful pieces of data from relatively small entities. But where’s all of the great information from the biggest companies in the industry?
One of the sad realities is that big companies get punished for transparency. Electronic Arts disclosed this week that it would miss earnings targets for the December quarter because Dragon Age: Veilguard and FC 25 soccer fell short. That shaved $4 billion off EA’s market value in stock trading. That was the equivalent to maybe for Ubisoft’s. But don’t feel sorry for EA, as it can say a big game is coming and it will gain back those four Ubisofts in no time. If you look at an earnings report these days, you’ll find that companies rarely point out the number of games that are sold; compare that to movies, where you get box office receipts but also get estimates on how much it cost to make those movies.
I have seen big companies pull people from our stages at our events because they don’t want to risk talking too much. Nintendo and Sony don’t say much except what they’re obligated to say in earnings calls. And since Microsoft swallowed Activision Blizzard, we lost the detailed information in earnings calls about the results of one of the biggest companies in the industry. These companies don’t hold press events so much where you can ask questions nowadays.
They go “direct” to consumers in canned video announcements, as we have lost the in-person gathering place of E3. At E3, I was sad to see that company CEOs held press conferences where they never took questions. And now I’m just lucky to get interviews with those CEOs. I was sad to see David Haddad step down from the top games job at Warner Bros. He was a statesman of gaming — of which there are just too few these days — and he was always happy to come to our events and express his views.
Social media has also taught us to be quiet as well. If you argue with gamers about your game really is good and they feel like it isn’t, you’re going to lose that argument. So why bother? If social media is full of misinformation, toxicity, entitled whining and unfair criticism, then it seems pointless to argue your case there. No one wants to argue with the entire internet. Game executives don’t want to risk saying something that might get taken out of context or twisted after being repeated.
Yet in gaming, it’s true as in any other industry: good data is power. Satvat’s data means that perhaps a year or two from now we might be headed back into the talent wars in the game industry, which would be good for job seekers. I think the game industry needs to marshal its considerable resources and make itself heard in places like Washington D.C. and before consumers. It needs to strengthen the Entertainment Software Association and speak up on its behalf as no one else is doing it.
Ball surprised people by observing that Roblox’s nearly 400 million monthly active users means that it has more players than almost the entire triple-A ecosystem and towers over core rivals like Steam or PlayStation.
And yet Roblox makes a fraction of the revenue per hour of rival platforms and publishers, and, as Tim Sweeney of Epic Games pointed out, Roblox has almost no clout when it comes to being able to push around Apple and Google, whose 30% fees on sales of games on their platforms generated somewhere upwards of $20 billion in mostly profits. This is why Sweeney is so steadfastly dedicated to winning antitrust victories against Google and Apple on behalf of game developers, as he noted in a press event where he touted third-party mobile games moving onto the Epic Games Store. Yet too often, Sweeney stands alone. Companies like Roblox and Microsoft don’t lend their voices to the antitrust cause.
We all know that transparency is further declining as the games media is drowning as well. Game Informer shut down. GamesIndustry.biz, one of our competitors at GamesBeat, lost its longtime leadership over the holidays. When a journalist leaves the industry, that means we’ll lose thousands of stories on games over time. When I go to industry events, I see more creators than journalists.
We’re being replaced by creators who have a more authentic touch with players, but they are often paid by the very people that they’re communicating information about. I can tell you that if the game industry isn’t healthy, it won’t support game media. And if the game media disappears, the industry will go dark.
So my message is simple. In your part of the industry, build a lighthouse and make a map. You know we’re going to need it, and we’re going to need thought leadership. After all, those 15 challenges that Ball pointed out are going to kill this business if we don’t have clear thinking and bold communication.
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