To be or not to be depressed, that's the question

The financial depression is hitting us hard. Shares are losing their value, companies are going under, people are thereby losing their jobs and additionally losing everything they have in their retirement funds, as the banks sitting on those investments are going out of business, after losing all of peoples' money they were supposed to take care of. This is every day news, and pretty much everyone currently employed can no longer be sure that their employment will continue to the end of the year.

This should therefore be a horrible time for the gaming industry, just like it is for pretty much all other industries. Or is it?

I claim that it's not, and that the gaming industry should be one of those less affected. It's not like games would be a critical product you can't live without like food. It's more that games themselves should be something we may actually spend money on, even though we have less of it left. No matter how hard pressed, people will always have a desire to be entertained. During economically strong times, people tend to use more money on getting entertained. Recessions in turn tend to make people use less money on entertainment, like on pretty much everything else. Games and especially latest generation console games are far from free, but you do get quite a bit of entertainment for that money.

Here in Finland a movie ticket to a prime time screening is ~10 euros. You get a ~2h entertainment experience for that, which does not give a very good money/time ratio. Buying that movie on DVD for ~20 euros is even more expensive, but you can then watch that movie again, evening out the value. Renting that movie (online or physical disk) should be most cost efficient, giving you the same 2h entertainment for just ~5 euros. An Xbox360 game disk costs 50 to over 60 euros, but the time that entertains you is also multifold. Many shooters can be run through in about 10h, ending up around the value of a movie ticket, but other games will entertain you far longer. I used probably 40-50h on GT3 and at least as much on GT4. I'm still not very far in GTA4 after ~10h gameplay and my colleagues playing Fallout3 spent over 100h on it. That challenges even movie rental value, and games are also deeper involving than movies.

Games purchased and downloaded online are many times 10-20 euros, and handheld games below 10 euros if not below 5. The time involving the gamer is shorter, but the value should still be excellent. The best value is probably still offered by multiplayer games, as there is usually no actual end in such games. You can challenge your friends or strangers online over and over. I've probably spent several hundred hours on Battlefield 1942, including the DesertCombat mod. All that was gained at the price of a normal PC game. This is where I'm finally getting to my point. Buying games should not be an issue, even during a financial depression. I would claim that buying the hardware is more of a such. But the console gaming industry most likely quite through pure luck managed to time it perfectly. When the latest hw generation was launched, people had loads of money on their hands to buy the hw. There was a few years time for all gamers to get those, and even time for price reductions and new audiences to get the console of choice. Now that the depression hits, we only have to pay for the games, as we already have the hw. Next generation of consoles is rumoured for 2012, so there is a few years to get out of this recession before new hw needs to be invested in.

But how about the more dynamic platforms, like PC gaming essential for FM/YG and handheld gaming current for me? It is very possible that aiming a bit lower than the very highest end is a wise decision for a game developer/publisher today. PC games on the other hand many times have several year development cycles, meaning that the game will not hit the shelves until people should again have money also to upgrade the hw. Handheld hw renewal is driven by primarily other aspects than gaming. Better internet browsing, email handling, photography and media & map solutions is driving people to renew their handsets, and handheld gaming will ride on this technology advance. Lately handheld gaming itself, especially in the high-end has taken a positive trend. I eagerly look forward to the day analysts list gaming among the most important reasons to upgrade the cellphone.

Gaming should thereby get through this financial depression better than many other industries. Big publishers may radically decrease their investments in new projects, but smaller publishers and self publishing developers should do quite well. A good market should remain, even though the giants of the industry may react strongly to the global financial situation.

So don't get depressed, game on!