Video Game Industry Crashes! Just like 84' except it's 04'

[quote name='Admiral Ackbar']You can't compare the costs to DVD. I mean, your rational is fine. Most people only care about price and that's it. But remember, for DVD's, most of the times the film or show has alreay run and made millions over seas or is in syndication or something.[/quote]

Actually you CAN compare the costs. Having been in the video business for a long time (though not anymore thankfully), I can tell you that there are tons and tons and tons of movies that DON'T get released in theaters, aren't released on TV first, and basically make no money until they are released on VHS/DVD. These movies have only become more prevalent since DVD has become widespread. They have budgets under $5 million (most have a LOT less than that), and when they are marketed to the different movie places (video stores, video retailers, etc), they are usually priced less than your average high budget theatrical release. They obviously do well, because so many get made, and there are many studios who release only those types of movies.

The only difference is in potential consumer base. Since probably 90% of the US has access to a VCR or DVD player, they can get away with only getting 5% of the market to look at their product. But even before such high saturation of VCRs, these movies were made and brought in money. I can only think that the reason some game companies have trouble doing something similar is due to the stigma of video games, which is that 'games are for kids.'

That's changing, but it's still prevalent.

And it looks like I'm singling out Admiral Ackbar in this thread. I didn't mean to, so it must be a trap.
 
i got a fucking question. what the fuck happened to cd's being cheaper than cartridges? i just don't see that this generation. for ANY side of this bad equation. and it's the publisher's and developer's fault and the big 3 for what's about to happen. they spend millions to push out games as fast as they can and half aren't even worth shelf space in an underground basement about to nuclear pulverized. i think microsoft made it happe. they're spending money to lose money just so they can be a ME TOO. and the damn graphics whores are buying it up like it's going out of style.
 
[quote name='pukemon']i got a shaq-fuing question. what the shaq-fu happened to cd's being cheaper than cartridges? i just don't see that this generation. for ANY side of this bad equation. and it's the publisher's and developer's fault and the big 3 for what's about to happen. they spend millions to push out games as fast as they can and half aren't even worth shelf space in an underground basement about to nuclear pulverized. i think microsoft made it happe. they're spending money to lose money just so they can be a ME TOO. and the damn graphics are buying it up like it's going out of style.[/quote]


CD's are cheaper to manufacture, but the development costs are MUCH higher today than 10 or 20 years ago. That's why the prices have not moved much for new releases. But look on the other side, b/c CD's are so cheap to produce, we get discounted game lines (platnum hits, greatest hits, etc..)
 
[quote name='PsyClerk'][quote name='Admiral Ackbar']You can't compare the costs to DVD. I mean, your rational is fine. Most people only care about price and that's it. But remember, for DVD's, most of the times the film or show has alreay run and made millions over seas or is in syndication or something.[/quote]

Actually you CAN compare the costs. Having been in the video business for a long time (though not anymore thankfully), I can tell you that there are tons and tons and tons of movies that DON'T get released in theaters, aren't released on TV first, and basically make no money until they are released on VHS/DVD. These movies have only become more prevalent since DVD has become widespread. They have budgets under $5 million (most have a LOT less than that), and when they are marketed to the different movie places (video stores, video retailers, etc), they are usually priced less than your average high budget theatrical release. They obviously do well, because so many get made, and there are many studios who release only those types of movies.

The only difference is in potential consumer base. Since probably 90% of the US has access to a VCR or DVD player, they can get away with only getting 5% of the market to look at their product. But even before such high saturation of VCRs, these movies were made and brought in money. I can only think that the reason some game companies have trouble doing something similar is due to the stigma of video games, which is that 'games are for kids.'

That's changing, but it's still prevalent.

And it looks like I'm singling out Admiral Ackbar in this thread. I didn't mean to, so it must be a trap.[/quote]

No, I think you're right to a point. I mean, you can make some comparisons. But you can also compare apples and oranges. They're both round, they're both fruit. Like you can make some comparisons to cd's and some comparisons to books and so on. But only in a generalized fashion. You can't directly compare say DVD's and Video Games and go, why are DVD's $5 to $20 and Video Games $20-50. Games should be the same price because they're the same as DVD's.

There are some very big differences that make some comparisons unreasonable. For example, there's the tiered deployment of video games. You can go from Theater Release, to TV, to Rental, to Pay per view, to DVD. And yes, there are flops in movies like in games. Also, there's been a shift because the DVD market is still relatively new. Just like CD's were new over a decade ago. One reason CD sales are lower is because people hav already bought CD replacement for their tape copies of music. DVD is in the middple of that now, where people can buy the Complete Monty Python to replace old tapes and such. But even that will eventually taper off. Where the video game market doesn't really have rleationships like this. At least, not nearly on the scale or integration of the studio machines. The two mediums have some very different costs and very different hurdles that make direct comparisons simpilistic in my view.
 
The market seems to be saturated with games at this point, many of which are good or mediocre, but with so many great games out on the 3 consoles and PC we just can't afford to buy all we may want to at full price. And I think the guys talking about game quality are on the right track, look at a developer like Bioware that takes their time and puts out a few great games (not just sequels) and the sales show.
 
pukemon makes a great point. (about his early post) i rarley buy games at $50 price. only the big names..like halo etc i pay full price.. most of the time i jus rent the games ( i got a game pass) and keep em for how long i ever want or wait till it becomes cheap. defender, i make a good point about ppl upgrading their pc for half life 2...but isn't it coming for xbox? isn't doom 3? i really think ppl..(who own xbox) would most likley get that verison. I could only expect this to get worse..i dunno about this crash but the cost of living is going to rise and income will stay the same..thus ppl will spend less.. i own a resturant n college ppl used to come often..now they don't cuz they have to save that money for gas. so i don't make money. business is bad for everyone (check out gas stations these days). i really hope the gaming industry don't crash..but with wat defenders sayin..it mite b true. again..its jus ur opinion. damn bush
 
[quote name='defender']CAG is my marketing.

I am not a noob who has just opened and messed up and now I have to close. I am one of the strongest and best independents in the city. The day I close will make many other retailers wake up to the bad news. My rent isnt that bad either..its below the local market value. This is why I want to keep the store but get rid of the games. I can still make money here. I wasnt always a game store anyways. Now my store is 100% games but when I opened I had computers, porn, laserdiscs, software, walkmans, electronics, and I did computer upgrades/repair and consulting. Eventually I made more and more on games and since my store aint that big other section were eliminated. Now the reverse has to happen and I must eliminate games as fast as possible to regain capital to buy back other merchandise. If I am lucky I can get a cheap place in Brooklyn to conduct mail order. The site has shown me that I can make money (it's not a lot) but the expenses are far less.[/quote]

I didn't mean to imply that you did not know what you are doing. Actually you seem like a business owner who stays on top of their industry. You would be surprised by how many business owners don't . What i really meant is that there are ways to save money on things like your yellow page ads. Obviously it depends on what size you have now, but your ad should be no larger than a triple quarter display ad. It should not have color. The first line should have a short phrase telling how you differentiate yourself. Then list your phone number, address and business name. Nothing more than that. Yellow pages are a big waste of money for businesses. They sit closed more than 99% of the time and most people who use them have already made up their mind where to buy. Studies have shown that size does not matter, and color can actually lower the effectiveness of an ad. I could go on for a long time, but I can give advice on nearlyevery advertising medium. I know you know your business better than anyone. I was just offering any help i can give because I know advertising and marketing. You seem like a nice guy trying to support your family. I think everyone on this site wants to help you if they can.
 
To straighten it out... I dont advertise at all in the yellow pages. My customers know where I am if they want a game. 10 years in biz. My first 4-5 years I spent well on ads and stuff but then the return on those stopped and I was just making money without it.

Do you know anything about internet advertising/marketing? PM me if you do because I am starting a project soon with a partner. You may be interested.
 
Well looks like it's time to vent. I'm not exaclty pointing fingers here.. well I am, Nintendo and Sony the cause behind the Video game market going down. They thought it would help if developers could easily make games and release them hassle free, unlike Nintendo's more strict approach. It's simple math, back in the day when Nes carts were 50 buck each, it wasn't a problem, because there would only be about 1-2 desired games a month, Great you get one or 2 of those games and are happy.

Years passed, And then you had SNES, vs. Genesis, same case, you get your games that come out every month, maybe 1-2, 3 at the most :0!

Then Nintendo made this huge mistake, scrapping the SNES cd, giving it to Sony... Now Nintendo had their real competiton. Before It was a battle between Nintendo, and Sega.... Turned 3 ways now, Nintendo, Sony and Sega. Everyone gets their games for their systems, let it be N64, PSX, or Dreamcast. Sega gets stomped on due to it's easy-to-pirate-ness and then Sony and Nintendo are left the duel.

The battle is fierce, and then Sony releases the PS2, a marvel of Graphics, power, and 99.9999999999% crap games, why? because Sony will let anyone make a game for their console, even if it is as crappy as... Backyard wrestling, or RTX (think that's the name) Well I could go on for hour of the crappy game ratio's for next gen console, but that would just bore everyone more than this post is already.

Nintendo responds with the Gamecube, and Microsoft comes along with the Xbox.

Big problem here, when there were 3 console before, the Industry was starting to hurt a bit, Yes it made a jump when Xbox and the cube fist launched, but when has a system launch not caused a jump in the industry? (Ok, forget about Virtual boy, and any "next-gen" Atari system... and cd-i.... and 3do... errr... yeah thats abouty all I can think of for now)

So we have 3 corporate giants fighting for the Top, One boasts A large Libary, One Claims it has more power than the two, and one has all of our favorite classic characters.

What does this lead to? Every console having it's own flock of games each month. Also included each month are a great deal of horrible games. Why? Because the console companies, with the exception of Nintendo (To some extent) are letting 3rd parties release whatever crap they want to.

Let's do this mathematically:
I'm not sure on the exact price of games for retailers, but it is obviously cheaper by the amount you purchase so I am going to say it costs $30 for each $50 game. (Go Ahead and Flame me if im wrong I could care less, it's just a rough estimate)

Back in the Days of NES, lets say a given store has 3 Games that came out that week, so they get 15 copies of each, all retailing for the price of $50, and cost them $30 per copy (Again ALL rough estimates) Roughly costing the store $1350, Let's say they sell 10 of Game A, All 15 of Game b and Game C was McKid's so they sold 2 (poor bastards that bought it) Right there, the store will break even, and the rest of the stock can be put on the shelves and make some profit, in the next weeks.

for the first week of june this year, I counted at least 20 games being released.... IN ONE WEEK, in the US, now is where the problem occurs. of all of those not too many seem that appeal, to be truthful.... I doubt i'll get any before a price drop, if any at all, why? because I can guarentee they are all crap, each and every one of them.

Ok I know some of them retail for $20-$30 but to get my point across i'm going to value them all at $50
let's say the store buys 20 of each game, demands are higher for games than they were back in the NES days.

If the store pays $25 for each game it comes out to: $10,000 for that week's purchases, not too bad considering they have $400 games with a MSRP equaling: $20,000 sitting in the back a possibility for a rather high profit. The problem? Wayy to effin many games and they all suck, who the ehll in tehir right mind is going to buy The Chronicles of Riddick, sweet jesus the movie looks like crap too!

Let's jsut say, so you all have less to read if you actually are reading it, they sell 100/400 games they bought in teh first week, $5,000 half their money back. Now those games that are out there, have a low chance to being purchased, because another 500 games were just added in the stock room, of those 500 only 250 were sold, much better turnover than the first week, but still not enough to compensate the amount the company is behind right now. All those games collect dust, and the retailer has no choice but to force a price drop to get rid of the extra inventory, all the games drop to $30 or less, causing each sale to help them break even/hurt them...

Multiply this effect for every week in a year, and the supply of games reaches an all time high, but the demand hasn't even budged, unless companies notice that crap games hurt the industry instead of help it, then the game industry is more screwed than Urkle in a deathmatch between Him, Chuck Norris and Bruce Lee... well we'd need a time machine for that to work, but you get the point.

And thank you to those who spent the time to read it, it's been something I wanted to get off my chest for a LONG time.
 
Up until last December, when I came to the realization that I had no money to spend, I bought almost every game I had at $50 a pop. But now (finally) I have noticed trends in game prices - primarily that most titles drop to $20 or under within a year. If retailers kept the prices higher, I'd be more inclined to buy games closer to their release at $50 a pop still. But I know that FF12 and MGS3 will be GH titles within 12 months, because the same thing happened with their predecessors.
 
I think another problem is there are no more event games coming out. Games people look forward to being released for years and it causes groups of people to buy it in a near hysteria. Do you think the release of Halo 2 will be anything like when Mario 3 dropped back in the day. I may be getting cynical in my older age but I don't get nearly as many wow-special moments in games anymore.
 
Defender, it's a shame to see that you aren't doing well, and I've been trying to deny what you are saying, but the past year or so has shown me that you may be right.

The past 2 years, games have grossed more raw revenue than theatrical films. Many (including myself) saw this as a great moment for games, a chance for games to be introduced to the mainstream, to be accepted for what they are, to not be seen as 'kid stuff'. Only recently have I considered the problems inherent to this: the videogame industry perhaps still isn't ready for the saturation that music and movies see; and the fact that many more people know of the potential for profit in this industry, and I don't mean independents like Defender.

As games become more mainsteam, more pressure is placed on companies to try and create product that has a wide appeal. Sometimes this can be a good thing, example The Sims. The Sims has become a household name and is one of the top-selling franchises in gaming for a reason: it appeals to a wide audience (how many moms do you know that play the Sims? Cuz I know a damn lot). But now, I fear this may cause companies to burden themselves with the belief that they need to make at least one game that can appeal to a certain demographic or all demographics. This may only cause a problem in lackluster content as companies soften their games, which sucks for the gamer for whom the game was created. Would DOOM have become what it is if Id Software had been concerned as to whether a 9 year-old girl would enjoy it? No, it wouldn't have.

But it also may cause a problem with market saturation and these new demographics being introduced to what is still a pretty alien form of entertainment. Too many people look at price, not quality when it comes to entertainment. Someone brings some $10 piece-of-shit budgetware game to my counter, I tell them it sucks, tell them they should buy this other good game that deserves their money, and they still buy the crap game. Why? Because it was $10, and they simply don't know anything about games. We here at CAG are guilty of this behavior too. Just because a game is $XX doesn't mean it is any fun. In fact, that is a good indicator that the game is crap.

The other problem I see is also related to budgetware, and was a huge factor to the '80s crash. When some company that originally had no affiliation with games finds out about the fact that games have recently grossed more than movies, they decide that they want a piece of that pie. They then fund the creation of a budgetware game with the knowledge that it will be seen on store shelves with a $20 price tag. Clueless, value-happy consumer enters game store to get some birthday gifts. Do you think they are gonna buy a quality $50 game when they could buy several budget games for that price? Of course they won't, I see it every day I go to work. So the more expensive quality titles go unnoticed in the sea of budgetware, and eventually are dropped in price to either compete with budgetware or to simply make shelfspace.

Or that company, instead of involving themselves directly in the games, could purchase a share of an established company, like Capcom or Konami. This may seem harmless (hey, bigger moneypool for developers, right?), but these companies now have a say regarding the content of the games they are now involved in. If a game is has questionable content, they can censor it, because it is their money at stake. This doesn't really have a direct affect on the sale of games, but could lead to alot of innovative games being toned-down or rethought, simply because these companies don't want to risk losing money.

Jesus, that was alot. I'll shut up now.
 
I believe there will be a correction, but not a crash. The market is alot different than 84 when videogames was still a relatively new industry.
 
And another thing. In an earlier thread people posted their games in their collection that they had not completed and a lot of them were quite long. If I have 20 games I haven't completed why would I spend $50 on a game that I may not get the chance to play for a few months when it has already dropped in price. Inflation is bad ask the Germans who needed a wheel barrow full of money to buy a loaf of bread after WW II because the Nazis figured they could fix things by over producing currency. the market makes me think of the sports card business and how it ruined itself by going from 3-5 major card companies making cards to a ton of companies and the major companies like Topps making several different types of cards or Fleer with their normal fleer,fleer ultra etc
 
There are too many holes in your theory of a crash and trying to mirror it to 1984. First, game companies are reporting profits and turnarounds. Namco and Square Enix both posted good numbers this week. Midway is in a turnaround and viewed as a hot stock right now. Ubisoft is churning out profits despite the crashes of XIII and BG&E, the Clancy license has proved to be a license to print money. Nintendo is still making money and it's "losses" last year were reportedly due to bad exchange rates. Capcom, Sega and Konami... all profitable. Do I really need to tell you how big EA is??? EB Games posted a 23% increases in sales for 1st quarter year to year despite not having something equivilent of the GBA SP or Zelda: The WindWaker like they did in 2003. How can they be posting that kind of increase with no console or single major title for the quarter if the market is going to bust?

The 1984 crash was precipitated by the home market, not the arcade market. There were a number of factors that caused the crash that will not be repeated.

1. There is not an oversaturation of product. In 1984 you had numerous companies that no one heard of making games for just one console, the Atari 2600. The third party support was not spread out evenly between the Intellivision or ColecoVision and the concentration of games on the 2600 led to a 300% oversaturation of how many games were sold the previous year.

2. You had incredible, nay, colossial disappointments in Pac Man and E.T. they just plain sucked. However not only did they suck, Atari made more Pac Man games then there were 2600's. Now, let's put that in perspective. If there are 30 million PS2's in the U.S. can you imagine Rockstar making 35 million Gran Theft Auto: San Andreas'? No, you can't. Can you imagine them spending $23 to make each of those 35 million games? No, you can't. Can you imagine them releasing that game and having it suck? No, you can't.

3. 1984 in hindsight should have been a transitional year for consoles. We should have been going from the 2600 to the NES like they were in Japan. Instead Atari had no equivilent generational jump in the pipeline. The Atari 5200 was not a generational jump. It was nothing more than the Atari 400/800 computer chipset put in a box without a keyboard, that chipset was designed in 1978. It wasn't a leap. Coleco didn't have the marketshare or gaming library to force a jump with ColecoVision, ditto Intellivision.

I could go on and on with this but the bottom line is while your business may be sucking the market is in fine shape. Best Buy may be selling $5 games but you know what? They're making money too.
 
I think the crash is different but there are similarities. I think it will be obvious that no matter how bad the crash can get that gaming isnt going anywhere.

I thought this statement was so true:
So we have 3 corporate giants fighting for the Top, One boasts A large Libary, One Claims it has more power than the two, and one has all of our favorite classic characters.
Click to expand...

The same exact thing could be said of Atari, Intellivision, and ColecoVision from 84.

When games crashed in 84 it was Nintendo that saved the market in 86. There will be something to save us in 2006 and I think it will have online written all over it. You heard it here first.
 
And now, for a different take on things. Sorry for the long post guys, but I'm tired of seeing conspiracy theories and fanboys freaking out (not saying that anybody here did that, its just a common occurance nowadays).

We are nowhere near a crash. However, for some of us nostalgic gamers, our time has just about passed. Let me explain. The Best Buy sale is the result of the Christmas flood. The market was flooded with so many games, yet developers failed to realize that their most profitable market (the casual gamer) spends millions on blockbuster games (such as GTA, Halo, Zelda, Ratchet and Clank 2, Madden, etc) instead of reading reviews; whereas the hardcore gamer who buys those off the wall and unconventional great games makes up 15-20% of the market.

The problem with the video game business is exactly that: It's a business. It's the same reason why you'll likely never see a Chrono Trigger sequel, RPG's without the Final Fantasy name never sell in great numbers, or people don't play Deus Ex Invisible Wars on a console instead of Halo. Its now a full blown entertainment medium, surpassing even the movie industry now in scope and reach. Therefore, companies follow tried and proven success formulas (just as in the movie industry following the "Franchise formula", EA follows the same creed). You will always see a few interesting and innovative games, such as Beyond Good and Evil, Disgaea, Panzer Dragoon, etc. But they won't sell many units except to the hardcore gamer (and then usually only when it drops drastically in price, because the hardcore gamer sees the good games and thus can't afford to buy EVERY game they want). Sadly, the only way that good story and gameplay elements from these outstanding games live is when they are implemented in those larger blockbuster overhyped games that have a greater impact on the market).

Don't believe me? I'm willing to bet that some of you thought that "summons" were this huge monumental groundbreaking event in gaming. To us older guys, they were called Espers in Final Fantasy 6 (III). Our how four player co-op games are a miracle (Ninja Turtles: The Arcade Game. Didn't do it first, but was really successful). So don't think this is an '84 crash waiting to happen. This is a transition period. Sadly, it means fewer fresh ideas, and rehashing of the same ole shit. And even though when you average the price of packaging, marketing, production, development, etc, a game still probably still only averages out to 19.99 per game to make. You expect me to actually believe that a game is $44.00 at cost? It isn't, and that's why this site is here
 
oh yeah. something else to note. look at xbox platinum hits. i don't remember if and what the criteria was to qualify as a platinum hit, but look at the platinum hits. how many of those games ARE HITS? more misses than hits if you ask me. sony's greatest hit line is much more enticing and the qualifications usually mean you're buying a game that sold well because it was made well.
 
An online only console would be sweet. What would that do for B&M stores though? If you just downloaded the games, what would stores do about trade ins? Wow, no more EB or gamestop! Then you would definately go out of business.
 
You know, I STILL don't see whats so great about online gaming. Most of the people who play online are complete assholes, and half of the pull when they're losing anyway. Single player for me!

Nintendo's "Revolution" is hinting that it won't just be a tv console, but who knows what'll end up happening with that. My prediction for the future is we'll see less emphasis on "epic" games that take alot of programming, and more focus on pick-up-and-play games.

Although, Sports games will keep the industry going forever.
 
[quote name='BigNick']An online only console would be sweet. What would that do for B&M stores though? If you just downloaded the games, what would stores do about trade ins? Wow, no more EB or gamestop! Then you would definately go out of business.[/quote]

Ever hear of the Phantom?
 
Another piece of my 2-cents, and one that people in this thread have actually added to again and again, is that the market is not going to crash. What'll happen is the guys who make the good games WILL come out on top.

You are all saying you'll go out and spend the $50 on the bigger titles (Halo 2, Doom 3, HL2...) as well as the proven developers (Bioware, Blizzard, Nintendo). These guys will live, and with them, the market will eventually stabilize. Those who make crap games won't be able to anymore (I dare you to find many developers who actually make a second or third title...the ratio of successful devs to failed devs has to be 5-1 or greater).

Quality will win out. However, we, as consumers, will choose what happens. You need to support the things you like and want to see. If you wait for the $20 pricepoint on a title, the industry sees that it isn't a viable situation to release titles like that. Money talks, quality talks.

Again, this is a correction that is well overdue. The company I work for has actually started the "quality over quantity" process over a year ago to great results. It'll shift itself out in the end.
 
Well, I'd buy an online console. Then I wouldn't have some dumbass 3rd key overconfident manager tell me "even though we opened the game, took it home, tried it out, and put it in a paper sleeve after putting our store stickers all over the case, its still new". The game merchant industry is a sick, convoluted, selfish and corrupt thing, and seeing them go down would get me off quicker than a Russian porn star.

Then off to the credit bureaus..... muahahahaha
 
[quote name='PittsburghAfterDark']There are too many holes in your theory of a crash and trying to mirror it to 1984. First, game companies are reporting profits and turnarounds. Namco and Square Enix both posted good numbers this week. Midway is in a turnaround and viewed as a hot stock right now. Ubisoft is churning out profits despite the crashes of XIII and BG&E, the Clancy license has proved to be a license to print money. Nintendo is still making money and it's "losses" last year were reportedly due to bad exchange rates. Capcom, Sega and Konami... all profitable. Do I really need to tell you how big EA is??? EB Games posted a 23% increases in sales for 1st quarter year to year despite not having something equivilent of the GBA SP or Zelda: The WindWaker like they did in 2003. How can they be posting that kind of increase with no console or single major title for the quarter if the market is going to bust?

The 1984 crash was precipitated by the home market, not the arcade market. There were a number of factors that caused the crash that will not be repeated.

1. There is not an oversaturation of product. In 1984 you had numerous companies that no one heard of making games for just one console, the Atari 2600. The third party support was not spread out evenly between the Intellivision or ColecoVision and the concentration of games on the 2600 led to a 300% oversaturation of how many games were sold the previous year.

2. You had incredible, nay, colossial disappointments in Pac Man and E.T. they just plain sucked. However not only did they suck, Atari made more Pac Man games then there were 2600's. Now, let's put that in perspective. If there are 30 million PS2's in the U.S. can you imagine Rockstar making 35 million Gran Theft Auto: San Andreas'? No, you can't. Can you imagine them spending $23 to make each of those 35 million games? No, you can't. Can you imagine them releasing that game and having it suck? No, you can't.

3. 1984 in hindsight should have been a transitional year for consoles. We should have been going from the 2600 to the NES like they were in Japan. Instead Atari had no equivilent generational jump in the pipeline. The Atari 5200 was not a generational jump. It was nothing more than the Atari 400/800 computer chipset put in a box without a keyboard, that chipset was designed in 1978. It wasn't a leap. Coleco didn't have the marketshare or gaming library to force a jump with ColecoVision, ditto Intellivision.

I could go on and on with this but the bottom line is while your business may be sucking the market is in fine shape. Best Buy may be selling $5 games but you know what? They're making money too.[/quote]

I will state again that the crash is more on the supply retail end which was a huge factor for the overall crash of 84. Many places like Sears took a HUGE beating and lots of places went under or at the least stopped selling games. Back then you could return games to the manufacturer or get mark down money. Because of Nintendo this is no longer true. So the loss goes to the retailer. While you are correct that many game publishers are reporting good numbers..those numbers are from some months ago. I am reporting a crash that started 3 weeks ago and is in it's course NOW. It has NOT bottomed out here. While you may think that just because my 1 store is doing poorly that it doesnt reflect the overall market...YOU ARE WRONG. I have many other friends within the industry who report the same thing. It's bad in MANY places in MANY parts of the country.

While there is no one pac-man or ET that doesnt mean there isnt about to be one. Also I don't expect this crash to be the same just similar. I think that overall more games will be produced. What if there are 10 million xbox units in circulation...over the next 6 months there may be in total 50 million games produced. So what if each user only buys 2 games and not 5 over the next 6 months...seems like the same results to me.

As other users are pointing out. Who has the money to buy all the games? Especially at $50. So if no one (or at least only a small percentage) of gamers only buy games at $50 then how will they make money? How will retailers make money. If retailers go under then a break in the supply chain happens and a crash ensues. Which is EXACTLY where we are right now except you don't see it.
 
Maybe the real crash isn't the video game market but the smaller retailors. I bet the internet is a big factor in your shops problem. Most shoppers like to do price comparision shopping. Would you rather spend hours driving around your city or take 3 minutes to check 6 retailors online to see where the best deal is. I know what my choice is. it is also a way for most people to dodge having to pay taxes. i know I personally only go into stores to look at their used games selection and to see if a dumb clerk lowered the game too much. I kind of see the internet acting like Walmart in this instance shoving the little shops aside. Although I do truly believe the game business is not running smoothly
 
Boy, would I pay to beat down the top execs in this industry from all aspects (from development to distribution to retail) with a crowbar.. and make them watch this whole incredible message board drama unravel as it is at this very moment. They could learn a thing or two
 
[quote name='evilmax17']Ever hear of the Phantom?[/quote]

That has yet to be proven - and I don't think anyone will really take to the Phantom.
 
A small-scale crash wouldnt hurt me as a consumer too bad at all. I've stacked up on about 15 cheap games that I haven't really spent any time with already. On top of that reduced price games would fuel my library even more. It's sad too that about 14/15 of those games are really fun and great to play while still having ratings of +80%. I feel for the VGD franchise but that's just how the dice are rolled and it's how the world turns. Evolution is the basis for all innovation.
 
[quote name='evilmax17'][quote name='BigNick']An online only console would be sweet. What would that do for B&M stores though? If you just downloaded the games, what would stores do about trade ins? Wow, no more EB or gamestop! Then you would definately go out of business.[/quote]

Ever hear of the Phantom?[/quote]

Thats a computer. I hate gaming with a mouse and kb. Plus I doubt they will be able to break into the market with a lot of impact. For them timng would be everything. If a retail crash happened, then they launched, they could survive.....
 
[quote name='Skylander7']And now, for a different take on things. Sorry for the long post guys, but I'm tired of seeing conspiracy theories and fanboys freaking out (not saying that anybody here did that, its just a common occurance nowadays).

We are nowhere near a crash. However, for some of us nostalgic gamers, our time has just about passed. Let me explain. The Best Buy sale is the result of the Christmas flood. The market was flooded with so many games, yet developers failed to realize that their most profitable market (the casual gamer) spends millions on blockbuster games (such as GTA, Halo, Zelda, Ratchet and Clank 2, Madden, etc) instead of reading reviews; whereas the hardcore gamer who buys those off the wall and unconventional great games makes up 15-20% of the market.

The problem with the video game business is exactly that: It's a business. It's the same reason why you'll likely never see a Chrono Trigger sequel, RPG's without the Final Fantasy name never sell in great numbers, or people don't play Deus Ex Invisible Wars on a console instead of Halo. Its now a full blown entertainment medium, surpassing even the movie industry now in scope and reach. Therefore, companies follow tried and proven success formulas (just as in the movie industry following the "Franchise formula", EA follows the same creed). You will always see a few interesting and innovative games, such as Beyond Good and Evil, Disgaea, Panzer Dragoon, etc. But they won't sell many units except to the hardcore gamer (and then usually only when it drops drastically in price, because the hardcore gamer sees the good games and thus can't afford to buy EVERY game they want). Sadly, the only way that good story and gameplay elements from these outstanding games live is when they are implemented in those larger blockbuster overhyped games that have a greater impact on the market).

Don't believe me? I'm willing to bet that some of you thought that "summons" were this huge monumental groundbreaking event in gaming. To us older guys, they were called Espers in Final Fantasy 6 (III). Our how four player co-op games are a miracle (Ninja Turtles: The Arcade Game. Didn't do it first, but was really successful). So don't think this is an '84 crash waiting to happen. This is a transition period. Sadly, it means fewer fresh ideas, and rehashing of the same ole shit. And even though when you average the price of packaging, marketing, production, development, etc, a game still probably still only averages out to 19.99 per game to make. You expect me to actually believe that a game is $44.00 at cost? It isn't, and that's why this site is here[/quote]

How old are you? You call yourself an older gamer but the average age of a gamer is 28. I bet you are younger than that. Older gamers should be about 35. Also I said cost on games is about $42. If you want I can take a scan and post it here for you.

As for fanboys freaking out...wtf are you talking about. No one is freaking out. The game market crashing isnt even close to being the end of the world. As a matter of fact I am glad it's crashing because maybe then some good changes can occur...like quality over quantity. The crash only means that many people will lose money. Gamers in general will totally make out with all the coming discounts but there may be a lull in good games as people who lost money scramble to figure out what to do. In 1985 you could still buy games. Games were still made. Gamers still bought them. But the market suckes ass and lots of business owners lost money. This is exactly what is happening NOW.

This isnt fucking rocket science or a fucking theory. It just takes someone with the proper perspective to see it and to point it out. In a year from now when this thread is here and I we look back you nay sayers will have to kiss my ass and say how you were so wrong. You may even try to edit your ignorant posts.

Sorry for getting so aggro but it's getting late and this thread is getting long.

:) I say everything with the nicest of intentions so don't feel the need to flame me.
 
and yes B&M retailing is in trouble for media entertainment as games are sold online, dvds are sold at tremendously low margins, and music is simple pirated....

but think of this...online retailer may be the future but while a crash is ensuing everyone with inventory scrambles to sell it because in a heartbeat it can be worthless...so how many copies of the new X game do I buy? All those Ebayers and mom and pop sellers like myself are finding out fast that our once valuable inventory is totally worthless...

I estimate the best buy sale alone has cost me as much as $2000 in list revenue. Anyone who wanted to get freedom fighters just got it at a third of my costs. How can I sell whatever I have in hand now? I sent the Best Buy sale to all my wholesalers and they practically shitted themselves. The pain of having thousands of dollars in inventory that just went to shit because BB decided to move first to ditch out. How can anyone respond to that sale other than to also match and discount? That list of $4.99 games was immense and many of those games were good too and recent.

This is just really bad for those who have a financial stake in gaming...for those that are gamers...this has a positive effect as they can get games cheap and the games that will come out will either be better product or quickly reduced.
 
Also while this best buy sale is happening my site isnt selling squat as anyone with a car and a $10 bill is running to BB.

It's just a chain reaction that's been building up for some time now.
 
Defender, I'm not flaming you, but you can't put up a post that provides your speculative opinion and not expect to get some feedback that doesn't agree with what you are saying. There had to be some people who had a differing opinion, and they wanted to post theirs too. I can understand your frustration with what is happening to your business, but to say that every one is gonna be kissing your ass if they are proven wrong simply doesn't sound like the same person that started this thread. The rest of CAG and I love having someone here who is directly involved in the sale and distribution of games. I don't believe that retail employees (myself included) can provide the same pespective taht you can provide. But that doesn't make you correct by default about this situation. I know you are a good, hard working person who is seeing the fruits of his labor being squandered, but try not to throw hate around. That simply isn't Defender.
 
Like I said I was just ranting....

but it's NOT just my perspective...I have conversations with plenty of people in the same situation as me.

If you bought a game that on the 3rd level started to skip and then you had 3 friends who had the same thing then when you went to the store and the person at the counter said it was just your disc that had a problem and there isnt any bug would you believe them???

None of you know what I know.
 
[quote name='punqsux'][quote name='Ledhed'] try not to throw hate around. That simply isn't Defender.[/quote]

actully, that sounds like him :wink:[/quote]

lol punqsux...you been around long enough to know! I am a hater but I keep it in check here at the site. I got a fucking bad attitude most of the time. I didnt start a magazine named Foul for nothing.
 
Whether or not a crash is imminent I have no idea but one thing is certain, I have not myself purchased a videogame for full retail price since, I think, Final Fantasy VII or Castlevania:SotN, I don't remember which came later. The fact is, 85 percent of the games I might be interested in WILL get reduced at some point. I received Final Fantasy X-2 for X-Mas, when it was still at the $49.99 price point. I might have bought it then just because I was eager but I knew that eventually it would go down.

Speaking of which, didn't it take like a whole year or more for Final Fantasy X to drop to 39.99? It's only been like six and a half months and X-2's dropped. Soul Caliber II, a brilliant game, can now be bought for $19.99, and we're getting swamped with great deals like the Best Buy and Circuit City deal of yore. Great for buyers, yes, but it's not like game manufacturers will keep pumping out games if they're confident that they'll only end up losing money in the process. They'll say screw it and go home.

And, really, the market is starting to overload. Three major systems, Apextreme, Phantom (which will never come out but still), Gameboy Adv. SP,Nintendo DS, PSP, NGage OD or whatever the hell it's called, it's just too much and the industry just won't be able to support all of these fat, sweaty, pimply faced game companies.

Aw well, smoke 'em if you got 'em.
 
If innovation and better gameplay is the result of a minor videogame market crash then I hope it happens. I just hope that small mom and pop stores like Defender's store are still around after something like that.
 
I don't think the industry is going to crash since it's much too profit worthy for the gaming companies (which is why many lousy titles make it to the stores). Individual developers (and retailers) may and will fold over time, but the big players will continue to make money. The problems are the cost of games and the increased number of stores selling them.

Games are expensive, and gamers will try to get the best price. This explains CAG's popularity. Because of these prices gamers can only afford to buy so many games at one time, and with so much retail competition only one store will recieve the money. I've purchased games from EB, Gamestop, Target, Best Buy, Circuit City, Wal-Mart, EA.com, Toys R Us, amazon, and many others in the past six months or so. Those with the lowest price will get my business.

When retailers such as videogamedeals.com are spending more of their available resources for games and Best Buy drops the price for a game, the small guy is going to lose since they likely can't afford the same move without losing a lot more money. Customers will go for the cheapest price (this site is probably the best example of this). The gaming companies aren't suffering from this competition, the retailers are.

I'm sorry you're having difficulties with your store defender. Hopefully things will turn around.
 
[quote name='Kaijufan']If innovation and better gameplay is the result of a minor videogame market crash then I hope it happens. I just hope that small mom and pop stores like Defender's store are still around after something like that.[/quote]

If we truly want to see this happen, then we should be boycotting budgetware and purchasing games that actually try to bring something new to the table (cough, BG&E, Ico, Rez, cough). My biggest wish is that companies like Acclaim who do nothing but jump on everybandwagon that occurs in gaming go down in flames, and leave it to companies that already know what they are doing and to new developers who are here for love and respect, not money.

So next time you are at Target browsing their markdowns and you see a Mom pick up a game that YOU KNOW is total crap, for God's sake tell her. This is the only way anyone at our level can show publishers what we want. Too often I see posts here where someone talks about how lame a game is, only to say that if it was cheap enough they would buy it. I know this is CAG, but have some standards for what you buy. If all you are gonna do is put it in your 'waiting to play' pile, then maybe you shouldn't buy it. No matter how cheap it is, it is still a waste of money if you either don't play it or if you don't wanna play it.
 
Im not for long posts so ill try an make this short.....

the 3 console game war has repeated itself over and over, and has only once resulted in a industry crash.

the main reason retailers lose money is that good games reduce their price too quickly. ex. PGR2 should've stayed at $50. people woulda still bought it and they coulda made more money off it. If games stayed at their original price longer (like halo), they could make alot of money if they're good.

Console have to wisen up on who they let produce games for a system. Microsoft eliminated competition between the ps2 and xbox rally racing by buying over collin mcrae rally. That ended up hurting them. The game started selling for $20 when it came out. It also came out earlier than rallisport challenge 2. If someone wants to try put a rally raceing game, they will obviously go for the 20$ game. Also, people who are ralli enthusiasts will jump at collin mcrae because it came out first. Most of these people probably wont but rallisport challenge 2 until it drops in price because they will have a game to play in the meantime.

Out of the three systems, PS2 is the worst hardware wise. Gamecube is the worst games wise, and Xbox is the worst fan-based wise. Most people own a ps2 because it came out earlier. People dont notice that 99% of ps2 games have a game of equal or better quality on Xbox. Example:
Socom 2------RainbowSix3
If people could see this, Xbox would dominate, PS2 wouldnt be flooding the market, and it wouldnt be in the state it is in now.

People may try to blame gamecube for all this since it started selling $100 cheaper than the two consoles, but this actually helped the industry. People who want to get into videogames, like children and others, arent going to spend $300 for something they dont even know if they'll like. Alot of people bought gamecubes, and liked the videogaming experience, then bought a new system afterwards.

One very clutch factor is the games. Everyone talks about the crap games messin up the industry, which is tru, but the lack of good games also kills the industry. Someone said it b4, halo2 and gt4 are the only games that people are really looking forward to FOR THE REST OF THE YEAR. Obviously, if any other games come out that they like a little, they will wait for the game to drop in price and then buy it.

And lastly, and i kno everyone'll hate me for this, sites like this that post cheap game deals also hurt the industry. If people didnt kno that a game was on sale at a certain store and they really wanted the game, they would buy it for full price. The stroe they bought it from would profit, and the store that had the sale would also probably profit, because they may end up selling the game for regular price.
 
[quote name='Kaijufan']
So next time you are at Target browsing their markdowns and you see a Mom pick up a game that YOU KNOW is total crap, for God's sake tell her. This is the only way anyone at our level can show publishers what we want.[/quote]

I've seen others in stores do this and it usually doesn't work. One time a Wal-Mart employee was pleading to a mom to buy a better game (no lie) that was $3 more. She thought about it for a second went with the cheap game anyway. Parents will buy whatever is cheapest since they usually have no gaming knowledge and think a game is a game. I've offered advice before, and rarely does it work. They usually just pick up another cheap, lousy game, say "thanks" and walk off. ](*,)
 
[quote name='Ledhed'][quote name='Kaijufan']If innovation and better gameplay is the result of a minor videogame market crash then I hope it happens. I just hope that small mom and pop stores like Defender's store are still around after something like that.[/quote]

If we truly want to see this happen, then we should be boycotting budgetware and purchasing games that actually try to bring something new to the table (cough, BG&E, Ico, Rez, cough). My biggest wish is that companies like Acclaim who do nothing but jump on everybandwagon that occurs in gaming go down in flames, and leave it to companies that already know what they are doing and to new developers who are here for love and respect, not money.

So next time you are at Target browsing their markdowns and you see a Mom pick up a game that YOU KNOW is total crap, for God's sake tell her. This is the only way anyone at our level can show publishers what we want. Too often I see posts here where someone talks about how lame a game is, only to say that if it was cheap enough they would buy it. I know this is CAG, but have some standards for what you buy. If all you are gonna do is put it in your 'waiting to play' pile, then maybe you shouldn't buy it. No matter how cheap it is, it is still a waste of money if you either don't play it or if you don't wanna play it.[/quote]

This is why I didn't but Wolverine's Revenge, Spongebob, or most of the other Best Buy deals - no matter how cheap, crap is crap.
 
[quote name='Hunter55']
the 3 console game war has repeated itself over and over, and has only once resulted in a industry crash.

Everyone talks about the crap games messin up the industry, which is tru, but the lack of good games also kills the industry. Someone said it b4, halo2 and gt4 are the only games that people are really looking forward to FOR THE REST OF THE YEAR.
[/quote]

When was the last time 3 consoles were competing for market share like they are now? I certainly can't think of anytime but now and the early '80s when systems had been released in such a small time frame and were still competing well with each other after three years of their release.

As for more quality games, we do see plenty of quality games released each year. Unfortunately, they get completely eclipsed by bigger titles and budgetware. This is why PoP and BG&E didn't do well, and both of those games were touted as GOTY by mayn publications.
 
hunter any credibility you had went out the window when you said "Gamecube is the worst games wise". xbox has it's problems gamewise too. both are notorious for having a lack of rpgs. and i could go on about microsoft but i won't because i don't care. my xbox will still be colleting dust until i sell it or halo2 comes out.
 
To get away from the whole is it crashing/is it not debate I'll go on record with this contribution. More than anything the U.S. market is becoming more like the Japanese market in its pricing structure. Japanese sales charts are weekly, not mothly like the NPD data. A game over there gets 70% of its sales (An example.) in the first 6 weeks and 6 months later that same game is 1,990 yen as opposed to 4,990 yen. Yet no one thinks the market is crashing in Japan. This has been true there since they started selling games on CD.

It no longer costs $24-30 dollars to physically make a large ROM game like in the 16 bit and 64 bit Nintendo systems. You can print a DVD game and the printing costs of the booklet and cover for $5. $7 for a license fee to MS, Sony, Nintendo. Why do you think makers can put out games with modest development costs at $19.99 or 29.99?

So gaming stops working at an independent retailer level. The same thing happened with movie rentals nearly 10 years ago. EB and Gamestop realized what you're realizing now years and years ago. That's why they are admittedly used game stores now.

Last but not least, your analogy with Sears having tons of inventory in the crash? Everybody did. Penney's, Sears, Children's Palace, Circus World etc. some of them aren't around anymore but that's not due to Atari or the crash. Everyone bought into the belief that 20 cartridge makers could have 5% of the market share despite there only being three worth a damn, Atari, Activision and Imagic. Everyone bought into the idea of 30% annual growth, that lead to those huge inventories. No such scenario exists today.

You don't hear Best Buy, CC, EB, Gamestop, Wal Mart and every player in the retailing sector saying "Buy 10,000,000 Halo 2's! because there are going to be 40,000,000 sold this holiday season and we want a 25% share!" This is the kind of stuff that was going on in 1984. That isn't happening now.

Like I said, I feel for anyone whose business is doing poorly but this is not a bust or doomsday scenario.
 
either games are losing quality or people are getting wiser with their money or both...........i remember paying $59.99 for many AAA N64 titles (million sellers which were the same as platinum hits were $39.99 back then)..........anyways, now i hardly even buy a game even for 30-40 bucks.......something obviously has changed with the market or my thinking has changed over the years
 
LOL, to hear some of you guys, its like chicken little. The sky is not falling. It is summer. Summer has ALWAYS been slow months in the industry. Only when the developers want to push something out that they KNOW will be a hit, will they do it in summer (i.e. wind waker, gba sp). Do I think it is smart to hold releases until christmas? Not for things like Halo 2 and res evil 4. Put it out today and it will sell just as many copies from now til christmas as it would being release in Nov. I think MS is trying to use it to suck up the dollars that might have been spent on games for other consoles during 4th qtr. This causes good games like beyong Good and evil to get lost in the shuffle.

Is it a little slow right now? Yeah. Will it get better? Sure. Places like EB and GameStop, unless something really crappy happens, will not go out of business. The business model isnt supported by new sales. I mean, take fight night for example. It is bought for around $40 wholesale and sold for 50. No margin. Its all about the used. Thats where money is at.

When you see BestBuy clearing games out at $5, dont think of it as a total loss. Someone is paid big money to sit there and do the math of how many copies they sold at full price, and how much can they discount certain games just to get rid of them, and come nowhere close to a lose. Not to mention, even though there were a lot of titles cleared out at BB, I hit the stores sunday monday and today, and there was nothing there. I dont think every store had every title in stock, and then they didnt have them in huge quantity. The BB employees at each store told me they only ahve a few of a few titles to mark down. It wasnt as big of a hit as you guys think. it isnt a last minute cash grab to get out of video games. No matter what they lose, they can make up by selling a tv or refridgerator.

What IS occuring is the end of the life cycle for this generation of game consoles. Prices will start to drop by the end of the year. New games will start coming out at $40 by years end. Retailers are just dumping slow moving skus and getting ready for the new stuff. Think it sounds funny? Its not. Today I am making plans and moving merchandise and preparing my store for what is to come out a year from now. You cant wait til the last minute.



:shock: Looks to be my longest post yet... :p
 
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