With all the layoffs in the video game industry happening, a common thing I’ve seen going around is whether or not we’re in for another crash. And while I do believe that as an industry we’re heading in the wrong direction, I don’t think that a crash is imminent. However, I want to talk about what I think the issues that led to these layoffs and why a lot of the biggest companies in the industry are failing in their core job of creating games.
So if you were to take a look at some of the worst rated games of last year, an interesting trend becomes clear. Three types of games tend to appear on the list: remakes, live service and licensed games. In fact, two of the games that a lot of video game fans think are the worst (The Lord of The Rings: Gollum and Skull Island: Rise of Kong) are licensed games. And then there is The Day Before, a game that many have called a scam for various reasons. And that brings me to my first reason why games are failing, they are blatant cash grabs. When you play a video game, you’re not just looking for entertainment, you’re looking for an experience. And the three games have clearly failed on that. Compare that to what people consider the best games of last year, Baldur’s Gate 3, Legend of Zelda: Tears of the Kingdom and Metroid Prime Remastered which either have a lot of content, passion or both.
So you might be asking, if companies are making games that are critically acclaimed, why are people being let go? To answer that, we need to understand where the money actually is going and who is being let go. But before that, I want to make one thing clear. I won’t be talking about indie teams letting people go unless they have at least two hit games under their belt. The reason I’m doing that is because I believe (as an indie developer myself) is that it’s hard to stay afloat when revenue is erratic. That being said, there are three companies I want to talk about specifically, because I believe they show the biggest issue in the video game industry currently: EA, Microsoft, and Unity. If you want to see a complete breakdown of all the layoffs that have happened, then you can find it here.
1. Microsoft
Microsoft is an interesting case, because it shows us the issues that come with consolidation. With their recent acquisition of Activision Blizzard King and previous acquisitions of Mojang, Rare and Bethesda, it was becoming clear that Microsoft’s game division was becoming increasingly bloated. And with that bloat came redundancies. It would be very easy to point to the executives and say that they should take a pay cut, but in Microsoft’s case, I don’t think an executive pay cut would solve the issue that all their acquisitions created.
2. Unity
I don’t think a company has shot themselves in the foot more than Unity. From being one of the most used and respected game engines to making some of the most baffling decisions ever. Following off the controversy last year where Unity decided to change its monetization policy that led to many game developers moving their games to other engines, Unity had lost a lot of revenue. I believe it’s because of that decision that they have decided to let some of their workers go.
3. EA
A good example of how a focus on profits can lead to disastrous results, EA has gone down as one of the worst video game companies. Whether it be through their predatory loot boxes, their obsessive focus on pack openings in games like Madden and FIFA (now called EAFC), or even the constant shutting down of “under-performing” development teams. And now, EA is more focused on keeping profits up than creating a quality game.
Even though these are just my opinions on why these companies are laying off workers, I do feel like ultimately, we’re going to see a shift in consumer trends where gamers will look towards smaller and indie teams for games and support them with their wallets. And while I don’t think that the larger companies are under imminent threat of collapsing, as long as the current trend where they only focus on what makes the executives and shareholders the most money and not the actual product they’re producing, then most games will continue to under-perform. But this is just how I see it.
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