On the morning of Thursday, February 19, a crudely printed piece of paper stuck on the entrance of the Yonge and Dundas HMV shouted STREET FIGHTER IV NOW IN STOCK. The following Monday, copies of the game for the Sony Playstation 3 are sold out across the city. It would be weeks before the stock caught up with the demand.
Is this the face of an industry mired in the global recession?
In terms of raw sales numbers, video gaming has shrugged off the recession with ease. The top titles on the worldwide sales charts are spewing out copies faster than American Idol seasons. The Xbox 360 and Playstation 3 versions of Resident Evil 5 have sold 1,771,478 copies combined in their first two weeks on store shelves.
Similarly, Nintendo’s Wii Fit, which has been available for just under a year in North America, has sold a total of 7.35 million copies in the continent (17.89 million worldwide) as of April 2009. It sold more than 1.6 million copies in its first week alone.
As far as the games themselves are concerned, then, gaming seems recession-resistant. But when one talks about an industry, the product is only one component. Along with it comes the games’ developers, their studios, the larger publishers that have the money to back up many of their projects, the gaming press, and the buying habits of consumers themselves.
The result is a complex tale with positive and negative stories aplenty.
Tristan Douglas is the ad-hoc games manager at the HMV store at Yonge and Dundas. He’s seen the gaming market grow and mature in the past few years, with consoles and titles attracting a wider audience. “About ten to 15 years ago, [the main gaming demographic was] male gamers; there weren’t too many female games, older gamers, and fewer younger games, too. It was mostly the teenage to mid-twenties group that played games. But now ... there’s so much out there.”
The games section at HMV features Playstation 3 consoles that play Blu-Ray discs for the HD film and gaming crowd. X-box Live is still a cultural giant among youths and young adults – just ask rapper Soulja Boy. And any day of the week, mothers will be roaming the aisles with their children, alongside the typical male demographic, looking for a fun time with a new Nintendo Wii or DS title (which are also often ten dollars cheaper than 360 or PS3 games).
This maturing clientele is the medium’s new-found strength. “I think if this recession happened, say 15 years ago,” says Douglas, “I think there would be a much greater impact on the games industry.”
Venturebeat.com recently interviewed Bob Mckenzie, senior vice president of marketing at Gamestop, North America’s leading video game specialty retailer (owner of both Gamestop and familiar-to-Canadians EB Games chains). He linked the company’s current growth to the general robust form of entertainment.
“As people kind of hunkered down and started staying home more, they obviously were looking for entertainment options, and gaming is a good alternative for them.”
After all, a video game can provide roughly the same experience whether hooked up to a typical television in the family room, or as part of a massive multimedia home entertainment system. Many enjoy the former arrangement, as evidenced by interviews with some local cash-strapped university students who spend much of their free time with a controller in their hands (see related slideshow for the interview).
Business is business, though, and on that side of the equation cuts have been made, similar to those in other industries. In February, publisher THQ shed 600 jobs, or roughly 24 per cent of its workforce. Publisher giant Electronic Arts, owner of the cash cow Madden NHL licence among others, lost approximately $310 million (US) in its second fiscal quarter of 2008, and as of February 2009 let go of 11 per cent of its workforce, about 1,100 people.
Despite these grim figures, the losses at major developers are not the end of the story for many of the former employees. Former EA game designer Jason Alejandre formed his own independent development group, Game Mechanic Studio. In an interview with gaming blog Joystiq, Alejandre noted the current series of layoffs are “a combination of this is just how the business is, and the other part is due to the current economic crisis. This is our industry.”
The prospect of starting a new company in a climate surrounded by doomsayers is sketchy, something Alejandre admitted. "It is indeed a crazy time in the industry, but the truth is we wouldn't be making games if we weren't a little bit crazy to begin with," says Bill Jackson, of Bonfire Studios. Bonfire was one of two independent studios that formed in the wake of Microsoft’s closure of its Ensemble Studios developer group.
The gaming press has undergone shrinkage and transformations as well. Video game magazines face fates similar to their print newspaper cousins. In January 2009, the online media network UGO Entertainment bought gaming website 1up.com and all its subsidiaries, including Electronic Gaming Monthly Magazine, a 20 year-old staple among gamers.
While EGM’s death throes echoed throughout gaming forums and Twitter posts for weeks, magazine editor-in-chief Dan Hsu followed a path similar to others in the industry. Along with fellow 1up.com castaway Crispin Boyer, Hsu started sorethumbs.blog. The two are currently working behind-the-scenes on a new full-on website tentatively named bitmob.com.