Why do layoffs, shutdowns, and mergers happen in video games?

Today we’re talking about the state of the video game industry, and honestly, things are different. We don’t talk much about video games here DecryptionBut we should do more of it. According to the Entertainment Software Association (ESA), gaming represents a large portion of the technology and media industries here in the United States. more Last year, 212 million people played games and spent more than $47 billion on games and their content.

Many of these games were announced here in June, a big hype season for the entire video game industry We’re going to hear about a lot of really cool projects. In the next few days almost all the major playmakers will announce their squads for this year and beyond.

But behind the flashy ads and release dates lies something of a crisis: tens of thousands of workers in all sectors of the video game industry Retrenchment – Temporarily laid off From the year 2022. And this year alone it happened Strictly speaking Over 10,000 video game workers have been laid off, and we’re not even halfway through the year yet. Dozens of studios closed and countless projects ended before we even heard about it.

It seems like a dark time for the gaming industry, even as the industry of video game design is booming. Big global publishers and small independent studios alike are under this financial strain, and it doesn’t look like they’re going to stop anytime soon.

So if sales were so great, where did this tremendous pressure on the company come from? How can accounts perform so poorly when consumer and player interest is so high?

I called Rand Video game reporter Ash Parrish is on the show to break it down, tell us what’s happening in games and what these changes — from a business, cultural and labor perspective — might mean next.