Saturday, January 28, 2023
HomeTechGaming industry is booming, but also struggling to develop new titles

Gaming industry is booming, but also struggling to develop new titles

Shares in some game makers like Nintendo Co. have trended upward over the past week alongside a steep increase in playtime with government-ordered lockdowns around the world.

Text Size:

Tokyo/Hong Kong/Portland: Gaming is experiencing an unprecedented boom right now, but behind the scenes, the coronavirus pandemic is hitting the $150 billion industry in subtle yet significant ways — delaying crucial development, squeezing out smaller studios and disrupting the pipeline of new games heading into 2021.

As with other sectors, Covid-19 has cleared the 2020 calendar by torpedoing marquee events like the Game Developers Conference this month and the biggest of them all, E3, in the summer. The litany of cancellations is especially painful for a business that, like the film industry, relies on flashy annual gatherings to launch big-name titles, connect publishers with creators and raise the profile of indie studios aspiring to become the next Rockstar Games.

​Shares in some game makers like Nintendo Co. have trended upward over the past week alongside a steep increase in playtime with government-ordered lockdowns around the world. But David Amador, who runs a one-man operation called Upfall Studios out of Lisbon, has a different perspective.

“Despite the technology and communication channels at our disposal, nothing really beats the face-to-face meeting,” Amador said. “It’s an increasingly challenging market and being able to talk to customers in a casual environment and having them play our games helps a lot.”

A serendipitous encounter two years ago at Gamescom, Europe’s premier gaming showcase, secured Amador a license to develop for the Nintendo Switch platform, he said. Missing events like the postponed Nordic Game Jam this year, “it’s hard to know the damage of people we won’t meet or deals not closed.” He works with freelancers when developing his games, and the trickle-down effect of missed opportunities for studios like his is a shortfall of work for designers and artists.

“For smaller publishers or indies like me, a chance conversation can lead to big things,” said Iain Garner, who runs Another Indie, a 12-person game publisher based in Taipei and the Chinese city of Xiamen. Like Amador, Garner was able to secure a much sought-after development license after meeting the right person at GDC, and his studio’s action game Sinner made it onto Microsoft Corp.’s Xbox Game Pass service after exhibiting at a crowded booth.

At a time when Valve Corp.’s Steam online gaming service is breaking records and global gaming publishers are registering increased demand due to millions of people stuck at home, the systems designed to build those companies’ future success are faltering.

One game project that Upfall Studios was doing work for has been put on hold because its developers weren’t able to demo it at GDC and haven’t yet managed to pitch it remotely. Two other developers Amador has collaborated with are also struggling to secure remote calls with publishers.

Before the coronavirus grew into a global pandemic, it was already interrupting the supply chain for game art and assets, as many big publishers rely on outsourcing to art studios in China, which was first to suffer the effects.

Super Smash Bros. creator Masahiro Sakurai wrote in industry magazine “Famitsu” last week that the release of additional content for his blockbuster series would be delayed due to the coronavirus. Private Division, a unit of Take-Two Interactive Software Inc., said last month that its Outer Worlds action role-playing game would also be late arriving on Nintendo Co.’s Switch due to the pandemic.

One major Chinese mobile game publisher had lined up a series of meetings for E3 and GDC and is now having to recreate those via much less efficient online calls, according to a person informed who asked not to be named discussing private plans. Japanese studios in particular, the person said, have insisted on meeting and signing contracts in person, pushing more projects into limbo until after virus-containment measures are relaxed.

The boss of a game studio that often produces so-called AAA titles for major publishers said that the biggest business opportunities every year were on the sidelines of trade shows. Meeting dozens of prospective clients at hotels near convention centers, developers thrash out the deals that lead to game releases months down the line, said the person, asking to remain anonymous.

Several of Japan’s leading game studios have tried and struggled with online tools for pitching remotely, according to multiple executives. The biggest problem, they said, is difficulty in establishing trust with new partners. This is having an impact on game platforms, which can’t expand libraries as fast as they’d like, publishers who have to fill mid- to long-term game release pipelines and indie developers who can’t secure business, they said. The executives asked not to be identified discussing non-public strategy.

Complicating matters, new consoles from Microsoft and Sony Corp. slated for the end of the year mean even more development work for already hard-pressed studios, said Billy Pidgeon, analyst at Go Play Research. “EA, Activision, Ubisoft and others track games on a profit/loss basis to determine whether they will be completed on time” and they don’t hesitate to cancel ones they deem to have a low chance of profitability.

For now, big publishers are assuring the public that the spread of the coronavirus disease, known as Covid-19, isn’t hampering them too badly. Ubisoft Entertainment SA said in a statement that “At the moment, the impact of COVID-19 on Ubisoft productions is minimal and has not affected our release schedule for the upcoming fiscal year.” The longer-term effects, however, are difficult to quantify.

“There’s really little visibility into that right now, given we don’t know how long this will last, how effective they can be remote and how complete games are already,” said Matthew Kanterman of Bloomberg Intelligence. –Bloomberg

Also read: Last weekend, time spent watching Netflix, Amazon spiked 20% around the world


Subscribe to our channels on YouTube & Telegram

Support Our Journalism

India needs fair, non-hyphenated and questioning journalism, packed with on-ground reporting. ThePrint – with exceptional reporters, columnists and editors – is doing just that.

Sustaining this needs support from wonderful readers like you.

Whether you live in India or overseas, you can take a paid subscription by clicking here.

Support Our Journalism

Most Popular