Armchair Speculation Pt 2

by narcogen , Andover, Massachusetts, Thursday, February 28, 2013, 23:05 (4289 days ago) @ Cody Miller

This is ludicrous even for you. This is almost certainly due to the stage we're at in the console cycle.

Nope. 100% wrong.

http://www.gamasutra.com/view/news/181343/Not_even_November_can_save_US_game_retail_now.php

Please point to a single sentence in that article that disputes my thesis. I can't find one, because there isn't one there.

If you think there is, I think you're probably misinterpreting this:

In previous generations, I believe there have been contractions in the lull before and during the launch of a sequence of new platforms. However, I don't believe that the industry has grown during a generation and then returned to its starting size at the end of that generation - until now.

It's long past the time when the industry should be asking if retail will ever rebound. It won't.

He's not denying here that there is a cycle. What he's saying is that the last cycle hasn't dropped as low as the start of the previous one before the next one starts before, but that is happening now. Also, he's talking about bricks and mortar retail, not the entire market, which he points out here:

Perhaps that is what it will finally take to encourage publishers and other outlets to begin publishing digital sales figures at least in the very modest detail we get for retail. Even if digital distribution revenue isn't keeping pace with the decline at retail, it would help soften the image of a physical market in freefall.

So the contraction in the total market may be smaller than it looks from just the retail market figures. He's not even sure that digital sales don't completely make up for the shortfall, which would mean that as far as developers and platform holders are concerned, there is no contraction-- there is only a shift from retail to digital. He can't be sure which is the case because nobody reports those figures in a way comparable to the NPD's retail figures, so there's no reliable metric for it.

(The fact that a global economic crisis intervened between the start of the last generation and this one just might be a factor, but if you think the real cause is how awesome Windows 8 is going to be for gaming, be my guest.)

In other words, it can simultaneously be true that:

A) The coming console generation might not ever reach the highest total installed base for all platforms as the previous generation-- or, more specifically, that holiday 2012 sales will not be enough to stop a multi-year decline in bricks and mortar retail sales, and that it may be possible that video game yearly sales as tracked by NPD may, at the peak of the next generation, be lower than the peak for the last generation;

and

B) PC gaming is not becoming ascendant over any of the console platforms individually, or even over all consoles in aggregate.

B) requires much, much larger shift in the market than A) does.

There is no reason to believe that an economic downturn should actually shift sales from consoles to PCs-- it will lower console sales more than PC sales, which is something different. The higher barriers to entry for the PC gaming market still exist-- more expensive hardware, more complex setup, support issues-- even while platforms like Steam try to mitigate those, but there are fundamental levels of irreducible complexity in the platform.

There is also some in that article that supports my thesis.

Looking out into the coming year it appears that the next 12 months will be just like the last 12, since Sony and Microsoft have made no public moves yet that suggest they will bring updated systems to the market any sooner than November 2013.

The clear implication there is that 2013 will be like 2012 because Sony and MS are not yet bringing new hardware to market.

In other words, that the decline over the past 2-3 years is at least in part due to the aging of the hardware, the inability of developers to make (or wish to make) compelling new content for it, the increasing price/performance gap that inevitably opens up between top of the line or even midrange gaming PCs and a platform that was designed a decade ago.

So even though he's saying the top and bottom of the cycle has shifted, he's not saying there is no cycle anymore, nor is he saying that console gaming isn't going to rebound. He is saying that retail-- which is what NPD tracks-- is not rebounding for 2012. (That was not a particularly bold a prediction when he made it because he already acknowledged there was no new hardware coming that year, and is even easier to make now, five months after the fact).

Along the axis of "the sky is falling, PC gaming is coming back, consoles are dead" a routine report of an ongoing decline in NPD brick and mortar retail sales doesn't even register.