Hellblade developer Ninja Theory and Psychonauts developer Double Fine are reportedly among the studios fighting to avoid closure as Microsoft makes significant cuts to its Xbox business.
But if the current giants die, new giants will arise from the existing smaller studios, no? There will always be a need for the next FIFA, F1, COD, whatever type of game, and someone will step in to fill that need if EA and the rest die, I imagine.
Yes but this is how “disaster capitalism” works, the entire industry gets burned down periodically and the result is that so much latent need for larger companies builds up that it becomes trivially easy to maintain a decisive leverage over the entire industry if you can consolidate and push out a critical threshold of competitors at the same size while running a larger company than anyone else. Well, in practice it is more likely for “cartel” structures to form where a handful of companies carve up the pie into a handful of big pieces and mostly agree to not fight over it past that.
My point is that a set of conditions are maintained at the cost of actually functional large companies that treat their workers well so that when a large company does form again in the rubble and ashes of the industry crash investors can easily and reliably pile on to establish effective capture of the industry and extract maximum profit.
But if the current giants die, new giants will arise from the existing smaller studios, no? There will always be a need for the next FIFA, F1, COD, whatever type of game, and someone will step in to fill that need if EA and the rest die, I imagine.
Yes but this is how “disaster capitalism” works, the entire industry gets burned down periodically and the result is that so much latent need for larger companies builds up that it becomes trivially easy to maintain a decisive leverage over the entire industry if you can consolidate and push out a critical threshold of competitors at the same size while running a larger company than anyone else. Well, in practice it is more likely for “cartel” structures to form where a handful of companies carve up the pie into a handful of big pieces and mostly agree to not fight over it past that.
My point is that a set of conditions are maintained at the cost of actually functional large companies that treat their workers well so that when a large company does form again in the rubble and ashes of the industry crash investors can easily and reliably pile on to establish effective capture of the industry and extract maximum profit.