Financial Crisis Puts The Squeeze On Small Publishers

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Posted October 30, 2008 - By r_pad

In an interview with Gamasutra, Lazard Capital Markets analyst Colin Sebastian says that the global economic crisis will impact small publishers. The interview did not state how many days and dollars of manpower were used to make this profound prognosis. Sebastian claims:

"We interpret this trend to suggest that the core market remains healthy, while more casual/mass market consumers are spending more cautiously or waiting to make purchases closer to the holidays. Naturally those titles selling particularly well will receive reorders. In contrast, there will be incremental pressure on smaller publishers as well as moderate or weaker-selling software." 

In other words, casual gamers are likely to spend less and established franchises are expected to reign. The analysis is good news for giant publishers like EA and Activision, as well as established franchises like Madden, Gears of War, Guitar Hero, and more. Sebastian suggest that niche titles released by smaller publishers are in jeopardy. Gamers wishing that their favorite boutique publisher will bring over an obscure role-playing game from Japan might be out of luck.

At the start of the financial crisis, numerous analysts claimed that the gaming industry was recession proof. These claims were hasty and shortsighted or based on the assumption that conditions would not get as bad as they currently are. Of course gaming was going to feel the pinch, eventually. Not to get all gloomy and doomy on you, but it wouldn't be the least bit surprising if even large publishers underperform. Money just isn't flowing like it used to and as awesome as videogames are, they're a luxury, not a necessity.


Tags: Videogames
Financial Crisis Puts The Squeeze On Small Publishers


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