Disclaimer: This is a bad news bear piece. If you're feeling rough, have a coffee and skip this one.

I have spent almost 20 professional years in what I would call the premium gaming market but now almost weekly I hear of layoffs and survive till ‘25 so what does our future look like?

Last week I was at GodotCon in Germany which was a great time but a moment to reflect on the shape and scale of the industry. I will likely write about it at some point but I think often we don’t look outside our little bubbles. This was doubled for me by a conversation with an indie developer explaining the shape of the Russian gamedev scene being very different because for a long time you could earn more as a gamedev in Russia than a typically Russian tech worker. Which is the hilarious opposite of most countries.

This was made doubly obvious by GodotCon which is fundamentally an amateur or hobbyist convention. As I saw the sideline companies of Game Services and Browser games, I know that a lot of smaller indie style industries enjoy a lot of investment and use from the gambling or iGaming market. That is to say nothing of how different the XR market or app development is from the general humdrum.

Conclusion up front to save you time

• Premium market will contract to fewer long lived titles
  
• Indie will experience VC investment resulting in higher failure rate by percentage
  
• Services market will grow with more lower quality work
  
• Fast Development market will merge due to more standardised tech, but accelerate due to Generative AI
  
• Passion development will bring YouTubefication of Games which will reduce traditional market size
  
  

The Premium Market

This AAA and indie market is really one market. Yes we have shiny billboard titles competing for the same headspace as the Oscars but the auteur low budget and arthouse gaming sections of the market are really a complementary element to the premium price market.

Typically the same people work in both, our awards shows are similar if not the same and by and large we have claimed the crown and the public perception of Game Developers. If a casual person across the world were to think of gaming our products and lifestyle is typically what is pictured. Be it the indie bohemian artwork or the commercial behemoths.

Professional indies know how to access funding, attend events and typically have talent with some studio experience or are published and nourished by a publisher who is able to close the gap for them. So this pro independent development is called indie but shares only a surface layer resemblance with the passion project from an outsider.

As a South African who always wanted to make games I can also say that this version of the industry barely exists outside the big countries of UK, America and Japan. Yes digital markets and indie explosion have seen its growth in other countries relatively explode but the infrastructure, talent and investment are largely located and culturally based in those regions.

Likewise once you're in the industry you have been in historically, shake the right hand and ship a title or two for the right company and you are now “in the industry”. As our industry experiences arguably its biggest contraction in decades combined with international growth, I do think the walls are getting higher and the island smaller.

Future of Premium

As back catalogues of content are made into more long term investment with returns being spread over years. The importance of IP and breaking through the noise resulting in higher risk mixed small investment portfolios or giant AAA budgets to guarantee breakthroughs. I think it is a completely uncontroversial statement to say fewer people will be directly employed in the premium market in the coming years.

The Services Market

Familiar to anyone in the Hollywood or tech model this is a combination of money first and desperate to escape talent. Traditionally attached but not always to the premium market this is also historically the easiest way for the countries not in the chosen geographies to break into the premium market. Whether it is technical or artistic outsourcing or specialist service it fundamentally exists to save money.

While there is a large amount of the workforce in these companies desperate to break into the premium market the bosses and company runners are often, not always, happy to be in the service biz instead of the creative. The high risk, high return model of the premium world is not there, neither are the awards but typically their companies are more stable.

While we talk about crunch I have seen more exploitation in this workforce than any other. Either because their country or locale has more lax laws, the ‘hungry to break in’ mindset makes people more exploitable or clients dehumanising the service company results in massively unrealistic turnarounds applied to people without mercy.

Also platform holders, large publishing companies and other premium gaming entities have effective small service companies embedded within the company. Though these are typically better to work for.

Future of Services

This area is likely to see the largest growth in terms of market value but I do think the pay and quality of the jobs in this area will do a classic k shaped split with certain high skill individuals getting larger paydays more in line with tech salaries while the bulk will see salary reduction. We will also see more consolidation of these companies and a few big names will emerge to the scale of large tech giants.

Mobile and Gambling Market

While some sections of the mobile market are associated with the premium market the bulk of the market is data focused with hyper fast turnarounds. While studios do not go boom or bust as much, the games are fast and furious with soft launches in small markets and further development almost entirely driven by adoption and data trends.

If you're interested in smaller game engines or unique tech stacks this world is full with them. The margins of this world are razor thin so anything that enables fast development is welcome. The explosion of middleware has meant companies will adopt any solution for rapid iteration. Also there is little brand recognition or defendable moat so these companies often have very high turnover.

This market segment also does branded work for iGaming or Gambling markets with a low bid contract model. Some of the best indie game developers have come from this market. Minecraft, Vampire Survivors and many other titles have come from people who came from this high production rate environment.

Browser and Installation Gaming

Similar to the mobile and gambling sector this market tends to be extremely high turnover with a lot of reskins of mobile and iGaming products. Though with the middleware market getting more mature and the introduction of WebGPU the gap is narrowing between the two markets. Though it has an even higher turnover in the near future with the tools gap narrowing.

The monetisation models are the primary market difference from the mobile and iGaming segment but again we are seeing a market reduction in these companies as sectors merge.

So I consider these now both the same sector of Fast Development.

Future of Fast Development

All signs point to this market adapting to new tools and cost saving measures. This is the market in which I think we will see rapid adoption of GenAI tooling due to the cutthroat and competitive nature of the games. With consumers less likely to make motivated purchase decisions which incentivises human art or ethical business practices.

In the near future the asset flip will be swapped out for the generative model. Still with humans in the loop but the already fast cycle will accelerate to new highs making this market fully commoditized. I don’t see this market being nearly as sustainable leading to more job loss in developed countries with a bigger lean on subsidised products.

Passion and Hobbyist Development

By far the fastest growing sector and one largely ignored by professionals are the passion and hobby developers. They come from all sections of life with some dreaming of being more involved in various market segments, typically premium gaming, they usually have no industry connections or finance plan. The games are developed as side projects, part of game jams or even as a lark. Some UGC platforms like Roblox, Fortnite creative, Dreams and others try to provide ready to build playgrounds for these creators.

Light monetisation exists for this market but it is often as much secondary income like Twitch, YouTube or associated influencer work. This market is exploding with the accessibility of tools and the self publishing boom. Though the reality is the vast majority, well over 95% of these creators will never recoup their money spent let alone their time an occasional breakout success will enter the professional Indie market it is not helpful to place them in the same statistical bucket as professional independent developers. This is no value judgement on the market and some of the highest quality product and artistic expression comes from these solo and tiny teams but it is fundamentally outsider art with a very low success rate as a product.

Though it needs to be stated that most of the time these people are not in it for the money or even the acclaim. With many meme games, weekend projects and flights of fancy creating thousands of unique experiences. This leads to the bulk of titles published on Steam not recouping their $100 cover charge, though only a small percentage of these games are ever pushed to marketplaces.

Future of Passion Projects

With the explosion of easy to use tools, higher game literacy and companies able to monetise the market we have seen an exponential explosion of creative expression at a small scale. This can only encroach on the attention spent on more professional products as the YouTubification of video games continues.

Players like Roblox, Meta Horizon, and others will exploit the market with poor monetisation rates while AI tools and more powerful middleware makes a fully complete fart platformer of Mario hunting Sonic’s stepson through brain rot content even easier to produce at a high quality standard. This is mostly a positive thing for culture and expression but the industry must acknowledge we will lose some section of our market attention to these passion projects. The long term future becomes the holodeck creation of unique experiences with minimal effort.

Conclusion

The survive till ‘25 motto inherently is driven by a thought pattern that the industry will return to pre-2020 levels. Though this may not be the case and in fact all signs point to it not being. We need to acknowledge that our ever changing industry will once again transform. Much like digital distribution, certification and arcades mutated it in the past the march of accessible tools and generative tools is likely to change the game on us again.

The YouTubefication of games has arrived, the investment landscape has changed and our next decade will be unrecognisable in many ways to the last one.

Onwards games, forever changing.