Over the last three weeks, 17 million people filed a jobless claim in the United States. The country is certainly in a recession (or even a depression) — as is the rest of the world. But hey — at least video games are “recession proof,” right? That’s the line Activision chief executive officer Bobby Kotick gave investors back in 2008. But indie developer Rami Ismail doesn’t agree with that. Ismail is one half of indie studio Vlambeer, and the executive director of the online multilingual GameDev.World event. And this week he joins the How Games Make Money podcast to talk about all of that and more.
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“I don’t think games are recession-proof at all,” said Ismail.
Gaming is doing well relative to other entertainment mediums. A Nielsen report from late March found that 39% of U.S. gamers are spending more money on games than they did before the pandemic. Games provide entertainment and give players a means of socializing with friends. But Ismail doesn’t think this temporary bump as people stay at home will last.
“The first response during something like this is very good for games,” said Ismail. “But even when things are going well, studios need acquisitions [to survive]. They layoff staff when they complete a project. They shutter entire studios as publishers look for ways to cut costs. Even when the economy is strong, we aren’t healthy as an industry.”
Ismail expects many people to start cutting back on games. Customers who would have spent $60 on a new release a few weeks ago may start to treat that as an unnecessary luxury. That’s especially true when they have so many free-to-play alternatives.
“So yeah, we’ll still do good numbers,” said Ismail. “I don’t think the games industry will collapse under the recession immediately. But I definitely don’t think of this as [a good thing].”
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