Whenever there is an economic downturn, investors often turn to safe havens to protect their earnings. These are typically industries such as consumer staples and, most often, includes things like tobacco or liquor firms. And the question always arises during these times: Are video games a safe-haven investment?
Well, if 2020 is any guide, it would seem so because this year is going down in the books as one of record-breaking revenues for the industry.
The major concern is whether or not this will continue as life returns to normal.
Many analysts think that this trend will continue, if not accelerate, in the coming years as gaming is normalized as a form of entertainment and as an alternative choice to streaming television, music, or movies.
Nielsen’s analysis firm SuperData backs this up, citing the willingness of consumers to invest in expensive new hardware even as the economy itself is relatively unstable.
“Even in this economic state, we see a lot of people willing to put down $500 for a new console…We don’t foresee anything sort of gaming crash due to economic factors because there are a lot of people stuck at home, shifting discretionary spending into gaming,” said SuperData’s Carter Rogers to CNN.
What makes all of this even more impressive is the fact that 2020 also witnessed some major failures in the industry. Besides the titular Cyberpunk 2077 that has called hype culture, gaming reviews, and everything else into question, massive failures such as Microsoft’s Twitch challenger Mixer and Amazon’s clumsy attempts at making a video game stand out not just because of who backed them but also due to the amount of money seemingly set on fire with those projects.
Oddly, one player that had failed to make much of a case for its existence, Stadia, is seeing renewed industry exactly because of Cyberpunk 2077’s failures on current consoles. The game not only runs well on Stadia, it looks spectacular. True, the Stadia didn’t roar out of the gates the way everyone expected it would (or at least hoped), its performance with 2020’s most hyped game is noteworthy.
The problem is whether or not Google will tough it out or cut and run just as it is getting good.
They seem to be aware of this very wariness on the part of gamers, too.
Stadia games director Jack Buser told CNN: “The games business is a tough business… There’s a reason why there hasn’t been a major new entrant into the gaming space since the Xbox in the early 2000s….Have we made mistakes? Absolutely. Have we learned from those mistakes? Absolutely. Will we make mistakes in the future? I’m sure we will. Right. And that’s part of what it means to be in this business. But one thing is for sure: we are committed to it.”
One thing that is really promising about Stadia, especially in light of the Cyberpunk debacle, is that it truly offers developers an almost unlimited amount of processing power to put their dream to silicon. It will be interesting to see where the cards fall for it moving forward.
What do you think the new console generation is going to be like? What are some things that you are looking forward to in the near future? Where do you see VR landing? Let us know your thoughts in the comments.
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