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Games industry enters a new level

It's larger than Hollywood, its virtual stars may live happily on a diet of bits and bytes, but the video games industry has not been able to insulate itself from upheaval.

Yes, gamers are snapping up the new generation of games consoles - Microsoft's Xbox 360, Nintendo's Wii, and Sony's Playstation 3 [PS3], but at huge cost to the industry.

Hardware makers are losing hundreds of dollars on every console sold, and games publishers face an "increasingly difficult environment, as rising development costs and small user bases [mean] that return on investment in next generation games development is unlikely to be achieved before 2008," according to media analysts Screen Digest.

More importantly, though, the video games publishers are facing a revolution of their business model.

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news.bbc.co.uk
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Scrumptious3786d ago (Edited 3786d ago )

"Hardware makers are losing hundreds of dollars on every console sold".

The only company losing money right now is Sony. What a "journalist" this guy is.

But the projected sales figures at the bottom are 100% correct!