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The Brief - The Gaming Renaissance MovementMaking games differently - from production, to financing and distribution.
So even though the industry seems to be maintaining its position at retail, established publishers and studios are crumbling under the weight of swollen overhead and development costs. Development costs for current generation consoles have ballooned to $15-$25 million for two platform SKUs and $25-$30 million for all SKUs. That is twice as much as the last generation of consoles, with much of the cost increases attributable to the graphics complexity of consoles themselves.
When companies are faced with mounting market pressure the short-term strategy is to announce layoffs, which is precisely what many game companies have done. EA estimates they will save $120 million with their layoffs. From July 2008 until now there have been over 60 companies that have publicly announced layoffs, with the majority of these layoffs coming just in the past four months.
I have tallied up these figures and a staggering 8450 game industry professionals have been laid off since July. Of these, roughly 6300 or 75% are from North America, with the remainder coming from the UK and Asia. Game Developer Research's latest Game Developer Census 2008 Report published November 2008 estimated the North American gaming workforce to be 53,900. That puts the current game industry layoffs in the North American at 12% of the total workforce.
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The Gaming Renaissance Movement