AAA studios are struggling. Meanwhile, successful indie developers focus on faster dev cycles, innovative game design, and new tech, which could represent a better way forward for major studios.
What’s Wrong With the Indie Darling to AAA Blockbuster Pipeline
Bigger gaming studios have always been risk averse; spending hundreds of millions of dollars to make a game doesn’t incentivise investment into unproven ideas. Activision spent over $1.5 billion on three Call of Duty games leading up to the 2020 release of Black Ops Cold War: Outspending the biggest Marvel movie of all time every few years encourages major studios to favor safe bets.
Indie games, on the other hand, have always been more experimental when it comes to genre, themes, and mechanics. When they succeed, they often set the direction for future AAA releases. Games like Guacamelee and Hollow Knight (among others), for example, resurrected the long-dead Metroidvania genre. Metroidvanias’ resurgence in popularity led to Ubisoft investing millions into a Prince of Persia Metroidvania last year to broadly positive acclaim.
However, taking a good idea from a successful indie game and building a AAA version isn’t the formula for success it used to be. Despite its positive critical reception, Ubisoft’s big budget Metroidvania, Prince of Persia: The LostCrown, racked up underwhelming initial sales. Despite revenue picking up in the wake of the game’s launch, the team that made it was disbanded after a single DLC release.
This begs the question: why? The Lost Crown is a well-received game. It sold 1.3 million copies and generated an enthusiastic response from critics and fans. It wasn’t a smash hit, but by no means a failure of the Indie-Darling-to-AAA-Blockbuster pipeline.
If You’re Not GTA V, You’re Nothing
The problem lies in the bigger economic picture. Last year, the bottom fell out of a games industry that was riding high on a lockdown-driven boom. In 2022, gaming pulled in an estimated $184 billion in revenue, more than the music industry and global box office put together. However, a combination of economic hard times, slumping sales as the pandemic waned, and ballooning development costs has made the gaming industry anything but recession-proof.
Today, one misstep can spell the end of a studio. Between 2023 and 2024, the gaming industry laid off around 25,000 people. Multiple developers shut down. Making a good game with respectable sales does not guarantee success. Or even a developer’s continued existence.
