Is PC gaming dead?

Why are people purchasing more console titles than PC?

Console games, (i.e.. Sony PlayStation, Sega Dreamcast, etc.) have always been more profitable to produce. The reason is that console games appeal to a broader market. Children of all ages, including girls, make up a large part of the sales. However, adult interest is also high. How many people in their 20s or 30s do you know who own a PlayStation? For me, almost everyone I know does. So your consumer base is large and diverse, which is important for a business that can be expensive to run.

Another strength of console production is that console games are cheaper to manufacture. Generally, console packages are smaller, with less documentation and only one CD or cartridge. When I was a Financial Advisor (stockbroker), I compared the financial figures for several game makers and their products. Often times console versions of games outsold the exact same game on the PC 4 to 1. It's not hard to understand why companies would want to make more console titles.

But why do more people buy console games? One answer can be found in the kind of consumers that purchase these games. console games attract more children and casual gamers. They also generate more repeat customers. An example would be the kid who has to own every Pokemon title on the Game Boy. Generally console games contain less thought and more action. They are also easier to learn and play. Because console games are designed for the same exact platform they are also much more stable. Thus, the average gamer gets fewer negative experiences when they pop in a new game in their PlayStation. Another reason for the success is mass marketing and brand name appeal. The product gets a great amount of press and attention in the general public while seeing advertisements for PC games is sometimes rare (although we are seeing more of it today).

Today the PC game industry has become a multi-billion dollar business that is run by people that have to answer to thousands of stockholders. Stockholders don't care that you make the best games on the market, only that they are profitable and the company is dominant and growing. In response, companies are making more games that have larger consumer bases (i.e. action titles) and less games that have smaller consumer bases, like war and flight simulations. Adventure games have almost totally disappeared because of their extreme cost in production. For a good adventure game you have to hire a professional writer to do a script, you have to get good acting talent for voices or video. This and more is all on TOP of production costs for a normal game! And again generally the consumer base is small, although not as small as wargaming. Some designers would like to make adventure games, but without a large diverse audience it doesn't pay the company to take the chance.

Because game companies have become a big business, they have also started to place PC Games on the same level as console games. Before, console games were considered a separate line of business, just like a company that would make toasters and ovens. The same company may make them, but it was considered a different business. Today console and PC games are being grouped together.

Here is an example for you: Electronic Arts usually makes a new football game every year and produces it on consoles and PCs. The same people usually handle the production and thus the business is grouped together in the eyes of the company. Now, if you are the head of Electronic Arts and your brand new football game makes a 40% profit on the PlayStation but only brings in 5% on the PC, then you have a problem. Next year do you bother to make another version for the PC? Why make PC versions when you only made a 5% profit? You can cut your costs by eliminating the whole PC production line for that game and invest the remainder into a new console game. If that new console game has a similar profit then you make more money NOT MAKING PC titles, even if they are profitable.

It is no surprise that some companies have begun to ask if they can continue to afford the production costs of games that have a higher chance of failing. Game producers look at how a public might like or dislike a game and then come up with a possible failure rate. If it is too high, they may cancel the game or remove unfinished parts of the game to reduce cost. Thus some games hit the market with an unfinished feel, or outright unplayable bugs. This is a big business, and companies cannot afford to have a title in production for two years costing a million or more, only to rake in a 5% profit. As a result of the changing face of PC gaming we are seeing more and more consolidation in PC game makers. Where once there was about 7 to 10 big software houses, today we are down to about 5 to 7. (Microsoft, EA, Infogrammes, etc.)

However, the biggest reason for the low sales, in my opinion, is the price difference. For a serious gamer, buying a new PC means going down to the bank and taking out a loan. The last upgrade that I did was from a Compaq P2 350 to a Dell P3 700. The system after taxes cost around 2000.00$. That did not include my Force feedback controller or my speakers. To purchase both items you would have to shell out another 300.00$. For a brand new PlayStation 2, generally you would spend around 300.00$. Just like with computers, you can purchase both items for less if they are used or older but the price difference still holds true. For a PC you will spend on average 5 times more for your system than a person who purchases a console.

Now lets think about this for a moment. A person who takes his 2000.00$ and purchases a new Nintendo GameCube can still afford to purchase 35 NEW GAMES! The same cannot be said for PC buyers. For many people who are casual gamers or for parents who are looking to purchase their child a gaming system, there is no way they are going to shell out 2000.00$ for a PC. Also, most of the sales for consoles are made up of casual gamers. Casual gamers might buy a couple of games a year, so they are not likely going to shell out large amounts of money to purchase a new computer every two years. This is why for many people console gaming is easy and cost effective.

Continued: What's better: PCs or consoles?

Table of Contents: Is PC gaming dead?