re: Is the video game industry crashing?

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but the ballooning costs of AAA games will cause some issues.

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The real issue is that the costs of nearly every game have skyrocketed. Very few developers are making low budget or smaller games (non-indie) and of those that are, they're nearly all in Japan.

We've seen the effects of it though. THQ, Midway, and Atari are the three big publishers that are gone, along with around 50 studios since the start of the generation. LINK and the 20 more gone in 2012. LINK