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Could the Gaming Industry Be Spiraling Into Another Market Crash?

Last Updated September 23, 2020 1:38 PM
William Worrall
Last Updated September 23, 2020 1:38 PM
  • Global coronavirus panic has caused chaos in the stock market.
  • Pandemic concerns are triggering fears of another global recession.
  • We could be heading for another gaming market crash similar to what happened in 1983.

The gaming crash of 1983  changed the industry forever. It shifted the console market’s focus to Japan and caused more developers to create games for home computers. It took years for the industry to fully recover.

With the coronavirus sweeping the globe, there are some fears that another market crash could be just around the corner,  especially with gaming on the cusp of a new console generation.

Gaming Market Crash - Stock Prices EA Activision
Stocks have fallen for both Activision and EA lately, although neither has yet hit their low point. | Source: Google/CCN 

Could Coronavirus Cause Another Gaming Market Crash?

The COVID-19-causing coronavirus has been wreaking havoc on the stock market lately. The Dow Index has dropped like a rock, sending stock prices tanking along with it. It’s getting so bad that they might even stop trading altogether.

With this amount of uncertainty going around, it’s no shock that large game companies’ stocks have also taken a hit. EA is down by nearly 5%, and Blizzard Activision’s stocks aren’t looking much better.

With many game companies currently jostling for space in the industry, it seems like the perfect storm of contributing factors: oversaturation plus tanking stock prices equal potential market crash.


Could a Market Crash Even Happen These Days?

Some argue that a gaming market crash couldn’t happen again, at least not in the same way. The previous crash was caused by oversaturation and a lack of access to game information. Obviously, the internet gives everyone access to info on games instantly.

If we remove the lack of information as a factor, what else could contribute to this crash? Quite obviously microtransactions, loot boxes, and especially live services. Not that I have anything against that last one.

Gamers have grown cynical towards microtransactions. | Source: Twitter 

Microtransactions and loot boxes are bad for gamers. They’re usually sold using shady tactics, and the latter of them is practically being made illegal in numerous countries. Live services also require a constant stream of income, which could be heavily disrupted by COVID-19.

Whatever happens in the coming days, we shouldn’t kid ourselves. A new video game crash is entirely possible.

Disclaimer: The opinions expressed in this article do not necessarily reflect the views of CCN.com.