Game Group Enters Administration – The Nail in the Coffin for Console and PC Games?

Today we learned that Game (The Game Group Plc), the high street computer game retailer, has gone into administration. It is feared the all stores will close within a week. Game suspended trading on 12st March 2012.

It seems that cash flow problems and investments were the main cause, with a failure to source new products from many of their suppliers. You can get a good picture of what is happening at Game from their Press Releases.

Game Plc. Press Release – Administration

“Further to our announcements of 21 March, the Board of GAME has completed its discussions with lenders and third parties without resolution, and has therefore today appointed PWC LLP to act as administrators for the Group. This decision is taken after careful consideration and ceaseless interrogation of every possible alternative. The Board would like to thank the teams of GAME and Gamestation colleagues around the world for their exemplary dedication, passion and professionalism.” – Game Group Plc.

It may be saved by RBS, although at the moment the future for Game is unclear. In fact, the entire computer games market is unclear at the moment. So much has changed in the last 30 years and it is hard to see how a high street retailer will be able to really compete against online gaming.

The Rise and Fall of Computers and Consoles

The computer games industry has been a very turbulent one indeed. Many businesses have rapidly risen only to crash and burn the moment a new technology takes over. A few, like Eidos, have managed to stay on top, but most have floundered.

There are essentially 3 ways to play “computer games” – on a PC or Mac, on a console or online. This has actually been the case for over a decade now, in fact, you could argue it has been longer – people were playing chess by email long before the first multiplayer games were written.

The Early Computer Games

ZX Spectrum 128

ZX Spectrum 128

The early innovators in the computer games industry were Sinclair, Amstrad (Sir Alan Sugar’s first success) and Commodore. These were computers, with full keyboard and operating system, on which owners could install or write computer games. The first popular games were never bought, instead computer owners would have to copy code from magazines to play them. The age of computing was just beginning.

In time businesses grew which focused on producing computer games, and like today, there were budget brands as well as the premium titles. We had Mastertronic, U.S. Gold and Code Masters on the Spectrum, for the Commodore there were Gremlin Graphics, Piranha and Bulldog Software. There was some crossover, but many houses focused on one platform, much like today.

The Consoles

At the same time consoles were also popular with the Atari dominating the market during the 1980s and 1990s. Sega and Nintendo were developing in the late 1980s and 1990s. Consoles were always a more expensive option and generally a provided family gaming experiences as a large colour television was needed to play them. Even today most consoles sit next to the DVD player under the HD flat screen. In fact, the PlayStation 3 was the most economical way for a while to have a Blu-Ray player to connect to a high-def flat screen. But back the the history of computer games.

The Atari ST – A Dedicated Games Computer

Atari 1040STF 16-bit computer

Atari 1040STF 16-bit computer

After these computers the main player quickly became the Atari ST. One popular game publisher for the Atari was Sega, who re-wrote some of their classic arcade games such as After Burner. Other big titles included Bubble Bobble by Taito and Romstar, Civilization by MicroProse, Double Dragon by Taito, Dungeon Master by FTL Games, Battle Command by Ocean Software and Starglider by Argonaut Games.

These games all marked a change in gaming style and genre. We have the simple fun platform games of Bubble Bobble, empire building in Civilization, classic beat-em-up in Double Dragon and RPG with Dungeon Master. It was from these roots that games such as Flight Simulator, Age of Empires, Age of Mythology, Mortal Kombat, World of Warcraft, and the Halo series.

Other titles are still familiar today. In 1994 Bethesda Softworks released The Elder Scrolls: Arena. Its successors, written for both PC and the XBox – Morrowind, Oblivion and Skyrim have become some of the most popular single player role-playing games even produced.

From PCs to Consoles

However, very soon the PC took over. It had a great advantage of suddenly having more processing power and better graphics. The main benefit was the more households were buying them as Windows developed and therefore people stayed on the same platform. This provided stability for games houses. For a long time the PC ruled. Games such as The Sims, World of Warcraft, the Diablo series, Half-Life, StarCraft, Guild Wars, Myst, Battlefield 1942 and Counter-Strike are amongst the top games of all time.

But then, slowly, the console platforms started winning people back. Playstation made a big impact with the with the Playstation 2 in 2000. By the mid noughties, Playstation and Microsoft’s Xbox had cornered the games market.

However, all this started to change with the rise of modern communications. Mostly driven by a new age of plasma and LCD televisions with surround sound, console games came back into fashion with the XBox, Playstation and Nintendo controlling the market.

Superfast Broadband, Social Media and Online Gaming

Although the first massive online multiplayer game was World of Warcraft, this was still a game that had to be purchased on CD / DVD when it was first released. Today faster Internet connections and better computers and mobile phones have seen a seismic shift in gaming. More people are now play free games online, both on their PCs and on their mobile phones, than are playing on consoles or traditional PC games.

Zynga

Zynga started producing games for Facebook in 2007. They have produced many games that work across the popular platforms (Facebook, Google+ and Myspace) including the likes of CityVille, CastleVille, Zynga Poker, FarmVille, and Empires & Allies. Empire Building games are the key. They keep people engage for months or years at a time and constantly evolve to bring new features to the players. Gone are the days that you buy a game to play until you complete it. Nowadays the games are always one step ahead.

By December 2011 Zynga floated on the NASDAQ stock market. It is having a rocky ride, but it is still dominating the games market.

Game in Liquidation

The impact is dramatic. The old games houses that had dedicated themselves to producing console and PC games are suffering and the retail industry is feeling the bite too. In March 2012, UK high street retailer Game, went into liquidation. People are no longer buying enough games, either for PC or consoles.

The games market has undergone the biggest change in its relatively short history. In 30 years we have seen consoles and computers battle it out for dominance only to see faster Internet connections and social media sites, specifically Facebook, steal the market almost overnight.

While the traditional games are struggling, a new age in gaming technology is here and it is likely to dominate for a long time to come. This could be another reason to look at Arm Holdings, as they make the computer chips that run in many of the smart phones and tablets on which games are played today.

Many more great games …..

Note, with have omitted many platforms and games. We could not mention them all. We know that diehard gamers will be distraught by the lack of mention of the BBC, Acorn and Amiga, or ignoring classic games such as Lemmings, Elite and Paperboy. If you want to catch up on your old favourite computer games Wikipedia is an amazing source of information. Start with the pages Arcade game, History of video games and PC game and continue surfing from there.

Image credits

Atari ST photo by Pixel8.

  2 comments for “Game Group Enters Administration – The Nail in the Coffin for Console and PC Games?

  1. SHP
    April 2, 2012 at 11:24 am

    News is not so good for Game customers though, as it is believed that Game gift cards are now worthless and will not be redeemed for cash. Whether or not the news of the Opcapita buy-out will resolve this problem is not yet clear. The gift cards may be considered a liability that can be written off. Hopefully more on this soon.

  2. SHP
    April 2, 2012 at 11:20 am

    Latest on Game: Opcapita buy Game for £1 saving 3000 jobs. Opcapita also recently took over Comet. Opcapita hopes to keep 333 shops open.

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