This is the end… my only friend, the end…

So OK, I’m not going to get into a lengthy discussion of economics, business, or who’s who of MMO gaming.  But I will say this… the economic downtorun is becoming a starker reality for MMOs and gaming in general.

Kotaku just announced that the Aliens RPG that Sega was working on has been canceled.  Recent confirmed rumors that WAR staff have been laid off have also emerged.  Midway of Mortal Kombat fame filled for bankruptcy (Chapter 11 which lets them keep operating).  Granted Midway’s woes are in large part due to Sumner Redstone “selling his 87% stake in Midway Games Inc. (MWY) for about $100,000, plus the assumption of $70 million of secured and unsecured senior debt. The deal resulted in a huge loss for Redstone on his investment in the video game maker, having invested $800 million in the company, but it also set up a substantial tax benefit.

Now, I’m not going to get into a economic thesis on were the gaming industry is headed.  But if Mr. Redston’s business strategy is any indication, big time and not-so-big-time mogels will likely be heading out of the gamng industry in favor of securing their holdings in more traditional markets, and in general the gaming industry is already experiencing a slowing in investments.

Sales have been all over the map lately.  Wii is leading XBOX who’s leading PS3… although Joystiq reported that while the overall console industry is up 13% over January 2008, handhelds are down 83% from December 2008.

For a business sector that absolutely depends on frivolous investor funding through the first 1-5+ years of development before actually releasing a product, this could be the start of a long unwinding of independent titles and concentration of games under more traditional, large-scale companies.  More likely, it will mean a slowing of releasees and potentially some under development currently will go under before they even hit Open Beta.

Your thoughts?

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