Games industry in search of new winning combo at this week’s Gamescom trade fair

The global games industry gathers for the vast Gamescom trade fair in the German city of Cologne, Germany this week, with hopes that upcoming heavy-hitters such as Grand Theft Auto VI can help the industry escape its doldrums.

The opening night’s event on Tuesday (Aug 19) will show off major releases slated for the months ahead, with the starring role going to Black Ops 7 – the new instalment in the sprawling Call of Duty saga.

Trade visitors will have the whole of Wednesday to peruse the stands and make connections, before tens of thousands of enthusiastic gamers are unleashed on the vast salon from Thursday to Sunday.

Last year’s Gamescom drew almost 335,000 people to the Cologne exhibition centre, where studios lay on vast stands with consoles or PCs offering hands-on play with the latest releases.

Nintendo is back in 2025 after staying away last year, surfing on record launch sales for its Switch 2 console.

Microsoft’s Xbox gaming division will show off new portable hardware expected to be released towards the end of the year.

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Sony, the Japanese giant behind the PlayStation, has opted out this time around.

The mood is mixed for the roughly 1,500 exhibitors attending this year, as major publishers have recently steered back into profitability but the job cuts seen over the past two years continue.

In early July, Microsoft said it would lay off around 9,000 people, with hundreds leaving game studios such as Candy Crush developer King and several games cancelled, including Perfect Dark and Everwild.

Battle for attention

Rhys Elliott of specialist games data firm Alinea Analytics said the industry is “consolidating quite a bit”, after the bumper years when Covid-19 lockdowns created a captive audience.

Around 30,000 workers have lost their jobs since early 2023, according to tracking site Games Industry Layoffs, with more than 4,000 so far this year.

Data firm Newzoo has forecast that revenue in the global games market should hold steady at just under US$190 billion this year.

The number of players and hours spent with the medium are stable, while an ever-expanding number of titles are jostling for attention.

And with leviathans such as Roblox and Fortnite swallowing the attention of hundreds of millions of monthly users, “everyone’s fighting for a smaller share of that pie”, said Circana expert Mat Piscatella.

The need to find new audiences has pushed Microsoft’s Xbox, the biggest game publisher in the world, to switch strategy, increasingly offering its titles on competing console makers’ hardware.

“They’ve had really great success on the PlayStation platform. Sony is making a bunch of money on that too,” Piscatella said. “It’s a little bit of a win-win all the way around.”

Some PlayStation games are making the trip in the opposite direction, with Helldivers 2 being the first to be made available on Xbox as well as the traditional PC port.

Success on a budget

Shoring up sales is vital in an era where the cost of developing high-spec “AAA” games has mounted into the hundreds of millions of dollars, exposing studios to massive risk should their games not perform as hoped.

But several breakout hits have recently shown that lower-budget games can still win over players with gameplay, story and art style, such as four-million-selling French turn-based battler Clair Obscur: Expedition 33.

Said Christopher Dring, the founder of industry website The Game Business: “There’s a realisation you don’t need to spend masses of money to deliver a high-quality game that can appeal broadly, and so everyone is rushing towards that model.”

But Piscatella pointed out that “for every Clair Obscur success story, there are 10 games that fail to find an audience at all”.

“It’s hyper-competitive for those products outside of that big sphere”, and smaller developers must fight hard for the funding they need to get games to market.

Nor is the cult-hit trend likely to displace the mega-budget mastodons.

Analysts predict that Rockstar Games’ vast Grand Theft Auto VI could notch up the biggest launch for any entertainment product in history.

That might be the juice the flagging industry needs to regain some of its mojo. AFP