We're Starting to See the Long-Term Impact of COVID-19 on Video Games

We're Starting to See the Long-Term Impact of COVID-19 on Video Games

THIS WEEK IN THE BUSINESS | The global pandemic is hitting every level of the games industry.

This Week in Business is a collection of stats and quotes from our sister site GamesIndustry.biz that sheds light on console sales, new trends, and more. Check back every Friday for a new entry!

I know you are surely deeply, deeply tired of reading about COVID-19. I share your exhaustion, being likewise deeply, deeply tired of writing about it. Yet the pandemic churns on; we do not know when it will be over; we do not know what its long-term effects will be; it is good to stay informed if we manage it.

And this week in the business, we have a slightly different story to tell about COVID-19 from previous weeks. This week, we began to see the industry shift from what has thus far been a series of immediate, necessary reactions to the coronavirus (i.e., rapid fundraising efforts, moving to work-from-home set-ups, cancelling imminent events) to planning for the long-term future.

Depending on who you ask, COVID-19 is going to be a problem we might be mostly rid of by summer or, far less optimistically, we'll still be in various states of shutdown come late fall or beyond. The games industry appears to be bracing for the worst while hoping for the best projections as it works to keep its people safe and its businesses stable -- hopefully in that order (with absolutely no more of this awful nonsense).

If you're looking for a summation of what's happened already alongside some analysis from industry figures across publishing, events, and retail, we published a proper "state of the industry" report earlier this week that helps break it all down.

So then from there, based on what we learned this week, what does COVID-19 mean for the games industry?

It means event cancellations, possibly more than and farther out than we may have expected:

QUOTE | "We look forward to bringing our industry and community together in 2021 to present a reimagined E3 that will highlight new offerings and thrill our audiences."- The ESA seems to have given up on its originally-suggested plan to have some kind of online experience in lieu of a physical E3, but it did set dates for E3 2021. Oh, and IGN appears to have partnered with some of the ESA's usual presenters for a digital Summer of Gaming event.

QUOTE | "In light of the challenges presented by COVID-19, we are adjusting our event calendar and strategy. For the remainder of 2020 we are embracing the opportunity to experiment with new platforms to provide our partners, customers and developers the highest quality, digital-first experiences." - Though not a cancellation, Microsoft is opting to play it safe and make all of its events digital-only through the end of July 2021.

QUOTE | "When you meet someone in person, there's a connection that's extremely hard to forge in any other way. "I've known some people for years online—including business partners—but there was something that still didn't feel confirmed until we saw each other. Opportunities for that confirmation are becoming increasingly rare with the event cancellations going around right now." - Strange Scaffold's Xalavier Nelson Jr, along with several other indie developers, discusses the impacts of event cancellations this year on their studios.

Though some events appear to be holding out hope:

QUOTE | "This is clearly a situation that will keep evolving and whilst we might not have all the answers right now, we will do all we can to keep everyone informed and updated when we do." - Head of UK events at ReedPOP David Lilley says the company will follow guidance from the UK government, but for now is planning on holding EGX in September as planned. Its planned location, the Excel Center, is currently being used as an NHS Nightingale hospital. (Quick disclosure: ReedPOP is the parent company of both GamesIndustry.biz and USGamer)

STAT | $99 - The price GDC is hoping will entice people to purchase an early bird Expo Pass for GDC Summer, which optimistically opened registration for its re-scheduled conference in San Francisco in early August. I would, uh, maybe hold out on that one.

It means some games and systems are selling extremely well, or trying to...

STAT | 2.6 million - The number of copies Animal Crossing: New Horizons sold in Japan in 10 days. The game has since surpassed 3 million sold in Japan alone.

QUOTE | "Nintendo Switch hardware is selling out at various retail locations in the U.S., but more systems are on the way. We apologize for any inconvenience." - A Nintendo representative, speaking to GamesIndustry.biz, reassures that more stock is coming despite Nintendo Switch systems selling out worldwide.

STAT | $9.99 - The price of a Stadia Pro subscription, which is what you're technically getting if you buy into Google's two-month free period for the service. It's not the planned Stadia Base version, which is free always, though it is locked at 1080p...exactly like Stadia Base. And you still have to pay full price for your games.

...likely because far more people are stuck inside, playing them and watching them.

STAT | 29% - The percentage of gamers in the US who say they are playing games online with friends more often, specifically due to COVID-19. The same study of 3,000 regular gamers found that they are buying games, playing more frequently, and watching more streaming content.

QUOTE | "Gaming was born in basements and living rooms, and it was our desire to connect and compete with one another online that ultimately drove gamers to create and support the notion of esports." - CPO and founder of Harena Data Shawn Smith writes in an editorial about how the esports industry is well-poised to weather the impacts of COVID-19, and come out stronger on the other side.

But other sectors of the industry aren't as fortunate:

QUOTE | "There are peripherals companies with no stock, retailers with no stores, events companies incapable of running events, and contractors without work. There are QA agencies with no games to test, recruitment firms with no jobs to fill, media with nobody advertising and museums with no visitors. And that's before you get to the studios suffering from cash flow challenges as a result of partners re-focusing and adapting to the new situation." - Our publisher, Chris Dring, urges the industry to take care of its more vulnerable businesses that are unable to weather COVID-19 as steadily as the rest.

It means some games are being delayed...

The Last of Us Part 2 is among the games delayed because of COVID-19 | Naughty Dog

QUOTE | "We want to make sure everyone gets to play The Last of Us Part 2 around the same time, ensuring that we're doing everything possible to preserve the best experience for everyone." - Naughty Dog in a statement explains why The Last of Us Part 2 has been delayed "indefinitely" despite being nearly done. Iron Man VR was also indefinitely delayed at the same time.

QUOTE | "It is also important to prioritize the physical and mental health of our development team, without whom we would never be able to release the quality updates and features you expect from [Final Fantasy 14], so we ask for your understanding as we adjust our schedule in accordance with the situation." - Final Fantasy 14 producer and director Naoki Yoshida, announcing that the game's 5.3 patch would be delayed due to the studio now fully working-from-home, as well as other COVID-19-related struggles with production partners.

But others remain on track:

QUOTE | "Everything else we are either already past that hurdle so we're not really impacted by it, or things are progressing smoothly or business as usual." - CD Project Red senior vice president of business development Michal Nowakowski told investors that the company was "comfortable" it could make its September 17, 2020 release date, as the game was effectively "in a complete form" already.

And it means that the industry is still doing its best to support relief efforts, both for those on the frontline of COVID-19, and for its own people who are struggling in the face of it.

STAT | $279,000 - The amount that Wings Interactive's GDC Relief Fund raised for developers impacted by the sudden cancellation of GDC due to COVID-19.

There, we've done it. The week is over and so is the COVID-19 news, at least for the present moment. If you made it this far, here are two more non-COVID-related rabbit holes to fall down, as a treat:

QUOTE | "As the developers, we can say with certainty there is no cryptocurrency or data collection or blockchain or anything else shady in the code. The Nintendo Switch is a very safe platform, with none of the data and privacy issues associated with some mobile and PC games." - The developer of Cooking Mama: Cookstar, 1st Playable, had to take to Twitter to affirm that its game wasn't using Nintendo Switch systems to mine for cryptocurrency. The whole story is a wildly confusing rabbit hole of IP ownership, who developed what, and who is responsible for what that managed to confuse gaming social media away from COVID-19 thoughts for at least several hours on Monday.

QUOTE | "The new controller, along with the many innovative features in PS5, will be transformative for games - continuing our mission at PlayStation to push the boundaries of play, now and in the future." - Sony showcased the DualSense controller for the PS5, with new haptic features and a Create button in place of the old Share button. I think the coloring makes it look like a Wii peripheral, but honestly am just grateful to Sony for managing to come out with what was probably the Most Normal News of the entire week.

Photo courtesy of official E3 website.

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Rebekah Valentine

Staff Writer

Rebekah arrived at GamesIndustry in 2018 after four years of freelance writing and editing across multiple gaming and tech sites. When she's not recreating video game foods in a real life kitchen, she's happily imagining herself as an Animal Crossing character.

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