As we’re still reeling from the 9,000 layoffs at Microsoft, including Xbox project cancellations and studios teetering on the brink of collapse, it doesn’t feel very good to look at the present at the moment. When you think you’ve weathered the storm, you’re again hearing of layoffs, studio shut downs, the madness going on behind-the-scenes that leads to some of our favourite franchises flopping with their latest iterations.
Five years ago, in 2020, it looked like the gaming industry was in its biggest boom for a long time, and few wanted to believe that in five years time we could be somewhere else entirely. So, it feels as though it’s fitting to guess at what the industry looks like five years from now. What changes? What continues? Who are the main winners and losers? I don’t know, really. I’m no psychic, but let’s have a guess.
1. AAA will largely disappear from our vernacular
We’re starting off bold, we’re starting off strong. If 2025 has proven anything so far, it’s that gaming can be a really tough industry to predict sometimes. Games that ten years ago were destined to sell millions are now remaining quiet, sales figures only revealed in financial reports, while debuting studios or “smaller” developers are able to add a classic into an established genre. This feels like it’s a trend that’s bound to continue in the near future. Considering how long it takes to make a game nowadays, especially by the big studios, we’re likely to see more lesser-known names break out with passionate projects that show taking a risk can reap bountiful rewards.
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In this way, I think the line between AAA and AA will start to become blurred, to the point where we might not even be using these labels so much anymore. Instead we’ll be judging games on the quality they bring, rather than the budget and manpower it took to make them. I’m not sure this is going to help the ballooning budgets of today, as companies will strive to give their game a level of prestige that matches Clair Obscur, Kingdom Come: Deliverance, and more, but as the traditional AAA publishers and developers struggle to come to terms with the fact their formulas aren’t working anymore, I’m not sure we’ll be referring to things with our old labels. I’m definitely not calling any game AAAA.
2. Live-service lives on
With the cancellation of the likes of Concord, and Sony reviewing its live-service plans, you might think the age of battle passes and trend-chasing is over, but unfortunately I can’t shake the feeling that live-service is here to stay. Even though the odds are stacked against them, it seems publishers can’t get over the dream of creating the next Fortnite. Every so often, a new player does enter the mix, too. In 2024 alone, Helldivers II and Marvel Rivals drew millions of players, so the desire from gamers is still clearly there. It’s a gamble, to release a live-service game nowadays, but it’s a risk a lot of companies will still take, when they know the rewards can make them Fortnite-level megabucks.
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We’re unlikely to see quite as many slap-dash attempts at cashing in on the live-service cow, but I do think studios will continue to chase the dragon. Multiplayer games have their space, and perhaps a new fad could replace live-service, but nothing has the profit potential quite like it, which is why I think so many won’t let it go quietly.
3. The last generation of consoles launches
At the time of writing, we’re almost definitely still years away from any sort of new hardware from any of the big players. And yet, we know that a PlayStation 6 will release at some point, alongside whatever the hell Xbox is going to name its latest Game Pass cube. A lot of people point to the PS5/Xbox Series X/S generation as a flop, and while it doesn’t feel like there has been a generational graphical leap in the most part, and the games haven’t flowed like water, I still think this generation has been dealt a bit of an unfair hand by a lot of gamers, who will likely be as disappointed in the next generation of consoles.
Calling it the last generation might be a bit dramatic, but it’s really hard to see where consoles go from here. It does feel as if we’ve hit quite the graphical peak in terms of what games can and should accomplish, and so the clearest thing is to add better performance. But, once that’s done, then how do you sell a PS7, a PS8? The Nintendo Switch proved people are willing to take a performance slash if their console was more convenient, and the fact that the PS4 stuck around for so long makes me wonder just how many games will be exclusive to PS6 three or even four years into its cycle. Then again… I don’t think we’ll see the doom of hardware anytime soon.
4. Hardware still sells like hotcakes
The Nintendo Switch 2 released this year, with pretty much one game people actually wanted to buy the console with (I mean the Welcome Tour of course). And yet it still broke records worldwide. Of course, Nintendo is a different beast, one you can’t really study, as you’ll only be left scratching your head trying to understand it. Like trying to figure out how a microwave heats up food so much faster than an oven, or how magnets really do what they do. Still, even if not everyone’s Nintendo, most gamers will go wild for a new piece of kit.
So long as new hardware feels fresh, unique, and its price point doesn’t feel like a kick in the gonads (looking at you, PS5 Pro), I can’t see why people won’t flock to buy it. Gamers are always willing to believe the hype, to pre-order and buy when they think something can really alter their experience for the better, and so I don’t see hardware sales slowing.
5. The bleakness continues
Every time that we see a new lot of layoffs I wish it would be the last time such news hits our feed, but sadly, we’ve been going through years of cuts despite record profits, and I don’t see them slowing anytime soon. Xbox especially looks fit to Xsplode again, whether that be through the closure of more studios, or significant changes to the current business model. My wise colleague Ben Lyons believes we could see Game Pass depart from its immense consumer focus and instead backtrack to allow Xbox to readjust its revenue streams.
WB Games also seems to be in dire straits. In the next few years, we are likely to see the first games of its new focus on four major franchises, and if those don’t do well, then perhaps more studios are for the axe, or the division and its IPs are just sold off to the highest bidder. To combat this future, a sense of realism would need to be adopted within the industry. No more thinking we’re in the COVID times, no more thinking a new game can reach 100 million players without being the biggest franchise in the world. No more massive franchise plans for games that haven’t even released yet. Sadly, recent years have proven there are a fair few important people still taking crazy pills, driven by the idea of the number must go up, to a point we’re likely to see this industry continue to spiral towards disaster in some ways.
