The cost of producing a flagship game has risen steeply across successive generations, driven by the amount of hand-crafted content that visual expectations now require.
The number of people buying games has grown, and not at the same rate.
The consequence for risk
When a project costs a modest sum, a publisher can fund several and accept that some fail. When it costs a very large sum, each one has to succeed, and the way to make success likely is to make something similar to what succeeded before.
That is why large-budget output has narrowed to a handful of genres. It is not a failure of imagination; it is what the finance requires.
The responses being tried
Higher prices, which arrived with the shift to eighty for a standard edition.
Monetisation beyond the purchase – cosmetics, passes, expansions – which works and generates ongoing resentment.
Longer development, spreading cost over a larger eventual audience, which increases the risk of arriving into a changed market.
And using tools to reduce content cost, which is where procedural generation and machine assistance are being applied hardest.
What is growing instead
The middle. Games made by teams of dozens rather than hundreds, at a fraction of the budget, that are commercially viable at far lower sales.
Several of the most acclaimed releases of recent years came from that category, which suggests the correlation between budget and quality is weaker than the industry’s spending implies.
Where this ends
Fewer enormous games, more mid-sized ones, and a widening gap between them. That is roughly what happened to film, and for the same reasons.