My Thoughts on GDC

I spent much of my time at GDC catching up with friends, offering advice to people who are in search of funding, running three days of roundtables about starting a game studio, and finally lecturing in the Careers Track about how to survive the game industry in a post-pandemic world. Now that I have recovered from GDC, I thought I would summarize some of my insights from the conference this year.

1. Investment – Funding is still very tight. There seems to be more opportunity this year than last regarding seed funding for AA games, but the funding is sparse for anyone wanting to do AAA games. Studios that have been around for two to three years and need bridge funding for early access are having difficulty finding financing. Unfortunately, this will force more indie studios to close their doors this year as their cash reserves dwindle.

2. Layoffs were a big topic this year at GDC. The number of layoffs this year and last has shaken our industry. Even people who still have jobs are nervous about the future of their companies. On a more positive note, many of my friends and colleagues want to start a new studio as their next adventure. What I hope happens out of the layoffs is that smaller studios that cannot compete with the big studios now have access to great talent to build more nimble smaller teams that have an opportunity to hit it big, like Palworld, Helldivers 2, and last Epoch. Not every game needs more than 200 people to make a hit game.

3. A spark still exists within the darkness. Even with the layoffs and funding shortfalls, I saw many game developers pitching their ideas in bars and hotel lobbies, looking for someone to invest in their game.  

4. Publishers are very conservative. Most publishers focus on first-party titles made with existing IP. Very few invest in new IP and even fewer invest in third-party studios. This will change later this year when they realize they will have significant gaps in their product release schedule in 26 and 27.

5. Games as service titles are moving away from FTP and towards a premium pricing model with seasonal content updates.

6. Many game developers are building content for Roblox and UEFN. I predict game developers will start seeing a good revenue stream from these multi-billion dollar marketplaces. As AI tools improve in the next few years, more content creators will be able to build successful franchises on these platforms.

7. AI was on the expo floor, promising to make games faster and with fewer people. These tools are still primitive, but the speed of AI advancement will close the production-ready gap within the next few years. Legal issues regarding IP ownership still need to be dealt with before this technology is widely used in game development. I see existing studios with successful IP catalogs using a small language model to grab their IP assets and use that to iterate and build content faster without the fear of IP infringement and with smaller teams.

8. I see a new business emerging where companies will offer royalty-based AI models already vetted in ownership to help generate content in games.

9. It's nice to see that PVE co-op games are becoming very popular with players. Valheim started the trend, and Helldivers 2 validated it. These games have better onboarding, retention, and lower levels of toxicity.

10. AA is the new hotness. This year is starting out to be a very good year for AA games like Palword, Helldivers 2, and Epoch, to name a few. Hopefully, we will see more AA titles do well in the future.

11. I see publishers and studios developing AAA games with much smaller, more nimble teams. The era of 200-plus developers on a game is, IMHO, going away. The trend is to have smaller core teams that outsource/insource asset development and use co-development houses to build content.