Exam preparation task: Question 7

What impact have recent developments in technology had on the production, distribution, marketing and exchange of videogames?

The videogames industry is technologically driven, with new ideas and technologies pushing the industry forward. New technological developments impact on all areas of the industry, including production, distribution, marketing and exchange.

Recent developments in technology has had a huge impact in the area of production. New creation engines such as RAGE enable a relatively small number of programmers to create hugely complex games. For example, 150 people used RAGE to develop GTA4, a relatively small number of people when you think about the enormous size and complexity of the game. Similarly, the development of the Euphoria engine has meant that games physics has improved dramatically, making ever more realistic games. This improvement has lead to a huge amount of competition, as developers attempt to out do each others efforts.

Distribution has also been impacted by the improvement of technology. The recent development of websites such as Steam has changed the way that videogames are distributed. Steam enables users to purchase and download entire games directly. Whereas before buying games online meant having to pay for postage and waiting for the game to arrive, Steam is an instant service that removes the need for delivering a physical product and therefore removing some of the cost. In terms of exchange, Steam has also had an impact. As it's popularity increases, it is having a detrimental effect on the trade-in area of the market.

Marketing wise, new technologies are making a huge impact. With people spending more time on the internet, technology has enabled companies to market online and reach a larger audience. The recent increase in the use of social networking has allowed developers to improve the relationship with their audience by allowing them to communicate with them directly through websites such as Facebook and Twitter. This also improves the overall gaming experience as it extends it. An example of this is how Flickr was used to market Just Cause 2. An account was set up for the games protagonist, with screenshots of the game being uploaded as if they were the character's personal photos. This social networking aspect has had an enormous impact. As well as what I mentioned earlier, some games enable users to upload clips directly to Youtube. This example of technological convergence shows the growing importance of social networking in the video games industry.