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Why is the video game industry in crisis? (self.outoftheloop)

submitted 7 months ago by Zeppo to c/[email protected]

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I keep hearing about layoffs, studios being closed and how the industry is troubled. Are companies losing money and sales are poor, or is it the same as Google and other companies laying off people just to pump their stock price and make money despite profitability?

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[–] [email protected] 25 points 7 months ago (1 children)

You need to understand, the people managing these companies don't make their money from profits, they make it from not paying people.

The profit is the baseline. It's the status quo. It pays for things you already have. Money coming in already knows where it's going and getting more of it is a fight with people higher up then you are.

But money you've freed up from not paying people? Layoffs? Closing departments? That's big earnings that show you're a savvy business man you can cut the fat. Numbeys go ups.

[–] [email protected] 1 points 7 months ago

Up and to the right!