Games Industry to feel the pinch?

It would appear that video gaming isn’t quite as recession-proof as many people would have you believe – long-time Nintendo supporter Factor 5 is rumoured to have closed it doors for the last time.

The company found fame via its Turrican titles but it wasn’t until it allied itself with Nintendo that it truly hit the big time, creating the superlative Star Wars: Rogue Squadron series. The studio recently ‘jumped ship’ to produce the disappointing Lair for Sony’s PS3, but it was thought to be working on a new game for the Nintendo Wii as well.

This new follows the announcement that highly-respected UK studio Free Radical Design had also closed down. Christmas isn’t going to be too jolly for the former employees of these two companies, that’s for sure.

Free Radical was originally set-up by some of the "elite" members from fellow UK developer, RARE - responsible for GoldenEye and Perfect Dark, probably the reason for the drop in quality from Nintendo's best buddy.

It's something we haven't really considered, the games industry isn't closely tied to the price of oil but it seems the change in economic climate is going to cause problems for developers.

Nintendo have already proven a refreshing change for games designers on a budget, it's a well known fact that developing for Wii is far cheaper than the "HD" consoles, the amount of investment is far smaller which is why its proven so popular.

We'd expect a lot of these smaller, Wii focused, companies to be okay (unless they're working on very low budgets) however some of the big guns with huge budgets, might still be at risk, time will tell.