Is the electronic games industry too huge for its own good?

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SINGAPORE (July 7): Every year in mid-June, a who’s who of the electronic entertainment and video game industry, from makers of consoles to game developers, descend on Los Angeles, the entertainment capital of the world and home to Hollywood, for E3, the annual games conference and exhibition. CEOs of Sony, Microsoft and Nintendo Co rub shoulders with creators of games such as Angry Birds, Candy Crush Saga and Minecraft.

Indeed, interactive games and entertainment, including online and multiplayer games, have burgeoned into a huge business. The global games industry had annual revenues of over US$100 billion (S$138.4 billion) last year, with Asia accounting for about half the market. And it has been growing 8% annually.

Game developers are also rushing to global bourses for listings or seeking large games-focused companies such as Singapore-based Sea, formerly Garena, reportedly readying an IPO on Nasdaq in September.

Increasingly, game studios are being seen as potential rivals to Hollywood. Indeed, the threat is so big that Hollywood has been busy buying emerging game studios around the world. 

But has the industry become too big for its own good? Are game developers, in their bid to outdo each other and chase new revenue streams, making new games too addictive? Beijing’s move this past week to scold game developers for poisoning young minds with “addictive” games, is seen as a reminder that the industry’s unfettered growth may indeed have limits.

Find out more in this week’s edition of The Edge Singapore (Issue 787, week of July 10), which is on sale now.