I was doing some background research for another essay and this is as good a time as any to produce an actual journal article on point.
There's a common talking point I've seen both in this comment thread and elsewhere that the number of entrants isn't the problem at all and the real problem is game developers aren't innovating, and if they just innovated more things would be fine.
Kevin Boudreau [1] is one of the earliest researches on this scene, who concludes that "incremental increases in the number of application producers in this context led to a decrease in innovation incentives, on average, as measured by the rate at which new versions of existing titles were generated" and further that "the strength of descriptive patterns alone suggests that marginal entrants curtailed overall innovation".
Kevin's research, while it has many limitations, suggests that innovation decline is actually a symptom of an overcrowded market, not an independent factor in its own right. If true, this could mean that the practical way to address an innovation crisis is to first solve the problem of the overcrowded market.
The idea that market crowding depresses the innovation of individual independent developers is sort of a surprising result, but once accepted there are many possible feedback mechanisms that may explain the effect. For example, market crowding may drive innovators to go innovate somewhere else. Crowding may also limit available funding which may be disproportionately required by innovative titles rather than non-innovative titles which can be more cheaply manufactured.
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I was doing some background research for another essay and this is as good a time as any to produce an actual journal article on point.
There's a common talking point I've seen both in this comment thread and elsewhere that the number of entrants isn't the problem at all and the real problem is game developers aren't innovating, and if they just innovated more things would be fine.
Kevin Boudreau [1] is one of the earliest researches on this scene, who concludes that "incremental increases in the number of application producers in this context led to a decrease in innovation incentives, on average, as measured by the rate at which new versions of existing titles were generated" and further that "the strength of descriptive patterns alone suggests that marginal entrants curtailed overall innovation".
Kevin's research, while it has many limitations, suggests that innovation decline is actually a symptom of an overcrowded market, not an independent factor in its own right. If true, this could mean that the practical way to address an innovation crisis is to first solve the problem of the overcrowded market.
The idea that market crowding depresses the innovation of individual independent developers is sort of a surprising result, but once accepted there are many possible feedback mechanisms that may explain the effect. For example, market crowding may drive innovators to go innovate somewhere else. Crowding may also limit available funding which may be disproportionately required by innovative titles rather than non-innovative titles which can be more cheaply manufactured.
[1] preprint: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=%20182670...
jstor: http://www.jstor.org/discover/10.2307/23252315?searchUri=%2F...