Can Subscription Services Revive the Mid-Tier Game Industry?

The decline of the mid-tier game segment is a longstanding issue, with the Xbox 360 era marking both the peak and the beginning of the end for lower-budget, quickly developed, and often discounted games. Recent events have brought this gap into sharper focus, with the $70 price point for AAA games making consumers more aware of the disparity between self-styled AAA games and those that are actually mid-tier. The concept of an "AAAA" game has emerged, with some executives attempting to differentiate titles within the overcrowded AAA category. The industry's output has become polarized, with AAA games priced at $60 or $70 at one end and indie games priced below $20 at the other. There is a lack of mid-range games, with few launching at prices between these two extremes. Many developers are unhappy with the pressure to label their games as AAA and launch them at $70, and there is a desire to explore other price points and develop games with stricter budget controls. However, there are concerns about the risks of doing so, both for the game and for the studio's reputation. The situation is unsustainable, with studios like Ascendant facing significant challenges, including staff furloughs, just nine months after launching their first game, Immortals of Aveum. The game struggled to find its audience, and its launch at $70 may have been a factor. The CEO of Saber Interactive, Matthew Karch, has expressed similar concerns about the $70 price point, stating that it creates unrealistic consumer expectations. There are some success stories, such as Helldivers 2, which launched at $40 and became a surprise hit. However, the industry lacks a viable space for solid, interesting games that lack the resources and polish of AAA titles. Building a mid-tier market would require time and commitment, but it could change the economics of game development, particularly for new IPs. Subscription services like Game Pass may offer a lifeline for mid-tier games, as they need a steady flow of content to keep subscribers engaged. By bringing back the mid-tier game category, services like Game Pass could provide players with shorter, lower-budget, but still fun and entertaining games on a regular basis. These games could be more experimental, and players' expectations would be set reasonably, given that they are not making a commercial purchase. Many of these titles would appeal to specific niches, but satisfying these niches can lead to mainstream success. Controlling budgets and designing games within limited budgets and timescales would become essential skills for studio managers. Returning the mid-tier sector to prominence could rescue a whole tier of creative output and bring stability to the development sector.