Jacob Navok, who is a former Square Enix executive shares his thoughts on the current situation the game industry is facing, using Square Enix as an example. Navok previously served as business development director and assistant to the president at Square Enix and is currently CEO of Genvid Technology explained on his X/Twitter account the current situation.

Navok said that consumer thinking and behavior has changed completely since around 2015, when planning for games like Final Fantasy XVI began, which he calls “the pre-Fortnite era.”

What’s happened? Not just to Square Enix, but to the industry as a whole? Audience behavioral patterns are radically different than expected in 2015. Remember, I said 2015 was pre-Fortnite.

The way it used to work was that you’d pick your release date similar to a Hollywood…

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— Jacob Navok (@JNavok) May 23, 2024

Thanks to live service games, there’s now an abundance of content, significantly raising switching costs. Consumers now require a $70 new game to be “considerably more captivating than their current game” before they consider purchasing it, rather than simply seeking a new game upon finishing their current one. This situation creates a choice between outright success and failure, leaving little room in between. Such polarization increases the risks involved in game development.

Navok also questions the market that Square Enix should have captured. He emphasizes the need to recognize that many players today favor service-based games, investing both time and money in titles such as Genshin Impact rather than Final Fantasy.

“The real mystery to me is why anyone other than Square Enix made Genshin Impact. It’s a market that Square Enix should have captured . I expect the production of similar titles will be a big focus for the next few years,” said Navok.

In the long run, Square Enix sees AAA game publishers shifting towards concentrating on a select few titles that integrate live service elements with premium-priced single-purchase games ranging from $70 to $150, reflecting its mid- to long-term strategy.