Back in the 80’s, Atari had a monopoly of games and charged absurd amounts of money for titles that pretty much had no quality control. The cost of each cartridge would easily go over $100 in today’s money and gamers began to pull back on purchasing anything. This eventually culminated in the infamous E.T. movie tie in that led to pallets of its unsold cartridges ending up in a landfill and crashing the industry.
Now that Nintendo’s signaled to the rest of the industry it’s okay to sell digital titles at $80 each, how soon do you see gamers collectively hold back on their purchases that will eventually collapse the AAA market? Will the current trade war play a role in the hardware side of things with the collapse? Will all major companies save Nintendo suffer the downturn?
The Atari crash was just Atari. In North America - and only North America, things were quite different elsewhere in the world - Atari was virtually the entire game industry at the time, but that isn’t the case today.
We already do see individual developers and publishers crash the way Atari did. All the time. But for every flop, there are a dozen hits. The industry is big, and it is not a monolith. And the audience is far far far larger. People will always be buying games. It’s not possible for the entire industry to crash the way Atari did.
It’d be like expecting the entire music industry, movie industry, or book industry to crash.