The Big Picture: What you need to know about the ongoing games industry reset

The games industry is undergoing a reset. That was the message of Gamescom Dev’s opening keynote, delivered by Amir Satvat, who until a few days ago was business development manager at Tencent, but is now general partner at 1Up Ventures.

Satvat is best-known for founding the ASGC, which provides help and advice for job seekers, and in a wide-ranging speech, he dove into the data behind the huge numbers of games industry layoffs, the shift of jobs to different regions, the concentration of revenue among just a few key companies, the changing nature of employment and games, and how the industry needs to adapt to face the current crisis.

He started with the bad news. Back in December, Satvat told GamesIndustry.biz that he expected around 7,500 redundancies across the industry in 2026, down from the roughly 9,200 in 2025. Following the huge waves of redundancies this year, Satvat has now revised that prediction to 14,666, not far off from the 2024 peak of 15,631. As of August 11, there have already been around 10,140 announced layoffs this year – more than for the whole of 2025.

Despite this, the total number of people employed in the games industry has barely changed over the past few years.

Satvat cited “very convincing” research from the Game Industry Coffee Chat (GICC) group indicating that roughly 750,000 people are employed directly or indirectly in the games industry, much higher than typically reported figures. “The reason this often gets very undercounted in my opinion is people don’t understand the extent of employment in China,” explained Satvat.

The upshot is that “even with all these cuts that have been going on,” said Satvat, “the industry is actually net positive in terms of employees from 2022 until now.” It’s only a small growth of less than 1%, but it is growth nonetheless. (Pre-2022, however, the industry saw explosive growth, adding around 150,000 net jobs over the five years from 2017.)

What’s happened over the past five years is a geographic transition. “Head count moving from basically North America to basically anywhere else,” Satvat said, with the move motivated not just by labour costs but also things like “government incentives and talent availability.”

Satvat said that over two-thirds of the layoffs he has been tracking have occurred in North America, pegging the total losses at 25,000 roles amounting to 15% of the workforce. California was hit hardest; in one period of 12-18 months, over 50% of overall layoffs were in that state.

Other regions, meanwhile, have seen a net gain of jobs. Asia Pacific (APAC) saw the number of available jobs increase by 10%, driven by 12% growth within China. The number of roles in Europe, meanwhile, has “basically stayed flat,” Satvat said.

Uneven revenue spread

One thing that’s confusing is why so many layoffs are happening at a time when the games industry is experiencing continued growth. The reason, says Satvat, is that growth is confined to a decreasing number of titles. “You have 50, 60% of the revenue being distributed to just the top 20 games.”

On mobile it’s increasingly difficult to acquire users, meaning the sector is now focused on monetization of existing players – while on PC, only 79 titles account for 80% of play time. “So the top line numbers look good, but … the numbers are much tougher when you go beneath the surface.”

Satvat listed 21 pressures the games industry is facing, including post-pandemic overhiring, changing player habits, longer development cycles, and rising production costs. But the two he worries about the most are discoverability pressure and AI uncertainty, because “to the best of my knowledge, no person has some master plan of how to have a solution to either of those two things, and not solving those two things could be a sinker that invalidates everything else I’m about to talk about.”

However, he said that above everything else, the geographic transition we’re experiencing is “the biggest driver of change in the industry.”

Decline in entry-level jobs

Satvat also pointed to a huge increase in the number of game-related programs at US colleges and graduates from these courses, at the same time as the number of entry-level jobs is declining. “Just in the US for example, there’s 400 colleges and universities that now offer credentials. And if you look at the growth in games and interactive media design completions over 14 years, it’s gone up 4x.”

Yet the chances of these new graduates with no prior games experience finding entry-level jobs are tiny. “There’s a 4% chance of obtaining employment in games over a 12 month period of time,” said Satvat. He added that overall, across the world, there were roughly five job seekers for every annual hire. But that ratio rises to 11:1 in North America.

“There’s also an interesting squeeze that’s been going on in terms of seniority,” said Satvat. “The average credentials that jobs are asking for, for the same job, have gone up by three years. And this further creates a squeeze down on early career candidates, because now if they’re looking at roles that traditionally would be no experience, or one or two years, and they can ask for and get candidates who have three to four years experience, because people are looking for work.”

In addition, there seem to be fewer roles available for senior developers. “My data suggests that when you get to the age of 50 or equivalent experience, you go back down to 4-5% again. And so what’s happening is we have this kind of odd sweet spot, where people who are basically between early experience and up to, like, 15, 20 years [of experience] are very, very employable. But people who start falling outside those ends are having a great deal of trouble.”

“You are 20x plus more likely to get a job these days if you have any connection to the hiring manager or the recruiter versus not”

In terms of the types of jobs companies are hiring for, Satvat said there had been an increase in the relative share of roles centred on engineering and development; business intelligence, data, and analytics; production and project management; and marketing, brand, and esports. These account for “about 70% of the open roles,” he said, noting that for the first time in four years, game design has fallen out of “the big four”. Other jobs that have declined in terms of their overall share of open roles include writing and narrative, QA, and recruiting.

Getting hired increasingly depends on networking and personal connections. “You are 20x plus more likely to get a job these days if you have any connection to the hiring manager or the recruiter versus not,” said Satvat. He also encouraged job hunters to seek out work experience. “If you can just get one to two years of work experience, statistically, your odds over 12 months of getting another games role if you’re unemployed jumps from 4% to 30%.”

Structural shifts

Satvat went on to outline a number of structural shifts that the video game industry is currently undergoing. First of all, he said that revenue growth in the console sector is coming “more and more from an engagement with existing customers” through things like premium releases and higher-priced subscription tiers, rather than an increase in the number of players. And audience growth will be put under further pressure by increased hardware prices.

He suggests the traditional model of driving people towards consoles with exclusive releases and improved graphics will “soften”, and the focus will instead be about making games more accessible, “because a lot of people just aren’t going to be able to afford the hardware.”

The market in China, meanwhile, is growing at an astonishing rate: “The numbers are just mind boggling.” 42% of global PC revenue growth came from China, while minigames on the Chinese social media platform WeChat have more than 500 million monthly active users. “And now because more and more people in China are going to college, each year we can comfortably expect 10 million plus people who are going to have computers.”

On the one hand, he said, the Chinese market offers a market opportunity for developers outside China, because the “taste for games in China [is] not that different from the taste [in] other places.” But on the other hand, Chinese developers will provide more competition globally, “because God, when you go over there and you see the volume and the number of studios… And I think in most cases, we have all underestimated how transformative and impactful that’s going to be over the next few years.”

Growth and contraction

In terms of where growth opportunities lay, Satvat pointed towards large user-generated content (UGC) platforms like Roblox and UEFN, but also sounded a note of caution that the “revenue opportunities on those platforms [are] concentrated in the hands of a very small number of people.”

Competition is getting ever tougher: the number of new Steam releases reached around 12,000 in H1 2026, up 19% year on year. However, Satvat emphasised not to put too much store in those numbers, like the headline of around 20,000 games being released on Steam in 2025. “If you actually pick that number apart, only 3% of those games, about 600, have a hundred or more peak CCU,” he said. In other words, the real level of competition is lower than it seems at first glance.

Meanwhile, the funding landscape looks more bleak. Satvat pointed to the collapse in global games start-up funding from $9.9 billion in 2021 to just $2 billion in 2023, and a similar drop in private equity and venture capital funding from $12.1 billion to $2.7 billion. Partly, this decline could be about misalignment. “I think most investment vehicles and games don’t mix,” said Satvat, noting that games rarely deliver predictable outcomes or giant returns.

“When I was at Amazon,” he recalled, “There was a point in time where I think we had four or five MMOs live or in development at the same time. Because at the end of the day, something like that is what looks good on a discounted cash flow projection… What doesn’t look good [is] taking a bet on smaller games that don’t have the big numbers and don’t have the big ROI.”

However, probably the most notable contraction is in permanent AAA job roles. “Two, three years ago when I went to DICE,” Satvat recalled, “people would tell me that they were using external development and contracting more and more extensively, or smaller teams, but they would tell me behind the back of the building because they didn’t want to say it out loud in front of everybody.”

Now, those conversations are out in the open (like our chat with Fuse Games CEO Matt Webster on the use of exdev on Star Wars: Galactic Racer), and Satvat sees it in the data. When he began tracking job roles in 2022, around half of the jobs were in AAA; that has now shrunk to below one-third. Meanwhile, jobs in external development and contracting have risen to make up roughly 10-15% of open roles.

“I don’t think, unfortunately, we’re going back to normal. I think we’re evolving to something else”

The remaining open roles are made up of indies, smaller players, tools and services – and Satvat said the biggest opportunities lie in the middle ground between solo indies and global giants, as the power base in gaming shifts.

“I think AAA will always have a role to play, particularly in situations with strong teams, dominant IPs, and reasonable cost structures that can get things done, like Nintendo and others. But I think that the power mix is shifting, and it’s undeniable.”

“People often say to me, Amir, when are we going to go back to normal?” Satvat said. “I don’t think, unfortunately, we’re going back to normal. I think we’re evolving to something else, and what that something else is hasn’t been decided yet.”

What needs to change

Satvat says players have always enjoyed social engagement, but things have changed a lot over the past two decades: modern audiences have become used to short-form content on social media. “And we’re like, did you like that? Here’s this 120 hour game. Enjoy it. Dig in and get comfortable. And it’s just a little bit of a misfit.”

He also thinks firms need to start engaging players at the very start of development. “Let’s get rid of this idea, which is a little bit antiquated, that you have to keep this game behind the curtain,” he said. “Community access, engagement and feedback is becoming much more important than ever before.”

He advocated for more flexible pricing (“so much more of the action these days is in $30 or less, $10 or less”) and improved job conditions: “We need to freaking treat game workers better.” He particularly cited callous offboarding processes and lack of ongoing development, which he said is driving talented people out of video games. “I estimate 120,000 years of games experience have already permanently left the industry since I started tracking things in 2022. If we want to stop that bleeding out, that’s recommendation number one.”

He wants to see dramatic changes to video games education programs, too, not only giving candidates upfront information about their slim chances of landing a job in games, but also providing them with training that goes beyond the games industry. More than 60% of the people that ASGC helped this year found work outside of games.

Importantly, Satvat sees a shift to smaller teams with tighter budgets as a “big part of the solution” to the current crisis, where games directly target a niche rather than simply aiming for the most popular genres. “That starts with a small team really thinking about the customers, being increasingly comfortable with exdev and contracting.”

In terms of where to “put the next bet,” Satvat’s recommendations included the following:

• Large, engaged ecosystems where creation, participation, and social connection can build durable player relationships
• Shorter, focused AA and indie games for players with money and less time
• APAC, Eastern Europe, and Latin America as competitive regions where talent, cost, and growth are converging
• Tools and service partners that let smaller teams build competitive games
• A focus on community through Discord, streams, and group chats, even for single-player games

“I don’t think we have a predestined outcome of where the industry goes,” Satvat concluded. “And I think perhaps more than ever, this is a really critical moment where the choices that we all make are going to decide where we go.”

He posited two less-desirable outcomes. “One is kind of extraction, where everything that’s mature market, that’s IP, gets bought by financial players, gets hauled out, and is just run for […] extractive revenue of what’s left, and [there’s] more and more ownership concentration.

“The other one, for lack of a better term, I call ‘small ball’, which is [where] everything goes kind of really hard to the edge of UGC, and maybe because of AI and other factors, everyone is just running lots of really small entities and that doesn’t have a lot of concentration. It makes things even worse than they are for people wanting to find an opportunity to build teams [and] to have continuity.”

The scenario that he hopes for is an industry made up of disciplined, smaller firms that can tackle the issues outlined in his talk. “And as they get bigger, because people are still going to want to play games, that market comes back.”

That scenario involves redefining success, whereby rather than needing millions of sales, companies can be profitable at much lower figures thanks to keeping a tight focus on development costs. “And if we went back to having that disciplined, smaller, steadier, and healthier ecosystem, I don’t think that would be such a bad thing, and it could set us up for where we want the industry to go in the future.”