Gaming Industry at Crossroads as AAA Development Costs Soar, Says Former God of War Executive

The era of blockbuster video games with astronomical budgets may be approaching a tipping point, according to former God of War executive Meghan Morgan Juinio, who argues that development costs have reached unsustainable levels while emphasizing that gameplay enjoyment should remain the primary focus.

The Unsustainable Economics of Blockbuster Gaming

Juinio, who recently departed her position as director of product development at Sony’s Santa Monica Studios, shared her concerns about the current state of AAA game development during an interview at Gamescom Asia. “I think it’s already not really sustainable in terms of the cost of development,” she stated, pointing to widespread industry layoffs, particularly on the US West Coast, as evidence of the mounting financial pressures.

The Unsustainable Economics of Blockbuster Gaming
Returning to “Fun First” Game Development
The Rise of AA and Smaller-Scale Success Stories
Challenges in Game Discovery Amid Content Saturation
Industry Implications and Future Directions

The former God of War executive highlighted how escalating minimum costs are forcing major publishers to reconsider their development strategies. “Development costs will necessitate that the big publishers create new pathways,” Juinio explained, suggesting that the industry’s current blockbuster model requires fundamental rethinking.

Returning to “Fun First” Game Development

Despite the challenges facing big-budget titles, Juinio maintains a clear vision for what makes games successful. “My opinion is that it has to be fun first,” she emphasized. “It can look the most beautiful, have the best soundtrack in the world, it can be winning all the BAFTAs for audio and all this, but if it’s not fun it’s not worth the investment, whether that’s $2m or $500m.”, according to market analysis

This back-to-basics approach represents what Juinio sees as a potential path forward for major publishers. “That’s where the biggest publishers can return: how do we go back to building solid games that are really fun to play. Maybe they aren’t 40 hours long, and maybe they aren’t the most cutting edge – but that doesn’t matter if the core experience is really fun.”, according to technological advances

The Rise of AA and Smaller-Scale Success Stories

Juinio believes larger publishers will increasingly look to AA or single A games for inspiration, citing recent successes from smaller teams with more modest budgets. Games like Clair Obscur: Expedition 33 and Peak have demonstrated that budget constraints don’t necessarily limit creative impact or player engagement., according to related coverage

For Sony specifically, Astro Bot serves as a prime example of critical and commercial success achieved through scaled-back ambition. The game’s director, Nicolas Doucet, articulated this philosophy during a talk at this year’s Game Developers Conference: “It’s OK to make a small game. In order to exist in this very busy world, I think it’s sometimes better to settle for a good spot in the second week rather than a bad spot in the first week.”, according to according to reports

Doucet’s approach with Astro Bot embraced what many would consider AA development principles: “A lot of choices we made with Astro Bot could be labelled as AA… like the size of the team, the size of the game, there’s no voice, it’s not open world, but that doesn’t really matter. We could still make something that gets people really happy.”

Challenges in Game Discovery Amid Content Saturation

While advocating for smaller-scale development, Juinio acknowledged the growing challenge of game discovery in an increasingly crowded marketplace. With thousands of titles released annually, even high-quality games struggle to find their audience, creating what she describes as “an increasing problem of access and game discovery.”, as additional insights

This saturation affects games of all sizes and budgets, though smaller titles often face greater visibility challenges without the marketing resources of their AAA counterparts. The dilemma creates a complex landscape where development cost management must be balanced against the need for effective marketing and distribution.

Industry Implications and Future Directions

Juinio’s comments arrive during a period of significant transition within the gaming industry, marked by:

Widespread studio restructuring and layoffs
Increasing development budgets for AAA titles
Growing recognition of alternative development models
Renewed focus on gameplay quality over technical spectacle

The former Sony executive’s perspective suggests that the industry may be approaching a fundamental shift in how games are conceived, developed, and brought to market. While blockbuster titles will likely continue to exist, their dominance may give way to a more diverse ecosystem where games of various scales and budgets can thrive based on the strength of their core gameplay experience.

As Juinio succinctly summarized: “I think what it comes back to is just make something fun. Just make something awesome, and that will achieve what you need it to achieve.” This back-to-basics philosophy, combined with more sustainable development practices, could chart a new course for an industry grappling with the limitations of its current blockbuster model.