"This is the worst crash we've seen since the 1980s," says Tim Sweeney

GamesIndustry.biz says Epic Games CEO Tim Sweeney is calling the current downturn the worst industry crash since the 1980s, with AAA budgets and component shortages both squeezing development. He pointed to RAM and storage prices quadrupling and argued the supply crunch could last for roughly three more years unless new factories come online.

The broader discussion in Edge issue 428 frames “Crash 2.0” as a cost problem as much as a market one. Raph Koster reiterated his long-running view that game development costs have risen about 10x per decade, while Sweeney noted modern AAA budgets now commonly land in the $250 million to $400 million range.

Former PlayStation boss Shawn Layden argued the industry needs healthier models for games that earn less than blockbuster hits, instead of treating a $50 million outcome as failure. He also warned against spending heavily on features that don’t meaningfully improve the experience, calling them expensive distractions.

AI came up as both a possible efficiency tool and a source of overconfidence. Amir Satvat said some studios are already cutting staff based on expected AI gains, then hiring back after realizing the savings were overstated. He singled out North America and western Europe, especially traditional AAA studios, as the hardest-hit regions.