2023 year in review

Previous yearly reviews: 2022, 2021, 2020, 2019, 2018, 2017, 2015.

Industry stuff

The global games industry had a peculiar year in 2023. Pandemic-delayed production resulted in one of the most stacked years in memory in AAA releases (and I’m ashamed to say my backlog is so long I might as well just declare bankruptcy). Meanwhile, mobile didn’t grow, and China arguably led the decline.

Sadly, layoffs were a major theme of the year too. In the west, the main drivers were over-expansion in the pandemic-boom (Epic) and the end of zero-interest fueled acquisition sprees (Embracer Group). The Embracer story was particularly depressing, because even during the buying frenzy it was highly questionable how operationally the whole strategy was supposed to work – and when it didn’t, it was the thousands of developers at those various studios who paid the price first.

In China, layoffs were also ongoing, with the Bytedance event late in the year being probably the biggest. What’s notable about the Bytedance layoffs is that it was mainly driven by the company’s shifting strategic priorities, rather than financial pressures or over-expansion per se. When Bytedance marched into gaming 4-5 years ago, it was driven by a desire to create a significant new source of revenue growth. Gaming has always been “core” to Chinese internet conglomerates (in contrast to FAANG), so the decision back then made strategic sense even if there were lots to critique about Bytedance’s execution plan. However, Bytedance has since discovered a new revenue engine in Douyin e-commerce, while the gaming initiative has been predictably slow to show results at a scale that is material to the company’s ambitions. So the strategic divestment of gaming assets reflects a desire by management to focus and shed distractions – and once again it’s the developers in the affected studios who are paying the price.¹

Depressingly, as I’m writing this in January of 2024, we’ve already seen a bloodbath of new layoffs – Unity, Riot and Blizzard (to name just a few). The Riot news hits close to home, since I worked there for 8 years. To be honest, I was shocked reading the publicly released email that since 2019 – which happened to be the year I departed – the company had doubled in size. The reason for my shock is simple – I felt back in 2019 the mood of the company was already “let’s be more fiscally disciplined and improve operational efficiency, since the new games outlook is uncertain”. Thus, it’s very hard to not point the blame at management, for either misjudging the big picture or not being able to fight back the institutional growth inertia (or both).

Moving on – the metaverse hype-cycle may have passed, but 2023 actually saw some tangible developments in games with platform ambitions. Epic unveiled UEFN to developers at GDC, and ended the year with a major expansion of diverse experiences in Fortnite – Lego, Rocket Racing and the Festival. Meanwhile, the “party-game as platform” war commenced in China, with Tencent launching Dream Stars in December in a direct head-to-head against Eggy Partyfrom Netease. Dream Stars released with a staggering (and almost comical) amount of features and game modes, including a UGC-platform that was already seeded with community-made content. As a small sample, the official game modes already include the classic Fall Guys race, an Among Us clone, a team vs team hide-&-seek mode, and a team death-match 3rd-person shooter mode.

Valorant finally launched in China; I’m unsure if it’s living up to expectations. Judging from PC cafe data, it’s a distant 5th in market share, behind the perennial top 3 of League of Legends, Dungeon Fighter and CrossFire, as well as 4th ranked Battle Royale game Naraka Bladepoint. This may be more of a regional product-market-fit issue rather than any particular execution failures – mobile is just too dominant in China, and we may be past the days where a PC game can break out of its niche hardcore audience into true mass market (like League of Legends did over 10 years ago). At the same time, from some anecdotal figures I heard, Valorant’s revenue performance in China is quite strong.

One dark horse the past couple of years in China has been Battle of the Golden Spatula – this is the Tencent-made China-only mobile version of Teamfight Tactics (Riot’s take on the auto-chess genre). The story of this game’s journey deserves a proper account some day. Suffice to say there were not high expectations for this game initially – both Riot and Tencent only had a skeleton crew to support the launch. And it has outperformed since, frequently overshadowing the much bigger Riot-Tencent mobile production Wild Rift. By 2023, it has become a regular name in Tencent’s quarterly filings – a honor bestowed only to the very few titles that are driving significant impact to the corporate P&L.

One last China-related commentary – the big game teams seem to have consistently gotten bigger in the last few years. I feel this is a combination of the “industrialization” death march and the market uncertainty driving consolidation. As one anecdote, I’ve heard Dream Stars has over a thousand full-time devs supporting its launch (this includes the “game team” and also supporting resources pulled in.

Work stuff

Last year was a rollercoaster of emotions at work, coupled with a lot of change. The highs involved reaching a successful internal project milestone, and stepping into some new responsibilities that forced me out of my comfort zone. The lows were several unexpected people-related challenges. One was particularly stressful, and in hindsight a big test of whether we lived our culture or was just paying lip service. I’m thankful we passed that test with flying colors.

All in all, I think I grew a lot personally through the trials by fire, and the Shanghai teams and games did so as well. Hopefully there’s more things public to write about next year:)

Personal stuff

I want to say “back to normal” was the main theme last year. I’m not sure how accurate that really is. Sure, I traveled a lot more, both for work and leisure. (I even managed to take my better half on a trip abroad, just the two of us – I can’t recall the last time we did that.) And it seems everyone quickly forgot what life was like under zero-Covid; I was only occasionally reminded by the box of leftover antigen test kits in my living room cupboard. They were put to use again when I got my second infection in July.

One thing I should a tiny bit proud of – I’ve gotten into a semi-regular habit of rock climbing, thanks to all the Sunday afternoons taking my son to his classes. In the grand scheme of things I’m still an absolute beginner, but it’s been great challenging myself and my comfort zone. One memorable failure was a session where the gym was more packed than usual, and I was too afraid to make a fool out of myself on the wall to get enough reps in. I think I’ve made some meaningful improvements on this, though I’m still painfully self-aware some days.

Media consumed

I did a bunch of catching up on my American history last year. I read in order 3 books by Alan Taylor – American Colonies, American Revolutions and American Republics. I then moved on to the Civil War, with Battle Cry of Freedomby James McPherson. I’ve since hit a total roadblock with the reconstruction and the gilded age through The Republic for Which it Stands, a much difficult read for me. I’ve just gotten back to it recently – hopefully I can say I finished it in the next yearly review.

In terms of film and TV, I did a lot of “Netflix and chill” last year (when I felt too fatigued to even play video games), and honestly there didn’t seem to be many memorable stuff (Blue Eye Samurai was great!). I do believe it was last year that I did a full rewatch of The Wire. Apple TV+ has some decent shows – I’m a fan of For All Mankind (which wins by sheer scale of ambition) and Slow Horses – but it doesn’t seem to have the quantity or the prestige yet.

Games – I sampled many games for work; one of the few games I finished was Final Fantasy XVI, which I played at home during my July bout of Covid. Diablo IV made me realize that I’ve always been a casual player of the franchise, and I bounced off it very quickly after its launch. I went back to Dead Cells and sunk a couple of hundred hours in it – I need to go back to it still since I haven’t finished 5BC difficulty yet. Towards the end of the year I picked up Warcraft Rumble – I wouldn’t say it’s a great game, but it perfectly served a need and I’ve played it almost daily since its launch.

Closing thoughts

This is a shorter piece than some past year’s, mostly due to a hectic January. I’d like to be a bit more disciplined about writing this year – otherwise this is going to be an annually updated blog (as opposed to a quarterly one) – let’s see how that goes…

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