The 1983 Video Game Crash and a History Lesson for Lina Khan
Gaming is big business, on track to be worth $321 billion by 2026, which is why Lina Khan and the FTC have their sights set on the sector.
Source: The 1983 Video Game Crash and a History Lesson for Lina Khan - Foundation for Economic Education
Most of those who have been around video games long enough are aware of the 1983 video game crash. The causes are pretty well understood. While some of it might come down to the limited technology in use at the time, most of it is due to a cash grab by greedy developers.
For a while, Atari had a virtual monopoly in the video game world, even more so when it came to games on their own system. Atari didn't treat its game developers particularly well though so some of them broke away and formed Activision. Activision had great success developing high quality games. Others saw their success and sought to emulate it but without necessarily including the "high quality" part. Pretty soon there was a glut of largely low quality games on the market and nobody was bothering to buy them any more.
Later on, Nintendo came along and brought improved technology and a renewed emphasis on quality games which led to a rebirth of the gaming industry.
Fast forward nearly 40 years and now the government feels they need to get involved in an industry that thus far has managed to work out its own problems quite well for the most part. Quite frankly, their involvement makes no sense here. Essentially, Microsoft is acquiring a high quality software maker to improve its competitive stance against Sony who is currently easily out competing them. Yet somehow it is Microsoft accused of being a monopoly (not a new position for them). For some reason, the idea of having exclusive games is monopolistic.
Lina Khan is the Chair of the Federal Trade Commission so ultimately, it is her decision to persecute...um... prosecute here. Fortunately, the right thing ultimately happened and the court called her out for being the idiot she is (well, not exactly in those words but let's just say she lost her case completely anyway). So this is just another example of a high level government official who doesn't seem to have a clue what they are doing and are proficient at nothing other than wasting taxpayer dollars.
What I find wild is, everyone was fine when it was Nintendo or Sony buying up studios and making them exclusive to one platform, but when Microsoft does it, it is suddenly monopolistic actions.
I don't get it either. Maybe it's some collective government bad memory from when they were suing Microsoft for Windows supposedly being a monopoly that has led to a grudge or something. More likely, Nintendo and Sony have better lobbyists.
As experienced as Microsoft is with government meddling, you would think they had the better lobbyists. 🤣
Course, Nintendo has been dealing with government in court often ever since the anti business practices of their NES days contracts came to light.
Sony though, I have never heard about them in court involving the government so they probably have the best lobbyists ever 🤣