“When GTA 6 ships, it will be a challenging disruption”: Mike Fischer, advisor at Krafton, on gaming landscape and 2025 expectations

How has the global games market changed from your point of view?

It’s been a heartbreaking year. I mean, almost every week I get a call from an old friend saying, “Mike, let’s catch up,” and then I find out that they’ve lost their job. And these are talented and experienced people. Underperformers lost their jobs a year ago. But the people losing their jobs now are really talented people who were just victims of this macroeconomic disruption in the games business.

So it’s been a tough year, and there is not just one single cause for it, right? It’s not just one thing, like inflation, war, or a new technology. It’s a combination of different things:

• Hangover from the overexpansion during the Covid pandemic;
• Continuing result of tightening restrictions on using private data for user acquisition and analytics in mobile;
• Aging life cycle of consoles that launched a few years ago, which never really achieved their full penetration potential because of the chip shortage that happened;
• TikTok, which is stealing something like 90 minutes a day from an average person who uses TikTok.

We also have the trend where people are staying with one game as part of their lifestyle. We used to describe a hardcore gamer as someone who buys five plus games a year and plays 20 plus hours a week. But now people are spending this 20 plus hours playing one and the same game because they’ve invested the time and the money in it, and it’s competitive.

So it’s a mix of different factors, and our industry is still adjusting to that. But I think we will settle. We will get our feet on the ground. There are already signs of it, with really wonderful games that came out recently, like Baldur’s Gate 3, Black Myth: Wukong, Helldivers 2, and Indiana Jones.

What also gives me hope and inspiration right now is the continued globalization and democratization of game creation. You know, I’m talking to you today from Jeddah, Saudi Arabia, and the creative power and sophisticated knowledge of video games of these young Saudis is inspiring.

I have seen wonderful, creative games here in Riyadh. I’m not talking about the big mega investments from folks like the Savvy Games Group, I’m talking about young, independent Saudi game developers who are leveraging the power of Unreal Engine and the power of Unity to make stunning games. There’s one studio here called TEKORE that has just released this beautiful simple gorgeous puzzle game, KORE, that really inspires me. And Nomadroid has an adorable little puzzle game called KoroNeko.

I’ve traveled around this world in the last 18 months. I’ve visited teams in Azerbaijan, Republic of Georgia, Kazakhstan, Uzbekistan, Philippines, and everywhere I go, I see these talented, creative young people inspired to tell their own stories through games, as opposed to the traditional, big, publicly funded, AAA publishers. I mean, Ubisoft, EA, Take-Two make great games, but they are not necessarily the fountain of innovation that I’m talking about.

And of course, we’re seeing the rise of AAA games from China like Black Myth: Wukong or miHoYo’s Genshin impact and Honkai: Star Rail. And also a big studio out of China, Hypergryph, has done some incredible work.

So the video game industry has not just become global in terms of markets, but also in terms of creation. That gives me hope and inspiration.

And what was 2024 like for you? What achievements would you highlight in terms of your M&A advisory work at Krafton?

I’m very proud and happy to have been working as an executive advisor to Krafton for investment and M&A for three years. I’ve seen Krafton evolve and change. When I first started, I had to spend a lot of time and energy explaining to people who Krafton was, to overcome the perception of it as an Asian company with a focus on just PUBG. It’s really wonderful to see how, three years later, the company has really matured and created a success story where they are empowering studios to achieve their creative potential.

I can only talk about some of the more public deals, of course, but we’ve seen them invest in studios across the globe — e.g. US-based Ruckus Games and Cyprus-based Eschatology Entertainment. I was also involved in the acquisition of Tango Gameworks. That deal was especially wonderful because it really saved the studio that was going to be shut down by Microsoft. It preserved an incredible creative team that was just getting into their sweet spot, after having made Ghostwire Tokyo and then High-Fi Rush.

Krafton is becoming, for lack of a better word, a wonderful force for good in the industry. So not only is it profitable and continuing to evolve their core franchises and develop their in-house content like inZOI, but it’s also helping these new studios like Ruckus, Eschatology, and Tango.

In an era where we’ve seen a lot of studios getting shut down, it’s wonderful to see companies like Krafton starting to take leadership and really help the industry. That will hopefully reinforce or even restore people’s faith in investment as a way to power creativity.

So I’m lucky to be working with a team that are investors, but it’s also a company of game makers. They know what it’s like to be a creator. And they’re dedicated to being the partner that as creators they would’ve wanted to have. In fact, they’re probably the most creator-friendly team I’ve ever met and their dedication to studio independence and creative freedom is something that’s restored my faith in the video game industry.

That said, the whole industry has some tough times ahead. I don’t think we’re out of the tunnel yet.

So what can we expect from 2025?

What actually keeps me up at night is the thought that GTA 6 is going to be so big and so successful it may suck up all of the time and all of the money of all gamers.

Now, I’ve met peers in the industry who disagree with me and think it won’t affect other genres. You will still have your traditional racing games, sports games and fighting games, and not everyone will have their lunch eaten by GTA. Me, I’m not so sure.

I remember when Fallout 4 shipped and Microsoft was shipping their exclusive Tomb Raider game. They’re different genres, but I think the blast radius from Fallout just ate up much of the demand for Tomb Raider, which, as a result, missed some of its potential. So whenever Rockstar ships GTA 6, there will never have been a game as big, as immersive, as incredible, as all-encompassing as GTA 6. It’s an unknown territory, and I’m a little concerned about what that will do for a lot of other AAA games in that space.

On the plus side, people will be buying a lot of PlayStation, Xbox consoles and high-end PCs to play GTA 6. For the current console generation, we haven’t had a super compelling game that has driven people to buy it, right? We’ve had a lot of great projects, but I don’t think we’ve had those sort of generation-defining games that would compel people to buy next-gen systems the way that Final Fantasy or Gran Turismo did for PlayStation or Gears of War for Xbox.

When GTA 6 ships, it will be a challenging disruption. Hopefully, there will be a larger audience as a result, but it’s literally an unknown territory, so we’ll just have to wait and see.