Europe's biggest video games show, Gamescom, opens its doors Tuesday in Cologne, Germany, with the industry hoping that the upcoming blockbuster "Grand Theft Auto VI" can provide a much-needed boost, as studios cut jobs amid fierce competition.
Fans and professionals will get a first glimpse at scores of new titles at a sold-out opening ceremony that begins at 8 p.m. (6 p.m. GMT), which will highlight coming games for about two hours.
Even though "GTA VI" will not be among them – its U.S. maker, Rockstar Games, has its own plans for what could be one of the biggest game launches ever – it will be on everyone's mind.
Nearly 360,000 people attended Gamescom last year, almost hitting the pre-COVID-19 levels of about 370,000.
Visitors, many of whom dress up as their favorite characters, will be able to play new releases at hundreds of stations starting Wednesday.
Over 1,600 exhibitors will showcase more than 800 games, according to organizers.
Japan's Nintendo will present "Nintendo Switch Sports Resort," and Microsoft's Xbox division will show off "Call of Duty: Modern Warfare 4" and "Gears of War: E-Day."
Another notable absence is Japan's Sony, maker of the PlayStation 5 console.
Meanwhile, Rockstar has scheduled a Netflix preview of "GTA VI" for Thursday ahead of its Nov. 19 launch, which is expected to steal away some of the Gamescom spotlight.
Some rival studios have pushed their releases forward to avoid clashing with "GTA VI," creating an unusually dense calendar of new games.
"It's a very crowded market," said Joost van Dreunen, a professor at New York University's Stern School of Business and a specialist in the economics of video games.
"There's just too much for people to play."
At the same time, console prices have risen as memory chips have become more expensive due to the artificial intelligence industry's huge demand for computing power.
In the U.S. video game market, for example, overall spending dropped 21 percent in June.
The combination of steep competition and pressure on profit margins has forced many studios to slash costs.
Nearly 10,000 people have lost their jobs in the gaming sector since January, and the industry is on course for 15,000 layoffs this year, according to the ASGC Games Industry Layoffs Tracker.
If reached, that figure would be close to the 2024 record, which followed a hiring boom during the COVID-19 pandemic.
"The current focus is margins. Not just growth. Not just revenue. Margin growth," von Dreunen said.
"Every major decision follows from that objective."
