This year’s Game Developers Conference (GDC) in San Francisco gave Fenwick’s Games Group an inside look at how triple-A publishers and indie studios alike are tackling the challenges that come with chilled market conditions and cutting-edge tech integrations.
Here were our key takeaways from the whirlwind week that was GDC 2025:
1. Continued uncertainty carries into 2025. GDC felt a bit quieter this year, which is not surprising given layoffs, studio closures, and overall belt tightening limiting attendees. As a result, there was no escaping the general sentiment of uncertainty. However, there was quiet optimism as well, with prospects of splashy announcements later in the year, such as the Nintendo Switch 2 and GTA 6.
2. AI dominated the conversation and is hitting its stride as a practical tool. Whether it’s being used in the game code development lifecycle, quality assurance testing, or enhance in-game advertising—AI technology has moved beyond its initial hype and is now being implemented in more practical and impactful ways. Video game companies should consider how AI tools can be used to maximize operational efficiencies and create more immersive player experiences.
3. Studios are getting creative with their funding strategies. Amid a slow venture capital market, video game studios are eyeing other funding vehicles such as crowdfunding, development deals, publishing deals, and focusing on smaller projects. A diversified funding strategy can help studios sustain innovation and remain competitive until market conditions are more favorable for taking larger risks.
4. Expect to see bigger collaborations and deals. The soft fundraising landscape is leading video game companies to explore more significant and transformative M&A deals. Companies are looking to pool resources and expand their market presence through strategic acquisitions that better enhance their capabilities and help their games stand out from the pack.
5. User-generated content (UGC) continues to drive engagement. Like we saw at GDC 2024, UGC remains a significant driver of community engagement and player retention, which has been further enhanced by the use of AI creation tools. Platforms like Roblox and Fortnite are proof-of-concept of the power of community-driven content creation. Game companies should consider reviewing their terms of service to protect their intellectual property while encouraging player creativity.
