Industry Pendulum Swings

tim-cain game-industry production outsourcing hiring teams art-style vr trends

Abstract

Problem: The game industry frequently treats recurring phenomena as novel trends, leading studios to repeat costly mistakes every 5–10 years.

Approach: Tim Cain draws on 45 years of industry observation to identify patterns that swing back and forth rather than trending in one direction.

Findings: At least eight major pendulum swings recur across production, staffing, art, and technology — from in-house vs. outsourced development to photorealistic vs. stylized art to VR hype cycles.

Key insight: These are not trends — they are oscillations. Recognizing them prevents you from being sold on the "next big thing" that's actually just the pendulum returning.

Source: https://www.youtube.com/watch?v=KPh_lkmmpSo

Tim distinguishes pendulum swings from trends. Trends move in a direction and may become dominant. Pendulum swings come and go and come back again — repeatedly, across decades. He also separates them from recurring false predictions (like "PC gaming is dying" every 5–7 years). The video covers swings he's personally witnessed over four and a half decades.

In-House vs. Out-of-House Development

Large publisher-developers periodically decide their in-house teams are too expensive, fire internal staff, and contract external studios. After a few years they realize external contracts are expensive too, quality is harder to control, and they pull everything back in-house. Tim watched Disney cycle through this multiple times.

Outsourcing vs. Keeping It Internal

Related but distinct: companies outsource specific disciplines (art, code, sometimes even design and QA) to avoid paying full-time salaries during low-utilization periods. They eventually discover that outsourcing requires dedicated management staff, quality review pipelines, and milestone tracking — which erodes the cost savings. The pendulum swings back to internal teams.

Experienced vs. Junior Hiring

Companies with expensive senior staff decide to hire cheaper juniors, framing it as "new blood" and "fresh ideas." The juniors, lacking experience by definition, fall into well-known pitfalls that seniors warned about. After burning money recovering, the company swings back to hiring experienced people. Tim sees this repeat every 5–10 years and suspects it may be unfixable — "some lessons you just have to learn, you can't be told."

Small Teams vs. Big Teams

Studios oscillate between small nimble teams (10-person preproduction, 50–100 full production) and massive teams (500–2,000 people) to compete at AAA scale. Small teams create designs too ambitious for their size; big teams become expensive and hard to steer. The cycle repeats.

Photorealistic vs. Stylized Art

When high-resolution 3D hardware arrived, the push was toward photorealism — which ages badly and falls into the uncanny valley. Stylized games (pixel art, cel-shaded, cartoony) hold up for a decade or more. As graphics fidelity improves again, photorealism comes back into vogue. Tim has no strong preference and simply watches the pendulum move.

VR Hype Cycles

VR has been declared "the new hotness" and then abandoned repeatedly since the Nintendo Virtual Boy. Each generation — Oculus/Meta, Apple Vision Pro — triggers a wave of excitement followed by the realization that VR is physically exhausting and the market is limited. Tim doesn't think VR is going away, but it keeps swinging between hype and disillusionment.

Other Recurring Swings

  • MMOs: Huge boom, decline, resurgence as players rediscover wanting to be online with friends.
  • Live service / subscription models: Pendulums between "everything must be a live service" and backlash. Tim doesn't think it'll disappear, but popularity oscillates.
  • Cloud streaming: Demonstrated impressively 15–20 years ago, still battling latency. Gains momentum as consoles drop disc drives, then fades when lag proves unacceptable for many genres.
  • Smell peripherals: A device in the mid-1990s let games emit odors. It died, came back, died again, and Tim hears it's returning. He does not want his games to smell.
  • Haptic gloves and suits: Periodically emerge, never stick. Tim notes he doesn't need to feel himself getting stabbed.
  • Taste: The one remaining sense nobody has seriously tackled yet. Tim preemptively does not want scratch-and-lick cards.

The Takeaway

Don't mistake a pendulum swing for a trend. When someone tells you something is "the future of gaming," check whether it's happened before — and whether it went away last time. Usually, the person telling you it's the future is trying to sell you something.

References