Well known for its third-party controllers, the Switzerland-based company has stated that it will discontinue its making of console accessories by the end of the year.
This story was confirmed by Bracken Darrell, CEO of Logitech, who stated that this decision came as a result of poor third quarter financial results, according to ComputerandVideoGames.com.
ComputerandVideoGames went on to cite that Logitech’s sales were down 14% this past financial year, meaning that it suffered a net loss of $195 million.
The PS3 Logitech controller, which currently retails on Amazon.com, used, for $17, in comparison to the official PS3 controller‘s price of $40, new.
This report came in soon after the announcements of Atari filing for bankruptcy, and THQ’s assets being divided amongst other video game companies. It brings to question whether this is a trend in the video game industry, or whether these were just unlucky coincidences.
It is odd to see video games suffering so much in the midst of a global depression, in that entertainment venues usually prosper in times of financial hardship.
A Time Magazine story in 2008, which was on the brink of the current Global Recession, stated:
“So far this year video games are on a 20% or more growth trajectory, thanks in part to the introduction of three popular new platforms. The $50 billion industry hasn’t been around long enough for other recessions to provide a guide as to how it will fare.”
From this, we can assume that the current status of the video industry will set a standard for how this specific industry will react in future recessions.
An explanation for large video game companies undergoing financial hardships could be the large move towards mobile gaming. As we reported on Tuesday, Temple Run 2 for iOS devices had 20 million digital downloads in its first four days of release. It was the top free app in the iTunes store, and was second in the top paid apps for its in-app purchases. Even Darrell claimed his company’s future alligience to mobile platforms.
In the future, Logitech will be focused on “more mobility-related products, leveraging the powerful growth of tablets and smartphones.” Furthermore, Atari stated that its reasoning for filing for bankruptcy came from its desire to move more towards mobile gaming also.
What do you think is causing the financial troubles for video game companies? Are mobile games to blame? Will you miss being able to buy the cheaper third-party controllers from Logitech?
Image credit: Joystiq.com (Logitech PS3 controller), Mashable.com (Mobile gaming picture)