5. The EA and Take-Two Acquisition Dance

In the weeks following late 2007's $18.9 billion Activision Blizzard merger, fellow publishing juggernaut Electronic Arts hoped to carry out its own coup by proposing a $2 billion bid for Grand Theft Auto house Take-Two in February.

This tango lasted for six months, which consisted of Take-Two rejecting the "inadequate" offer, EA going hostile with the bid and lowering the price of its proposal, multiple extensions of the offer, and pages upon pages of analysis of the situation from outside parties.

All of this exposition and posturing led to the biggest anti-climax of the year when EA walked away from the deal after exhibiting steadfast discipline in sticking with its $25.74 per share offer. A review of upcoming Take-Two titles failed to convince EA to raise the bid and the non-deal disappeared behind the horizon.



4. Gamers and Developers Get Into the U.S. Election

During the 2008 U.S. presidential campaign, gamers and game developers were outspoken in their views. Indie developers created countless Flash games featuring candidates, Obama and Palin became downloadable content in Mercenaries 2, in-game Obama ads went up in Burnout Paradise, Microsoft facilitated voter registration via Xbox Live and industry execs made thousands of dollars worth of donations to their presidential picks. The interest that gamers showed in the future of their country was just one more example of the maturation of the gaming community.



3. Nintendo Hardware Cheerily Crushes All

It's hard to imagine now that we ever snickered at the wand controller, or questioned Nintendo's wisdom in calling its new console "Wii." With around 40 million sold worldwide in just over two years, the Wii is this generation's certified sales freak, smashing records gleefully with mass market appeal.

And economic downturn? What economic downturn? Nintendo's home console sold over 2 million units in the U.S. during November, more than the top piece of software, Gears of War 2, almost as if Nintendo wanted to say, "Come see what we can do when we actually have supply." In terms of installed base growth, it's laying high-def consoles Xbox 360 and PS3 to waste, typically outselling both consoles combined on a monthly basis in North America.

As for portable domination, the four-year-old DS is now ahead of the Game Boy advance with around 90 million sold worldwide. Nintendo hopes to reinvigorate handheld sales with the DSi, the freshened hardware that launched this year in Japan and slated for 2009 in the West. It looks like a one-two finish for Nintendo's platforms.



2. Poor Economy Tests the Industry

2007 ended with a bang for the games industry, as sales reached a record $18 billion in the U.S. alone. Analysts projected further growth and videogames appeared to be an unstoppable force.

As 2008 wore on, however, the average person became all too familiar with the term "credit crunch" and the games industry along with investors began to question the resilience of videogames in such a tumultuous environment. At first, with the industry growing at an nice clip throughout the year, some threw around the idea that games were "recession-proof."

But after individual publishers began directly citing poor consumer confidence and a "soft economy" for financial shortfalls, the sentiment of a "recession-proof" industry was quickly nixed in favor of "recession-resistant."

While we've seen report after report of layoffs, cut-backs and closures in recent weeks, overall, the games industry has been fortunate to experience growth, and that's because the people behind the games on the creative and business sides have been able to cultivate a tenacious appetite for interactive entertainment, even when consumers are strapped for money. NPD says the U.S. is on-track to hit $22 billion in 2008.

But where some have weathered the storm, other companies and the people within them have fallen upon the chopping block...



1. Layoffs, Closures and Cut-backs

Related to the economy but deserving of its own entry are the layoffs and studio closures that became commonplace in the last half of 2008. Particularly in the fourth quarter, layoff and closure reports were churned out at an alarming rate.

Even industry giant EA, with its powerful publishing and distribution capabilities and well-known franchises couldn't avoid slumping consumer confidence, announcing in December that it would cut 10 percent of its workforce, or 1,000 people, in order to cut costs.

There was also Midway, which after being sold to private investor Mark Thomas cut 25 percent of its total workforce, or 180 people.

Stormfront, Iron Lore, Pseudo, THQ, Eidos, Flagship, Spacetime, Factor 5, Free Radical, Funcom, Gearbox, WildTangent, Avalanche and others either announced significant layoffs or outright closures this year. The economic downturn wasn't the driving factor behind every single one of these instances, but if anything, unemployment is even tougher when the economy is in the tank.