Paradigm shifts in the video game industry

Purpose – The purpose of this paper is to identify, characterize, and discuss paradigm shifts that have occurred in the video game industry with some emphasis on competition and competitiveness. Design/methodology/approach – Basically, the paper depends upon a review of the literature associated with video game development. Past history is taken from texts and academic papers dealing with the subject. More current observations are taken from the business and popular press. These observations are placed within a context associated with the classic papers on industry evolution, paradigms, paradigm shifts, competition, and competitiveness. Findings – It is difficult to capture present shifts in such a fast‐growing industry, but these shifts seem clear: the original entry of video games into the arcade sector that led to the industry and the demise of pinball; the development of the home cartridge and console that made the industry a home‐based phenomenon; the entry of independent game‐publishers that made the industry a two‐tiered one; and the development of massively multiplayer online role‐playing games (MMORPGs) that changed the way games are played. Originality/value – The video game industry is an interesting one to follow. To an extent, its development characterizes our generation – fast paced, technologically oriented, and targeted toward the young and young at heart. This paper takes the subject away from a historical or anecdotal approach and places it within the context of industry evolution, paradigms, and paradigm shifts. It thus should be of value to students of not only video games, but also the evolution of rapidly growing industries and establishment of competitive advantages.