Gamescom, the world's biggest video game trade show, commences on Tuesday in Germany, coinciding with a challenging period for the industry, marked by layoffs and studio closures. Organizers anticipate the event, held in Cologne until Sunday, will draw over 300,000 attendees, with companies promoting upcoming titles such as 'Indiana Jones and the Great Circle' and 'Call of Duty: Black Ops 6'. The industry is projected to exceed $180 billion in revenue this year and engage over 3.4 billion players, as per Newzoo. However, sales have not reached the highs seen during the pandemic. Amidst smaller studios' struggles, major publishers are implementing severe cost reductions, leading to thousands of job cuts. 'I witness studios that influenced me closing down, and it's alarming,' said David Rabineau, a French developer and head of independent studio Homo Ludens, to AFP. Game Industry Layoffs reports that at least 11,000 workers have been laid off this year, surpassing the total for 2023. Bungie, the American creator of 'Halo' and 'Destiny', recently announced it would cut 220 jobs, representing 17% of its workforce. The company, acquired by Sony in 2022, cited rapid expansion and a significant downturn in the industry. Rabineau, a Gamescom regular, noted that publishers are reducing budgets and becoming more selective about the games they support. 'They are taking less and less risk,' he stated. Stephane Rappeneau, a video game economics professor at the Sorbonne, explained that publishers are facing reduced funding, as investment firms shift focus from the pandemic-driven gaming boom to sectors like AI. 'Publishers are transferring these financing challenges to studios,' Rappeneau added. Mat Piscatella, an analyst at Circana, described the year as 'tumultuous', highlighting that the major consoles—Nintendo's Switch, PlayStation 5, and Xbox Series—have passed their prime. He also pointed out that older games like 'Fortnite', 'Minecraft', and 'League of Legends' continue to dominate player engagement and revenue, overshadowing new releases. Despite the challenges, Piscatella expressed hope that the industry has navigated the worst. He anticipates a boost from the upcoming release of 'Grand Theft Auto VI' and the unveiling of Nintendo's Switch successor next year.