There's been a lot of turmoil in the gaming industry recently, as economic hardships being felt world round are starting to take its toll on videogame publishers and developers. Everybody from Sony to EA have had to downgrade profit expectations and lay off huge amounts of people, but the big companies are the lucky ones. They're just making less money right now, but they're still viable companies that aren't going anywhere soon. But what about the smaller companies, the ones with maybe 100-200 employees (or less), who only make one or two games a year?

In the last week, two experienced and long standing developers have gone under -- Free Radical and Factor 5. Both of these companies were famous last generation for their own unique franchises. Free Radical made the wildly entertaining TimeSplitters series (a personal favorite of mine during the halcyon days of the PS2) and Factor 5 made the Rogue Squadron series -- easily some of the best playing and looking GameCube games ever made. While neither of these franchises were wildly successful, they were well reviewed and sold well enough for multiple sequels and earned both developer teams some much deserved kudos. But that was last generation, and what a difference a couple years makes.

This generation, both developers sided with the PlayStation 3 as the system to make their first games for. Factor 5's LAIR was one of the first games shown off for the PS3, a fast paced violent dragon-based fantasy take on their previous Rogue Squadron games, and Free Radical's first game was the much hyped first person shooter Haze. While there were high levels of initial excitement for both titles when they were unveiled, certain signs started popping up early that the developers may have bitten off more than they could chew. Multiple lengthy delays, hit or miss hands-on reports, and rumors of massive development issues started to plague both games. But plenty of games experience all of these issues and come through it okay, so most gamers (and the press themselves) wrote off these issues and focused on the more important topic of the time -- the always popular controversy over PS3 exclusives or the lack thereof. The will-they-won't-they guessing game of Haze's exclusivity took the front seat to the actual quality of the game itself, which kept hype running high, regardless of the hands-on reports and long delays.

Eventually though, both games were released and all the hype in the world couldn't hide the unpleasant fact that both games were horrible. LAIR's much hyped 1080p resolution turned out to be more of a detriment than anything, forcing the game to use muddy textures and chug along at a framerate that would render it unplayable at times. And all its 'innovative' SIXAXIS motion controls did was unfortunately showed the world how badly Sony had failed to mimic the accuracy and responsiveness of Nintendo's Wii-mote.

Haze didn't fair any better. Free Radical had departed from their fast-paced, story-light TimeSplitters series and focused on a slower, more methodical game with a 'serious' storyline penned by one of their internal employees (unfortunately never a good sign). Though the hype meter ran exceptionally high for Haze, nothing could hide the fact that when it came out, people were exposed to amazingly subpar gameplay, as well as glitchy, unattractive graphics -- not to mention the game's laughable dialogue and painfully stupid story. Unsurprisingly, both game were massive critical and commercial failures. 

The problem is that normally when an established company makes an unsuccessful game, they pull themselves up by the bootstraps and focus on making their next game better, and I'm sure both Factor 5 and Free Radical were trying to do this. But instead, these PS3 flops killed off both companies before they were able to even release (or even really announce) their next games. Sure, the current state of the economy would have been putting extra pressure on the studios to close down (or at least streamline), but you can't help but wonder if the difficulty in developing for the PS3 was a factor as well. The delays both games went through were extreme, and would have cost the companies untold hundreds of thousands of dollars -- if not millions. And even after all the delays, both games had massive technological issues that dragged down the public's interest of them even more. Would these games have had such issues if they had been released on the Xbox360 or the Wii? If LAIR was released at 720p and with standard controls, most of the complaints against the game would have been dropped and if Haze had been developed for more standard technology, maybe they could have released it at a reasonable resolution and with less glitches and in a more timely manner. 

So is it dangerous for smaller studios to develop big budget titles for the PS3? If making a single PS3 game has the risk of bankrupting your company, surely that will make the idea less appealing. Admittadly, studios like Media Molecule have done quite well with LittleBigPlanet, but what if they are more of the exception to the rule than the norm? It's unlikely that developing a game for the PS3 was the sole cause for the two studio's untimely demise -- there is no denying that Free Radical and Factor 5 both released just one game this generation, and now they're both out of business. Was this just the sign of two small studios not being able to run with the big dogs, or is this a sign that developing for the PlayStation 3 is the industry equivelent of Russian Roulette? For Sony's sake, they better hope it's the former.