I used to work in the game industry. I worked as a programmer on several Playstation games and did a little PC game programming too. I left the industry for two reasons:
1) Financial: Small developers setup and go out of business at an alarming rate and often take your last months wages with them. I was getting old, I had responsibilities and I needed something more stable, so I jumped into the burgeoning Internet development industry shortly before the dot com crash....
The pay sucks in games too (though it has improved). You either have to be a genius (Which let's face it, few of us are. You may think you're the next John Carmack or Warren Spector but trust me, the industry has many very, very clever people, and it's more likely you'll end up being the next faceless "UI/Peripherals programmer" or "Internal Producer"), or you have to have been working in the industry since the 8 or 16 bit days and have lots of respect.
It doesn't help that making games can be interesting and exciting work(unless you're working on Barbie Fashion Designer 4) and many people will work long hours for little money, just to be a part of it.
2) The industry is very immature. Whilst it's got more professional with the consolidation and large sums of cash required, a lot of companies have people in middle and upper management with little or no management training, who were probably victimised at school and are intent in wreaking vengeance on anybody who disagrees with them or reminds them of the bloke who gave them a wedgie behind the bus stop circa 1985.
When I joint the industry I saw found it be a spoilt 8 year old, who had learnt enough to know the difference between right and wrong, but still got overexcited and greedy on occasion. Nowdays, I see the industry as a petulant 14 year old, who wants to be grown up and be given responsibility but still can't help sulking and throwing tantrums when things don't go their way.
Anyway, I've left it now and I don't intend going back. But trust me, if you've got the skills and the determination, then it can be a really rewarding career. Just don't expect to get rich doing it.
Gunrock
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