Video games production networks: value capture, power relations and embeddedness

This paper has two main aims. Firstly to conceptualize the production networks of the video games industry through an examination of its evolution intoamulti-milliondollar industry.Secondly, touse thevideogames industry to demonstrate the utility of Global Production Network approaches to understanding the geographically uneven impacts of globalization processes. In particular, three key notions of value, power and embeddedness are used to reveal the most powerful actors in the production network, how they maintain and exercise their power, and how the organization of production is manipulated as a result. It is argued that while hardware production is organized by console manufacturers using truly global sourcing strategies, the production of software is far more complex. In fact, software production networks arebounded within threemajor economic regions: WesternEurope, North America and Asia Pacific. This paper seeks to explain how and why this has occurred.