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In: Computers and Technology

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Journal of Economic Geography Advance Access published June 22, 2005
Journal of Economic Geography (2005) Page 1 of 30 doi:10.1093/jeg/lbi001

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

This paper has two main aims. Firstly to conceptualize the production networks of the video games industry through an examination of its evolution into a multi-million dollar industry. Secondly, to use the video games 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 are bounded within three major economic regions: Western Europe, North America and Asia Pacific. This paper seeks to explain how and why this has occurred. Keywords: video games, global production networks, value, power, embeddedness JEL classifications: L14, L23, L82 Date submitted: 4 October 2004 Date accepted: 12 April 2005

1. Introduction
The video games industry1 was born during the early 1960s and has rapidly, and almost continuously, grown in size and scope ever since. It is estimated that the industry was worth around $23.2 billion in 2003, and is predicted to reach $33.4 billion in 2008 (DFC Intelligence, 2004). Despite now being comparable in size to the global film industry, and having a pervasive impact upon popular culture, the video games industry has received relatively little...

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