The closure of the Disney Infinity is not an example of the toys-to-life bubble finally bursting, because the sector has been in trouble for some time.
Looking purely at UK data, the toys-to-life genre of video games has been growing every single year since it began in 2011 with Activision’s Skylanders: Spyro’s Adventure. However the numbers are misleading, because that growth was largely due to the introduction of new competitors.
In 2013, Disney Infinity arrived. In 2014, Nintendo debuted its Amiibo range. Meanwhile, 2015 saw the arrival of LEGO Dimensions.
All three made the market look stronger than it really was. If you look specifically at Skylanders, that brand has been in steady decline since 2012’s Skylanders Giants.
There are reasons specific to each brand that has caused the sudden drop-off in interest.
Activision’s reluctance to develop Skylanders into anything other than a video game (it would frequently tell reporters that the ‘game was the TV show’) meant that the brand never developed any recognisable characters and was quickly eclipsed by Disney Infinity (Activision is now, finally, working on a Skylanders TV show).
Disney Infinity, meanwhile, despite regularly introducing recognisable characters, failed to innovate with the games themselves. Disney Infinity 1, 2 and 3 are all good titles, but they are all very similar experiences.
As for Amiibo, Nintendo’s toys have been very successful with almost 25m figures sold in the last 12 months. However, by Nintendo’s own admission, these have sold primarily as collector toys, as the number of people actually using these figures in games remains very low.
There is also a bigger, wider industry challenge facing toys-to-life (and kids' games in general).
Video games machines tend to perform better amongst a younger audience later in life, when the prices have fallen so that parents can afford them. We are still in the early stages the the PS4 and Xbox One’s lifecycle. Both machines dominate the sector, but their audience is currently older users.
So is toys-to-life in jeopardy? Is it time to abandon the idea?
It’s easy to point at a failure and at declining sales figures and suggest a market is about to collapse, but there are opportunities still in this market. There were over 620,000 Disney Infinity, Skylanders and LEGO Dimensions starter packs bought in the UK last year, an increase of more than 21 per cent year-on-year.
LEGO Dimensions launched last year and did a strong job, particularly amongst older players. LEGO has always had an appeal beyond children, while the LEGO video game franchise remains one of the biggest in the UK – in fact, it sits behind Grand Theft Auto, Call of Duty and FIFA as the UK’s best-selling video game series.
The game has done well so far with only a handful of big licences (Batman and Lord of the Rings), and a number of more niche ones (Doctor Who, Back to the Future, Ghostbusters). With the closure of Disney Infinity, there may now be the opportunity for publisher Warner Bros to introduce LEGO Star Wars and LEGO Marvel to the Dimensions universe.
Yet the real excitement in toys-to-life exists away from these big players. Dimensions, Skylanders and Infinity are all similar games in many ways and they’ve not really innovated beyond the original idea of sticking toys on a portal and watching them appear in game.
However, in projects like Anki Overdrive (which reverses the concept, with the game coming to life on a physical race track) or Fabulous Beasts (which is a sort of strategy game mixed with Jenga) we are seeing video game and toy projects that are offering something quite new.
It is here, in this experimental space, that toys-to-life has a future.
Chris Dring is the editor of leading video games trade publication MCV. He can also be found writing for The Observer, The Guardian and Doctor Who Magazine.