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This mega-article, which comprises all of the text we've already spilled on these topics, contains contributions from Gamasutra's staff and contributors, including Kris Graft, Leigh Alexander, Brandon Sheffield, Simon Carless, Frank Cifaldi, Tom Curtis, Mike Rose, Eric Caoili, Chris Morris, and IndieGames.com's Tim W.
In the following article you will find everything from the biggest surprises, trends, and controversies to our outlook for the most exciting games of 2012 -- and much more besides. And if you have an eye for history (or just want to check our track record) you can revisit Gamasutra's Best of 2010, 2009's 'Top 5s' compilation, plus 2008's similar compendium and 2007's chart rundown.
The dynamic video game industry never disappoints when it comes to major news events, and in 2011, choosing just five of the most meaningful events was as difficult as it's ever been.
That's because this year was filled with many instances worthy of note. There was drama, destruction, risk, death, disappointment, flashes of brilliance, moments of surprise and, above all, victory.
Whereas last year's major events did a fine job of bringing about questions, this year was able to provide at least some answers. Now we know where Nintendo is placing its hopes for its home console business, and that $250 is too much for a 3DS. Now we know that game companies can't take security for granted. And we also know that we won't be carded for an M-rated game anytime soon.
5. Steve Jobs's Death
For someone only ostensibly part of what we might define as the "video game industry," Apple's Steve Jobs had an enormous impact on the sector. It was his iPhone hardware that opened up new kinds of gameplay, the App Store and iTunes that gave game makers a new platform for wide distribution, and the iPad that opened up a tablet market that welcomes video games with open arms.
Steve Jobs passed away on October 5 this year after a fight with pancreatic cancer. It was his design genius that allowed Apple products to touch so many people and so many industries, including the gaming industry (one that he was an active part of earlier in his life).
It's true that there are intelligent capable people he left behind at Apple, and Jobs' death doesn't mean that the company can't still have considerable impact on the games industry. But we'll never know just how much further Jobs could've taken his vision, and how that might have influenced gaming.
4. Wii U Unveiled
As the only pure-play video game company in the big three, Nintendo's hardware unveilings are always big news. The way the company attacks the medium from unique angles has a special way of keeping us on the edge of our seats.
At E3 in June, the company put rumors to rest and gave a name to its next home console: "Wii U". Nintendo's next home console will be high-definition capable and backwards compatible, but most strikingly, the controller boasts a 6.2" touchscreen in between more traditional sticks and buttons.
As with the debut of the phenomenally successful Nintendo Wii, the Wii U's unveiling was cause for excitement, as well as questions. Would Nintendo finally be able to make both the mainstream and the core gamer happy? Will the games utilize the new control scheme in new, fun ways? Or will it just be a gimmick?
Nintendo president Satoru Iwata made a big statement when he told E3 attendees, "The new platform will provide you with deeper game experiences than what even the most passionate gamer has realized before and it will offer wider appeal to gamers, wider even then for Wii... It will let everyone see games in a different way."
3. 3DS' Rapid Price Drop
Months before launch, Nintendo appeared supremely confident that its next handheld gaming machine, the 3DS, would be a hit. There was little indication that it wouldn't be, as the device had generally received positive reviews from the press, and the glasses-free stereoscopic 3D effect wowed others who got a pre-release hands-on with the DS successor.
The March launch price of the machine reflected Nintendo's confidence: $250, or the same price as the Wii when it launched in 2006.
Nintendo's new handheld wouldn't hold that price for long. Sales were dropping rapidly and the company had to make the drastic decision to cut the price of the device. Four months after the U.S. 3DS launch, and five months after Japan's, Nintendo announced it would reduce the price of the handheld to $169.99 in the U.S., with similar price cuts worldwide.
If the 3DS' price cut is not the fastest and heftiest post-launch sales drop in video game history, it certainly is a top contender.
Nintendo eased the rage of early buyers by deeming them "Ambassadors," and giving them 20 free downloadable games playable on 3DS. The price drop took effect in August, and gave the handheld much-need traction. Now, with some strong holiday software titles, Nintendo says the 3DS is on track to beat first-year sales of the smash-hit DS, another Nintendo handheld that had a slow start.
2. PlayStation Network Breached
It's not uncommon for a network to have to go offline for a short period of time, due to technical difficulties. When Sony said in late April that PlayStation Network would be down for "a day or two," there wasn't much reason not to believe the company. This of course is Sony -- surely it has the resources to get the network up and running again, promptly.
But that wasn't the case. Rather than an outage that lasted just "a day or two," what appeared to be a technical snafu turned out to be a security breach of monumental proportions, as Sony announced that an "external intrusion" by unknown cyber assailants had compromised personal information of about 77 million registered PSN accounts, plus nearly 25 million Sony Online Entertainment accounts.
Sony had only partially restored major online functions to its network by mid-May, and it wasn't until six weeks later, in early June, that a full restoration would take place in the Americas and PAL territories, plus parts of Asia. Japan and the rest of Asia were fully restored in late May.
The event showed that even the world's largest companies aren't safe from hacking and other kinds of cyber attacks. Sony went on to add to its staff a "chief information security officer," and promised that security is now a "full-time commitment."
1. Video Games Are Protected Speech
Easily the biggest news for the video game industry was the validation by the highest court in the land that video games are protected speech.
The long-awaited, landmark ruling in June this year set a precedent for the government's role in the regulation of the video game industry, and helped place the video game industry on equal ground with other forms of media in terms of government regulation.
Games could continue to be self-regulated by the industry, and not treated by the government as pornography or some kind of addictive substance that's harmful to youth. Rather, the people who make games could enjoy the same creative freedoms as authors, playwrights and film directors.
The ruling tells politicians to think twice about penning unconstitutional laws, and using taxpayer money to initiate more moral crusades against the video game industry. Now we know that, according to Supreme Court of the United States of America, "Video games qualify for First Amendment protection."
Other notable industry events of 2011 included:
Sony unveils NGP/ PS Vita
Japan's devastating earthquake
Call of Duty: Modern Warfare 3's big sales
Duke Nukem Forever actually launches
EA acquires PopCap
Adobe halts Flash player development for mobile browsers
Zynga files for major IPO