Nintendo president Satoru Iwata has criticised 'quantity-obsessed' social and mobile creators, questioning whether developers in this model will be able to make a living in the future.
Speaking during his GDC keynote speech, Iwata argued that the video game business is splintering into two sides; one focused on quality, the other quantity.
He said: "When I first spoke at GDC in 2005, very few in the audience were involved making games for mobile or social networks. Today, perhaps the majority of you are. Our industry has expanded. But I also have concerns.
"Our industry is dividing," he added. "Until now there has always been the ability [for devs] to make a living. Will that still be the case moving forward?
"Today in America there are more than 500 games for PS3, more than 700 for 360 and more than 1,000 for DS and Wii. With so many choices, it is very difficult to achieve visibility with the public. A few games do become mega-hits, but it is not easy... even being noticed is extremely difficult. Huge investments promise nothing.
"Consider this: The number of games available on the big app sites is in the tens of thousands. Game development is drowning. Yes, these games are far less expensive to create, but what revenue will they generate?"
The stage screen then displayed a Screen Digest quote, that 92% of leading downloadable 'app' games last year were free.
"Why is this happening?" Iwata asked. "It's necessary to understand two very different ways of looking at our business. Is maintaining high value games a top priority or not?
"First consider the objective of those of us who manufacture dedicated games hardware. [We believe] consumers reluctantly purchase hardware to play the games they want... We are a game creator first and manufacturer second. We really want our consumers to appreciate premium value of software.
"Although Xbox and PlayStation businesses are different in some ways, I believe we share this value 100%.
"But there is a second entirely different way to consider the value of software. The objectives of mobile and social network [creators] are not at all like ours. For them, content is something created by someone else. Their goal is to get as much software as possible - because quantity is how they profit. The quality does not matter to them.
"We are looking at two distinct sides of the video game business; one often requites investment that is too big, the other provides games that are not high value."