If consoles didn't have exclusive games there would be no market. The margins of gaming would contract and contract and contract because there would be very little reason for any consoles to compete with each other and the platforms would start to shrink until all that's left is EA, Activision and Ubisoft. It would not be healthy for the industry at all for every console to have the exact same library.
I wonder how the computer market flourished for decades alongside consoles, then.
Hell, it was rife with bootlegs, legality wasn't always very present like with the Giana Sisters... and it still had way more games than the consoles of yore. Didn't crash in 1983 either.
As for competition... if it was only AAA and indies left... it wouldn't be so different, wouldn't it? They do represent the immense majority of sales
and total number of games released every year.
But then they would have to stand on their own merits like Ubisoft games (which do rate pretty highly), without emotionnal investment in a particular company selling you plastic boxes.
It also wouldn't be SUSTAINABLE for the industry. A lot of smaller developers survive BECAUSE they don't go overboard porting to every platform under the sun.
That's pretty weird, because that's literally the opposite of what happens, and what happened since the beginning.
Smaller devs could only publish on the PC because there's no platform owner to tell them to get fucked or pay them royalties while following their guidelines. Since the early days, the "wild west" was the only way to go, not getting a deal with Nintendo or Sega.
And the Japanese scene is fascinating, as doujin could only made on one platform because nobody wanted them. And they started finding large success... when they finally could expand to other platforms, visual novels were a ridiculously small niche, now it's much more popular because it's not only on crazy expensive computers from the 90's.
Without even talking about the "AA" games, that could only survive... with a single uncontested leader. Remember the days of the PS1 and the PS2? It sure as fuck wasn't competition that made smaller devs popular, it was the fact that you'd put your game on it, and the largest number of players would play it.
The few that took a deal or tried to push games on Saturn are not here to talk about it anymore.
Nowadays, it's much easier to port small games on every platform and the indie scene is thriving!
Because exclusivity is death to a small game.
There is zero doubt that Kero Blaster launching on Playism only damaged its potential beyond belief, and that's the follow up of Cave Story, the granddaddy of all indie games.