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Indie gaming is on the verge of an immersive sim eruption
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You can argue half life, but Deus Ex and Thief are the quintessential "immersive sim" forbearers (along with system shock 2). When they say sim, they mean the game reacts to play action in ways that aren't predetermined or scripted. The idea is they value player agency and their impact in the game world over pre-set events