Is game development/programming prohibited in Islam?

In simple words, is game programming, development and publishing prohibited?

I am a hobby programmer and while I was learning one of game development frameworks, my friend suggested that since making pictures of living beings is prohibited, game development could also be prohibited because the characters are often humans or human-like. I know many Muslim brothers developing games for iPhone, Android etc. This is a bit confusing. If it is not allowed then why are so many Muslims involved in it?

Here is what my search led me to

And what about small 2D games which have cartoon characters and not humans?

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