Your Thoughts Exactly: My first love

Friday, June 18, 2004

 

My first love

Ok, I started this blog off with high aspirations, wanting to touch on all sorts of hot-ticket issues, but who wants to read a blog about that kind of stuff? Nobody, that's who. So I am going to talk about the subject I am most qualified to talk about: video games.

I have been playing video games since I was able to form coherent memories, so I feel I have a lot of experience. Mostly in PC games, but right now let's discuss consoles.

Right now Sony holds the lion's share of the console market, with something like 60-70% of console owning households owning a PS2, compared to like 40 and 20 for the Xbox and GameCube. However, recently, the Xbox has started to outsell the PS2 which I feel can be directly linked to the fact that the Xbox is the newest and most powerful console of the three. Microsoft is really leveraging their deep pockets to sell Xboxes (they take a loss with every one they sell) and recently announced that the Xbox 2 will be out before either the Nintendo Revolution or the Sony PS3. This is very bad news for Sony, who plans to release their PS3 in 2007, almost two years after Xbox 2 comes out. By the time this happens I believe that Microsoft will have wiped Sony off the map.

How can Sony expect to go almost 7 years between updates of their flagship console? The PS2 already shows its age in graphics quality and now game quality, and to wait another 3 years for an update is like market suicide.
The problem is that Sony thinks of itself as a hardware manufacturer (its strength since it sells TVs, VCRs, computers, etc.) However, Sony Entertainment, the group that heads up PlayStation development, is almost a separate entity and should be able to make decisions based on a much shorter timeframe. By the time PS3 rolls out in 2007, it will be like they are entering the video game market anew. And from what I've heard about the learning curve for making games for the PS3, this is not a good thing.

The Xbox 2 will be the first console out, it will sport new graphics, (which people have been waiting for since... the last Xbox), and now that the Xbox is the top-selling console, Microsoft will be able to translate these sales into Microsoft loyalty and encourage them to buy Xbox 2, especially if Xbox 2 is backwards compatible with Xbox.

And ah, of course, Nintendo. Nintendo has to fill a niche market if they want to keep up with the big boys. Nintendo might have to make the switch to a software-only company if the Revolution fails. But if they are able to make the Revolution a separate product, they won't really be competing with Microsoft or Sony at all. People will buy Nintendos AND Xboxes. And they can accomplish this by not going head to head with them, but by creating a totally different kind of console that uses some crazy interface or makes games somehow different than we are used to (control pad and tv). And I think they are already headed in this direction as shown by the Nintendo DS, which sports dual screens and a stylus.

Anyway, that's my take on the console wars. More on PC games later.

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