Wild Tangent CE, Alex St John, predicted in a talk in Seattle that gaming consoles as a physical box will be extinct by 2020. He substantiates his claim by saying:
shareholders of Sony and Microsoft will no longer tolerate the massive, billion dollar investments that it takes to create proprietary video game consoles.
He further goes on to say that:
Even though Nintendo’s Wii console has met with success in the market, [...] the only thing that makes it different are the proprietary controllers. That’s the same thing that happened to the arcade video game business years ago, which had to design new controllers and devices to try to compete with the home consoles that had equal or better graphics and game play.
There are several holes in his argument, and because he’s no analyst, I reckon his words should be taken with a pinch of salt. I’m not analyst either, but I refute his argument, and present the following counter arguments:
- Sony and Microsoft are happy to invest the billions now for future heavy returns–a console doesn’t start making money until the third or fourth year of its life span when the components start getting cheaper. In fact, if you look at the model of the PlayStation 2, it started off making a loss as well, but it’s now almost ten years old, and it’s been a profitmaker for Sony since at least the slimline version. To date, in fact, it’s sold over 140 million units. I don’t think Sony’s going to turn its back on that sort of success. Furthermore, Sony and Microsoft HAVE the billions to invest because consoles aren’t their primary, or only, market.
- Nintendo’s Wii is more than just “innovative controls”. Nobody expected to Wii to do well, because, to everyone except Nintendo, the idea sounds batsh!+ crazy on paper. But it works because I don’t think many people took into account the social aspect of the Wii, and that’s where Alex’s argument falls flat on its face again. Friends trumps innovative controls–I’ve never had more fun in my life than sitting and competing with a bunch of friends over a video game.
- Alex has obviously not played any of the current generation consoles: I can think of, off the top of my head and without breaking a sweat, games for current gen systems that feature microtransactions, free-to-play advertising models, and the ability to sell games digitally (so what the heck are the Playstation Store, the Wii Shop, and Live, Alex???)
- PC games are losing audiences and developers for a couple of very good reasons:
-> PC games are more prone to piracy than console games, and this is a quotable, verifiable fact
-> PC games require constant PC upgrades, at least every year if you want to be able to play the latest and greatest games, so the cost outlay is far far more. By contrast, once you’ve bought a console, you seldom need to upgrade it to play the latest and greatest (note I say seldom–I’m calling peripherals such as microphones, balance boards, and buzzers “upgrades”).
-> PC games require a larger investment of time than console games do. Furthermore, the attraction of console games is the “switch on, plug in, and play” capability. The one thing I hated about PC games is the fact that I have to have my system perfectly configured just to play one game. Console games, you just put the disc in and play. No lengthy wait times for booting (I’m looking at you, Windows!). Unfortunately, with current gen games, load times are comparable to PC games.
Sorry, Alex, but I don’t think you’ve thought your argument all the way through. Well, I may not have either, but I’m not going to make such wild predictions about the next 12 years!
[Link: Seattlepi.com via El33tOnline]
Read Full Post »