With rumors flying around the web about the possibilities of Microsoft’s next Xbox having a heavier emphasis on the casual side of things and requiring Kinect 2.0 and such. I decided to look into the past and see if I could see any pattern that could help better predict the future. And to my surprise I stumbled on an interesting trend dating as far back as when the first PlayStation released.
Let’s take a trip down memory lane, shall we?
Going into the mid-90s and entering the 5th generation of consoles, Nintendo came in as the Top Dog of the gaming industry with the Super Nintendo having been quite the success story, and with the Sega Genesis being a close second. No one could have predicted that Sony, virtually an unknown in gaming back then, would have turned the industry on its head the way they did with the PlayStation. Sega was first to show their successor to the Genesis and introduced the Sega Saturn to the world in 1994. Followed by the new kid on the block, the PlayStation, and later the Nintendo 64. Things didn’t pan out too well for Sega as they only managed to sell 9.5 million units of the Genesis in 4 years, and discontinued production in 1998. Nintendo on the other hand managed to sell 32.9 million units of their Nintendo 64, placing them a distant 2nd after Sony’s PlayStation which sold some 100 million units. This was the first time in gaming history that a single console managed to sell 100 million units. The PlayStation took gaming to new heights as it was well marketed, but also because it had the best variety of games from both first and third-party studios to back it up.
Being the first one to start the 5th generation of consoles the last time around, Sega again took it upon themselves to start out the 6th one. They did just that with the Sega Dreamcast, but to disappointing results as the Dreamcast only sold some 10.6 million units in its lifetime though it was considered to be ahead of its time technologically. Sega sadly had to leave the console business and became a software only company. It had some good games, but it simply couldn’t compete with both the PlayStation and Nintendo brands, plus Microsoft would join the fray with its own Xbox console. For the 6th gen, things played out pretty much the same for Sony with PlayStation 2. Sporting an unmatched library of games and cool features such as the ability to play DVDs and CDs, the PlayStation 2 became the most successful home console of all time. Nintendo’s Gamecube slid further behind with barely 22 million units sold worldwide. Microsoft sold some 24 million units of their first console, the Xbox, which is more than Nintendo did with the Gamecube.
For 2 generations of consoles, Sony managed to go from one success story to another, becoming synonymous with the term “video games”. Something that wasn’t lost on either of its competitors in Nintendo or Microsoft, especially after Sega’s misfortunes. Something had to be done differently to combat Sony, and Microsoft figured that if they could launch first and employ a similar marketing strategy as the PlayStation and PlayStation 2 had, then they were confident that they could best Sony. So Microsoft did everything in their power to release the XBox 360 in 2005, a full year ahead of the PlayStation 3. Nintendo on the other hand understood that it was nearly impossible to go toe-to-toe with the PlayStation brand for the core market, especially with new-comer Microsoft vying for the same customers, hence they had to use a different approach go after an entirely different market. Nintendo decided on the Wii approach and the gamble paid off as the Wii became Nintendo’s best-selling home console ever. Microsoft’s gamble on the other hand was successful to a degree, as they’ve managed to have an entire year to themselves on the market as the only 7th generation console out, giving them a nice early install base. But they, just like Nintendo, would come to the conclusion that the PlayStation brand is still too strong to tackle head on.
The PS3 debuted in 2006, and although more expensive than both of its competitors, outsold the Xbox 360 on a yearly basis worldwide. Furthermore, going into 2010 the PS3 had significantly reduced the gap between itself and the XBox 360, (The numbers are; PS2 149.7m, DS 144.59m, Wii 84.64m, PSP 67.1m, 360 50.9m and PS3 47.9m.) Meaning that Microsoft had to do something fast. In comes Kinect, released on November 4, 2010 with a marketing budget of $500,000,000.00 and treated as a relaunch of the Xbox 360 in order to combat a slump in sales and a surging PS3. It was clear at that point that Microsoft, like Nintendo, had realized that it was much easier to create a new market than to go after PlayStation’s established core fan base. Something that Nintendo themselves realized after spending the previous 2 generations trying to cater to the same audience as Sony’s PlayStation, and watching Sega, their long time rival, bite the dust in the process. So it’s no wonder that Microsoft as of late seems to be deviating from the core market that it pursued at the start of this generation, and going after something else. Sitting on already established franchises such as Halo, Gears of War, Forza Motorsports and other third-party multi platform games is much less risky for Microsoft than venturing and betting on new IPs and such, something Sony and the PlayStation brand excels at.
So the lesson of the day? From a historical standpoint, no gaming company has been able to stay the course when going up against Sony and its PlayStation brand. Those who’ve tried have either been forced to go after a totally different market (Wii and Xbox 360 Kinect) or faced the prospect of becoming irrelevant in the market (N64, GameCube, Sega Saturn and Dreamcast). With the announcement of the PS4, it’s pretty clear that Sony is revving the PlayStation brand’s engine and firing on all cylinders. Something that Microsoft would have been expecting, thus why I kind of understand why Microsoft’s Senior vice-president of their Interactive Entertainment Business said that they’re changing their focus “from a gaming console, to an entertainment console.” Though something tells me that might just another way of throwing in the towel and leaving to Caesar what is Caesar’s. As we speak, Xbox 360 fell behind the PS3 worldwide even after a full year head start and while maintaining a price advantage for the entire generation as well. Meanwhile Sony is still pumping out games for the PS3 including new IPs such as The Last of Us and Beyond: Two Souls, while being the number one device used in the world for other things like Netflix.
So What are your thoughts on the matter? Do you think Microsoft will go for the casual continuing what they started with Kinect? Or do you think that they will have a “core gamer” first approach?