Think you know what's going to happen in the console wars? Think again.
The battle between Xbox One and PlayStation 4 is exciting to watch, but its importance is being significantly overblown. Yesterday, the NPD Group said that even after the launch of Xbox exclusive Titanfall, PS4 outsold Xbox. Shock! Microsoft announced that it had sold 5 million Xbox Ones, a day after Sony said that it had sold 7 million PS4s. Thrilling!
At Penny Arcade Expo this past weekend, I was on a panel about the console wars, and of course we used a Game of Thrones metaphor in the slideshow. The White Walkers, in this analogy, were everything else -- phones, tablets, microconsoles, Steam Machines, et cetera -- that stood on the periphery, ready to come in and change the dynamic of the wars. Oh, you managed to dethrone the king in the castle next to you? That's great, but very soon all of humanity is going to be threatened by invincible zombies.
That is to say, it may not actually matter if Xbox or PS4 gets the advantage over the other, as the threats posed by outside forces are larger than the threats they pose to each other.
What I did find in talking to many people at PAX is that there seemed to be a lot of misconceptions about what's going to happen. Here are some of what I think are the mistaken notions about the next few years, and my responses.
For the time being, you will continue to plug something into your television that puts videogames on it. There is nothing saying that Microsoft, Sony and Nintendo could not provide those sorts of devices far into the future. But the console as we have always known it since the days of Atari is a dead paradigm walking.
What that means is that the model -- pay $500 for the box, pay $60 for each game, have the DRM tied to the disc so you can sell it as if it were a book or a sofa -- is done. We will continue to see digitally distributed games become a larger and larger percentage of console makers' revenue because consumers demand the low cost and convenience.
Every advantage of game discs over game downloads is also true of audio CDs, and when was the last time you bought one of those? The shift is inevitable; the question is whether Sony et al can react fast enough to stay relevant when it hits hard.
Disruptive products have to choose where to enter the market. You can't come in with a product that's exactly like everything else that already exists. You can try to start with a radically cheaper product that gets gradually better, like Fire TV, or you can go the opposite route and come in with a more expensive product that gradually moves downmarket.
The ride-sharing app Uber started that way -- hiring a town car was half again as expensive as jumping in a cab, but it more than made up for it in convenience and quality of service. As it scaled its business, Uber introduced lower-priced options and now in many cities it is actually significantly less expensive to arrange a ride via Uber than it is to take a taxi.
While it's no guarantee of success, it's not crazy to think that Steam Machines could start out by first attracting the customers who are willing to pay a little bit more for the machine in exchange for the significant savings on games, then make the product cheaper if it catches on. If there's a demand for it, PC makers will expend the energy to figure out how to reduce costs.
Everything affects everything. The question is how much. Studies of tablet users show that they largely use them at home, at night -- you know, prime console playing time and place. It may not even be necessary for a TV-tethered device to replace the traditional game console model. It may be that a self-contained unit like a tablet could have a significant impact all by itself.
I have left the response to this argument outside your local Sam Goody.
Ouya's failure to make a splash in the gaming world is not a failure of the concept of a low-cost console with inexpensive digital games. Ouya doesn't have a lot of money, and it's trying to do hardware.
That's a steep hill to climb -- just ask Oculus, which has proven far more popular, has gotten endless amounts of buzz, is beloved by gamers, and ended up selling to Facebook anyway. Even the resources they had as a startup attracting tons of venture capital, its founder pointed out after the acquisition, weren't enough to pull off the launch at the quality they were hoping for.
If Ouya had gotten itself acquired by, say, Amazon before it launched, it would have been a different story. The resources at Amazon's disposal -- and at Google's and Apple's, if and when they launch their respective TV gaming devices -- are more in line with what it takes to make a difference in hardware. If you believe there are fundamental issues with the Fire TV model that will cause it to fail to make an impact, that's one thing. But "Ouya isn't getting traction, so neither will this" is apples and oranges.
Hardcore gamers have already welcomed their new free-to-play overlords with open arms. Ars Technica's recently released data on the Steam service's most-downloaded and most-played games show Valve's free-to-play Dota 2 and Team Fortress 2 crushing everything else.
This is not to say that the next Last of Us sequel on PlayStation 4 should be a free-to-play game in which you have to pay to put more bullets in your gun. But the idea that free-to-play must necessarily be an exploitative scenario fit for FarmVille but not Final Fantasy just doesn't hold water.
I think some people fundamentally misunderstand what Oculus is, even people who are excited about it. You can tell these people because they say things like, "They should add Oculus support to Titanfall!" Now, that alone could actually be a fun experience, but that's not what virtual reality is going to be. It is its own platform.
Yeah, you can hack VR display into anything in a few minutes. But the games that are truly transformative will be designed with VR in mind from the ground up. It will bring with it a whole new era of learning, of experimentation, of trial and error. And as designers start to solve these problems and create experiences that are truly unique, not just Previously Released Game X But On a Screen That Wraps Around Your Eyeballs, VR may very well become a compelling new experience that also starts to draw players away from traditional games.
