Why Xbox 360 will be the console leader in the next generation.

(originally posted 10/10/06 on my previous blog)

Successful game systems usually have two things:
1) A reasonable entry price
2) 'A-list' games, with strong 1st, 2nd and 3rd party support

If you look at some of the biggest system failures you see they were unreasonably priced, had little or no quality games, or simply didn't have the marketing or financial support to agressively attack the competition. Several game companies have failed by oversaturating their own market.

Lets look at some successes. The Atari 2600, which at one point was the hands down leader in console sales regardless of the fact there were technically more advanced machines on the market (Intellivision/Colecovision). Atari at that point looked unstoppable, but then they started saturating the market with subpar titles and people no longer trusted the company and simply stopped buying games.

Enter Nintendo Entertainment System. The NES was highly suspect when introduced to the US, most retailers didn't think there was a market for game consoles. Nintendo persisted and eventually became even bigger than Atari, and was more successful internationally to boot. They locked all their developers into exclusivity contracts and basically stifled all their competition.

Along comes the Sega Genesis/Mega Drive. Sega couldn't get key titles for their previous system due to Nintendo's exclusivity requirements. So when the Genesis came out with much better graphics they focused simply on how much better the system was technically, attacking Nintedo directly with marketing like "Genesis does what Nintendon't." Unfortunately even with a strong head start Nintendo still managed to catch up by releasing the SNES, and the 16-bit wars were virtually a tie, with the loss handed to the NEC TurboGraphx 16. Then Sega got the idea to saturate their market with peripherals and variations on the Genesis technology. The 32X, Sega CD, CDX, Nomad, were just too much for consumers and developers and retailers to support and when their next product, the Saturn, was launched it was met with lukewarm response. It probably didn't help that it cost $400 either.

Then Sony entered the market with the Playstation. It was priced reasonably, was more powerful than anything else on the market, and had solid support from game developers. It won the 32-bit system wars hands down and worldwide. Sony, not resting on it's laurels, released the sequel Playstation 2 with something previously unheard of, built in backward compatibility with the existing library of games. Having a DVD player in the box also helped them gain mass acceptance, and may be partly responsible for DVD format success in many parts of the world.

The Playstation 2 was pretty much unstoppable in the most recent generation of consoles commanding a huge lead over both Nintendo and newcomer Microsoft. But they decided to price their next product much higher than their competition and they haven't secured a good list of launch titles that will sell a system beyond enthusiasts. That doesn't take into account their manufacturing snafus, they simply won't have any real quantity of PS3's on the market this year. No systems means no games, no developer wants to risk making a game that CAN'T sell.

Nintendo's Wii has a lot of hype and good press, but it still doesn't guarantee much more than the latest ports of a bunch of games you already played and downloads of very old games that you definitely already played. Zelda and Mario will sell the system, but without some serious 3rd party support it's just an underpowered system with a gimmicky controller.

So PS3 is overpriced, Wii doesn't offer the latest technology or 3rd party support, that leaves the 360. This box is crammed to the gills with everything you could ever want in a system, 3 CPU cores, high end graphics, a hard drive, networking, USB, wireless controls and most importantly LIVE. It's apparently easy to develop for, everything pretty much works as advertised, and it looks dead sexy sitting in your entertainment center.

The killer app for 360 is LIVE though. Sure they have Halo, they have GTA, they have all the EA, Ubisoft, and most of the Capcom and Sega games, and they may even get Konami and Square on board at some point. Sure they'll never sell any real quantity of these in Japan, but who cares? LIVE is now in it's second generation and it took more of a revolutionary than evolutionary step. Nintendo and Sony are still trying to piece together their online gameplan, and it's being done by gaming companies and engineers based in Japan, which honestly doesn't bode well for them. Microsoft is doing what it does best, networking. PC games went online 13 years ago (DOOM) with a vengence and they really haven't looked back. Consoles have been trying to get themselves online, but the user interface was never very good, and very few games supported online in any meaningful way.

The 360 integrates the online experience directly into the core of the system, you don't have to have an online-enabled game to configure it, or to find an opponent. You can simply add people to your friends list and always see who's playing what. So if you are playing Halo, and your brother is playing Madden, you don't have to call him and say, lets play Madden, you just pop in your disk and send him an invite. Or better yet, offer him a voice/video chat opportunity to discuss what game he would really like to play. The days of inviting your friends over to sit around one TV and play games in split-screen are over. Now everyone gets their own TV, their own couch, and still retain the ability to talk smack.

If you believe the future of console gaming is online, then there really is no choice in systems. XBOX LIVE is light years ahead of the competition and is Microsoft's killer app. If you believe the future is a new controller design and rehashes of titles you played 20 years ago, then buy a Nintendo. If you believe the future is Blu-Ray then buy a PS3. Or if you can afford it, buy all 3.

What might kill the Xbox 360. Fragmenting their market, and lack of Japanese developer support with respect to the THREE titles mentioned below. Selling systems both with and without a hard drive was a bad idea and turns off developers. Adding too many unneeded peripherals is a bad idea, we don't NEED an HD-DVD drive just because Sony has one. Microsoft is doing evereything in their power to woo Japanese developers into making hit titles for the 360. Until they get Metal Gear Solid from Konami, and Dragon Warrior and Final Fantasy from Square-Enix they will lose many sales to Sony, and have zero chance in Japan. The good news is MS has managed to lock up GTA and Resident Evil which were two other A-list titles they missed out on previously.

One other wild-card is Peter Moore. I am not convinced that he knows what he is doing, and I pretty much believe any successes he has have been sheerly luck. He was mostly responsible for the failure of Sega and more specifically the Dreamcast in America. I honestly like him as a person and think he puts on a good show and I have even had the pleasure of having a beer with him on the way to the Dreamcast launch back in 1999, but I don't think he gets gaming or gamers so much as marketing and PR. The launch of the XBOX 360 was a fiasco and was poorly directed, but Peter would just say something like "look, we sold every unit we could make." Well of course you did, you didn't make enough, and the overall quality was still poor! Fortunately he has the deep pockets of Microsoft to bury his mistakes in now. I think the HD-DVD was his idea, and is a very bad one. I think there are other crap peripherals waiting in the wings that will be hoisted on an unsuspecting public and maybe saturate their own market.

Speaing of market saturation, don't get me started on Xbox Live Marketplace. It's already backfiring, because developers are using it as a revenue stream and pulling features out of their games so they can charge more for them AFTER the purchase. BAD BAD BAD.

CONSUMERS: DO NOT BUY MARKETPLACE ADDITIONS FOR YOUR GAMES, SEND THE MESSAGE TO THE DEVS THAT $60 IS ENOUGH. Spend your points/money on XBLA (arcade) instead encourage more development on NEW content, not paying more for content that should have come with the game. Need some examples what NOT to buy?

1) Horse Armor - Oblivion
2) Map Packs - COD2, GRAW, etc
3) Cars - PGR3, Forza, NFS, etc
4) Hint videos, uniforms or stadiums - Madden
5) Characters - Lego Star Wars
6) Themes, gamerpics - pretty much every game

Things you might consider buying:
1) Any of the original Live Arcade Games (Geometry Wars, Cloning Clyde, etc)
2) Arcade games that you absolutely loved playing in the past (Doom, SFII)
3) Gamerpics - unfortunately there just aren't enough free ones out there
4) Casual games you might play with friends or family (Spades, Uno, Poker)
5) Game DEMOS/trailers - they are FREE! Great use of Marketplace.