What Microsoft, Sony, and Nintendo don't get
Each other.
Too simple? After seeing yesterday's NPD numbers and hearing about them from all the companies, each has their own spin on what went down last month. Nintendo (rightfully so) chose to gloat about how well the Wii is selling. According to NPD, the Wii outsold the 360, PS3, PS2, and PSP during April. Even better for the company, it held the number two spot in hardware sales with its DS platform.
On the other hand, Microsoft chose to discuss how well its platform has done so far and explained to me that its 10.1 million units sold mark is a major milestone for the company because the first console in each generation to hit 10 million units sold in the US has won the console war. When asked if it should be worried about Nintendo, Microsoft said it doesn't see Nintendo as a competitor. When asked if it should be worried about Sony, the representative said it's not worried at all and the company believes it's in the best possible position right now.
Finally, we move to Sony. The company was barely beaten in hardware sales by Microsoft -- a mere 900 unit margin separated the two companies -- and it did relatively well in software sales. That said, it only captured 35 percent of GTA IV sales, which the company attributes to a smaller installed base. Of course, a more logical notion suggests the robust online component included in the Xbox 360 version was the main reason. Regardless, it contends that it's coming on strong and can win the console war.
And as I examined what each company had to say about the numbers, it became quite obvious that not one understands the other.
The Nintendo mistake
Nintendo has no idea what Sony and Microsoft are all about. If it did, wouldn't the company realize that what it's lacking (even though it's still the leader by a long shot) is strong third-party support? Time and again, Nintendo will say that the Wii is about innovation and it's a different style of gameplay, but at its very core, isn't it still a gaming platform that should have a wider array of games available for it?
To me, the Wii is a gaming platform on par with the Xbox 360 and Playstation 3, regardless of the fact that almost no one from Microsoft, Sony or even Nintendo, wants to admit that. Aside from that, Nintendo really doesn't understand that although it's performing extremely well now, it may not happen forever. As the number of first-party titles start to dwindle and third-party support continues to erode as fewer games sell well on the hardware, what will Nintendo do? Sony and Microsoft understand that. Nintendo chooses to ignore it.
The Microsoft mistake
Much like Sony, Microsoft is quick to downplay the significance of the Wii. The company doesn't see Nintendo as a valid competitor to its platform and feels that the Wii is providing an entirely different experience to an entirely different set of customers. And while some of its studies may prove that point, hardcore gamers still find reason to own a Wii and there's no debating the fact that it sold almost 7 times better than the Xbox 360 in April alone.
Microsoft is also strangely not worried about Sony's recent surge in the gaming environment. According to the company, its jump can be written off and should not be viewed as an important development. Of course, what it fails to realize is that although Sony may just be "catching up" to the pack, it's still hanging in there quite well and is in a much better position than it was last year. Sony's hardware revenue is up 19.4 percent year-over-year and its total software revenue is up 68.6 percent. Maybe it's just me, but I think I would be a little concerned if I was looking down the barrel of those statistics.
The Sony mistake
Sony is certainly not innocent in its utter lack of understanding. Sony also believes that Nintendo isn't a worthy competitor and believes that it's performing so well because it caters to a different group of people. While true to some extent, I still don't understand how a company that's being pelted in the sales figures can honestly say that the Wii isn't a major concern. Suffice it to say that if the Wii weren't around, many of those who own one would have either opted out of the video game business altogether or purchased on of the other consoles. And if you're competing for many of the same customers, doesn't that automatically mean that the other company is a competitor? It certainly does in my book.
Sony has shown time and again that it doesn't really worry too much about its online component and keeps coming back to its contention that the Xbox 360 is winning because it had a head start. But why can't Sony wake up and realize that it's losing right now because it lost its focus for too long and allowed Microsoft to capitalize? Why hasn't it realized that the online component of the Xbox 360 is easily its most valuable asset and tried to compete with it more directly? Simply put, I just don't think Sony has truly woken up and realized the full scope of where it is right now. Microsoft is leading in two major areas -- online and third-party developer relations -- and there's no indication that anything will be changing anytime soon.
Sadly, it's as if none of the big three in the video game industry really understand each other. And while I know all too well that many of their comments are the result of PR speak, there's always some truth in what's made public. And as each company tries to stay true to its own belief of what's really going on in the industry, one truth remains: not one of these companies have the answers and they really don't know each other too well.
Let's hope that changes.
Don Reisinger is a technology columnist who has written about everything from HDTVs to computers to Flowbee Haircut Systems. Don is a member of the CNET Blog Network, and posts at The Digital Home. He is not an employee of CNET. Disclosure.
Also, I don't think that a significant amount of gamers would intend to buy a 360 / PS3 and end up buying a Wii. The two systems have drastically different gametypes. I don't think Nintnedo should bother would doing many 'hardcore' games, since they can easily be outclassed by the hardware of Sony and Microsoft. Nintendo needs to stick to what it's good at - fun, accessible experiences. Similiarly, Xbox would be wise to make small strides into the casual market but remain centered on the Gears of War-esque crowd.
I'm not sure about Sony though. I don't know what they can do. There's not much that differs from Microsoft in terms of focus. I'm sure they are banking on the fact that their technoology will outlast either console, which it probably will, but as you said earlier, it is all about the games.
Looking at Microsoft, they are not that worried about Sony's numbers because of Sony's main number. Sony continues to have huge loses in their games division. Sony has lost upwards of 5 billion on the Cell and Blu-Ray. 1.2 Billion this past year. The Ps3 has wiped out everything the PS2 makes and keeps eating more cash. reports have come out that Sony can't afford anymore prices cuts on the PS3 and that they are still losing money on each console sold. They even had to raise prices in Asia on the PS3. Microsoft knows the clock is ticking on this generation. 2010-11, the next generation starts, and Sony has lost so much money they may not be able to afford to move on as soon as Microsoft wants to. Microsoft has positioned themselves very well, though things could change.
As far as Sony's online situation goes, i believe it is not only a matter of being late to the game, it is a matter of money again. Having a online experience as deep as Live cost money. After criticizing Microsoft for charging, it's kind of hard to come back and charge people yourselves. They did make the mistake of not having chat and messages as a built-in part of the console and leaving it up to developers was a mistake. With so many developers having problems and added expense of programming the PS3, they don't have money or time to implement other features. Even Sony's first party titles lack some of the online features ao don't expect third party devs to go through the trouble.
But even if I disagree with your opinions, they seem to be based on something other than money. Which is more than I can say for David Carnoy.
On the subject of Sony Playstation 3 Losses, Matt Peckham at PCWORLD says:
"There are over 127 million PS2s sold worldwide. [What are the] chances of the PS3 replicating that success? I'd say today almost zero. The PS3's chugging along at 12.6 million units worldwide since its late 2006 launch. It'll be lucky to sell half as many systems by the time the PS4 shows up (as early as 2010, by the way). Sony predicts it'll sell another 10 million PS3s for the fiscal year through March 2009. That would make around 23 million. Compare that to the Xbox 360's 19 million and Wii's 26 million already today."
SOURCE:
http://blogs.pcworld.com/gameon/archives/006963.html
How do first party titles start to dwindle? ***?
GTAIV on PS3 has online as well.
I enjoy reading this section now just to see what this idiot writes next.
Of course Microsoft is worried about Sony. They would be fools if they didn't. But just stop to think the reaction the market would have if Microsoft said they are worried. Sony would then get an advantage on the media and investors might play their money on other things.
Microsoft's PR decided instead to downplay Sony, to give the impression on the media that they are on a dominant position.
They could have said instead that while Sony is a strong competitor Microsoft is responding accordingly, but that would have brought questions on WHAT they are doing to respond. And a PR's nightmare is getting questions on something they don't have information about. And thus the famous "I can't give any official statements".
As for Nintendo, it's true that their system is different from the others. It has a different playstyle and a different approach to online gaming. Not to mention that it doesn't have as much power as the 360 or the PS3. So if Nintendo wants to sell in a market where the other competitors are better in graphics, it has to emphasize what it does that others don't: the different way of gaming. That's not to say it can't create hardcore games. It's just that their hardcore games can also make use of these new control layouts.
And finally Sony. Of course they are working hard on reaching the 360's sales figures. The PS3's Home is proof that they are trying something into online that can be compelling and at the same time different. Because that is what Sony needs: not a copy of the 360's point pickup system but one that will attract the media's attention because of it's different capabilities. If the media gets interested, you can be sure sales will increase.
I thought you, Don, as a journalist/columnist would know better about this.
Nintendo, Sony and Microsoft have invested way too much money to just make stupid decisions in their businesses. They certainly know what they are doing and they do understand what their competitors are doing. It would be crazy not taking them into consideration!
By the way, I'm a long time reader, first time writer. Your rant on these three companies' declarations got me up to finally comment on one of your posts (although I've been wanting to comment on many of them for long...)
Well I guess this show PS3 is doing more than ok. I understand MS kept saying "games is what sell consoles", is that a PR BS? Is that what they really believe? Has the paradigm shifted?
Now that they are battling for the living room/entertainment console and Gaming is now more "in"/on par with Hollywood. Could cusumer be buying PS3 just to play HD disc? And since Gaming is in fashion, would rich PS3 owner (rich enough to buy such an expensive player + HD disc) be buying copies of the 'in' games, like owning a branded hand bag? Are MS missing out on all those fashion goer.
Since Sony owns contents (Sony Pictures). Selling PS3 solely as a BR player might not really hurt them. It will help to sell their HD Disc too. And with the knowledge that gaming is now the "in" thing. Their rich customer would likely be converted as a casual gamer, it is ok even if they buy games and never play them. So why should they go for serious gamer? Why should they lower their price?
Gaming is about to have fun, Nintendo's Wii is fun. It seems to have quite a wide customers demography. When children are loving it, grandparents are loving it. It is very likely parents (adults) would buy one. It is like an expensive toy. Did TV programme/movie kill a fun physical toys? I don't think so, I believe they will continue to cook up great game even without 3rd party. Nintendo does not seems to be planning of owning our living room.
MS Vista Home Premium is not going according to plan. Imagine if Media Center is now doing well, 360 as a media extender will also be boosted. Well the 'war' is far from over.
What can MS do to cut off their competitor backline/support? Should Xbox Live be free? Could they provide 360 users more free+fun arcade games to make inroute to Wii markets? Could they get more exclusive title for 360?(from good game developer start-ups) Could Vista recover to boost their media center market? Could their plan still hold together? Will BR movies surge in sales to give PS3 a boost, since it is the 'best' available BR player. So many possibiliies, it is so exciting and fun to see those big companies thrashing it out. It is like watching high paid boxers going at each other, blood is unavoidable. Who will be the last 'man' standing?
- by leonardwashington May 19, 2008 5:08 PM PDT
- Point 1: Nintendo fully understands the value of third party support as it's how the original NES dominated the market and killed the SMS. They have lots of junk third party support now and that may seem to cloud things, but they practically built the best third party model for console gaming.
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(12 Comments)Point 2: I think MS understands where Nintendo and Sony sit. It's just slinging PR babble to try to win hearts and minds of those who listen. It says it's not competing with MS which is a lie flat out and it says it's "ahead" of Sony. Both have made incredible gains on MS in the past year despite the year head start MS had. That's all that MS has is a head start. MS can't compete again Nintendo or Sony in the long run of this generation because of it's image and shotty hardware from both Xbox and Xbox 360 problems. Maybe the next gen will see them make a real system that has a long shelf life.
Point 3: Sony competes against Nintendo day in and day out. More PR babble if they say they don't. Although, it does have a thread of truth since the PS3 is about games AND BlueRay. So they are competing against them in one area and not in another. They are trying to catch up to MS with offerings like "Home" and the "PS Store", but those are taking awhile to come online. Who'd deny that MS had more than a year head start in the online department. That has been their bread and butter in Windows games for almost a decade.
This article wasn't well thought out.....sadly, a staple of this author's work.