This article from MIT Technology Review argues that the near-simultaneous release of the PlayStation 4 and Xbox One may mark the last wave of consoles, at least as we know them. Not so sure I agree with that, but the article makes some interesting points. Though this generation of consoles is clearly superior to the ones they replace, the technological leap is clearly much smaller than the previous one. In addition, the gaming market has become fragmented, with smartphone and tablet gaming grabbing a significant and, depending how you calculate things, perhaps majority slice of the pie.
Downloadable games such as Angry Birds and Minecraft, which play on mobile phones and basic PCs, now constitute a major part of the industry (in April this year, Angry Birds developer Rovio estimated that its games have been downloaded 1.7 billion times, while in 2012, Minecraft earned its independent creator, Markus Persson, more than $100 million).
There’s no question that franchises like Call of Duty are still selling big. The argument is that the value perception of each new console release is declining and the number of consoles sold is declining accordingly.
Each new iteration of hardware brings a historical downward trend in console sales. Sony’s wildly successful PlayStation 2 sold 150 million consoles. Its successor sold 80 million. It appears that Sony and Microsoft both lose a lot of money on these devices. For these reasons, some people think this new generation of console hardware (including Nintendo’s beleaguered Wii-U, which has failed to capture consumers’ imaginations) may be the last.
For consumers, the decline in consoles is not only a symptom of broader choice (in the 1990s, consoles and PCs were the only way to play complex screen games) but also one of diminishing returns. Martin Hollis, designer of the seminal Nintendo 64 movie tie-in Goldeneye 007, told me: “With each iteration, the multiple of increased power matters less. Looking back, PlayStation 2 was a huge leap from PlayStation. But PlayStation 3 was a much smaller leap. Each time we climb a curve of diminishing returns.” Hollis, like many others, believes that most people who only casually play video games will remain unconvinced by the difference between the new versions of the consoles and the previous ones.
From a gaming point of view, smartphones, tablets, cloud solutions (like Steam and Gaikai) and consoles are all converging. Just as iOS and Android emerged as the last OS standing in the great smartphone dust-up, I suspect there will be just a few players left standing once the gaming chaos resolves itself.
Home devices don’t converge. People own more and more of them. They have iMacs and MacBooks and iPads and smaller iPads and AppleTVs and TVs and Receivers and cable boxes and Chromecasts and Bluray players and networked video players and NAS devices and gaming consoles and all kinds of devices that are optimized for a specific purpose. Each device fills a niche, and is built for that niche. Angry Birds doesn’t displace Call of Duty. Hell, Call of Duty on an iPad doesn’t displace Call of Duty on a PS3. It’s a different thing that is used in a different way and fills a different niche.
Portable devices converge, because you have limited room in your pockets. But devices you have in your home don’t. The opposite happens. As time goes on, we have more of them that fill different niches in better ways.
I’d argue that the “hardcore gaming” niche has plateau’d and is saturated. There is no real reason for the average person to own a game console.
The casual gamer is better off with a smartphone, tablet, and laptop/desktop. Especially comparing the price of an app ($5) versus a game ($30+). You don’t have to worry about controllers, game discs, or long load times.
Sitting in front of the TV or having a dedicated gaming device is antiquated.
I think people talking about consoles in that way are writing with the delusion that console gaming ever was mainstream.
Console gaming is and has always been a niche market for people who love games. Consoles aren’t mobile devices. They’re static dedicated standardized hardware for playing games. The entire reason why they still exist is because neither the developers nor the users have to worry if the hardware they’re using is compatible with a certain game because everyone uses essentially the same hardware for that generation.
MIT is a really prestigious school, but whoever wrote that really failed in his research and most importantly his math.
I suggest he take a closer look at the hardware differences between the last generation and the one that just began. There’s quite a big leap, but you don’t have the standard definition to high definition leap that occurred in the last one. Launch games hardly ever show what a new console is capable of because the developers haven’t learned the console fully at that point.
The PS2 sold a lot because it was the undisputed champion of that generation. The GameCube sold very little, and the Xbox sold a bit more but was a late comer to that generation. Nintendo has a failure (so far) on its hands with the Wii U (not Wii-U), but neither the GameCube nor the Nintendo 64 sold well either. Nintendo’s still around making consoles. Shocking. Now, the math:
PS2 155m
GCN 21.74m
XB 24m
200.74m total
PS3 80m
Wii 100.30m
Xbox 80m
260.3m total
So, with using the latest sales figures available for both generations it’s clearly seen that the most recent one sold more consoles and the sales have been more evenly divided. Launch sales for both the Xbox One and PS4 were in excess of 1 million. That’s the biggest ever. Where’s the decline? Consoles will be replaced with new consoles for as long as people are willing to buy them. Disruption may happen, but the replacement will be essentially a console system allowing people to play immersive games from their couch.
Exactly. Casual gaming like Angry Birds is not some new phenomenon – it has existed all along as part of PC shareware gaming. That casual gaming market is now shifting from the PC to tablets and smartphones.
Nintendo got lucky in the last cycle and managed to capture a huge slice of the casual market with the Wii and DS, but if you look at their consoles historically, that was an abboration. As long as there are hundreds of thousands of people willing to buy new Mario & Zelda games for $30-60, Nintendo will be fine – and there’s no way they’d ever get those kinds of prices selling iOS game.
As a PS3 owner and Gran Turismo fanatic, I have to admit that the PS4 has completely passed me by. GT6 comes out in early December and runs on the PS3 – for one of the big PlayStation franchises, this seems to take a lot of wind out of the sails of the PS4 launch. The PS4 doesn’t play PS3 games, as far as I know and I haven’t paid enough attention to know if there are “big” titles in the raft of launch games.
The fact that there are new games being launched exclusively for the PS3, just weeks after the PS4 launch, tells me that I don’t need to worry about PS4 for a few years yet.
Why should it be antiquated?
Those games offer experiences that the majority of mobile games can’t offer.
I really like Infinity Blade, but Infinity Blade is just a single game, while the majority of the profits in mobile games is most likely from CandyFarmBirdsVille.
The high sales of the PS2 are also due to the long time it has been available.
Sales of the Xbox and GameCube stopped the moment the sucessor was released.
The Playstation 2 is STILL AVAILABLE!
EA released FIFA 2014 for PS2, Konami released Pro Evolution Soccer 2014 for PS4!
I don’t know the exact sales of the PS2 til the release of the Xbox 360 and PS3, but they were probably closer to 100 million than to 150 million.
It wouldn’t be fair to compare total sales of the 2001-2006 console generation with the 2006-2013 generation, because the Playstation 2 has been available until now.
Sales of the Wii will also continue for at least a few years, Nintendo released the cheaper Wii Mini earlier this year.
And the Playstation 3 will also be available for a few more years.
Total sales of the last generation (360, PS3, Wii) will reach 300 million units in a few years.
It’s mainly the physical media aspect that I find old-fashioned. Having to pop discs in and out, it’s going the way of the DVD. Cloud is the future. (Technically, streaming from the cloud is now, considering how convenient Netflix is.)
Eventually, I imagine gaming will be just signing into your account and have your games available, no matter what device you’re on, (similar to checking email).
With what Apple offers now, it seems their plan is to use the mobile device as the main hub/machine, AirPlay mirror through Apple TV, (maybe have the game stored on the actual Apple TV, like Angry Birds on Roku), and have an accessory controller to provide tactile controls.
“My use-case is universal.”
The physical media aspect has been optional for years.
A few days ago, i bought the Playstation Vita and got a Playstation Plus subscription.
Now i got 2 games on physical media and 8+ games as downloads, with three more coming on the 27th (as part of the PS+ subscription).
Xbox Live and PSN have been offering full game downloads for the Xbox 360 and Playstation 3 for years.
But there are benefits you get from using physical media. More stores to choose from, you can also get games from other countries, that are maybe cheaper, uncut or too weird to be officially released in your “appstore”.
Streaming games from your iPhone to AppleTV is not as good as it needs to be to become a real competitor to dedicated game consoles.
Streaming introduces lag – to solve this problem, they need a new AppleTV generation (streaming from PS4 to PS Vita is as far as i know not suffering from this problem).
Storage on your mobile device – Killzone Mercenary, a FPS for the PS Vita, has a size of more than 4 gigabytes. Games running in FullHD (or iPad-resolution) with included videos etc would be even bigger, games on the new consoles can reach 40 gigabytes!
Downloading those large files can take a while but storing it on your iPhone would be the real problem.
The mobile games market is so profitable because the games are very cheap to produce.
To produce a AngryFarmCandyZooManager you need one guy who can draw cute animals, one guy who can code and one mathematician who will need to make sure that players keep on buying fertilizer or smurfberries or whatever.
Producing real games (like Halo, Zelda, Battlefield) costs much more and it is not yet proven that games like that could be successful on a mobile device.
We have two examples of successful “big” games on mobile devices – Infinity Blade, which is now featuring lots of IAPs – and Real Racing 3, which is so full of IAPs that it has become unbearable for me.
Yeah, the complete switch to mobile devices could lead to the death of something – but it wouldn’t just be the new consoles, it would be the death of “core gamer” gaming.