This is what I am wondering about, what is MS strategy and what is the role they have for XBox. Because I can not see the relevance the consumer space is going to have for MS.
Not following MS as a business, so this drivel is just my pov.
I think when they went into the game industry with the XBox it was a valid choice, the living room was a relevant battle place, since consoles could move closer to PC and be used as the main computing device in the home and might kill windows/office at home. But then OS X, smartphones and tablets happened in a big way and consoles potential area of effect shrank to just games and video again.
Looking at Sony it seems they have to be in games, since consumer entertainment is such a large part of whom they are (consumer electronic, music, movies) so not being in gaming seems like the wrong approach for them, imo.
Well, either way core gaming is not typically massively profitable. And that holds for Sony the same as MS. So I dont see the difference really. Profits are profits no matter how they come or dont. Because one company is XYZ and the other QWERTY doesn't change any bottom lines.
MS has a whole phone OS to push, Sony just has another (struggling) Android phone. MS ties Xbox Live into Windows Phone a lot, it's a main selling point almost.
It may be clumsy but I think MS efforts to tie gaming into something bigger have been far more aggressive so far. TV was part of that as well, a part that arguably was shortsighted. Xbox video, Xbox Music...
As a practical matter, we've been going on about MS leaving the business for a decade, and I dont think anybody really thinks it's a serious consideration, in a it-might-actually-happen, way.
I think it's much more complicated than that.
They introduced the PS3 with a muddled message/vision at a high price point. They weren't able to hammer home the message that it was actually good value, that many of the extras on the 360 was included, they were late to the market thanks to the Blu-Ray laser (supposedly) but i think it was really the software that was a problem, development and games. Microsoft caught them off-guard and when they launched they had nothing impressive except the price tag. It took them years (it only does everything) before they were able to fight back with software, games, services and a reduced price.
Microsoft launched with a strong vision, strong hardware interesting features and a comparable gaming lineup.
The vision just isn't selling, neither are the features, which leaves them with a big clumsy box that runs games worse than the competition.
Again (repeating myself) i have a hard time seeing what they can do except throw money after it. They can reduce the box, make it sexy, drop the kinect, the HDMI, drop the price. But no matter what they do they still end up with the lesser powerful box that couldn't so they would need to be so much cheaper that people think it's worth paying less for the weaker machine that gives the least value (online services) out of the box.
Personally i want the big fat deal with everything because it's fascinating hardware. But i would expect a pure XB1 vs PS4 to be at least $50 cheaper than the PS4 in order to compete and have a chance to win.
And i wouldn't consider it a done deal even at that price difference.
Consider what we're discussing in sales so far, weaker hardware selling for $100 more. What if it was only $50 more (permanently and advertised and official)? XOne sales would get a bump. What if it was the same price? They'd get another bump. What if it was cheaper? Yet another.
We cant say exactly where it might land, but it's to be expected that
the hardware that is $100 more wont sell as well. Even throwing out the power issues for a minute. That simple. Until that changes I'm not sure how much we really know.
Yeah, that's the thing. Last gen we could pretty easily see a way forward for the PS3. It was expensive because it included more expensive tech, not just Blu-ray, standard hard drives and wifi, but full PS2 backwards compatibility. The solution was to cost reduce massively, as quickly as possible, but they never gave up any perceived technology advantage to do so. The software wasn't great, so Sony cultivated the biggest, most technically accomplished stable of first party studios. And then there was a whole world outside the US and UK where people held out for the PlayStation.
Microsoft doesn't have any loyal regions. The US and UK are both swinging towards Sony and there's no secret enclave for Xbox to counter that.
Last gen Xbox really only won USA, UK, and probably Canada. That's it. Yet they still tied PS3 despite a ~10 million deficit for Japan.
People tend to underestimate North America and UK and overestimate continental Europe as markets.
I think the playing field is there for Xbox to do well under the right circumstances, basically. The only market Sony can truly count on in the way you make it out is Japan, which is isolated enough as an ecosystem to not matter that much (and looks to be getting smaller as a console market every gen).
As a strategy matter I think it's 6 of one, half dozen of the other. Xbox has a few really big markets that are very receptive to it, and there's more smaller ones (Europe, ignoring Japan) that are somewhat more loyal to PS, but last gen proves it can even out.
The only way to cost reduce (in a way not easily matched by Sony) is to cut the only features that make their system unique: Kinect & HDMI passthrough. If they do that they just end up with a less powerful PS4, so it needs to be so much cheaper that people won't care. And they just don't have the first party holdings to go toe to toe with Sony (or Nintendo), nor can they buy out enough third party exclusives when they're playing from so far behind.
I disagree, because I think they have advantages in online, UI, OS, etc. Heck they've already rolled out a lot of big feature packed Xone updates, twitch streaming, youtube uploading, friend notifications, I dont see anything comparable coming out for PS4 in that time (the PS4 update thread at GAF seems like it's just exceedingly boring housekeeping), and I think it highlights a key difference.
To me it's like MS did everything possible to make Xbox hard to buy, above all with the $500 price, yet it's sold almost comparably to PS4 in the US. Why? Cause there's a lot of kids that are just in the Xbox ecosystem, you can find them on twitter and twitch and so on. I follow some people that are good at Gears of War for example. Well, they just stick with Xbox for a new gen because that's what they do and where they're at and almost their gaming identity. Of course, there's people like that on PS too, but I'd venture the Xbox online community is knit together a bit stronger because it's easier for them to communicate.
So yes, for the reasons above, I dont think they would necessarily be "just a weaker PlayStation" in that scenario. And neither do I automatically cede the exclusives games race either. MS's exclusives franchises (well, just Halo and Gears mostly) I prefer. There's also the controller, which I prefer on Xbox and is a really big deal for me.
Giving up was never an option for Sony. PlayStation is a core business for them and games technology a core competency. It's not a sideshow to their core business the way Xbox is for Microsoft. MIcrosoft can walk away at any time with no real impact on their bottom line. MS could break the bank to make it a proper fight, I just don't know why they would.
I dont think they have to break the bank at all. I think they could probably do a kinectless $349 SKU at something around break even right now, and I think that at least has a chance to do really well. And the funny thing here is it's not even a fight in terms of financial resources. One of these companies can afford to lose a little money to win a market a whole lot more than the other. It's funny how people act like the wrong company is always on the ropes here.
