Famitsu: XBOX 360 global domination through 2007

[Gerry]

Couldn't have put it better myself.

Most people want one system, most people do not buy more than one system. The NES, PS1 and PS2 generations were perfect in this respect. PS1 and PS2 more so because niche's were filled by truly viable competitors. I don't want an equalised marketshare.

Aren't you in fact more or less disagreeing with Phil rather than agreeing with him? He's not arguing against an equialised marketshare. What he's saying is that he doesn't want only multi-platform titles to exist within that environment - he wants individual games that stretch the boundaries of each and every console that exists. He wants multiple consoles fighting for their market share as it's what leads to innovation and technological progress.

At least, that's what I though he meant, which seems to be not what you're saying.

 

[SPM]

Couldn't have put it better myself.

Most people want one system, most people do not buy more than one system. The NES, PS1 and PS2 generations were perfect in this respect. PS1 and PS2 more so because niche's were filled by truly viable competitors. I don't want an equalised marketshare.

There is a big difference between people buying one of three systems and people having to buy one system because that is all there is with viable games. I don't see Microsoft as having a market share problem because of it's cash reserve. Nintendo and to a lesser extent Sony may be more of a worry. As for Sony gaining a monopoly in a competitive marketplace - I don't think Sony will ever be good enough to manage it. When it comes to danger of one company monopolising the market, the real danger comes from the companies that are able to cheat to put competitors out of business - and one thing you can be sure of is that all businesses will cheat it they can. That is why Microsoft is the one to watch - because it doesn't have to comply with the laws of economics like the other two.

 

[Tap In]

...That is why Microsoft is the one to watch - because it doesn't have to comply with the laws of economics like the other two.

sorry but... what?

of course they do. Those are the kinds of opinions that boggle my mind when people talk about why/how they dislike MS. Maybe that's because I'm not a socialist though.

woops.

 

[MasterDisaster]

That is why Microsoft is the one to watch - because it doesn't have to comply with the laws of economics like the other two.

so the lies are a law of economics?
when you lie saying that your product is twice powerful than the competitor, that it has 1/100 of the human mind, that the competitor have 3d games but their product have the 4d games thnks to online gaming..

are you tired to read sony saying that 'european will not have a price cut (usa and jap yes), because they will buy the ps3 whatever is the price'? or 'we can launch ever without games at all, people will buy out console', is arrogance and lies what came from a dominance position of sony in the last gen market?

then I will be happy to see sony after nintendo and microsoft, maybe they will learn to say the truth, and that we gamer (european especially) are not sheeps

 

[Inane_Dork]

Right now its great for consumers. But what happens when Microsoft have pushed every other competitor out of the console market and decide that they want to make those 8-10 whatever billions back plus several billion in profit? How great do you think it will be as a console gamer then? That's why every effort should be made to keep the console market competetive.

That is a really, really far cry from where we are now. I see no reason to seriously consider that possibility more than others. Quite obviously, MS is not pushing anyone out of the market.

Why not just have one console then, if all 3 hardwares have the same software anyway? Even better; lets have all games cater to the weakest link and forget about revolutionizing hardware, because there's no point in it anyway, if all developers go for multi-platform games that hardly scratch the surfaces of what's possible on that given hardware. Instead of MGS3 or HALO, lets have renderware and other middleware based games! Forget about the sixaxis controllers, wii remotes, internal harddrive, blu-ray disk for more storage, high tech GPUs like Xenos or RSX that have different advantages over each other... or hell, why even bother with CELL for more physics or the Xbox360 GPU with 3 cores if all multi-platform developers will use is 1 PPE since that's the only link both of them have in common?

Here's my vote for all games being multi-platform... NOT.

That's quite possibly the most negative way you could take the argument. The funny thing is, just taking PC gaming into account discredits your take. Making games multiplatform or making only one platform does not necessarily incur a technological drop of a 4-5 years. You're really reaching with that one.

If MS and Sony standardized on either the 360 hardware or the PS3 hardware and consumers got games for both platforms, that would be a big win for consumers. Why do you think hybrid HD-DVD/BD players are even being considered? People hate format wars and want to watch movies.

 

[fulcizombie]

The Xbox division would have to run losses that are much, much higher than they have been, so high that they could creat problems in the bigger picture, for MS to actually "abandon" the console business.
And that won't happen, simply because MS has too much disposable cash to burn, and the Xbox division will break even and maybe even make a profit much sooner than its losses will start to impact MS in a heavy way.



Incorrect. MS couldn't "easily" buy Sony, and i'm sure a few anti-monopoly laws (cause in the end, an hostile takeover of Sony would be seen as yet another attempt to create a monopoly for MS, this time in the Console business) would stop them from doing that anyway even if they could "easily" afford it, which they can't. They're definitely rich, but they won't just spend the money that easily. We're not talking about pennies here.

When i say easily,i mean financialy.Isn't Sony's total worth around 35-40 billion??That means wthat with around 20-25 billion someone could gain control of 51% of Sony.How would MS be breaking anti-trust laws,technically, by buying Sony when there is another competitor on the market,Nintendo?

Look i am not saying that this will happen and Sony would be a burden for MS anyway,since Sony is failing pretty much everywhere(but the home console market,although they had a nice year with the bravias but still...).

The bottom line is that MS isn't even feeling the losses from the xbox division and MS has to invest some of its profits somewhere(i mean weren't they at over 65 billion in the bank and had to give some back to their shareholders so as to fall to around 40??).The console market with all its implications seems like a perfect market for them right now.Squeesing Sony a bit doesn't hurt them either.

 

[London Geezer]

When i say easily,i mean financialy.Isn't Sony's total worth around 35-40 billion??That means wthat with around 20-25 billion someone could gain control of 51% of Sony.How would MS be breaking anti-trust laws,technically, by buying Sony when there is another competitor on the market,Nintendo?

Well this is one of those discussions (like the old MS buying Nintendo one) which really has no point. Not gonna happen, and no it wouldn't be easy, even financially. Just because MS happens to have the money in the bank, paying 20Bn and take control of a company like Sony is not an easy thing to do.

Look i am not saying that this will happen and Sony would be a burden for MS anyway,since Sony is failing pretty much everywhere(but the home console market,although they had a nice year with the bravias but still...).

Incorrect again. Sony are now the best sellers in the HDTV market, and it only took them the Bravia range to get there. So no, they are not "failing pretty much everywhere but the console market". Add to that the very profitable movie and music business and you start to understand that Sony is both bigger and doing much better than you think it is.

The bottom line is that MS isn't even feeling the losses from the xbox division and MS has to invest some of its profits somewhere(i mean weren't they at over 65 billion in the bank and had to give some back to their shareholders so as to fall to around 40??).The console market with all its implications seems like a perfect market for them right now.Squeesing Sony a bit doesn't hurt them either.

Of course the console market is a very attractive market for MS, it has been growing like crazy over the last few years, it keeps growing and it shows no signs of slowing down. Especially now that everyone (but nintendo) is trying to joing this with the "multimedia in the livingroom" market, if that even exists. And that's even more good reason for MS and their quest to put Windows everywhere - for obvious reasons.

 

[quest55720]

Couldn't have put it better myself.

Most people want one system, most people do not buy more than one system. The NES, PS1 and PS2 generations were perfect in this respect. PS1 and PS2 more so because niche's were filled by truly viable competitors. I don't want an equalised marketshare.

Most people are stupid so I could careless what they want. I want a healthy market for a long long time. The only way for that to happen is for someone to take a chunk out of sony this generation. A dominate ps3 IMO is the worst thing that could happen to the industry. It would be the final step towards a sony monopoly with MS leaving quietly and nintendo being a niche player. They could launch the PS4 when every they wanted and charge what every they want. They would not even have to put cutting edge tech inside the ps4 because of no competition. We see this already in the PS3 launch it is way over priced because they can. They are using gamers to win some stupid movie format war. If they were not in such a dominate position you would not see the rediculous PS3 price for a stupid movie player. IMO the best thing to happen in the hand held market was the PSP because it forced nintendo to come up with something great in the DS to compete.

 

[avaya]

Aren't you in fact more or less disagreeing with Phil rather than agreeing with him? He's not arguing against an equialised marketshare. What he's saying is that he doesn't want only multi-platform titles to exist within that environment - he wants individual games that stretch the boundaries of each and every console that exists. He wants multiple consoles fighting for their market share as it's what leads to innovation and technological progress.

At least, that's what I though he meant, which seems to be not what you're saying.

My point was that most people prefer a PS2, Xbox, GC situation vs. a 33/33/33 situation. Phil’s point about optimisation does not really go against that from my point of view. Multiplatform development breeds inefficiencies and laziness in delivering an end-user experience, EA is a perfect example.

There is a big difference between people buying one of three systems and people having to buy one system because that is all there is with viable games. I don't see Microsoft as having a market share problem because of it's cash reserve. Nintendo and to a lesser extent Sony may be more of a worry.

I wasn’t proposing that people want a monopoly. The PS2 generation has one console where most people can be fully satisfied with the selection of greats games available, if they aren’t they can go and buy a Xbox or GC to satisfy the niche need they desire. People have a choice of buying a PS2 or not because the other two consoles have a selection of great franchises they could enjoy.

There is no de facto standard, no hidden costs. Most people don’t feel they’re really missing out if they select one console, the people that don't feel that way fill such a small fraction of the market that they are essentially never going to be satisfied without sacrificing for the majority.

Furthermore Sony does not overtly behave like a monopolist. They react to their competitors in the market and are not holding the industry back in any real way, pushing technology, game design and encouraging growth. I would say this generation was almost the perfect situation for the consumer.

As for Sony gaining a monopoly in a competitive marketplace - I don't think Sony will ever be good enough to manage it. When it comes to danger of one company monopolising the market, the real danger comes from the companies that are able to cheat to put competitors out of business - and one thing you can be sure of is that all businesses will cheat it they can. That is why Microsoft is the one to watch - because it doesn't have to comply with the laws of economics like the other two.

I don’t think anyone is seriously going to get away with “cheating†in this industry. As an economics graduate, I’m not sure I follow what you mean by complying with the laws of economics.

Microsoft have had their number called in all three major markets by all the major regulatory bodies, governments and international organisations. They walk on thin ice, they are not going to get away with any cheating. Sony’s biggest problem seems to be execution, they have the systems in place to stay market leader for many years but a series of catastrophic failures in the executive branch is hurting them. Nintendo’s only problem is their overwhelming corporate greed. Once they are on top Nintendo is utterly ruthless at squeezing the margins to get every last drop of value often to the detriment of future stability.

My overriding belief is that monopolies only tend to arise due to the failure of a selection of firms or the market as a whole. The last major entertainment monopoly created is the iPod, which was as much due to the utter incompetence of the CE majors as it was due to Jobs’ brilliance in spotting the gaping door left open to him.

Monopolies don’t arise thanks to the strength of the product alone, that is only half the picture, the other half is due to the failure of others (competing firms, the market as a whole or regulatory bodies) to react.

 

[quest55720]

My point was that most people prefer a PS2, Xbox, GC situation vs. a 33/33/33 situation. Phil’s point about optimisation does not really go against that from my point of view. Multiplatform development breeds inefficiencies and laziness in delivering an end-user experience, EA is a perfect example.



I wasn’t proposing that people want a monopoly. The PS2 generation has one console where most people can be fully satisfied with the selection of greats games available, if they aren’t they can go and buy a Xbox or GC to satisfy the niche need they desire. People have a choice of buying a PS2 or not because the other two consoles have a selection of great franchises they could enjoy.

There is no de facto standard, no hidden costs. Most people don’t feel they’re really missing out if they select one console, the people that don't feel that way fill such a small fraction of the market that they are essentially never going to be satisfied without sacrificing for the majority.

Furthermore Sony does not overtly behave like a monopolist. They react to their competitors in the market and are not holding the industry back in any real way, pushing technology, game design and encouraging growth. I would say this generation was almost the perfect situation for the consumer.



I don’t think anyone is seriously going to get away with “cheating†in this industry. As an economics graduate, I’m not sure I follow what you mean by complying with the laws of economics.

Sony is behaving exactly like a monopolist right now. The PS3 is over priced late and is being used to push a non gaming agenda. This past generation was not a perfect situation for any consumer except sony fan boys. This past generation just moved sony even more towards complete control of the gaming industry. I don't think almost doubling the price between generations is really encouraging growth. It was bad when atari and nintendo control the industry it will be no different if sony drive MS out of the market and has complete control. I don't care if it is nintendo or MS I just want someone to take some market share from sony. If they lose market share this generation maybe it will make them think twice about doubling the price between generations and using gamer sto try and win some movie format war.

 

[Sankari]

I guess the doubling of the price works for USA/Japan(Increase for Japan but not 2x). When you consider EU and other markets thats not the case. Its launching with the same price it did with PS2. Atleast in here.

 

[SPM]

so the lies are a law of economics?
when you lie saying that your product is twice powerful than the competitor, that it has 1/100 of the human mind, that the competitor have 3d games but their product have the 4d games thnks to online gaming..

are you tired to read sony saying that 'european will not have a price cut (usa and jap yes), because they will buy the ps3 whatever is the price'? or 'we can launch ever without games at all, people will buy out console', is arrogance and lies what came from a dominance position of sony in the last gen market?

then I will be happy to see sony after nintendo and microsoft, maybe they will learn to say the truth, and that we gamer (european especially) are not sheeps

Exaggerated advertising claims/PR spin are nothing to do with what I am talking about. Everybody does PR spin if it helps their business: Microsoft also makes some outrageous lies about Windows security. Politicians build whole careers on it All sorts of businesses rely heavily on it. In UK we have a government that is nothing but PR and spin. Taking Sony down a step or two isn't going to stop them spinning - spin doesn't come out of arrogance - it is just a way of selling to gullible people, and you can't blame a Sony or Microsoft or anyone else for taking advantage of gullible people - it is a business dammit.

There is no law against PR and spin, and the only defence against it is instead of getting worked up about it, learning to treat everything you hear with a healthy scepticism until you see solid proof - ie. become less gullible. The idea is that in the end, with free and fair competition market forces will decide - if Sony is arrogant, then the customer can walk away. The problem happens when you have a monopoly. In that situation, the customer can't walk away. In the PC market Microsoft is the most arrogant of any company in existance. It isn't arrogant in the console market, but that is only because it has no monopoly there. As for Sony gaining a monopoly in the console market, you may think differently, but I don't think that is possible because all three consoles are very good. I don't think Microsoft can either if it competes fairly. The thing about Microsoft is it has the ability to leverage it's monopolies to compete unfairly, and it has a corporate history and a chain of lawsuits and convictions for monopoly abuse - this is not my opinion, it is the opinion of DOJ, and EU, S.Korea, and Japanese anti-trust authorities. That is the reason Microsoft needs to be watched. I wouldn't trust Sony either, but Sony is not in a position to leverage a monopoly.

 

[SPM]

Sony is behaving exactly like a monopolist right now. The PS3 is over priced late and is being used to push a non gaming agenda. This past generation was not a perfect situation for any consumer except sony fan boys. This past generation just moved sony even more towards complete control of the gaming industry. I don't think almost doubling the price between generations is really encouraging growth. It was bad when atari and nintendo control the industry it will be no different if sony drive MS out of the market and has complete control. I don't care if it is nintendo or MS I just want someone to take some market share from sony. If they lose market share this generation maybe it will make them think twice about doubling the price between generations and using gamer sto try and win some movie format war.

That is not how a monopoly behaves. A monopoly manipulates the market to exclude competition from market share. A monopoly does not increase it's prices so that it's competitors gain market share. A monopoly does not delay it's products entry into the market so that it's competitors can gain market share. Such actions might upset customers, but they are signs of Sony's weakness not it's strength, arrogance or control of the market.

On the contrary, a monopoly would cut it's price and take a loss and force it's competitors to take a loss and pull out of the market, and then raise it once it's competitors are out of the market. At the moment there is no monopoly in the console market. Sony may have the biggest market share of last gen, but Microsoft has the biggest market share of next gen.

 

[SPM]

I don’t think anyone is seriously going to get away with “cheating†in this industry. As an economics graduate, I’m not sure I follow what you mean by complying with the laws of economics. Microsoft have had their number called in all three major markets by all the major regulatory bodies, governments and international organisations. They walk on thin ice, they are not going to get away with any cheating.

The problem is that the anti-trust authorities have been very lazy and slow when it comes to dealing with monopolies lately. When it came to Standard Oil and AT&T, the authorities acted decisively and split the companies up. The baby Bells and SOs became the the vibrant and competitive oil companies and telecom companies we know today. The problem is that with globalisation, there is a degree of protectionism granted by anti-trust authorities to companies from their own countries. For example Lockheed and Boeing are the only two aerospace companies left in the US and with the exit of Lockheed from civil aviation and McDonald Douglas taken over by Boeing, the US government is going to find it difficult to get a competitive tender in future for defence jobs. If they want a tanker or EW platform, they only have Boeing to go to. If they want a fighter, they have to go to Lockheed since with the loss of the F22 and JSF by Boeing, means Boeing is effectively out of the fighter business for future fighters. The vibrant, inventive US aerospace industry of the past is gone for ever. In US and Europe - anti-trust authorities don't want to break up monopolies up because they feel bigger companies will be able to compete better in the global market. That is why Microsoft has been treated very differently from SO or AT&T.

What I mean by laws of economics, is that in a competitive market, you can't charge your customers extortionate prices, threaten your customers with price hikes or withdraw your product if they do business with a competitor, or dictate draconian terms and expect them to accept. In a competive market, you cannot hike up the price in one sector and indefinitely run at a loss in another. If you do this in a competitive market environment, the laws of free market economics (as promoted by Adam Smith) will mean you go out of business because your customers will walk away.

Sony’s biggest problem seems to be execution, they have the systems in place to stay market leader for many years but a series of catastrophic failures in the executive branch is hurting them. Nintendo’s only problem is their overwhelming corporate greed. Once they are on top Nintendo is utterly ruthless at squeezing the margins to get every last drop of value often to the detriment of future stability.

Which is why I don't think Sony or Nintendo have any chance of achieving total market dominance anytime soon.

My overriding belief is that monopolies only tend to arise due to the failure of a selection of firms or the market as a whole. The last major entertainment monopoly created is the iPod, which was as much due to the utter incompetence of the CE majors as it was due to Jobs’ brilliance in spotting the gaping door left open to him. Monopolies don’t arise thanks to the strength of the product alone, that is only half the picture, the other half is due to the failure of others (competing firms, the market as a whole or regulatory bodies) to react.

Very true. However the anti-trust authorities seem to have given up breaking up monopolies into smaller companies to create a competitive playing field when monopolies do arise for whatever reason. This would be the ideal solution when a monopoly arises. This means monopolies have to be constantly monitored and policed. This is not ideal because the anti-trust authorities and the law are just too slow to act.

All monopolies are a problem once they arise because they have the ability to abuse market control they have and subvert normal free market economics. The only place where a monpoly has a place is in the old Soviet style communist system with it's state granted monopolies where market competition is not permitted. Unfortunately we seem to going into an age were monopolies are allowed to remain in place on a permanent basis.

 

[quest55720]

That is not how a monopoly behaves. A monopoly manipulates the market to exclude competition from market share. A monopoly does not increase it's prices so that it's competitors gain market share. A monopoly does not delay it's products entry into the market so that it's competitors can gain market share. Such actions might upset customers, but they are signs of Sony's weakness not it's strength, arrogance or control of the market.

On the contrary, a monopoly would cut it's price and take a loss and force it's competitors to take a loss and pull out of the market, and then raise it once it's competitors are out of the market. At the moment there is no monopoly in the console market. Sony may have the biggest market share of last gen, but Microsoft has the biggest market share of next gen.

I would say having a lock on all the important japanese franchises is excluding others. A real monopoly does not have to cut prices because there is no true alternative. A real monopoly can charge what they want because there is not viable competition. If you want to play the biggest japanese titles you have to buy a PS3 no if ands or buts. Because of this sony can get away with charging an outragous price for thier product. They can use gamers to push a stupid movie format because of they have excluded others. You can bet your ass if sony was in MS or ninendos position coming off of last generation they would of not charge a kings ransom to push a movie format.

Sony might not have a complete monopoly right now but they are inches away from it. Nintendo has already given up directly competing with sony they are going to try and make it as a niche player. If the 360 fails like the xbox before it MS will be gone also leaving just sony and a niche player in nintendo. Times are interesting but also damn scary.

 

[superNoid]

... Sony may have the biggest market share of last gen, but Microsoft has the biggest market share of next gen.

And MS will likely hold the lead heading into 2008.

 

[Dave Baumann]

Sony might not have a complete monopoly right now but they are inches away from it. Nintendo has already given up directly competing with sony they are going to try and make it as a niche player. If the 360 fails like the xbox before it MS will be gone also leaving just sony and a niche player in nintendo. Times are interesting but also damn scary.

And this is where you see the likes of EA and other big publisher / dev houses step in. Its not in their interest to see a monopoly either.

 

[quest55720]

And this is where you see the likes of EA and other big publisher / dev houses step in. Its not in their interest to see a monopoly either.

It is not the north american publishers who are the problem. Most of them are mulitplat forum unless it is a paid exclusive. It is the publishers over seas who stick and will only stick to sony. EA will never pull big games from the PS3 to even the odds. Granted EA could go to MS and say 500 million and madden is exclusive for 2 seasons that would even the odds but hey would never do that. EA cares to much about short term profits to step in and really even things up.

 

[Wunderchu]

It is not the north american publishers who are the problem. Most of them are mulitplat forum unless it is a paid exclusive. It is the publishers over seas who stick and will only stick to sony. EA will never pull big games from the PS3 to even the odds. Granted EA could go to MS and say 500 million and madden is exclusive for 2 seasons that would even the odds but hey would never do that. EA cares to much about short term profits to step in and really even things up.

like Dave Baumann's statement about EA, it seems Square Enix would rather not have a monopoly either; http://www.neogaf.com/forum/showthread.php?t=121174

 

[Phil]

That's quite possibly the most negative way you could take the argument. The funny thing is, just taking PC gaming into account discredits your take. Making games multiplatform or making only one platform does not necessarily incur a technological drop of a 4-5 years. You're really reaching with that one.

I never spoke of a technological drop of 4-5 years - you're just putting words into my mouth now.

Most PC games are developed with the lowest common denominator in mind - though are somewhat scalable in what effects can be switched on, depending on what kind of hardware you're playing it on. The joys of buying an expensive GPU for double the price of a console sure is an amazing experience - especially when the latest games rarely scratch the potential it has to offer - not until 2 to 3 years later anyway when the GPU you once baught is obsolete by the newest card out on the market.

Still, PC games are highly inefficient compared to optimized console games - at the same time, exclusive titles tend be a lot more optimized for the hardware they're supposed to run on than multi-platform games. My point still stands - make all games multi-platform and the whole point about revolutionizing console gaming with fancy GPUs and CPUs that pump millions of FLOPs is rendered useless when the hardware(s) are different.

I think I'd rather stick to my console of choice this coming generation and focus on the games that do push the envelope and make the best of what hardware is under that fancy plastic.