MS Xbox is gaining momentum...unstoppable...

[Vince]

Teasy: Hehehe - Got a smile outta me!!

I'm not sure why Vince has to be so insulting all the time, but I'm sure I'm not alone in noticing it.

Because I'm sick of your useless rhetoric. I'm only insulting when you post this BS. Do you ever read the shit you write?

I don't really have any interest in debating these matters with him anyway, as he seems to believe the console war is a 9 month battle.

Beleive me, I've been thinking of this since GDC 2002, well before you knew anything (Which I told you).

The console war is no longer a console war, it's .Net vs OGSA - it'd the future shape of the living room and internet.

As stated by PCO, Sony dominates the front-end production houses (Cinema, Music, TV) and the back-end appliences (PSx, VAIO, Trinitron, Walkmen, DVD, BlueRay, need I go on?). All they need to do is connect them with the help of IBM and Toshiba - whose supplying the core hardware microarchitecture, the OS, the GRID standards.

Microsoft dominates the middle turf (Windows, .NET, MSN) and will only supply the middle to 3rd parties for implimentation and is attempting to gain a back-end with XBox - which isn't working.


Ok, explain to me how Sony's stumbling? They have all the pieces to seemlessly distribute digital media, and are now connecting them.

MS has the connection standards, but no hardware and no front-end to sell.

And explain to me how MS can leverage ANYTHING in the console market. It's a closed architecture, Windows means nothing.

Sony has the potential to sieze the market by the balls. Buy a Sony TV with Cell/OS that can flawlessly interact with your Cell/OS powered PDA or VAIO, or your Cell/OS powered PS3 which allows you to get any of Sony's thousands upon thousands of hours of digitized films dating back to the '60s (I dream of Jeanie!). Or some Sony Music which can be sent to your Cell/OS powered Walkmen or Sony/Aiwa Audio products. Buy one Sony product, and you'll end up buying another 5.

How is Microsoft going to counteract this? What can MS offer me? hypothetically better graphics? HA! We're past that. TiVo? Um, no. An integrated Harddrive? hehe

Nobody gives a damn about graphics, we're well into a point of diminishing returns with respect to current TV limitations, and even with HDTV, the average consumer won't notice a diffrence between PS3 and XBX2.

Microsoft has what advantage? Rare? Give me a break, their one development house thats been failing as of late. Buying up as many development houses as they please isn't going to change the fact that people hate XBox. Sony's still outselling it >2X in the US, and the gaps widening.

How XBox2 is going to rectify these deficiencies is beyond me.

I know a boat load of PS2 owners that are either getting an Xbox at $199 or later at $149.

And they'll continue to buy Sony Games, and Products. Their are over 30M unique PS2 owners (That own just PS2), I doubt their are 1M unique XBox owners... way to dominate.

 

[Kolgar]

Wow, Vince, interesting reply. I've often wondered how a Sony/Microsoft standoff would shake out, and your analysis seems to make sense. Funny, I hadn't given Sony that much of a chance, but as I said, your argument is compelling...

Whatever happens, it's gonna be more interesting and bloody than any "console war" we've ever seen!

Kolgar

 

[Vince]

Whatever happens, it's gonna be more interesting and bloody than any "console war" we've ever seen!

Ohh yeah; if you supply the lawnchairs, I'll supply the drinks

 

[Grall]

Vince, I say like Kolgar; interesting points you make.

HOWEVER...(hehe)...! I don't believe they'll execute anywhere as flawlessly as this.

A: just because things integrate with each other doesn't mean instant commercial success. The more peripherals something needs to fulfil its potential (or worse yet: even work to begin with), the less software support will be available for it, and the less support, the less consumers will be enticed to buy it as well. The less consumers buy it, the less incitement for soft-co:s to support it, thus completing the vicious circle... Hence reason for failed SegaCD amongst other things.

B: Sony COULD do all these things you propose, sure. But do you really think they WILL? It would require an awesome commitment from the company as a whole, from hardware division, software, marketing, media, everything... LOTS of co-ordination will be needed (on a larger scale than almost anything gone before it) and most likely many cone-haired bosses on many different levels having their say. You think they all have the guts to go for a scheme like this? As for me, I'm very doubtful. There's SO many ways they could screw something like this up and simply lose oodles of money when it all blows up in their faces. I expect the PS3 to play DVD movies and connect to the internet for online play and that's it. PERIOD. Heheh. (Oh alright then, maybe it'll run Linux too just like the PS2. Maybe it'll even run Linux as the resident firmware OS, who knows.)

Let's wait a few years and see who's right in the end.


*G*

 

[Vince]

The more peripherals something needs to fulfil its potential (or worse yet: even work to begin with), the less software support will be available for it, and the less support, the less consumers will be enticed to buy it as well.

You don't Need them for it to work, but if your going to buy theese products, why not buy ones that work together? I'm going to buy a TV, get a Sony HDTV that has Cell/OS, need a digital camera - Sony with Cell/OS and send the images anywhere.

See my point, it's not 'accesories' that are necessary, but rather help entice you to making all the products you're going to buy anyway Sony. Go ahead, buy a Zenith TV, it just won't be compatable with Cell/OS network.

B: Sony COULD do all these things you propose, sure. But do you really think they WILL? It would require an awesome commitment from the company as a whole, from hardware division, software, marketing, media, everything... LOTS of co-ordination will be needed (on a larger scale than almost anything gone before it) and most likely many cone-haired bosses on many different levels having their say.

True, but I take Sony Groups realignment around their media groups as an indication, aswell as the power given to SCEI and Kutaragi.

As well as the formation of MovieFly an alliance between MGM/Paramount/Sony/Universal/Warner Bros to deliver Video on Demand.

And when the broadband future finally arrives, Sony may have a leg up on competitors in both PCs and consumer gadgets, not least because it makes them all, along with the digital "content" that drives their sales. When it comes to linking all these worlds, with a PC like the Vaio as a hub, the rest of the computer world is "catching up" to what Sony is doing, says Will Poole, Microsoft Corp.'s vice-president for digital media. "They've gotten this concept ahead of the others," he adds


Substitute/Interchange PSx for Vaio. Now time for sleepy...

EDIT: Mark, their nothing you posted that I didn't cover somewhere with some dynamic hinking on your part. I'm going to bed, think it over yourself. Maybe even do some research into Sony's realignment/new CEO (Aibo IIRC) and his intentions.

 

[Mark Cicero]

I think Vince has missed a couple of other rather blatent assumptions Grall.

The console war is no longer a console war, it's .Net vs OGSA - it'd the future shape of the living room and internet.

Last time I checked e-commerce didn't really occur from the living room.

As stated by PCO, Sony dominates the front-end production houses (Cinema, Music, TV) and the back-end appliences (PSx, VAIO, Trinitron, Walkmen, DVD, BlueRay, need I go on?). All they need to do is connect them with the help of IBM and Toshiba - whose supplying the core hardware microarchitecture, the OS, the GRID standards.

This of course is contingent on a few factors. One, that they all decide to get along together. Two, if said getting along occurs, that they somehow get past Congressional inquiries which are a bit easier to do with multiple industries trying to create a monopoly rather than just one company (allegedly) trying to do it. Third, that IBM is going to help them connect. But that gets to my next point. Thanks to xbox live, Microsof is taking a definite interest in doing what individual states (esp. Engler in Michigan) are having a hard time selling: universal broadband connections. If MS decides to underwrite the whole project (which given the lack of at least a few layers of beurocracy will probably make it far more efficient than any public undertaking) then they, not IBM or Sony or Toshiba, will control how this great media conglomeration/congruence will operate.

Microsoft dominates the middle turf (Windows, .NET, MSN) and will only supply the middle to 3rd parties for implimentation and is attempting to gain a back-end with XBox - which isn't working.

How is it not working? MS's projections for December are 9 million. They are not, repeat NOT, expecting to take over the market in one fell swoop. This round is to establish that it isn't a joke. Next round is to scare the $hit out of sony, the third round will decide the winner or at least will provide something to keep these forums alive. Xbox3/PS4 is where the finally war in the valley of armageddon will occur (provided of course that Nintendo somehow or other doesn't manage to get UN sanction for suppling all of our gaming/entertainment/communication needs).

Ok, explain to me how Sony's stumbling? They have all the pieces to seemlessly distribute digital media, and are now connecting them.
MS has the connection standards, but no hardware and no front-end to sell.

This is assuming that they indeed wish to enter the digital entertainment market. The post-napster world has changed the way the industry has, and will, look at things. They weren't ready before now and I'd be willing to bet they arent' going to move into the digital realm until they are "certain" they can solve the essential problem of copying.

And explain to me how MS can leverage ANYTHING in the console market. It's a closed architecture, Windows means nothing.

Umm now I could be wrong (and that's admission not sarcasm) but aren't all of the current consoles closed architecture? And again, there's the assumption that Xbox2 = some form of windows. If you read The Making of the Xbox people, especially Steve Balmer, freaked out when they were told it wouldn't run windows.

Sony has the potential to sieze the market by the balls. Buy a Sony TV with Cell/OS that can flawlessly interact with your Cell/OS powered PDA or VAIO, or your Cell/OS powered PS3 which allows you to get any of Sony's thousands upon thousands of hours of digitized films dating back to the '60s (I dream of Jeanie!). Or some Sony Music which can be sent to your Cell/OS powered Walkmen or Sony/Aiwa Audio products. Buy one Sony product, and you'll end up buying another 5.

This is assuming, as Grall pointed out, that people will by peripherals. At least if MS takes over it will all be in one huge ass box beside the tv if in the home at all.

So yeah Vince's post is food for thought but in the end acid-reflux causing heartburn is a b!tch.

 

[Sonic]

Why couldn't Sony pull it off? They've got a much better chance than MS does, and just as much as every ambition. It's obvious that they are going to be competing with a format that's able to connect households with a network all across the world. It just isn't about a console to play games on any more. Sony and MS both want more than that, that will still be the main focus, but they see advantages of making profit in other ways by making use of the machine for other uses. Sony has all the pieces of putting it together, now all they need to do is put them in the right places and make sure the foundation is stable. MS has a lot of the pieces and is somewhat on its way to acqiring more of the pieces, but its overall partners are not in high numbers like Sony's are.

It will be interesting, but don't forget that Sony might just have to let IBM have control of the network. Afterall, this is what IBM is really striving for.

 

[marconelly!]

then they, not IBM or Sony or Toshiba, will control how this great media conglomeration/congruence will operate.

With their closed network that has no visible advantages over the already available open internet? Without content providers to back them up (I don't see them merging with film or TV industry anytime soon). I don't think so. If anything, what Sony/IBM are trying to do is much more open and visionary than what I see coming from Microsoft.

This is assuming, as Grall pointed out, that people will by peripherals. At least if MS takes over it will all be in one huge ass box beside the tv if in the home at all.

How can it be one box if you want to have digital camcorder, digital photocamera, PDA, etc, etc. Peripherials will be there as long as they don't make an universal pocketable device that does everything, is connected with evertything, and can project images into 3D space or even better into your visual cortex

 

[Grall]

Vince:

"You don't Need them for it to work, but if your going to buy theese products, why not buy ones that work together?"

I think you're assuming everyone's a techno-geek. Provided you as Joe Consumer (or Jane for that matter) even understand the concept of this Cell/OS thing you're trumpeting and the (percieved) benefits it might offer, you might just as well end up buying some other brand simply because you think Sony's TV/mobile phone/whatever LOOKS UGLY. So you might not be able to communicate with your PS3 through them, at least it matches your furniture/glasses/whatever, something most people rate far higher than gadgetry interconnectivity! (Yes, strange as it may seem to you and me, but this is how actual people think, LOL!)

Then there's price to be considered too of course, Sony's never the cheapest out there.

I'm going to buy a TV, get a Sony HDTV that has Cell/OS, need a digital camera - Sony with Cell/OS and send the images anywhere.

"Go ahead, buy a Zenith TV"

Uh, Zenith isn't available in Euro Disneyland.

"True, but I take Sony Groups realignment around their media groups as an indication, aswell as the power given to SCEI and Kutaragi."

I still say it's way too early. Anything introduced simply because it's neat and handy without there being any real need or demand for it has an uncanny way of blowing up in the most spectacular manner possible. Witness: the imminent implosion of most Euro 3G telecom operators...

"As well as the formation of MovieFly an alliance between MGM/Paramount/Sony/Universal/Warner Bros to deliver Video on Demand."

Is this something consumers are even interested in? Why would you pay every time you want to watch a movie when you can just get the DVD and pay once AND get a bunch of extra features AND a nice box to display on your shelf? This is the exact reason that divx scheme crash-landed you know. People don't want to pay for intangibles.

"When it comes to linking all these worlds, with a PC like the Vaio as a hub, the rest of the computer world is "catching up" to what Sony is doing"

Everybody else won't be 'catching up' to Sony if their scheme relies on a Vaio as the central hub. Hell, Vaios aren't even on sale in Sweden. NEVER seen one over on these shores. Scheme for world domination relies on availability on all markets you know... Otherwise you leave door open for arch-nemesis Bill Gates and henchmen.

Having a PS3 as a central hub seems only marginally better. It's a bit of a stretch for a gaming console to fulfil that role (they ARE seen as toys you know by the general public), and gaming consoles disguised as set-top boxes or such has also flopped (usually never even been brought to market). The PC is seen as the natural hub of such things simply because it's easily recognized as a computer. Children's toys (or in case of the Playstation; young mens' toys) controlled by joypads can't fill those shoes.

I don't foresee a change in that attitude in the next few years. We're not ready for that total integration yet. Maybe the around PS4 or 5 we will be...


*G*

 

[JF_Aidan_Pryde]

Sony tried to do the connectivity thing with the Memory Stick and it sure worked for me.

*Self confessed VAIO + Cyber-Shot onwer* \

I mean, with that memory stick slot starring at me, am I *seriously* going to considering buying something else? The DSC-P5 is truely a blast.

 

[bryanb]

I don't think the "suits" at MS are going to intervene in the Xbox project if they meet their 9 million target by June 2003. I remember when everyone laughed at Window 3.1 and Pocket PC (I was one of them, a big Amiga supporter back in the early 90s), but who's laughing now?

There are no suits at Microsoft who have the power or inclination to stop the massive capital hemorage that is the Xbox. The only suits that matter on this issue are Gates and Ballmer. These are the guys that placed the bet on the Xbox. These are two of the most ego driven corporate leaders ever. They aren't about to admit failure. Business is a game that these guys take very personally.

But the loss of face that Gates and Ballmer would incur from a straight out flop of the Xbox, such as is ocurring in Japan and partially in the EU, doesn't compare to the loss of face that Microsoft would incur in the consumer electronics market. Microsoft wants access to the family room and the Xbox is their biggest salvo yet into that market. As a business with stagnating profit margins in all of its existing markets, Microsoft badly needs the Xbox to succeed. They company is valued more than GE and IBM combined. Stockholders are soon going to start looking for badholders now that 20% quarter growth at MS is over.

There was a reason why they code named the Xbox - "Project Midway".

 

[Glonk]

While Vince's theories are interesting none the less, I don't think he's very much grounded in reality.

Most of the points have already been addressed here, but I do think that it will be an interesting battle. But in the end I don't think Sony stands a chance against MS.

MS has more money (which is kinda stating the obvious), MS can use this money to position itself better. That's why it's acquiring all these talented developers as first party. Sony's getting the idea, getting TakeTwo to sign exclusively for PS2 and the like, but they don't have that kind of money to throw around.

Sony also pissed off a lot of developers with the PS2. Development costs and times are FAR higher than they could have been, and it's kinda put Sony at a disadvantage. One of the reasons the PSX was so popular was how easy it was to get a game on it. The PS2 was the opposite.

This whole talk about Cell worries me, for a couple reasons. First, the common perception these days on the internet is that it involves distributed computing over the internet. I don't think that's true at all (in fact hasn't it been flat out denied?). But by the same token, the PS2 fanboys are standing behind Cell was a computational powerhouse when it's totally unproven, and actually looks to be nothing more than CMP.

Hardware wise, I don't think Sony+Toshiba+IBM will be able to compete with Intel/AMD+Nvidia. That's all up for debate, though. And if the Xbox2 is as easy to develop for as Xbox1, and MS still has deep pockets, and they launch at the same time as the PS3 -- where's Sony's advantages gone?

Think about it.

 

[Crazyace]

high dev costs not just for PS2....

Hi Glonk,

I think you'll find that the high dev costs are for any projects on next gen consoles, not just PS2.... This is more to do with the high expectations in terms of audio and graphics more than anything else..
High end 3D art packages have historically cost as much as devkits...

 

[zurich]

Brian,

It was called "Project Midway" because it was supposed to be halfway between a console and PC (the later implications were a coincidence). Read the book

As for Ballmer, he may take business seriously, but if you read "Opening the Xbox" he was far from pleased with the whole idea. I think in one chapter, a conversation between him and Fries goes something like:

Ballmer: So you're telling me that in the next 5 years, we could very well drop $4 billion on the Xbox over a span of 5 years and make no money off of it?

Fries: In a worse case situation... yes.

Ballmer(shouting): THEN WHY THE HELL ARE WE DOING IT?!

I dont think MS will kill the Xbox any time soon, but I'm just afraid that they'll loose focus and start getting the 'wrong' ideas to boost market share.

zurich

 

[zidane1strife]

I just hope Ms doesnt make xbox 2 or 3 into a minipc by incorporating win compatibility... cause thatd be enough to push pc distributors, manufacturers, software dev.s, who are already feeling threatened by Ms, go over the edge a.k.a get very pissed off.... and could make them do some crazy things like a switch to linux across the whole pc industry with software dev.s providing both win and linux compatibility, until an eventual switch over to linux...

Ms might have alot of power with their monopoly of the operating system market, but if they make a big move that threatens alot of people it could consolidate the market into going against them... organizing a fellowship, and throwing the ring into the fires of mount....

 

[Johnny Awesome]

Vince

Your argument boils down to ignoring all of MS/NVidia/AMD/Intel advantages and exagerating those of Sony/IBM/Toshiba. It's also strange for you to compare Sony's future technology with that of the Xbox (and not Xbox 2), which is a lot closer to being a set-top box in the living room than the PS2 right now.

Microsoft has a very good relationship with Vivendi/Universal, RCA, just to name a couple companies that could put a dent into Sony's plan to rule the living room. Things aren't so cut and dry you know.

Unfortunately, you seem to place more emphasis on attacking me rather than my arguments. You just come across as Ken Katarugi's cheerleader. Sadly, I think the only way you'll be happy is if we install a Cell-based CPU into your brain so that Sony can control you more directly.

PS: Offline I only know 6 people with Xbox besides myself. All six of them are casual gamers with no other system. Six out of seven people I've played on Xbox Live (beta testers) only own Xbox, don't like Sega games, and three of them only play sports games. One of them only owns NFL2K3. Sounds very casual to me.

Mark Cicero:

Good points on convergence. It's going to be a slow process where consumers and content providers will want assurances before fully embracing the paradigm. MS is taking the first step with downloadable content on Xbox Live and will be well on their way with this long before PS3 arrives.

Glonk:

I agree about the financial picture. Sony vs. MS is a joke financially, but don't forget that IBM is pretty powerful. Together they could mount a reasonable, but IMO somewhat weaker, challenge to MS financially. Microsoft's Cash/Equivalents are literally 20 times those of Sony (2 Billion vs. 40 Billion).

Xbox and Xbox 2 are far too important to MS for them to abandon the console. They already have 17% of the US hardware market (and about 25% of the software market). Even as Sony outsells them 2:1, they are gradually moving towards 25% of the market. They just need to get their European house in order.

One of the worst things that could happen to Sony is that all the hardcore gamers (who buy tons of games) get an Xbox and sap away software sales from Sony. The most powerful hardware is where the ports are usually bought when multiple systems are owned, which is why games like Max Payne did so well on the Xbox.

 

[marconelly!]

MS has more money (which is kinda stating the obvious), MS can use this money to position itself better. That's why it's acquiring all these talented developers as first party. Sony's getting the idea, getting TakeTwo to sign exclusively for PS2 and the like, but they don't have that kind of money to throw around.

Getting the idea? You probably were not around when Sony was getting developers left and right, some of them far more important than Rare can ever hope to be anymore. Square comes to mind among others.

Sony doesn't have as much money to throw around but:

- They throw it very wisely so far, which is not something you can always say for MS (acquiring Oddworld, paying for DtR exclusivity)

- PS2 is one of their core money making businesses. For MS, Xbox is yet another thing, that of all, right now loses money. If you think that MS will use all of their cash disposal backing up something like that, I think you are badly mistaken.

 

[Johnny Awesome]

By the same token, all of the losses on Xbox so far amount to only one months profit for MS. Do you think this is all that onerous a burden? I think MS is willing to lose $1 billion (one months profit) every year for the next 4 years to get Xbox into the marketplace.

On acquisitions - MS has made as many good moves as Sony. Oddworld is still a good franchise that has sold 350,000 copies on Xbox so far and the sequel will probably do a lot better. DTR was a bad idea, but who knew that Namco would make a crappy game that didn't exploit the Xbox hardware? What about Sony and 989 Studios? That's been a fiasco. It goes both ways I think.

 

[bryanb]

Brian,

It was called "Project Midway" because it was supposed to be halfway between a console and PC (the later implications were a coincidence). Read the book

As for Ballmer, he may take business seriously, but if you read "Opening the Xbox" he was far from pleased with the whole idea. I think in one chapter, a conversation between him and Fries goes something like:

Coincidence? That's a real load of revisionist crap. I'm not saying that the name might not have had multiple meanings and "between a console and PC might be one of them", but you seriously think that a corporation with guys as bright as Microsoft come up with a name like Project Midway that is solely competing with Japanese product and you think there were not historical allusions?

Too simple minded.

Just for kicks, let's calculate XBox cost of revenue so far:

375 million for Rare
200 million for Bunjie (just an estimate)
200 million to NVidia for R&D costs
150 million for exclusives: feed money to 2nd and 3rd parties
500 million in marketing
50 million to manufacture/ship the 10 million Xbox titles that have sold
1.2 billion in hardware costs (4 million Xboxes at 300 each)

MS has already spent 2.7 Billion on the XBox.

Ok, let's calculate revenue:

150 million for the 10 million Xbox titles that have sold (15 bucks per title to MS)
800 million for hardware (average 200 to MS per Xbox)

MS has received 950 Million revenue for the XBox.

There is essentially no way that the XBox will ever produce revenue. Simply recovering the seed money that Microsoft will spend on this project over the next 2 years could take 5 to 10 years, once the product becomes profitable. They have to get hardware costs down from their current 275 bucks per box amount for that scenario to even become possible.

Oh, I forgot XBox Live costs, which are supposed to be 2 billion. Gaming has turned into a very low margin business with the recent price cuts!!! No wonder Nintendo is such a spend thrift.

 

[Tommy]

but who knew that Namco would make a crappy game that didn't exploit the Xbox hardware?

Namco is a joke anymore. When is the last time they made a really good game?

I think I read somewhere they are making a new Starfox game for the CUBE. ummm unless Nintendo is heavily involved in helping out Namco...it will probably suck real bad.