Game Over for Consoles

Matt Barton's picture

Okay, probable flame bait here, but Peter Vesterbacka (marketing lead for Angry Birds) is claiming that the glorious days of console gaming are over. His argument? For one, as we all know, innovation isn't coming from the big companies these days (the ones who target consoles), but rather indies (ahem, Angry Birds). Secondly, there's a huge cost difference ($60 console game; $.99 Angry Birds). He also thinks that tablets pose a real threat to consoles. The main claim there is that "four generations of new tablets come before a new console." These comments followed a session by Satoru Iwata (Nintendo CEO) who wonders if the rush of mobile and social games might destroy the industry, making it impossible to earn a living as a developer.

What do you think? Are the days of the big three coming to a close?

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Bill Loguidice
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Of course not. It's ironic

Of course not. It's ironic that the marketing lead for Angry Birds (great game, of course) is saying that, as the game was already released for the PS3 and will soon be coming for the Xbox's Kinect. In any case, it's also silly to say that innovation is not coming from the big three - because clearly they're offering up as much innovation as anyone these days, particularly in regards to hardware - and sales by no means reflect any significant downward trend. In fact, games like "Call of Duty Black Ops", with over $1 Billion (with a B) in sales, fly in the face of that.

If this were an earlier period of time, the argument could be made that with all the smartphones and tablets and budget gaming options, there is increasingly less room for traditional console and PC games. It's NOT an earlier time and in fact it's clear that there's room for everyone. The game market is not contracting or becoming more restricted, it's expanding. There's room enough for everyone. Really.

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Nathaniel Tolbert
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This is only an opinion..

Don't forget that they also released angry birds on the PC and Mac as well. He has reason and need to try and push for their platform of choice as a dominant platform. I don't particularly see the android and apple app market overtaking everything and destroying the current gaming trends. I do see them both supplementing what is already established. I personally prefer physical media with a box, as I still very much enjoy cover art. It's not in the same arena as the classic games, as pointed out in a previous article by Mr. Loguidice (I think. You were the one that put of the article with the pictures of the various classic games, like the LP covers, and special cases, correct?) but they still have some meaning to me and I like to set them on a shelf to look at. I do think in the future that physical media will go away. There are many reasons for this, but the most common one stated is increased security versus pirating. I agree that the Kinect and PS Move are interesting (just got a kinect last week with some of our money from out tax return. Any suggestions for good games?) and I think they will continue to bring interesting new ideas to the market. Child of Eden looks interesting. Reminds me of REZ, but without any character representation on screen. The usage of the PS Move on Killzone 3 seemed to me to be almost completely intuitive, making it much easier to use motion controls for a shooter than any game I've tried previously. But I have digressed far from the topic. To reiterate my opinion, I don't see the App store or small mobile games destroying handhelds or consoles or PC's any time soon. We have a long way to go for that.

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clok1966
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true
Nathaniel Tolbert wrote:

The usage of the PS Move on Killzone 3 seemed to me to be almost completely intuitive, making it much easier to use motion controls for a shooter than any game I've tried previously.

I agree... the MOVE in Killzone 3 is the best use of motion control in any game I have played. I may just start thinking FPS belong on consoles... and if you know my hate for all things FPS on consoles thats high praise. I no longer think i wasted my money.. much like the Steel Battalion controler.. one game may just play cool enough to warrent that big a expense.

as for kenict.. isnt Dance still the only "good "game for it? it was at launch.. several where fun.. but nothing you would play more than a bit (opinion only). Is there a reason to fire up my kinect now? Of course its pretty sad the Move wasnt worth using till now either...

Nathaniel Tolbert
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The exercise program is

The exercise program is really nice, and it's really beating me down. I really enjoy the little mini games in Kinect Adventures. My major problem is that I cannot seem to get myself completely in frame by the time I get myself fully in frame with my arms up I'm outside the camera range apparently. At 8 feet when I stick my arms up, they go out of camera range? I'm no giant, but apparently 6'1" is just a little too tall for the Kinect. I have the same problem with the Wii though, as when I'm supposed to raise my arms they go outside the sensor range and I get penalized. It can be very frustrating to lose points because you are following the directions.

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Soulgotha
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Joined: 09/06/2010
Not by a long shot

I agree with Bill. As far as innovation, I think the wii remote is the coolest thing I've seen in video games in a long time. It definitely hasn't realized its potential yet, but seeing the technology introduced and now the other consoles making their versions shows me that consoles are far from over. Heck, they have the wii in retirement homes and hospitals to help people with rehabilitation and whatnot. 10 years ago I never would have thought some 85 year old lady would be playing a Nintendo as part of her rehab from a stroke. That's pretty damn innovative if you ask me, and that's modern console technology.

What's cool about games like Angry Birds though is that I can play 'em on my phone on my breaks at work. Then again, I can play classic NES games on my phone at work as well.

Chris Kennedy
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Controllers

I think that one thing that people (developers included) tend to overlook when it comes to analyzing all of this stuff is play control. Graphics, sound, or whatever - Controlling the game is what truly matters. Something like a tablet - which, by the way, is what I am using to write this post - doesn't use a traditional controller. The tablet sets up great for touch screen games, but not all games can be adapted to make a touchscreen seem like the natural controller of choice.

I suppose it is possible that console games and systems could be a bit more niche, but hey wait a second - isn't that what they have always been? We have seen the gaming ecosystem EXPAND with phones, tablets, etc, but that shouldn't mean the majority of twitch gamers will annihilate the use for a console.

Take for instance the madden crowd - pretty sure that is a "let's play it on the big tv with a loud home theater" crowd rather than a "hey Jimmy - bust out your phone, and let's throw down" type of crowd.

Now...if games are shoved into a multimedia TV set and the user only needs to purchase on controller...well, who knows.

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Mark Vergeer
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Arrogant statement

Just an arrogant statement from a successful developer let's see if he/she can keep up the good work and how it plays out.

I have a ton of games on my iPhone but almost invariably am let down by the controls when it comes to more traditional games. The touch screen just doesn't cut it. Games like angry birds are wonderful for touch screens but I will go braindead if I play it more than 20 minutes in a row. LOL

I'd say pc and console gaming are here to stay. Perhaps in the shape of these new streaming services.

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Mark Vergeer
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Looking at money spent on entertainment

Looking at the gross amount of money people spend on entertainment a large chunk is spent on gaming media. Physical media carrying games. I guess people like to play games from disc or cartridge still...

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Nous
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Disrupting the Software Market, From Without and Within

From a recent article on gamasutra http://www.gamasutra.com/view/feature/6303/npd_behind_the_numbers_februa...

During his GDC keynote two weeks ago, Nintendo president Satoru Iwata spoke in strong terms about the current trends in mobile and social games and how they threaten the value proposition traditionally offered by platforms like the the Nintendo Wii and DS. Specifically, these platforms host software that ranges in price from $20 - $50, far above the free or modest prices charged for applications on smartphones and on social media sites like Facebook.

While we typically don't address these non-traditional markets in this column, the time is fast approaching when those markets will be impossible to exclude from the conversation. Iwata's warning to developers may suit Nintendo and its chosen strategy, but the industry appears to have other plans.

Indeed, when analysts like Michael Pachter of Wedbush Securities suggested that devices like the iPhone and iPod Touch were a threat to Nintendo's business, Iwata famously replied that Nintendo's devices and Apple's devices “appeal to different consumers.”

If Nintendo's platforms and the iPhone appeal to different consumers, then why the impassioned appeal to keep the value of software high? Clearly, Apple's mobile platforms and smartphones generally have turned out to be a threat after all.

And Nintendo may feel that threat most acutely now, as it launches its new handheld, the 3DS. While we believe the 3D effects and exclusive software will certainly help push the 3DS initially, we remain dubious about the system for both the $250 system price and standard $40 software price.

Yet the 3DS will have a means for competing with mobile devices. Nintendo is readying a storefront that will allow 3DS users to buy software over a network connection (like DSiWare on the Nintendo DSi now), and has announced that Netflix movie streaming will be available on the system. However, Nintendo is relatively new to the distribution of software through an online channel, especially compared to its most immediate rivals in the video game industry, Microsoft and (to a lesser extent) Sony. Each company has had its share of challenges expanding into these areas, and Nintendo will be no exception.

Clearly, pricing will be one of those challenges. When asked about Iwata's keynote, Wedbush's Pachter drew an analogy with “a record company executive speaking to a group of recording artists and saying that iTunes was a terrible model” and “that they all band together to make sure that consumers buy only album length CDs for $20 instead of individual songs for $1”.

If we accept the analogy, then Nintendo's 3DS and its software will likely still sell well – there are, after all, albums that sell well even today – but the prospects for a Nintendo DS-like hit seem significantly dimmer.

The problem with pricing, we would argue, is not just on handhelds. The industry as a whole has maintained an average price for software of $39 - $41 for three years and during that period software unit sales have declined by 13%, leading to a decline in overall revenue. Most of those software units are for consoles, not handhelds.

Are console software sales also being undercut by another source? Possibly. When asked Pachter offered that he doesn't “see as great a threat to console games, since there is nothing analogous [to the App Store] available on the television” but that “ it's coming some day.”

We respectfully disagree. We believe that at this very moment Microsoft and Sony and, yes, even Nintendo are undercutting their own packaged software business with their online storefronts: the Xbox Live Marketplace, the PlayStation Store, and the Wii Shop Channel. While some sales on those services are likely to be additive – money spent on top of what one would already have spent – we think it is likely that those purchases are actually substituting for retail purchases on an increasing scale.

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clok1966
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Consoles much Like PC's will

Consoles much Like PC's will never go (IMHO) but i think he has a few nugets of truth in his post. A $.99 game on a device I can carry anywhere is pretty appealing. game sucks Im not out much. People are spending less and less time in there homes, its just a fact. We have went from a single Money maker homes (pre 50's) to duel parent money making homes, not to forget so many single parent homes with devorces and such.. and simply singel parent. All this means working away from home, less time in it. And the very nature of the devices we buy MOBILE shows how little time we sit around. Pc's took a hit when we could play games as good (I know, PC's games look better and all that) on the consoles, couchs where the new play spot instead of a chair in front of a PC.. the new play spot now is a car, the mall, the bus, the couch is the chair now.

The reason consoles will take a hit is pretty much as he said.. Mobile platforms are evolving at an astounding rate right now while console devolpers try to extend the life of there product, get buy with gimics instead of new hardware. And even if you dont htink they are gimics (sales do suggest they are not) they are STUCK in front of a TV. The other reasons is devolpers have forgotten how to make a game with a BUDGET! the Indie guys know, but EA/Activision/Square/etc dont kno how to make a game without a budget of a modern blockbuster movie.. And they are putting out 2-3 games that make money and 5-10 that dont. this will catch up with them.

tech always moves.. evolves. Consoles have had a great run.. they really dont have much room to improve. Grpahics are getting to the point of "realistic" ther eis alwasy room for improvments, but they are quite good. Physics, proper lighting, fluid animation.. again always room for improvment but we are really getting close to done on those areas. Now its time for the CONSOLE to evolve, and the new controlers are a start, but mobility is a far bigger step (imho) then gesture controlers. And I belive people will gravitate to that far quicker then being chained to a couch.

Its not always true but when it comes to electronics the Asians seem to be a few steps ahead (sometimes to far ahead) of the rest of the world. They embraced Cell phones before much of the rest of the world (and us Americans almost always seem to be the last to get on board). Take a look a the MINI Sat dish systems.. it was 10YEARS before the US got them (mostly becuase cable providors and the 12foot dish guys cried to congress that they couldnt compete,and had them push a import ban on them for 10 years so they could "prepare" read up on it.. sad, the tech was not used becuase some companies got to far behind). Desiel as a fuel is excellent now and used almost worldwide.. except in the states. The negatives have been pretty much fixed and its a better fuel then gas now (at least for auto's). err opps getting off track.. Mobil gaming is KING in asia.. and I see it surpasing consoles quite quickly. Consoles wont be gone.. but $15+ million development games will be..
2000- over 3000 games released, 100 made a profit, only 50 of those made a GOOD profit. devolpemtn costs averaged 1.5-3 million pluse about the same to advertise.
2009- budgets are "normaly" 1.5- 6 Million but most AAA titles are 10-50million. These numbers dont show advertising budgets. And nobody seems to want to talk about succes/fail rates nowdays either. The reall suprising numbers are the way they split money.. 15-19% for the devolpers. 32% for the publisher, 5% actual production costs, console makers get 18% royaltes, store 32%.

here is a pretty interesting number too. before STEAM anybody who sold online (indie) they made about 85%.. of course there where very few indie titles sold that way. Currently STEAM is about the same as the normal hard copy.. its just more as they cut out some middle men. Seems sad that the Devolpers get the least.. kinda like Movies and Records I guess. Used to be the tallent made the money the leachs hung on and did ok.. now the leaches make more then the host.

Gameing is evolving fast, it moved from the arcade to the home, i think its moving from the home to "everywhere', not going to happen overnight, but I think Mr Angery Birds ideas are leaning towards correct.. but who knows.

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