Clarifying Remarks About the Future of Consoles
I always love getting feedback on my comments and quotes. One important part of making your opinion public is to get new angles and feedback to see problems in a new way. This past week, during our yearly Paradox Convention (http://www.paradoxplaza.com/events), I commented on the next generation of consoles as probably being the last. This sparked a discussion on PlayStation, Nintendo and Xbox forums, as well as within the PC community and sites such as Reddit. Some of the rage coming from this discussion was misdirected, in my opinion. First of all, this was not to be seen as a declaration of war against consoles. If I wanted that war I would focus on CPU power on consoles compared to the PC, and being an avid console gamer myself (mostly Xbox, but also Wii, PS3 and DS), I think I have a pretty good feeling about the strengths and weaknesses among both PCs and consoles.
Nor do I think Nintendo, Sony or Microsoft will disappear from the gaming market; quite the opposite. They are now, and will be for many years, a driving force in our market; however, the way they operate will probably evolve into a somewhat different role.
Looking back on the history of gaming, our industry has gone through several big changes in the 40+ years of its existence and the advancement of technology has lately been faster than in almost any other industry. My own experience of digital distribution is that we made 1.5 percent of our revenue from digital distribution in 2006, while the digital number in 2011 was over 95%. One of the reasons for this growth is that we have made a big push for digital, but the other reason is that customers always strive for more convenient forms to consume entertainment. My own personal view is that one of the major reasons that piracy ran rampant in the early 2000’s was the inherent conservatism on big portions of the music industry that refused to look at new distribution models. Many companies say customers are conservative and do not like change -- my experience is quite the opposite. Companies are typically conservative and like the old ways of working and making money, basically because it is more convenient for them, while customers always strive for the easiest and most convenient way to consume their products.
To give an example of the quick change of the market, the iPhone has only been around for five years and the iPad for less than two years. Both have had a big impact on the market as well as on customer behavior. Cell phones and tablets have been around long before Apple came up with their competing products, but hardly any have made the same impact in such a short period of time.
Looking into the future, streaming is obviously the most convenient solution since the hardware is all on the server side. The major bottleneck, however, is the bandwidth, and it may take quite a few years before enough people worldwide have the bandwidth to enjoy streaming under reasonable circumstances.
Smart TVs are also a very attractive solution; Samsung with their built-in “Samsung Hub” makes it easy for people to access all kinds of entertainment directly through the TV. It is attractive enough that I ordered one for the office to check it out and see how the first generation looks.
To sum up, I strongly believe the big console makers of today also will have a big impact on the games industry tomorrow, but it will not take a piece of hardware between the gamer and the screen for them to do so. Maybe we’ll see a Sony, Nintendo, or Microsoft “hub” integrated in TVs or their own OS included in the TV; let’s not forget the Google TVs that have already seen their first generation and the oft-rumored Apple television set (not to be confused with Apple TV). As a content producer, I am really excited to see what happens on the hardware market in the coming years.
Thanks for reading.
This week I'm in New York so I do not have that much time for gaming, but I'll play some Warlock Master of the Arcane and Crusader Kings II (single player since I wasn't allowed to join the weekly MP session in the office). I'll report my progress on Twitter