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Alienware And The Battle For The Living Room

Alienware And The Battle For The Living Room

Wed 20 Jun 2012 12:31pm GMT / 8:31am EDT / 5:31am PDT
Hardware

Arthur Lewis on turning PC gaming into a ten-foot experience, and why publishers will leave the console model behind

Alienware

Alienware manufactures attractive and powerful gaming machines for end users and high performance workstations...

alienware.co.uk

The rumoured death of PC gaming has haunted Arthur Lewis for much of the last two decades. As one of the principal shareholders and top executives at Alienware, he helped steer a fanciful idea concocted by two of his childhood friends to the very pinnacle of PC gaming hardware, and ultimately to a 2006 acquisition by Dell rumoured to be in the hundreds of millions. But in all that time, and through all that success, the notion that PC gaming was a hair's breadth from some catastrophic tipping point was on every journalist's agenda.

"It has always been a forecast that has never come to fruition," he says, "but PC gaming will never die, because PC gaming drives technology."

Lewis is now vice president of product management for Dell's entire PC division, but he has worked around PC gaming for long enough to witness a persistent stream of innovations that owe their very existence to the growing market for video games.

"Products like SLI and CrossfireX never would have happened if it wasn't for PC gaming, extreme edition processors from Intel never would have happened without gaming, and the list goes on and on and on: high speed memory, video frame-buffer memory on discrete graphics cards.

"All of those things are driven by high-end applications, and there are still very few applications that are as taxing as games. That will continue until, well, as far as I can see. I don't know how far that is, but I don't see the end any time soon."

"Game developers would rather create for one platform, not four platforms, so the more we can make the PC a ubiquitous device the better it is for the industry"

In 2005, speculative articles about the obsolescence of PC gaming could be forgiven, if not entirely respected: there was no Facebook, no Steam, and a highly anticipated console generation rumbling over the horizon. But such an article appearing today, in 2012, is virtually beyond comprehension. PC gaming is a bigger and more diverse marketplace than ever before, readily embracing the sort of progressive technologies and practices that console manufacturers are still struggling to adopt.

"If you take a look at the data from the PC Gaming Alliance, software revenue is gone up," Lewis says. "I think this year will be about $20 billion in PC software sales. The problem is that games are like movies: most are not good, some are great, so there's a high beta. You get a lot of noise when a game doesn't do well, but there are a lot of games that are very successful, and many more games in general.

"Take a look at what Valve has done with Steam - it's incredible. They have 40 million active subscribers, they generate a billion dollars in revenue, and that's going to lead the way into something else; maybe a 10-foot experience, or a different UI. That's innovation driven by gaming."

During our interview, the concept of a "ten-foot experience" is never far from Lewis' mind. The PC has always been well suited to a mouse, keyboard, and the user's face two-feet from the screen - and that will always be a part of the PC experience - but Lewis wants a future where that is just one way to use the device. Alienware continues to invest in its desktops and notebooks, but it also intends to lead the next "evolution" of PC gaming.

1

"There's an opportunity to be the company to take the PC into that ten-foot experience, into the living room," he says. "We're trying to be at the fore of that. We don't necessarily understand exactly what's going to happen 18, 24 or 36 months from now, but 55 million consoles are going to be sold - that's a lot of product being moved.

"Game developers would rather create for one platform, not four platforms, so the more we can make the PC a ubiquitous device the better it is for the industry: it's good for the gamers; it's good for developers."

And it's good for Alienware. Lewis claims that the company sold more units in Q4 last year than it did in the whole of calendar 2007, and that's still several months before the launch of its most significant hardware launch in years: the Alienware X51, which, to all intents and purposes, is the company's first attempt to find a synthesis between the accessibility of a console and the future-proofed power of a PC.

"That was the genesis around X51," he says. "We understood from our customers that our boxes are big and they are expensive, relative to other boxes. There's a lot of good reasons why these products are expensive, and there's a market for that, but we also see that there's a market for people that want to buy something a little less expensive, but that was still powerful and allowed them to play games either as a two-foot experience or a ten-foot experience."

"Right now you can't be all things to all people. Every technology company has to make a bet, and that's what we're doing"

Lewis calls the X51 "console-esque", and that sums it up rather well. It is reminiscent to the Xbox 360 Elite both aesthetically and in terms of size; it can stand vertically or be laid on its side, making it an easy fit for both living room or the office, connected to a high definition TV or a monitor. In terms of hardware, the top-end models are very much what you'd expect from a gaming PC in 2012, only with a layout and build that will make upgrading simple even for the uninitiated.

"[The performance] rings true to our brand," Lewis says. "We didn't want to come to market with a cheaper PC; we wanted to come with a PC that was best-in-class in that category. It's what Alienware does: we sort of made the gaming notebook market, we started with the desktop, and now we're making a market with this console-esque box. Other companies have come before and positioned their product as a media centre, but it never really panned out all that well. We come at it from a different angle, from a gaming angle.

"We all know that gamers are not unique to a certain platform. Our data shows that close to 90 per cent of people that own a gaming PC own a console as well. It's more about there being certain games that are better played with a mouse-and-keyboard, there are other ones that are better played on the sofa. With FIFA and Call of Duty, a lot of people prefer the sofa and a gamepad. If it's an MMO or an RTS it'll be mouse-and-keyboard."

And the X51 can capably support both, but there is one significant wrinkle. With prices ranging from 649 to 899, the X51 may offer striking value for a gaming PC capable of tackling even the most demanding titles, but it's still double the likely price of Microsoft and Sony's next generation of consoles. However, Lewis is quick to point out that this is not a mass market device; it's just a more approachable riff on what Alienware has always done.

2

Historically, an Alienware PC was intended for someone in the 25 to 40 age bracket, earning $75k to $100k a year. The X51 is pitched at the "student, teenage, gen-Y kind of crowd," a device for a college kid who needs something for work and something for play. The X51 isn't an alternative to a console; it's an alternative to a console AND a PC.

"This is the first product that we've actively targeted to that segment," Lewis says. "Not that the segment didn't exist before, but typically Alienware was more aspirational - 'I really would like to have it but there's no way I'm going to convince my mother to spend $2000 on a notebook'. The value proposition has completely changed, and we market it in a way that highlights how it increases productivity. It's very useful beyond gaming as well."

"The product has done very well for us - even we were surprised - and I do think it's going to force the way for whatever's next. We now have our foot in the door, and a lot of developers have been talking to us about our vision for gaming."

As a company, Alienware's vision will always centre on the needs of the AAA gamer. Lewis acknowledges the emergence of social and browser games as important to the market as a whole, but while the console manufacturers need to contemplate how to bring them into their closed platforms, their technological demands in terms of PC hardware are almost non-existent. It's the trickle-down effect: by making a machine that can play Battlefield 3, Alienware can satisfy everything else as well.

"Ultimately, devices connected to the internet in a Windows-type environment are going to win. It's a better customer experience and a better business model"

In the broader context of how the PC will fare once the next generation of console finally arrives, Lewis believes that the open nature of the PC will be its most powerful weapon. With so many new platforms and payment methods and technologies all jostling for primacy, the full sweep of the games industry has become near impossible to comprehend. Any company putting out hardware in the next few years is effectively gambling on what the future will look like, and the very nature of console business - with its walled gardens and long life-cycles - means that Microsoft and Sony need a more detailed vision that it's possible to create.

"This is going to sound bizarre because we're device manufacturers, but we have a saying when we plan products: 'Our customers don't play devices, they play games'," says Lewis. "The device is a means to an end, a means to the experience they want. There are so many ingredients out there that there's going to be a premium on who plans properly, because right now you can't be all things to all people. Every technology company has to make a bet, and that's what we're doing.

"Put yourself in Activision's shoes: you develop a game, you've got to sell it through a channel, so you have to pay somebody a margin for that. If you're playing that game on an Xbox, Microsoft is charging you how much a year for that? $75? Do you know how much Activision gets of that? Zero. Do you think they want to move away from that model? Do you think they like the PC, an open platform, downloading directly from Valve, or Origin, or their own store? Will they like the fact that nobody else is making money from their game?

"Everything points in that direction. We do have to figure out what the solution is and get it right, but to my mind, ultimately, devices connected to the internet in a Windows-type environment - or DirectX or Linux or whatever - that's going to win. It's a better customer experience and a better business model."

12 Comments

Rick Lopez
Illustrator, Graphic Designer

1,203 816 0.7
Yet another article dooming consoles... its easy for a PC manufacturer to say this against a competing platform.

Alienwere computers are expensive, 2k or 3k just to play games? Can I even put this in a living room, carry around or play with family and friends? They need to be upgraded every 3 to 5 years like consoles, only you spend alot more.

Posted:A year ago

#1
As the article states, the X51 is specifically designed for the living room: it is around the size of the original PlayStation 3, and from what I saw it definitely fits into the living room set-up. The price in the US starts at $699 - even the top model is only $1200.

That's still a lot more than a console, but the X51 is also a PC, and so it can perform all of the other tasks for which we all own home computers. Almost everyone who owns a console will also own a Mac or a PC, but this machine can perform both functions - in that context it presents very good value.

Posted:A year ago

#2

Morville O'Driscoll
Games Blogger & Journalist

1,374 1,021 0.7
I'd feel more comfortable if "standard" computer makers were talking like this as well. Yes, Alienware are aiming for the student-crowd with this - and that's great, w00t - but a lot of students get laptops. Acer, Asus, Dell. These are the machines that would work better. Not technologically, as such, but in user-base. Valve are promoting Big Picture Mode to publishers and developers, but that's where the 10ft UI idea stops, right now. No-one wants to write essays on a TV screen, and few are going to have a monitor in the same room as their X51 and TV, and fewer still want the hassle of plugging/unplugging cables.

Compare that to the portability of a laptop with HDMI output. Whilst their tech-specs are variable, they can all play most games well, even if it's low-details. Take a decent Acer laptop, slap an HDMI cable in, start Steam (once Big Picture Mode is rolled out to users), and you're good to go.

Edited 1 times. Last edit by Morville O'Driscoll on 20th June 2012 4:27pm

Posted:A year ago

#3

Rachel Patterson
Studying Graduate Entry Medicine

12 0 0.0
I was quite interested in the x51 but had a look online..there are issues with the wireless connection but also the tight fit of the components and the low power supply means it is in fact not upgradable, which is something an expensive pc needs to be to keep its value high relative to consoles.

Posted:A year ago

#4

Kevin Patterson
musician

181 93 0.5
I have always wanted an Alienware system, but unfortunately it's out of my price range :(. He is right about the PC though, for years after the release of the current consoles the term "PC gaming is dead" and it just wasn't true. I hope I am wrong, but the rumored specs Sony and MS are going to have for the next-gen are underwhelming, and if true, the major advances in next gen gaming are going to be on PC.

Posted:A year ago

#5

Robert Mac-Donald
Game Designer

57 44 0.8
One of the big barriers for PC gaming is that people usually don't want to bother with doing research to figure out which components to buy and assemble the parts themselves (not because its hard, but because its boring for many people), but the alternative of a pre-made pc/laptop for gaming is usually too expensive.
If pre-made gaming pcs drop in price, the value of getting a regular PC for everyday usev+ console vs only a gaming PC will become similar. And a gaming PC has access to more games and a variety of controller types.

I sent an email to gaben to sell cheap pre made valve pcs, since that would even boost steam sales with new pc gamers coming in. Strangely he hasn't done it yet, maybe it went to the spam filter.

Posted:A year ago

#6

James Ingrams
Writer

208 72 0.3
Oh come on. Alienware is the reason PC gaming HAS declined! What has been the console publisher argument? That PC owners are required to upgrade every 2 years at 600 a pop!

The fact is, the proof of decline is the reason for the short-term boost in PC games sales! The fact is, with more and more AAA PC titles being console conversions, and with 360 and PS3 being 7 years old, there has not been a PC game to really test an 8800 card and 2GB ram, let alone anything better!

This is why we have seen a 30% plus decline in PC gaming hardware sales (whatever is happening with Alienware!) over the last 2-3 years, from CPU's, graphic cards, LCD monitors and hard drives. Quite simply, between console PC game conversions, indie games and the PC stalwarts of RTS' and MMO's, there is nothing that pushes PC upgrading anymore.

This has meant many PC gamers are still able to use their PC's of 3-4 years ago and not spend anything on hardware, so they have bought games instead! But whereas they spent an extra 100 over on games over the last 2 years, they have not bought 250 of hardware, so overall, a rise in PC games, loss in hardware sales.

As we move to the new 2012-13 consoles, I believe we will see many fewer PC conversions. This will leave us with a few East European AA publishers and the indie market. Not exactly the PC games market of 15 years ago, when no less than 48 PC only games were reviewed in magazine like PC Zone, PC Gamer and Computer Gaming World. Magazines that don't exist any more.

I have been a PC gamer for 20 years and never owned a console. So I really would like to see PC gaming survive and grow. Logic tells me it isn't and it won't.

Posted:A year ago

#7

Morville O'Driscoll
Games Blogger & Journalist

1,374 1,021 0.7
there has not been a PC game to really test an 8800 card and 2GB ram, let alone anything better!
BF3. The UI might be console-ised, but PC Ultra settings require a very good CPU, and better GPU. Generally, though, yes, I agree with you there. Consoles drag the PC down, visually.
As we move to the new 2012-13 consoles, I believe we will see many fewer PC conversions. This will leave us with a few East European AA publishers and the indie market.
Hmmm... I'll disagree with you there. Shoddy conversions are based on attitude and development time constraints, rather than specific hardware. Mass Effect 1 was beautifully ported to the PC by Aspyr, after it had been released on console. ME 2 and 3 were poorly done conversions by BioWare themselves, released at the same time as console versions. Deus Ex: HR was ported to PC by Nixxes, who worked alongside the console developers at times, but ensured the PC conversion was right. Remedy ported Alan Wake with care. Obviously, there's games like Dark Souls, with the 30fps cap, but it's not so bleak as you make out.

Have you seen Company of Heroes 2? That looks like it's going to push the PC, though it's early days yet.

Finally
I have been a PC gamer for 20 years and never owned a console. So I really would like to see PC gaming survive and grow. Logic tells me it isn't and it won't.
Damn... 20 years and never owned a console? That's not something to boast about - there's some amazing games out there. :)

Edited 1 times. Last edit by Morville O'Driscoll on 20th June 2012 6:20pm

Posted:A year ago

#8

Andy Kibler
Associate Game Designer

2 0 0.0
Upgrading a PC tends to be relatively painless(cheap) as you usually just have to buy a single component. That is until you run into a technology shift, which usually causes the motherboard to be changed in some way. Even then you will probably buy a motherboard and whatever component has changed on that motherboard. Like a CPU socket change or an increase in RAM slots.

I probably could have waited to buy my most recent upgrade, but I was starting to see some stuttering in some of the games that I was playing.

As for the article. I find it interesting, but I just don't see the vast majority of students getting a desktop-like computer to do their homework on/play games.

At least, when I went to college, I used my laptop for school work and games, and the students that didn't use a laptop tended to use the school computers.

I'll be curious to see how the X51 does

Posted:A year ago

#9

Tony Johns

520 12 0.0
I use my PC laptop to play indie Japanese games that don't cost too much in money and memory, so I am thankful when it comes to gaming on my laptop I decided to chose the one with lesser graphics but still does what I need it to do.

Posted:A year ago

#10

Dave Herod
Senior Programmer

517 731 1.4
I did want an X51 when they first came out, it's the kind of thing where I'd be willing to make a bit of compromise on power for that small form factor. Unfortunately though the compromise is too much. Geforce 555 doesn't cut it for me, especially at 900. I don't know why they don't have a line of PCs that sits somewhere in between, all they sell is tiny X51s or the other behemoth machines.

Posted:A year ago

#11

Nicholas Pantazis
Senior Editor

968 1,161 1.2
Not sure what James is talkikng about with the PC "decline." PC has higher revenues than ever, even adjusting for inflation and taking away social games. It's also absolutely changed. It's certainly not about upgrades as much as it used to be, and that has little do with consoles hanging on. Many built-for-PC games have taken advantage of pretty modern hardware (look at The Witcher 2) without limiting themselves to consoles. The difference is that software manufacturers have realized that they can't push graphics forever, and that it's getting way too expensive to do so, while simultaneously alienating large amounts of players.

Steam was really the start of this, with brand new low-spec games suddenly being very visible to players success on PC became less about technology (ala the 90s through the first half of the 2000s) and more about clever ideas. The rise of games like Minecraft, Leage of Legends and the extreme popularity of Valve's and Blizzard's games despite the dated engines are proof of this. It's not consoles holding PC back. PCs are holding themselves back, because fighting for more powerful tech is stupid.

On the actual topic of Alienware, they don't price well enough for this, but there's definitely a market for a PC to go under your TV. It won't be Alienware that makes it though. Come on Steam Box!

Posted:A year ago

#12

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