Samsung's Neil Sharma has warned the console companies to start regarding mobile devices as their "first screens" to avoid financial calamity.
During a panel at SXSW Interactive, attended by Polygon, Sharma said that the console gaming industry still considers smartphones and tablets as "second screens" in terms of importance.
"I would posit that it is the first screen," said Sharma, vice president and general manager of Samsung Telecommunications. "I would also posit that it's an inflection point that, if it's not looked at carefully, the gaming industry's going to move by and miss it, and there are going to be companies that go out of business."
According to Sharma, the rapid rate of progress in mobile hardware - and the number of emerging solutions that will allow smartphones to communicate seamlessly with connected TVs - will leave consoles at a clear disadvantage in the near future.
"That's the state of that industry," he told Polygon. "Outpace, out-innovate. We have so much technology on tablets and smartphones today. Doesn't matter which company it is, it's just, that's the level of innovation. Quad-core processor? It's in all of them. Two years ago, it's, 'quad-core processor? Are you kidding me?'"
Sharma also drew parallels to his time as business development manager for Microsoft, where he attempted to make Windows Media Player a platform for streaming video. Microsoft and other big companies focused on quality and brands, but YouTube stole a march by pushing social integration and community.
"When you use the word quality, you've actually plateaued," Sharma said. "You've come to an area where you can't bounce further. It's a good touch-point to say, 'What else is going on out there?' I feel it as I walk around the gaming industry. I hear that a lot: 'Look at the graphics! Look at the quality!' I say, 'Okay, I've been through this in my lifetime. I've got to step back.'"