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Self-Analysis: Rewriting The Future

Self-Analysis: Rewriting The Future

Mon 30 Dec 2013 3:00pm GMT / 10:00am EST / 7:00am PST
Business

Our panel of analysts revisits their previous set of predictions for 2013 while going out on a limb with new ones for 2014

In just a couple days we'll be in 2014. That makes it a perfect time to launch our annual set of predictions, first from analysts and then tomorrow our GamesIndustry International staff weighs in as well.

This time, however, we've decided to have a bit of fun with it. Readers always complain that analysts can say anything they want and no one holds them accountable. Well, before our analyst panel tackles what's to come in 2014, we've asked them to assess how they fared with their 2013 predictions.

Here's how it played out.

Jesse Divnich, EEDAR

1

A recap of 2013 predictions:

Smart TV to Become a Big Deal

As much as I was thrilled by the ingenuity of television manufacturers attempting to turn their devices into entertainment platforms, it ultimately didn't pan out. Costs, the content, and depth of service are not there yet to convince technology enthusiasts to make the switch. Until they convince technology enthusiasts that Smart TVs could be an all-in-one delivery solution for all things entertainment (and eventually for games), they will never make the jump to building demand among a broader and larger demographic audience. I still believe the solution is coming, but 2013 clearly wasn't the year and it doesn't look like 2014 will make much progress either.

Synchronous Multiplayer on Mobile and Tablet Devices

The synchronous mobile feature was much more prevalent in games in 2013 compared to 2012. It's among the fastest growing features in mobile games. Unfortunately, we haven't been able to deliver a synchronous multiplayer experience that the masses would enjoy. While I could argue for the plethora of casino, bingo, and poker games that have broken the top 20 rankings (most of them have synchronous tournament multiplayer components), the spirit of my prediction was rooted outside the Casino genre. Some games in the top 20, outside of the Casino genre, do have synchronous multiplayer components, but it certainly hasn't been the impetus to their successes.

The technology is there. It works. 2013 may not have been the year, but I am hopeful 2014 is. The install base, daily activity, and demand all exist for synchronous multiplayer to become a driving feature in mobile game activity.

The Rest of My 2013 Predictions - Proven Right:

Digital revenues have surpassed physical revenue. GTA V was the biggest selling game of 2013. And finally, 2013 was a year for mobile studio acquisitions and layoffs as we continue to learn from the limitations, successes, and failures of others in the market.

2014 Predictions:

The Year of the Micro-Console - Not Likely

With the support of a core community of fans, micro-consoles are looking to create a disruption in the market. Unfortunately, and as a supporter myself, the reality is that these micro-consoles are unlikely to gain much traction in 2014. The lack of a differentiating competitive advantage is the primary factor driving my prediction. They are attempting to position themselves in-between a traditional console and a portable gaming device, but none of the micro-consoles I've played have demonstrated superiority to either a traditional home console or a portable gaming device in few areas, outside of price. You can't disrupt on price alone.

"50 percent of the top 10 selling next-gen games of 2014 will be new intellectual properties"

Jesse Divnich

And I don't classify the Steam box as a micro-console. Some do, but it isn't part of this prediction.

Free-to-Play on Consoles - Success is Coming, Just Not in 2014

With both Sony and Microsoft now supporting the free-to-play business model on their new platforms, it seems inevitable that free-to-play, which has been successful on nearly every other gaming platform, will begin to emerge on the new generation of consoles.

My skepticism of free-to-play success on home consoles is more speculative on consumer behavior trends rather than something rooted in hard data.

Despite the broadening of our demographics as an industry, those who contribute the most dollars to the overall pie tend to come from a more specific group of consumers. Specifically, these are who we would call our loyalists, “whales”, “gamers,” or hobbyists. The same people who are shelling out hundreds of dollars in Candy Crush Saga or Clash of Clans have a strong overlap with the people that play Battlefield 4, actively engage on Steam, and were the first among their friends to own a Wii. What I've learned is that while the consumer remains the same (for the most part), their needs, motivations, and desired expectations change depending on the platform they are playing on.

50 percent of Wii owners were core gamers, but when presented with a “core” Wii game, nobody bit because the “core” need was being satisfied on other platforms (PS3, PC, Xbox 360, etc.).

It's a bold statement, but I do not anticipate any free-to-play title being successful in 2014 on the next-gen consoles. To keep it objective, I will quantify success at generating over $50 million in revenue (equivalent to selling 1 million units on a traditional console game).

The free-to-play model can succeed on the home consoles. I just believe it will take time to understand how to create a proper free-to-play console experience that cannot be delivered through other platforms. 2015 will likely demonstrate a different result as developers begin to optimize the free-to-play experience to the home console experience.

Third-Party Mobile Controllers - No Demand, No Penetration

With Apple allowing third-party peripheral controllers for its mobile and tablet devices (and Google supporting them for some time), we've seen a rush to market by peripheral manufacturers to try to get ahead of a rising tide.

In gaming, it is software the drives demand for hardware and without any “killer apps” that make full use of these controllers, there is little motivation for consumers to make the jump.

Personally, I believe the failure of third-party mobile controllers are at the fault of their manufacturers, who do little to fund development of exclusive games that create demand for their hardware. It's been a tried and true strategy. Nintendo, Sony, Microsoft, Sega, Valve…they've all realized the power of exclusive software to drive engagement and interest to their platform.

On 8th Gen - Indie Title Breaks 1 Million Units in First Year

With a greater percentage of software sales occurring digitally (growth that will be even more aggressive with the PS4 and Xbox One) and both platforms' openness to independent developers, we anticipate that there will be at least one indie title to break 1 million units in its first year on the new platforms. While 1 million units seems insignificant, bear in mind that only a handful of titles have ever accomplished this on home consoles and none have ever done it in the first year of a new cycle when install bases are at their lowest.

End of 2014 and Still No Next-Gen Winner

We anticipate a back and forth battle between Microsoft and Sony throughout the year. One will claim more consoles sold, another will claim more engagement time, higher software attach rates, “bullets fired” in game X, etc. Ultimately though, 2014 will end like 2013 ended. There will be no definitive leader with the 8th Gen consoles. I firmly believe both will be able to claim victories in their own ways.

Out of Left Field Predictions

Here are a hodgepodge of projections that are entirely speculative: a) 50 percent of the top 10 selling next-gen games of 2014 will be new intellectual properties; b) Used game sales will decline as more consumers purchase games digitally; c) Steam Machine launches and instantly becomes a major competitor within the console wars.

Michael Pachter, Wedbush Securities

2

Last year, I predicted that the Wii U would feel price pressure and receive a price cut (check), Bungie's Destiny would charge for multiplayer (denied by Activision Publishing President Eric Hirshberg at the Bungie announcement event, although we still don't know for sure), the PS4 would be announced during the first quarter (check) and would launch before year-end (check), the next Xbox would be announced at E3 (wrong, it was announced in May), it would come out in early 2014 (wrong, it is out) and it would be subsidized by cable TV providers (wrong, so far), and that GTA might sell “only” 20 million units (wrong, it has sold 24 million or so through November).

This year, I believe:

The PS4 will outsell the Xbox One due to price. Sony and Microsoft sold an equal amount of units in the last cycle, with the PS3 falling way behind due to a higher launch price, and recovering once the PS3 was priced competitively with (and ultimately lower than) the Xbox 360. I expect the same thing to happen in 2014, once supply exceeds demand), and think we will see the PS4 outsell the Xbox One by 20 to 25 percent in the summer.

"It is possible that Microsoft will reconsider forcing every Xbox One owner to pay the extra $100 for Kinect"

Michael Pachter

Sony's lead over Microsoft will cause Microsoft to reconsider price. I think the most likely case is that prior to the holidays, the Xbox One gets a $100 price cut, but that presumes that the PS4 remains at $399. I think Sony will see sales sufficiently high to keep pricing for another year, so I think a $100 Microsoft price cut is likely, with Sony holding off to make a pricing move until 2015.

The Wii U will lag far behind the leaders. I expect Sony to sell 10 million or more PS4 consoles annually, and expect Microsoft to sell 8 million or more Xbox Ones, with the ratio remaining relatively stable at 10:8 for the two manufacturers. Barring a cut dramatically below cost, it appears unlikely that Nintendo will sell more than 5 million annually. Even with a price cut, I think that Nintendo's console will remain uncompetitive, as I think that Sony will cut the PS3 to $199 in early 2014, and expect to see an Xbox 360 model with a hard drive at the same price next year. Nintendo's software offering will continue to attract millions of new Wii U owners, but I think that comprises 5 million new owners per year, not 10 million.

Microsoft will get that elusive cable TV subsidy in 2014. I remain convinced that this has always been their plan, but I think it was too much to pull off logistically in 2013. In order to deliver a subsidy, Microsoft has to create the impression among consumers that its console actually sells for the subsidized price, much in the way most people believe that an iPhone 5s costs $200 rather than $650. That requires the manufacturer to make the subsidy available across all of retail, so GameStop and Best Buy would have to be equipped to offer cable TV subscriptions. My true belief is that the ultimate subsidies will be offered for Internet service, so ISPs (Internet service providers) will be the best positioned to offer a subsidy; this means that the cable companies and the telecom providers who offer Internet will probably jump on the bandwagon, and it will likely take all year to get these types of offers to retail stores.

Microsoft might unbundle Kinect. It was my impression that Kinect was a pet project of Don Mattrick's (likely influenced by Steve Ballmer). With both executives departing Microsoft between launch and the end of 2014, it is possible that Microsoft will reconsider forcing every Xbox One owner to pay the extra $100 for Kinect. Although I predicted a price cut and predicted a subsidized price above, unbundling Kinect would save Microsoft close to $100 per console, making the lower price less costly for the company. Kinect was initially included with every Xbox One due to Microsoft's belief that video and voice recognition were essential for its multimedia features. Other than Skype, there are few functions that Kinect actually performs that could not be accomplished relatively easily through SmartGlass. I think Microsoft will see little support for Kinect-enabled games in 2014, and may reconsider requiring each Xbox One owner to buy Kinect.

David Cole, DFC Intelligence

4

Assessment of 2013 Predictions:

We were clearly wrong about the console launches being delayed until 2014. Sony going with off-the-shelf components made them significantly more agile and it almost seems they caught Microsoft by surprise as well. However, we were right that the market reaction to the Wii U would continue to be tepid. Also we did not see any big mergers in 2013, but we are doubling down on that for 2014. Mobile also continues to disappoint us. We would really like to see some products for mobile that can actually charge money upfront, but alas it didn't really happen. It was more wishful thinking on our part. The investor disconnect with game revenue models continues. There are so many ways to generate revenue beyond retail sales and smart companies are really taking advantage of them.

2014 Predictions:

The PlayStation 4 Pulls Ahead; Microsoft Investors Ask Questions

Last year we doubted that either Sony or Microsoft would launch a new hardware system in 2013. They both surprised us, but mainly it was Sony that had its ducks in a row for a new system launch. A big help was they went with off-the-shelf components instead of the complicated Cell architecture for the PlayStation 3. By getting out in front, we felt Sony forced Microsoft's hand earlier than they would have liked. The biggest surprise of 2013 was how Sony seemed much more prepared for launch than Microsoft. We think this will carry over to continued success in 2014.

"Nintendo continues to underperform even our very low expectations. However, it is more of a business failure than a product failure"

David Cole

The late cycle success of the Xbox 360 has in some ways hurt Microsoft in migrating to a new system. The idea of an all-in-one entertainment box did not resonate and Microsoft investors are starting to ask questions. This is likely to intensify in 2014. The issue is, even if the Xbox One is successful, it will be hard for Microsoft to make a profit.

Nintendo Does Something

Nintendo continues to underperform even our very low expectations. However, it is more of a business failure than a product failure. The abysmal strategic planning and marketing for recent hardware launches is the stuff business school students will be writing case studies about for years to come. Nevertheless, Nintendo still has a strong brand and some pretty good niche products. A new handheld could really make waves if handled properly. Nintendo does not have to compete with Sony, Microsoft or Apple but instead could carve out its own share of business just based on fans of its first-party brands.

An Asian Game Company Acquires a Major Western Publisher

Making predictions about acquisitions is a sure way to be wrong.  Last year we predicted that there would be a lot of investment activity in the space. We were wrong on the timing but for 2014 we are doubling down. Companies in China, Korea and Japan have made a lot of money in their domestic markets but struggled to expand to North America and Europe. It is only a matter of time before they decide to buy rather than build.

Zynga Enjoys Some Modest Success

Zynga is still way down from the heights of its IPO, but its stock did pretty well through most of 2013 assuming it was bought at its low point in late 2012. The company has new management, mobile content and most impressively some mid-core content. Solstice Arena was an MOBA of surprising depth. This product came from the acquisition of developer A Bit Lucky in late 2012. Zynga helped pioneer the free-to-play market in the United States and they still have some weight to throw around assuming expectations are low.

Western Console Game Publishers Launch Many F2P Titles With Tepid Response From Consumers

Last year we forecasted that consumers would actually spend real money on mobile games. Alas that did not happen and it is still about giving away the product and hoping consumers pay for the product. From a consumer perspective it was great that you could get Plants versus Zombies 2 for free, but with no compelling reason to spend money it makes it a scary business proposition. The biggest challenge the industry faces is the expectation of free brought on by mobile. Last year we thought that would change but we were unfortunately proven wrong. We think that in 2014 major publishers will continue to find that a pure free-to-play model is not nearly the revenue generator they expected.

Billy Pidgeon, Independent

3

2013 Prediction 1: The audience for games is still growing but could peak in 2013

Last year I said the audience for games could peak in 2013, and I think that was mostly true. With growth in mobile continuing and social games on Facebook having bottomed out and relaunched, the casual games audience has grown somewhat. On the other hand, there hasn't been as much growth in the console sector as we've seen in previous console transitions.

2014 Prediction 1: The overall games audience will remain at a plateau in 2014, but could be headed for a resurgence in 2015-2016

I think there's still latent potential for audience growth in casual games and hardcore console and PC games, but I don't expect this to be realized in 2014. My projections indicate the audience will expand slightly but not dramatically in 2014. There could be more extensive growth in 2015 to 2016, but that would be dependent on continued strong smartphone, tablet and eighth generation console adoption. This outlook assumes an upturn in the global economy that supports and stimulates stronger consumer confidence and spending. A necessarily corollary to a stronger economy is that dedicated and convergent hardware is more widely available at lower retail prices, a scenario far more likely with convergent mobile devices than with dedicated gaming hardware.

2013 Prediction 2: The next generation of consoles is here but will have low impact

"My outlook for the console sector is generally less bleak than it was last year at this time"

Billy Pidgeon

My prediction that the eighth generation launch cycle would have low impact remains true for 2013 as publishers and vendors still have large active installed seventh generation bases to sell into. Sony and Microsoft are more aggressive in manufacturing and shipping hardware launch units early on than I had expected, although Xbox One and PS4 are likely to sell through whatever numbers are shipped to retail into 2014. Still, with hundreds of millions of active seventh generation consoles out there, in the near term the big numbers for the big games will be on Xbox 360 and PS3.

2014 Prediction 2: The installed base of eighth console generation will grow more quickly than the seventh

I actually hope I've been overly pessimistic on last year's prediction and that the numbers reflect greater growth in the console sector as the cycle plays out. I'd like to see PS4 and Xbox One each achieve and surpass US installed bases of 10 million each as soon as possible. Let's just say based on current data and on my updated projections, my outlook for the console sector is generally less bleak than it was last year at this time.

2013 Prediction 3: Console games aren't going away, but they're not coming back to reclaim past numbers

Reviewing my 2013 prediction on console games revenue and units declining somewhat rather than rebounding to match or surpass previous heights, I believe that the final numbers will back me up here, and we'll have those soon enough in early January. As for my related prediction regarding far slower uptake of eighth generation hardware and attach rates for packaged goods, sluggish new hardware sales are somewhat mitigated as Sony and Microsoft have been more aggressive in shipping new consoles than I expected. With sufficient volume of quality console software released regularly, the eighth generation could outpace the seventh in the mid to long term. Still, I think it's too early to write off my 2013 prediction in the near term.

2014 Prediction 3: Console game consumption is still trending toward franchises supporting longer multiplayer lifecycles and more downloadable add-ons

As far as hardcore games are concerned, I don't think gamers are likely to change their preferential playing patterns. They are still buying multiplayer games with add-on downloadable content in larger numbers as opposed to single player games in boxes. To reiterate, packaged goods aren't going away, but the growth momentum is in downloadable content rather than boxed games.

Also games on convergent platforms like PC, tablets and phones are consistently gaining in quality and will continue to occupy gamers' time, whether the games those players prefer are more casual or more hardcore in format.  While the average time spent on consoles will likely continue to gain, much of this will be in multiplayer gameplay and in streaming video and television viewing.

Like my outlook for base growth in hardware, this is one I'd also hope to be wrong on for the sake of the economic strength of the sector - more eighth generation consoles selling in and more seventh generation hardware remaining active into this cycle would be a very good thing for the industry overall. However, with high quality casual games on a growing base of convergent platforms, I'm far less optimistic on the prospect of maintaining the viability of previous generations of hardware.

Games in boxes could retain and even gain some traction, but only if the installed base of older Microsoft and Sony consoles and current Nintendo hardware remains active, particularly in younger and older demographics that play single-player offline or multiplayer local.  

2013 Prediction 4: Double-digit growth for digital revenue... Again

Based on my projections and publicly available data, I contend that my prediction on continued double-digit growth in digital revenue was correct. Digital verification is still a problem, as there are no reliable third party data sources, and publishers are not forthcoming with these numbers.

2014 Prediction 4: More double-digit growth for digital revenue

Despite a lack of official verification that will likely persist throughout 2014, I think digital revenue will continue to grow aggressively, and I hope that more public numbers will be available to back up my projections.

2013 Prediction 5: Games on smartphones and Facebook will close the quality gap

As for my final 2013 prediction, yes, games on smartphones and on Facebook now have higher budgets and higher production values. Mobile and social games are indeed closing the quality gap with consoles and handhelds to some degree, although business models cannot support the necessary investment to provide immersive hardcore games on convergent platforms.

2014 Prediction 5: Games on smartphones and social networks are higher budget and higher quality

Upside: there will be big revenue growth overall. Downside: the market is not evolving to keep pace with game development. Expect turbulence, failed IPOs, with greater potential for failures than for successes.

In 2013, it has become increasingly difficult for unfunded small developers to break in and crowd-funding is less available. There should be an upside to this effect - a reduction in the glut of low quality and copycat games. Fewer developers and investors are chasing the apps and games 'gold rush,' which is also a good thing bringing more realistic expectations to the sector. However, thousands of game titles come out on a weekly basis for each platform.

The volume of games available on mobile and social networks continues to grow faster than the audience and there are still far too many low quality games. In a volatile ecosystem, the revenue fluctuations inherent in the fortunes of individual developers and games will attract much attention and coverage. In 2014, we can also expect big shakeouts in the thriving layer of third services that help game developers acquire larger player audiences for their games -- a dicey prospect considering the additional necessary step of converting players to payers in the prevalent free-to-play business model.

But the revenue potential of mobile and social games is completely subject to the larger competitive forces that connect consumers to each other and to the online marketplaces that enable in game revenue and data transactions: operator and advertising networks, e-commerce and consumer data analysis systems, payment solutions, and platforms. Companies like Google, Apple, Amazon, Verizon both limit and expand opportunities for mobile/social games and for other connected content and services that derive revenue from in app transactions, advertising and subscriptions.

11 Comments

Jim Webb
Executive Editor/Community Director

2,210 2,051 0.9
Popular Comment
Interesting predictions for 2014 and a welcomed look back at those for 2013.
Nevertheless, Nintendo still has a strong brand and some pretty good niche products. A new handheld could really make waves if handled properly
Mr. Cole, am I understanding you correctly that you think Nintendo should release a new portable console in 2014? You do know the 3DS is the best selling dedicated video game console on the market? Why in the world would they want to discontinue a hot product after just 3 years on the market?

Posted:3 months ago

#1

Robin Clarke
Producer

275 600 2.2
Ah, professional guessers, never failing to entertain.

Synchronous (online) multiplayer has been possible on mobile for years. It will continue to get only limited traction because the way user interfaces, connectivity and identity are handled on mobile are all suboptimal for it. That's not changing very quickly.

Local multiplayer in the model of SpaceTeam is a much more interesting proposition.

On third-party mobile controllers: Apple don't allow iOS games to require third party hardware- touch screen controls must always be present as a fallback, so exclusives are not possible. There are already many hundreds of games that support physical controls (or could be trivially adapted to do so), the problem at the moment is that the peripheral manufacturers have only just barely stuck a toe in the water (I'm not sure where this supposed "rush to market" has come from). Nevertheless controllers reaching the tipping point at which they become widely adopted is still far off - although getting the basic facts right would make this prediction more credible.

The indie title that breaks a million units will be Minecraft, presumably. Or The Witness perhaps?

The NPDs over the next 3-4 months will probably put paid to the idea that it's still anyone's race to win.

Pachter's theory on who is left at Microsoft that still supports Kinect is an encouraging one. The Xbox One is still a horrible consumer proposition in many other ways (e.g. anaemic specs, digital purchases requiring a net connection), but ditching the $100 albatross would at least make them appear competitive.

How quaint that someone is still lumping mobile games and social network games (do they even still exist?) together in 2013.

Posted:3 months ago

#2

Jeff Kleist
Writer, Marketing, Licensing

209 86 0.4
Microsoft will not unbundle the Kinect

Kinect has everything everything to do with the entertainment/app side and very little to do with gaming. It's all about everything from home automation and security to programming the DVR, and all the other services the cable companies are and want to offer. They will eat the cost of Kinect before they pull it, because it's something all their partners find very attractive. I repeat. Kinects use in games is a secondary function.

People need to get off this bandwagon., because the gaming press has very little idea about the breadth and scope of what they're doing, and how much it's really worth. The first feature getting yo inked from the Dbox One is the HDMI in, because it's only there until the networks finally allow a full software based cable box to function, and the cable companies get their backends adjusted for it.

You will see an Xbox Mini, which will be a quad core processor that just runs the app side, probably along with Win 8 Metro games , with Kinect that's just there to be a cable/home automation box before you see them yoink Kinext. Cable companies want this to succeed, because they are sick of spending half a billion dollars a year developing new boxes every time they want to add new features, and maintaining the existing ones. They very much like the idea of fire and forget boxes they ship to you, and from then on just push software updates if it breaks, you bought it, or they collect their $10 a month anyway in equipment warranties just like the cell phones. These features are also Microsofts last ditch to get into Asia. Expect the Japanese Xbox one to feature DVR and a Bluray burner for example.

Seriously, big picture, future picture. What they're doing is clear as day, and people won't care about the SRP when they're paying $199 withthe cable they were buying anyway

Posted:3 months ago

#3

Paul Johnson
Managing Director / Lead code monkey

787 931 1.2
@Jesse Divnich. You get synchronous multiplayer right. It's just that you, the entire press and most of planet Earth, have never noticed Combat Monsters... :)

Posted:3 months ago

#4

Nick Wofford
Hobbyist

94 61 0.6
@Jeff
Thank you! I completely agree with that assessment. It's why I think Pachter's right about the subsidy in the future.

Posted:3 months ago

#5

Klaus Preisinger
Freelance Writing

953 804 0.8
The way it stands, we have not yet seen how both new consoles perform outside of the most dedicated crowd of gamers. Sure, we have seen core gamers wait in line, we have seen people eager to earn a quick buck, we have seen pre-orders.

What we have not seen is the equivalent to that Wii moment, when everybody including your grandmother suddenly decided that the Wii was something they wanted to play. Quite honestly, the Kinect did not have that moment back when it was first released, so what is different now? The voice control rebranding?

As for the importance of Xbox One to the TV viewing audience, I just point to CES Las Vegas in one week and the preview articles of said event.

Finally, are we really suggesting that a $500 console, which is considered expensive among gamers, is suddenly considered cheap among people who are in the mood to buy something making their cable TV box a little less insufferable? Especially, since European and Asian markets have most of their tuners included in the TV itself and external boxes are a dying breed. Between the Xbox competing to bring features to your TV and TV manufacturers competing to make a sale, the Xbox One will most likely not have any exclusive features that it can add to your TV; outside of $500 worth of processing power. If anything else the Xbox offers proves to be something driving sales, Samsung and LG will have it in their TVs by the end of the quarter.

Posted:3 months ago

#6

Jeff Kleist
Writer, Marketing, Licensing

209 86 0.4
The original Kinect is the most successful addon ever at 30 million sold. It required ownership of an existing console to function

The Sbox 369 was incapable of multitasking, which is essential to a home hub box. There's tons of apps that will be running in that 3GB. The system was also not marketed by cable companies with subsidies

Your comment about tuners shows your ignorance of the market. Every TV in the US contains a digital broadcast tuner.

Whose technology do you think drives samsung's gesture and voice features? They've been tight with Microsoft for years.

smart TVs do not have the horsepower or RAM to run these kinds of functions. Not even close. Nor are they likely to. The heat, the expense of the parts, it's just not feasible. The cable companies will write the apps to support the services, and then they're going to run on the box transparently. Short waits to switch, instant commands you name it. And yes, when "Xbox, dim the lights, turnout the heat, order lasagne from Luigi's and turn on Barry White" is a reality, and at least something close to that is coming sooner rather than later, the mainstream will understand it just fine. They're not showing it off full force till the kind are worked out, and they're ready to push it, after it's been debugged and enhanced

The entire pint of that $500 of processing is that it's going to be chewing on stuff you don't even think about. That it will be transparent

Posted:3 months ago

#7

Robin Clarke
Producer

275 600 2.2
@Jeff Kleist: I don't think anyone has failed to notice why Kinect is still bundled. There's a big difference between making a plan and it coming to fruition. The Xbox 360 was supposed to beat the records set by the PS2. HD-DVD was supposed to beat Blu-Ray. Microsoft make lots of grand plans based on owning the entire ecosystem where consumers have shrugged their shoulders. Dictating the price of the hardware based on chasing a shrinking TV audience in one territory is misguided.

Posted:3 months ago

#8

Jeff Kleist
Writer, Marketing, Licensing

209 86 0.4
HD DVD was never supposed to beat Blu-ray. The entire goal was to sabotage physical media. After Disney bailed on them, everyone knew it was over. Their plan is already coming to fruition, and it's not just based on North America. This is what I'm saying about how the games community doesn't understand the. Bigger picture. Microsoft has made huge partnerships in Asia for example. They have willing partners. The Kinect stuff is going to be gangbusters there

That's the point. The TV audience isn't shrinking, it's spreading, and Xboxs ecosystem can hook into all of it.

Posted:3 months ago

#9

Chris Hunter-Brown
IT / Games specialist

51 14 0.3
Microsoft have been trying to get into bed with the cable companies for years. Remember the CES where they talked about 360 IPTV? It barely happened and never really took off. It's hard to see how that's going to change when other screens than the TV are increasingly more important in people's lives.

It's not a new plan, it's an old plan and even Sony had a go with the PSX. If it was a good idea, millions of 360's would have been subsidized into people's homes via this method already. Outside of the US it's an even bigger can of worms to get any functionality of note working and whilst the 360 battled admirably in Japan that market will always be an uphill struggle, even when Microsoft made a big effort. There's no sign of that being repeated with the One.

As for the cable companies, if they've suddenly acquired the technological nous to start developing all this lovely software we don't yet know we need in our lives I'd be staggered. It's simply not in their DNA. Maybe the likes of Netflix will force the issue but for all the wants coming from Redmond if it hasn't happened by now, it's hard to see how it ever will unless Elop gets the CEO gig, spins Xbox out as he has stated is his intention and it becomes the only way of funding it as a going concern.

Up until now, a lot of this TV stuff comes across as bluster to justify the Xbox within Microsoft. Maybe it's how they kept Balmer on board.

Posted:3 months ago

#10

Jeff Kleist
Writer, Marketing, Licensing

209 86 0.4
360 IPtv failed for the same reason that iTV hasn't happened. Everyone thinks they can come in and "crack" TV. Then the networks tell them "were not pissing off the people who feed us, the payTV establishment, and they fizzle. Intel is the latest who tried, and they just sold the tech to Verizon, whomis going to use it to expand their serves beyond the current places they've strung fibre.

That's why Microsoft turned their strategy to kissing cable ass.

Microsoft has already partnered with China's biggest PayTV provider. The have extensive deals I. Europe and elsewhere through Sky. Verizon is streaming 75 channels, TWC their full lineup, and Comcast is also in the game. They're already there my friend. The cable companies are already adjusting their strategies, and all the new systems are based on IP delivery. You know all the voice command stuff you're seeing from Comcast, Samsung etc? Well, if you look at those companies, you'll find both, *gasp* have very strong! and very long ties to Microsoft. Wonder where that tech came from?

Posted:3 months ago

#11

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