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Digital Foundry

In Theory: The Challenge of the Ten-Year Lifecycle

Wed 18 Jan 2012 8:08am GMT / 3:08am EST / 12:08am PST
Digital Foundry

Will we still be playing PS3 and Xbox 360 in 2016?

Recent rumour-mongering that both Sony and Microsoft would be announcing next-gen hardware at this year's E3 has brought into sharp focus the oft-repeated claim that both Xbox 360 and PlayStation 3 were designed with "ten-year lifecycles" in mind.

"Andy (House) is absolutely right in that we are not making any announcements at E3. I've always said a 10-year life cycle for PS3, and there is no reason to go away from that," Sony CEO Kaz Hirai told the Wall Street Journal during CES in response to the latest round of rumours. Hirai was referencing an earlier denial that SCE president Andrew House delivered to CVG.

"I don't think we're contemplating talking about anything to do with future console iterations at this point," House said.

While we fully believe Kaz Hirai when he says there'll be no PS4 at E3 2012, the implication that Sony's current home console won't be replaced until 2016 is almost certainly a red herring.

"But one thing I always point to is that, somewhat in contrast to our major competitors, we have, particularly with PS2, managed the length of the lifecycle and ensured its profitability for our publishing partners for a much longer lifecycle than has been true of the competition."

While Hirai's statement regarding a PlayStation 4 no-show is fairly unambiguous, it's safe to say that the lifespan of the PS3 or indeed the Xbox 360 has only a limited bearing on the timing of the announcement of any next-gen successor. While we fully believe Hirai when he says there'll be no PS4 at E3 2012, the implication that Sony's current home console won't be replaced until 2016 is almost certainly a red herring. History has demonstrated that console generations overlap and there is no firm cut-off point between between one console and the next, something that House is clearly acknowledging.

To illustrate, PlayStation 2 continues make money for Sony five years after the launch of the PS3. Despite the launch of new hardware, key products such as Guitar Hero and Singstar continued to drive purchases for the cheaper console and the PS2 market is still considered serious enough for Electronic Arts to produce a version of FIFA 12 released just a few months ago. Clearly the glory days are over, but the PS2 still has a role to play in emerging markets.

From a manufacturing perspective, there's nothing to suggest that both Xbox 360 and PlayStation 3 couldn't follow the same pattern going forward. As with PS2, the internal components of both platforms will be shrunk down and crammed onto ever-small slices of silicon, bringing down associated costs and allowing Sony and Microsoft to produce ever-smaller, cheaper, cooler boxes. It's an ongoing process that has already seen both consoles receive mid-life refreshes that have crammed their innards into much slimmer boxes.

As it is, the consoles are currently operating with a 45nm fabrication process for its critical CPU and graphics chips, but Microsoft has already managed to incorporate both components into a single chip - just as Sony did with the PS2 during its transition into its "Slim" form factor. As fabrication technology improves, so the current-gen consoles will drop in size still further. Last year's "next-gen" job-postings from Microsoft - including a Senior Hardware Design Verification Engineer - are just as much about making the Xbox 360 cheaper and more efficient to produce as they are about manufacturing a next-gen console. Logically the next step will be transition the current designs onto 28nm production processes, but that's likely to take quite some time - perhaps another factor in extending the lifespan of the current generation of consoles.

From a software development perspective, until next-gen rendering techniques dominate, there'll be a period of transition where we expect to see multi-platform games cross the generational divide. Both EA's Frostbite and Crytek's CryEngine 3 are designed to handle both current-gen and next-gen architectures with developers approaching the platforms in much the same way that low-end and high-end PCs can handle the same games, just with differing levels of visual accomplishment. I suspect there will be far more technological commonality between current-gen and next-gen than there was previously - another factor that could help extend the lifecycle.

PS3 and Xbox 360 face both stern challenges and new opportunities compared to the PS2, which trounced all opposition and dominated the entry-level console space. We'll see stiff competition from the likes of the new Smart TVs, which will contain their own gaming platforms along with access to cloud gaming services such as Gaikai and OnLive. Samsung even has some plans to make their own Smart TVs upgradeable, allowing for low-cost, system-on-chip and presumably RAM upgrades. The idea here is that you won't have to replace your entire screen in order to keep up with the latest technology - and being Android-based, we can assume this will include gaming.

There's also the notion that smartphone technology in general - be it contained in handsets, tablets or indeed TVs - could supersede current generation consoles fairly quickly. Some believe that the top-end A9600 version of the upcoming Sony Ericsson NovaThor chipset could finally see mobile tech reach the same approximate level as the Xbox 360 and PlayStation 3, thanks in no small part to IMG's PowerVR 'Rogue' chipset. Whether this will actually translate into competitive software clearly remains to be seen, but if the mobile market opens out into the living room via Smart TV technology, it could change the entire gaming landscape. The emergence of Unreal Engine 3 on mobile platforms is the first indication that current-gen tech could converge with mobile.

Timing of any next-gen announcement will be crucial. Revealing a next-gen successor calls time on the current, profitable hardware and focuses the attention of the core audience on the future rather than the present.

However, the existing home consoles have advantages of their own to help them weather the storm in that they are not static, fixed-platforms like the PlayStation 2 was in its day - they can evolve easily. Via firmware upgrades, the Xbox 360 and PS3 can be radically transformed in terms of functionality - indeed, we've already seen it happen more than once over the last few years. PS3 has expanded to support 3DTVs and operates beautifully in concert with the PSVita handheld and has always been the Blu-ray movie player of choice, while the Xbox 360 has undergone two drastic revisions of its front-end, first with NXE and more recently with the 'Metro' dashboard update which repositioned the 360 as a conduit for streaming video in addition to its position as a core gaming platform.

Indeed, recent rumours that the next-gen Xbox would arrive in two SKUs - a set-top box with Kinect functionality and a fully-fledged 360 successor - lead me to wonder if the current console itself, evolved, repackaged, and repositioned, may well be one of those SKUs. If the main job of the machine is to stream in HD media via the internet, there is absolutely nothing to stop it working on a Cloud-style basis to bring next-gen Xbox titles onto current-gen systems - only the support for the rumoured bundled Kinect 2 could cause issues there.

Embracing Cloud as part of its next-gen strategy could work for Microsoft. The platform would save an absolute fortune on loss-making hardware just for starters, and instead earn money via pay-per-play transactions and subscription packages. In terms of the system's suitability for hosting a Cloud-based gaming environment, the bottom line is that Xbox 360 has already proved that it can both stream and decode h.264 video so that's not really a problem. Indeed, behind closed doors at E3 2010, David Perry and the Gaikai team were demonstrating perennial favourite World of Warcraft operating quite nicely on an Xbox 360 devkit, proving conclusively that it can be done. Of all the major platform holders likely to embrace the Cloud, it's Microsoft that has the resources to create the infrastructure required and the in-house personnel to make it happen.

As a streaming platform, the Xbox 360 could easily live on to 2015 and beyond, as a Cloud-based portal to all manner of movie and gaming, with Kinect titles - which probably wouldn't need the sophistication of next-gen architecture - downloaded onto the system via Games on Demand and run using the existing 360 technology. At the same time, core gamers would most likely be satisfied with the more advanced second SKU, a more traditional piece of console hardware that would provide the high fidelity experience that audience demands, bypassing the latency and image quality issues that are almost certain to persist with streaming gameplay.

In terms of just when we will see actual replacements for the Xbox 360 and PlayStation 3, sources suggest that work is significantly further advanced on the Microsoft console than it is at Sony. I wouldn't be at all surprised to see something from the Nextbox team at E3 this year. The recent news that Crytek's first party Kinect title Ryse appears to have switched onto the next-gen platform strongly suggests that Microsoft will be ready sooner rather than later. With regards PlayStation 4, I'm told that work is still at the early stages on crucial elements of the developer toolset at Sony's R&D offices, so there's little reason to question the denials from Kaz Hirai and Andrew House about a potential E3 reveal.

Timing of any next-gen announcement will be crucial. Revealing a next-gen successor calls time on the current, profitable hardware and focuses the attention of the core audience on the future rather than the present. Certainly for Sony - with a raft of high-quality first party exclusives in the pipeline including a new game from the God of War team at Sony Santa Monica, plus Naughty Dog's The Last of Us, calling time on the current-gen PlayStation this year doesn't really make sense...

16 Comments

Klaus Preisinger Freelance Writing

1,135 1,171 1.0
All those non-gaming functions of the 360 and the PS3 work just as fine on a $35 Raspberry Pi. Why would you need a $250 console for that? (Streaming games, videos and surfing a few sites and social networks)

Sure, Sony can absolutely sell a 10 year old device. The question is merelyto whom and whether the people who bought a PS3 early in its life-cycle might buy something else for the very same reasons they bought a PS3, or not. GameStop will not wait a single day to push a new generation of Microsoft consoles in exchange for Sony hardware. That will take a lot of early adopters and players of so called hardcore titles off the market and put a lot of cheap consoles on the market.

The Sony Move does not appear to be to the PS3, what Singstar was to the PS2 in Europe.

Posted:2 years ago

#1
I can definitely see value in an Xbox + Kinect 2 with increased accuracy.
Power upgrades have only been successful when there was a major dev advancement attached to it (you could clearly see a jump from 8 to 16 bits, and from 2D to 3D gaming, but after it got blurrier).
With tools like Kinect, added hardware (both in the sensor and the console) would be a welcome addition.
In comparison, a PS3 hardly needs an upgrade. It's not better graphics that consumers are after, it's better experiences. Seeing the limits of the motion technology right now, I can't see a problem with a new Xbox coming soon... It doesn't have to be a generational jump, but if Apple's success has showed us one thing, it's that consumers are usually ready to get to the next level every 2 to 4 years.

Posted:2 years ago

#2

Andrew Goodchild Studying development, Train2Game

1,254 421 0.3
@ Shann
"but if Apple's success has showed us one thing, it's that consumers are usually ready to get to the next level every 2 to 4 years"

Posted:2 years ago

#3

Joel Hruska Analyst/Journalist

24 122 5.1
Show me the Raspberry Pi that comes with hundreds of GB of internal storage, the GUI developed for XBox Live, integrated wireless, integrated ports for wired controllers, and additional bits like Bluetooth, IR, etc -- and I'll show you a Raspberry Pi that doesn't cost $35 anymore.

Even if we equate the RPi's CPU with the CPU+GPU inside the XBox 360 (a blatantly false comparison), there's a ton of additional capability baked into the console that the $35 plug doesn't come with. That doesn't make the RPi a bad thing at all, but it's not designed for this sort of functionality.

Posted:2 years ago

#4

Kevin Patterson musician

187 103 0.6
I am most definitely ready for a console upgrade, and looking forward to it.
The current consoles are starting to really show their age IMHO when compared to PC.
As an example, Deus Ex:HR on PC is so much better looking than the console versions.
On console, the game is still great, but it's more immersive on the PC.
I just hope that MS and Sony do not skimp on ram, 4GB for the next gen please.

Posted:2 years ago

#5

Andrew Ihegbu Studying Bsc Commercial Music, University of Westminster

461 172 0.4
@shann biglione ...but if Apple's success has showed us one thing, it's that consumers are usually ready to get to the next level every 2 to 4 years.

You and consumer are two different things. Phone contracts certainly ease the process as Mr Goodchild states, but you also misinterpret the Apple market. Many many Apple owners do not buy to utilise the full abilities of the product. Apple products are as much Tech as they are Fashion items, and many early adopters don't buy it because they like what it can do, they but it because they can show it off. To state a good example look that the iPhone 4S. Compare it to the iPhone 4 launch and its sales are pretty lacklustre, even though its now pretty hard to get a normal iPhone 4 on contract. Why? Cos it looks the same, so most of the fashion crowd see no reason to buy it.

To put it simply, that kind of market does not exist with Consoles. If a new console came out every 2 years, Devs would produce each game to run on the last 3 iterations because most consumers simply wouldn't be able to keep up, especially the younger gamers that get consoles and games for their main birthday present. It wouldn't be worth the R+D, and the consoles themselves would be much more expensive as there would be no time to revise and reduce the internals to reduce costs enough to recoup and profit before the next iteration was out.

All in all. I can tell you love your Apple products, but not everything Apple or Jobs does can be adapted to the world of technology. That RDF has been working on you too well lol.

Posted:2 years ago

#6

Klaus Preisinger Freelance Writing

1,135 1,171 1.0
@Joel

Raspberry Pi $35
1TB USB Drive $95
Multiwireless USB Adapter $15
USB Hub $3
Duckt Tape (still lying around)
XBMC Software $0
Real Browser for everything else $0

Money left for scratch lottery tickets compared to 360: $151

If there is any indication of non-gaming related Xbox services turning into a system seller, then competition will swarm this market like crazy. Oh wait, they just did during CES.

Posted:2 years ago

#7
Personally I think these 10 year life cycle attempts are terrible for the Industry, but good for business, and unfortunately money wins out, on the plus side, the longer console's last the more likely the game is to pick up a pc and become a pc gamer instead, why terrible, well it's a hard-limit on innovation, yes it'll be around 5 years before a given console has the best trashed out of it, but, far better would already exist by 5 year's time, and 5 year's seems a good toss-up between technology and longevity, given our current steady pace of hardware technologies advancement, by 5 year's a console is well and truly obselete and all these lower nm's result in 3 thing's alone, only one has any benefit to consumers and beyond a certain point this benefit isnt the accumulating kind, lower nm chip's result in less heat, resulting in less noisy (and still cheap I might add) fan's, which tend to extend chipset life with lower temp's.

No 2 they fit more chips on the same size die in the factory so it's cheaper per chip to produce, No3 they give the company an excuse to set a new price point reversing the natural trend and preventing natural competitions driving the console's price below a level the console maker is happy, despite not providing the consumer's with any decent new features and still hawking a museum piece, and as it get's cheaper year on year they maintain if not grow profit thanks to it.

From all accounts the xbox360 is based on something like a ATI X1950 XT with a few changes to allow more unified featured for the DX9.5 style graphics that X360 run's but still it has more in common with DX9 then dx10 in most features.

The latest PC card from ATI is the X7970 3GB, a 7xxx line on from the 1xxx line, and run's DX11, the difference between the two card's is staggering, and hardware age does ultimately place a cap on the performance of any console, ms and sony may decide to see the whole 10 year life cycle thing to the end, they may be only offering PS3 and xbox360 for sale in 2016, but for all but the casual's or possibly kid's, in my opinion most gaming will have moved to the PC by then.

As pc prices can be quite cheap and no doubt more and more gamer's on console's may be tempted by PC's, it remains to be seen if AMD and Intel can manage to make even their most budget CPU's integrated GPU's outperform the console's significantly at this time, as many of these console gamer's will have a very limited console size'd budget for how much they might spend on a PC at first, with software developer's still limiting tech to allow cross-platform development with ancient hardware, the benefits have been limited to date however I expect by 2016 enough games sporting much enhanced tech will be out to make the quality of PC game's obvious, and it worth splashing out 300 to 450 or so on a budget pc with more power under the hood, and I suspect AMD and Intel recognise this and are all these integrated GPU's of recent times are about more than just cheaper manufacturing and streamlined pipelines and squeezing out gpu maker's, they want a slice of the gaming market pie, and think pc's will be the best way to re-capture it.

Of course this is more a theory then a fact, but I hope I'm correct neverthless, being a PC man 1st and foremost:)

Posted:2 years ago

#8

Greg Wilcox Creator, Destroy All Fanboys!

2,193 1,170 0.5
Klaus: excellent post above, but from working in retail for a few years, I can safely say that the average (American) consumer wants a simpler, plug and play experience out of the box as opposed to a spectacular DIY kit purchased from a few sources that will frustrate them because they can't figure out what to do when a product comes in more than one box.

That and trying to explain Linux (and ANY sort of OS) to those folks will have your head fall off into your lap within seconds, trust me... =P

Posted:2 years ago

#9

Brian Smith Artist

196 85 0.4
The best game titles usually appear in the 'end of days' of a consoles life. I'd like new tech too but I'd still like to see developers exploit, dig deeper and amaze with the current generation. Games released recently almost look like a generation jump beyond the Xbox's and Ps3's launch titles, and they'll get better still, assuming there's any developers left to work on them.

New consoles seem to have that duality where they are hotly anticipated but produce poor quality in the beginnings. Sure you get the first party gems, the Gears of war or Wipeout whatever but the majority of devs are feeling there way in, unable to squeeze the max out due to lack of experience. Then alongside your great first party titles you get a bitter helping of last gen games hurriedly stoked up with higher res textures and larger amounts of on screen enemies, games developed for last generation but with 3d added on etc. Rose tinted blah blah... I'm happy how it is and hope we don't see new ones for at least another year.

Posted:2 years ago

#10

Roberto Dillon Associate Professor, James Cook University

33 24 0.7
Wait, we finally got slim, quiet and reliable devices that don't overheat and consume less energy and now you want to start all over again with another set of big, over-heating and prone to faults systems?? We truly are a bunch of masochists! ;)

Posted:2 years ago

#11

Tony Johns

520 12 0.0
So the XBox360 and the PS3 that I got in December 2008....are still going to be on the market way until 2015?

Wow...and considering that XBox360 was released in November 2005 and PS3 was released in November 2006, we are seeing one of the longest hardware generations ever in Videogame History.

And with the Wii U being the only next gen console, it is more likely that the Wii and the Wii U would both fit within this hardware generation with the Wii being the new PS2 console for the casuals for their music and trivia games. like the way how there are still new BUZZ games for the PS2 still coming out almost every year.

Also think of the used game sales, they can still keep the used game sales for this current gen of consoles as well as for the Wii U.

It seems that the only real next gen market will be the 3DS and the PS Vita and who would have thought of that back in the 90s that we would be seeing the only next gen market being on handhelds instead of consoles.

Well...it is like nothing is confirmed until this years E3 then, but I wonder who would attend if most people are going to boycot the event in protest of ESA's support of the SOPA and the PIPA laws being proposed by the US Government?

Posted:2 years ago

#12

Peter Dwyer Games Designer/Developer

482 293 0.6
Most arguments here could have been sum'ed up as "heck no"

As developers and gamers we need fresh new technology to play with or we get bored. The average consumer on the other hand would most likely still get a kick out of a 2600 and an ET cartridge.

Apple have proved that consumers care less about the tech and more about the functionality and ease of use. Telling them something has 2 terrabytes, can shift graphics like black ops tech and blow your brains into next week just doesn't make them excited.

Posted:2 years ago

#13

Ryan Butt Studying Computer Science, Keele University

1 0 0.0
Regarding an Apple-esque 1/2 year cycle for consoles, you have to consider that they need to support multiplayer communities for games and by releasing a new generation that frequently the online communities for games would become increasingly fragmented over not only different consoles, but also different generations of consoles.
Add to that the nightmare of the amount of different platforms developers would need to support...

Posted:2 years ago

#14
The great thing that Apple has managed to manage is peoples expectations.
How else to explain peoples willingness to play on a tablet (that is NOT a console) but to charge for prices 1.5-2x the cost of a console :)

Even better, lets produce a small mini upgrade every 240 days!

Posted:2 years ago

#15

Craig Page Programmer

384 220 0.6
What are they thinking? They can't release the next xbox with barely anymore power because the current one is garbage, it's been out for 900 years and I'm still seeing games like Mass Effect 2 come along that don't anti-alias everything. Or do most people play on little 40" screens and not notice how bad everything looks in a lot of games?

Posted:2 years ago

#16

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