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Network services the "true battlefield" for home consoles

By Matt Martin

Thu 24 Jun 2010 7:00am GMT / 3:00am EDT / 12:00am PDT

Hardware, motion control and 3D are only incremental upgrades to the console business, says Square Enix

Square Enix president Yoichi Wada is looking further than the latest wave of hardware additions for home consoles, positioning the company to take advantage of networked services on the Xbox 360 and PlayStation 3.

While interested in 3D, Move and Kinect motion controls, Wada said that the new technology only marginally increases the capabilities and potential business models for home consoles, while online services will be the "true battlefield" for publishers in the future.

"The innovations that we hear about during this E3 are only minimal additions to the existing technologies," offered Wada, in an interview conducted in LA last week. "What is not visible today is the quiet change that's taking place at the network level."

"What the motion controls and other new technology will do is extend the lives of the consoles, but they themselves are not the true battlefield. The true battlefield is the respective network services that support consoles, whether or not they can truly establish these network services will have the definitive effect on the future of games consoles."

Describing home stereoscopic 3D as "not bad, but only so-so" and Kinect as "just a small extension to what is already available", Wada said he wants to see format holders relax online networks in order for publishers to experiment with alternative business models.

"First and foremost I would like them to come up with a network infrastructure that will allow the publishers like us to freely design different business schemes. For the publishers the advantage of the networks is that it allows more types of diversified revenue models and I don't want their networks to interfere with that."

Square Enix is currently looking into its own online services said Wada, drawing parallels to Valve's Steam service, but he would not be drawn on specifics, only hinting the goal is to reduce the friction between publisher and customer.

"What we are interested in is the layer or level closest to our customers, those that form communities. Anything below that level is something either we could do or we could take advantage of somebody else's technology and whatever it is we will choose the most efficient means to get there.

"The closest image I can think of is Valve's Steam service. But I do not want to end up fighting with Valve or the game console manufacturers," he added.

The full interview with Yoichi Wada can be read here.

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