Amazon Fire TV: A "nonevent" for games?
Analysts chime in on the impact of Amazon's new Android-powered box; most don't think Microsoft or Sony have anything to fear
With Fire TV, Amazon has launched its first box to deliver games to the living room. The $99 Android-based hardware features a quad-core processor, a dedicated GPU and a separate gaming controller for $40. Moreover, Amazon will bring exclusive games to the Fire TV through its first-party team at Amazon Game Studios.
Similar to other microconsoles, the games on the digital store will be either free or quite cheap to purchase, which Amazon hopes will make it attractive to the masses. Amazon has an army of resources and while other microconsoles have failed to become mainstream, it would be foolish to doubt Amazon's potential. Should dedicated console makers like Sony or Microsoft be concerned? The majority of the analysts GamesIndustry International spoke to didn't think so.
Wedbush Securities' Michael Pachter called the announcement a "nonevent," saying Amazon "will not be a player." DFC Intelligence's David Cole agrees.
"Short term they don't have a reason to be concerned but long term it could be an issue. The main focus of the box is streaming video. The issue is video is 1) a much bigger application than games and 2) much easier to do. It is clear games are at best currently a distant after thought for Amazon in terms of the Amazon box. The type of games they are looking at are more in the realm of tablet/mobile/casual products, which are really no substitute for what the dedicated consoles provide," he said.
"Anybody in high tech or in content that sees Amazon jump into their bread and butter market and isn't concerned about what Amazon might be able to do should have their head examined"
Lewis Ward
"So I think right now it is a rounding error in the game industry but that could change if Amazon decides it wants to make a big investment in the space. However, the reality is you really have to very directly target gamers and Amazon right now is only half-heartedly doing that."
Indeed, hardcore gamers won't be passing up the PlayStation 4 or Xbox One for an Amazon Fire TV anytime soon, said independent analyst Billy Pidgeon: "Hardcore games enthusiasts won't be satisfied by this or any other inexpensive television-connected device. Still, Microsoft, Sony and Nintendo are increasingly competing for individual and family entertainment time with interactive entertainment, video and audio available in the home on multiple devices, including smartphones and tablets as well as multimedia boxes that connect to television sets."
Pidgeon conceded that "as more devices can offer games and media, consoles' appeal for the mass market (an important factor in mid-to-end cycle console adoption) is in steep decline." He added that if anyone should be worried now, it should be Apple and Google.
"Apple and Google have been the main contenders for online media transactions, but Amazon has the motivation, the focus and the distribution to move Fire TV quickly into lead position. Apple has competition issues with media providers and Google is behind in online retail and user experience. Amazon's entry into connected TV could energize the competition and speed household penetration," he said.
Asif Khan, CFO of Virtue LLC, wasn't wowed by the Fire TV announcement either. Even with exclusive games - and now Amazon has hired some heavy hitters in Clint Hocking and Kim Swift - he's not convinced that Amazon can disrupt the console market.
"We knew that Amazon was going to enter the games industry, but I am not sure who is going to feel compelled to buy it with a controller that costs 40 percent of the device. The success of the device as a gaming alternative will likely depend on the software that Amazon's gaming studio can create, but we have seen with Nintendo's Wii U flop that first-party content is not enough to get consumers to buy a device," Khan noted.
"There is chance that Fire TV can make some waves if Amazon's partners continue to bring games to the device, but in my opinion this product will achieve limited success," he continued. "It feels like all of Apple's competitors have now shown their cards in anticipation of the upcoming Apple TV refresh. We have seen Xbox One, Chromecast, and now Fire TV. None of these products have wowed consumers and ushered in a new age of how we interact with TVs. This announcement by Amazon today just has me even more interested in what Apple is going to announce this year. Clearly the set top box market has a lot of players and Amazon has a chance to contribute something to that increasingly crowded space. With that being said, I do not think the Fire TV is a game changer for video game consoles. It is a set top box that also plays games, with the potential of asymmetric gameplay."
If the analysts seem overly negative, perhaps they are forgetting about Amazon's web services. The back-end technology could make a difference, said IDC research manager Lewis Ward, who believes Amazon is "absolutely" a contender in the console space.
"Anybody in high tech or in content that sees Amazon jump into their bread and butter market and isn't concerned about what Amazon might be able to do should have their head examined," he commented. "Let's put it this way: Fire TV is by far the most viable microconsole platform out there. Couple that with Amazon's back-end streaming, storage, and game-hosting platforms and developer tools and you've got a serious threat to casual home-based console gaming in particular, at least in North America and pockets of Europe in the next few years."
What is Amazons vision with this box? Is it tv, is it games, is it streaming? -I know the answer is all 3, but is harder to market something that does lots of things rather than dedicated to one usage.
There is so much choice out there now, particularly in the android micro console space - this will only do better than the others out there due to whos selling it and pushing it
However most none gamer types, see gaming as casual affair. Unlike the real-gamer, they have no interest in buying, purchasing, collecting or owning anything. They are not game hobbiests. They dont care about the evolution of gaming or the technology or business aspects behind it. They just want to get home and play games as easy as it is to flip on a TV and see whats on. I see this working on a business model akin to netflix and HULU.
As for me I have ZERO interest in the product, however if I had small kids this would be the perfect gaming device. If for some reason my kid got seriously into it, I can consider getting him a game console in order to expirience something much more deeper. But I see these devices aimed more at people who dont play games. there is irony in that statement, but the same can be said when I see people playing candy crush at work. These people have ZERO interest in games. But will play games like candy crush or just to kill a few minutes of there time. And this is OK. I really support products that cater to different peoples needs.
I just go off sometimes when people come and say that their new thing will come to get rid of everything else when i think they can coexist just fine. Because likewise, i have differant needs too. And I really enjoy console games.
Edited 1 times. Last edit by Rick Lopez on 3rd April 2014 5:45pm
Edited 1 times. Last edit by Pete Thompson on 3rd April 2014 5:41pm
I imagine the following conversation happened soon after announcement, while the Amazon crew is riding around in a proverbial armoured vehicle:
*THUD*
"What was that we just ran over?"
"I'm not sure, I didn't feel anything"
*looks back* "I think we ran over Ouya!"
"Oh. And nothing of value was lost."
The threat to the consoles is not the direct switch of fanboys from consoles to microconsoles. It is that the economics of consoles requires a large addressable audience, and tablets/microconsoles will reduce that addressable audience.
Amazon TV is not a direct threat to the consoles. It is a massive, life-threatening, indirect threat.
People are also seemingly dismissing what I think is Amazon's end-goal, and that's streaming. Amazon has exceptionally strong back-end technology for making this happen, and could be a serious threat in the streamed-games service model.
Edited 1 times. Last edit by Neil Young on 3rd April 2014 7:42pm
Agreed. Just look at (a very inaccurate) informal stat: the Nintendo Wii sold 100 million units. But according to vgchartz, Skyward Sword only sold to less than 4% of Wii owners. I realize that some Wii owners may just not like Zelda, but conventional wisdom online would say that more than 4% of Nintendo owners would want to play a Zelda title. The same holds for most consoles.
On average, console owners will buy 10 or fewer games. That's not the "hardcore" fanbase we tend to think of, is it? I've owned probably 200-300 games for my 360, yet the attach rate for the console is about 12. So for every one of me, there are a ton of people who only bought a handful of games and stopped. These people are the target. They are the ones that Amazon is after.
Right now the Fire TV's audience is the Kindle audience, folks who more than likely own some media content from Amazon services. If Amazon Game Studios has a compelling slate of original content (It's hard to tell from that sizzle reel they released.), the device could pick up some interest from the gaming audience.
The device isn't targeting the AAA market, so the need for streaming may just not be there. If it is, then they'll probably support it.
If the goal of the current console generation is to own the living room, a $99 box (+ controller) with access to the above tools, Amazon's entry into to said room is very much an event.