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Xbox always-online: Maybe it's not so terrible

Chris Morris explains that having a big company like Microsoft step up could make always-online more palatable for next-gen

Will the next Xbox continue the reign of success Microsoft has seen this generation or will it stumble Sony-style, losing momentum at a critical junction for console systems? The answer could lie in a single feature.

Kotaku recently reignited the rumor about the next Xbox requiring a constant connection to the Internet - and Microsoft Studios' creative director did nothing to put out that growing brushfire with his Twitter fiasco last week.

Will the next generation Xbox require an 'always-on' connection? There's nothing to base that on right now except for rumors and the echo chamber of the Internet. But, for the sake of argument alone, let's say that is an upcoming feature. Is it as bad as it seems?

Certainly, the recent history of mandatory Internet connections hasn't been a good one. Anyone who purchased Diablo III, SimCity, Defiance or, for that matter, any recent World of Warcraft expansion has lived the same story: Eager to play, they inserted their game disc - only to be unable to log onto the servers. It's a nightmare scenario for pretty much everyone involved - player, developer and PR/community person who has to do clean up work afterward.

What's staggering about this all-too-familiar scenario is its regularity. The video game industry has had the chance to prepare for these sorts of launches time and time again, yet constantly drops the ball.

"If we cannot provide the level of service appropriate and we continuously disappoint, we create continued ill will from customers"

Christian Svensson on failed always-online attempts

"As an industry, we needed [SimCity] to get it right," says Christian Svensson, Senior Vice President at Capcom Entertainment. "We needed Blizzard to get it right. And there are reasons that needed to happen for the sanctity of our revenue streams. ... Network based service models are crucial to our business moving forward. If we cannot provide the level of service appropriate and we continuously disappoint, we create continued ill will from customers. Even when there's a huge value to consumers ... every single time, it's going to be viewed with skepticism and waiting for people to get burnt."

While that logjam created by a big launch is one of the most-cited problems with the always-on model, it's not an insurmountable one.

"It's a money question," says Chris Early, VP of digital publishing at Ubisoft. "If you backed it up with Amazon servers, you could launch any game that we make today - completely digitally. There's enough server space and bandwidth to do that."

Of course, those servers cost money - and publishers aren't in a financial position to overestimate and miss, especially with investors watching them so closely these days. (Investors, it's worth noting, didn't seem to care about SimCity's problems. EA stock didn't suffer during the launch woes.)

Microsoft is in a slightly different position. It has the ability to make that gamble - and having launched a few big games of its own without incident, it has some expectations of what to look out for. Halo 4 and any recent Call of Duty debuted without any major hiccups in the multiplayer component - and expanding capacity to handle the single player element wouldn't be too challenging for the company.

Consider also that, even if the new Xbox does require a constant Internet connection, Microsoft will have plenty of time to study trends before it reaches a significant roadblock. The system will be supply constrained at launch, meaning roadblocks won't be a problem. Additionally, there's unlikely to be a game that has the same level of anticipation as a SimCity or Diablo, since it's economically infeasible for publishers. (That's why the holiday after a system's launch is typically much more exciting for players - the installed base has reached a point that publishers can fully devote resources to it.)

That gives Microsoft a chance to learn, like Valve did with Steam, and be ready.

"We face [as an industry], I think, the same problems as when people started to think about 'I have a home phone and I have this new cellular phone.' And who sat at home and used their cellular phone? Nobody did - because it was unreliable," says Early. "When you were home you picked up the phone. ... Now, some amount of time later, when the appropriate amount of investment has been made in the infrastructure, a lot of people don't have hard lines any more."

"Any potential cries of forum dwellers are unlikely to match the level of volume Microsoft's marketing machine will make during the ramp up to the new system"

The more troubling problem - and the one that seemingly doesn't have an answer right now - is what happens when someone's Internet goes out for more than a few minutes? Or, conversely, what about the people who live in rural areas, where Internet speeds are well below the national average?

While that audience makes up a minority of the potential buyers, their defenders are vocal - and could prove sufficiently loud to affect sales, though likely not on the scale they'd like to imagine.

Why's that? Well, despite the tempest in a teapot that was the SimCity or Diablo III launches, look at the sales numbers of both games. EA topped its expectations and Blizzard moved more than 12 million copies. Even with all the outrage that accompanied both of those games, they were massive successes. And any potential cries of forum dwellers are unlikely to match the level of volume Microsoft's marketing machine will make during the ramp up to the new system.

Of course, even if Microsoft launches with this feature, it can always switch course fairly easily. Should it sniff a consumer pushback that's growing beyond its ability to contain and control, it can easily fall back to the position Sony has established - pushing the choice (and, thus, the blame) back onto the publishers, while quietly offering them all the support they need.

To some, that might seem a victory, but when it comes to big titles, they're likely to see that always-on connection just the same.

That's not a roundabout way of saying "deal with it". (We've all seen the effects of that ludicrously condescending hashtag.) However, always-on DRM is unlikely to go away anytime soon. It's invasive and annoying for some consumers, but many, many more don't really care too much about it. Additionally, it helps publishers protect their IP - and regulate things like cheating much more easily.

It's a problem that's slowly getting better, as publishers try to work it out themselves. Maybe - just maybe - having a central player like Microsoft stepping in could speed up that learning process and make it palatable.

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Chris Morris

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Chris Morris has covered the video game industry since 1996, offering analysis of news and trends and breaking several major stories. He was the author of CNNMoney’s 'Game Over' and has also written for Yahoo!, Variety, CNBC.com, Forbes.com and other publications.

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