Benchmarks for Valve’s Steam machines are out and it does not look like the Linux powered OS is stacking up well against Windows.
According to Ars Technica the SteamOS gaming comes with a significant performance hit on a number of benchmarks.
The OS was put through Geekbench 3 which has a Linux version. The magazine used some mid-to-late-2014 releases that had SteamOS ports suitable for tests including Middle-Earth: Shadow of Mordor and Metro: Last Light Redux.
Both were intensive 3D games with built-in benchmarking tools and a variety of quality sliders to play with (including six handy presets in Shadow of Mordor’s case).
On SteamOS both games had a sizable frame rate hit. We are talking about 21- to 58-percent fewer frames per second, depending on the graphical settings. On our hardware running Shadow of Mordor at Ultra settings and HD resolution, the OS change alone was the difference between a playable 34.5 fps average on Windows and a 14.6 fps mess on SteamOS.
You would think that Valve’s own games wouldn’t have this problem, but Portal, Team Fortress 2, and DOTA 2 all took massive frame rate dips on SteamOS compared to their Windows counterparts.
Left 4 Dead 2 showed comparable performance between the two operating systems but nothing like what Steam thought it would have a couple of years ago.
Activision Blizzard has bought King Digital Entertainment for $5.9 billion, marking not only one of the largest acquisitions in videogame history but one of the largest deals ever made in the entertainment business. Comparing this to previous entertainment deals highlights just how extraordinary the figures involved are; the purchase price values King at significantly more than Marvel Entertainment (acquired by Disney for $4.2 billion), Star Wars owner Lucasfilm (Disney again, for $4.1 billion) and movie studio Metro-Goldwyn-Mayer (acquired by Sony for almost $5 billion). The price dwarfs the $1.5 billion paid by Japanese network SoftBank and mobile publisher GungHo for Supercell back in 2013 – though it’s not quite on the same scale as the $7.4 billion price tag Disney paid for Pixar, or in the same ballpark as the $18 billion-odd involved in the merger that originally created Activision Blizzard itself.
How is $5.9 billion justified? Well, it’s a fairly reasonable premium of 20% over the company’s share price – though if you’ve been holding on to King shares since its IPO in 2014, you’ll still be disappointed, as it’s far short of the $22.50 IPO price, or even the $20.50 that the shares traded at on their first day on the open market. The company’s share price has been more or less stable this year, but Activision’s offer still doesn’t make up for the various tumbles shares took through 2014.
A better justification, perhaps, lies in the scale of King’s mobile game business. The company is a little off its peak at the moment. Candy Crush Saga, its biggest title, is on a slow decline from an extraordinary peak of success, and other titles aren’t growing fast enough to make up for that decline, but it still recorded over half a billion monthly active users (MAUs) in its recently reported second quarter figures. In terms of paying users, the company had 7.6 million paying users each month – more than Blizzard’s cash cow, World of Warcraft, and moreover, the average revenue from each of those users was $23.26, far more than a World of Warcraft subscriber pays. King took in $529 million in bookings during the quarter, 81 per cent of it from mobile devices – a seriously appealing set of figures for a company like Activision, which struggles to get even 10 per cent of its revenues from mobile despite its constant lip-service to the platform.
In buying King, Activision instantly makes itself into one of the biggest players in the mobile space, albeit simply by absorbing the company that is presently at the top of the heap. It diversifies its bottom line in a way that investors and analysts have been crying out for it to do, reducing its reliance on console (still damn near half of its revenues) and on the remarkable-but-fading World of Warcraft, and bulking up its anaemic mobile revenues to the point of respectability. On paper, this deal turns Activision into a much more broad-based company that’s far more in line with the present trajectory of the market at large, and should assuage the fears of those who think Activision’s over-reliance on a small number of core franchises leaves it far more vulnerable than rivals like Electronic Arts.
That’s on paper. In practice, though, what has Activision just bought for $5.9 billion? That’s a slightly trickier question. The company is, unquestionably, now the proud owner of one of the most talented and accomplished creators and operators of mobile games in the world. King’s experience of developing, marketing and, crucially, running mobile games at enormous scale, and the team that accomplished all of that, is undoubtedly valuable in its own right. Those are talents that Activision didn’t have yesterday, but will have tomorrow. Are those talents worth $5.9 billion, though? Without wishing for a moment to cast doubt on the skills of those who work at King, no, they’re not. $5.9 billion isn’t “acquihire” money, and when that’s the kind of cash involved we simply can’t think of this as an “acquihire” deal. Activision didn’t pay that kind of money in order to get access to the talent and experience assembled at King. It paid for King itself, for its ongoing businesses and its IP.
Open the shopping bag, and you might struggle to understand how the contents reach $5.9 billion at the till. King has one remarkable, breakthrough, enormously successful IP – Candy Crush Saga, which still accounts (not including heavily marketed spin-off title Candy Crush Soda Saga) for 39 per cent of the company’s gross bookings. No doubt deeply aware of the danger of being over-reliant on revenues from this single title, King has worked incredibly hard to find success for other games in its portfolio. But even its great efforts in this regard have failed to compensate for falling revenues from Candy Crush, and it’s notable that a fair amount of the “non-Candy Crush Saga” revenue that the company boasts actually comes from Candy Crush Soda Saga. Other titles like Farm Heroes Saga and Pet Rescue Saga are no doubt profitable and successful in their own right, and King would be a sustainable business even without Candy Crush. But it would be a much, much smaller business, and certainly not a $5.9 billion business.
Despite being generally bullish about King’s prospects, then, it’s hard to avoid the feeling that the company has done incredibly well out of this acquisition. The undoubted talent and experience of its teams aside, this is, realistically, a company with one IP worth paying for, and unlike Star Wars or the Avengers, Candy Crush is a very new IP whose longevity is entirely untested and whose potential for merchandising or cross-media ventures is dubious at best. King has done better than most of its rivals in the mobile space at applying some of the lessons of its biggest hit to subsequent games and making them successful, but it shares with every other mobile developer the same fundamental problem: none of them has ever worked out how to bottle the lightning that creates a mega-hit and repeat the success down the line. Absent of another Candy Crush game, the odds are that King’s business would slowly deflate as the air escaped from the Candy Crush bubble, until the company’s sustainable (and undoubtedly profitable) core was what was left. Selling up to Activision at a healthy premium while the company is still “inflated” by the likely unrepeatable success of Candy Crush is a fantastic move for the company’s management and investors, but rather less so for Activision.
Perhaps, though, the whole might be more than the sum of its parts? Couldn’t Activision, holders of some of the world’s favourite console and PC game IP, work with King to leverage that IP and the firm’s reach in traditional games, creating new business at the interaction of their respective specialisations? That’s a big part of what made Pixar so valuable to Disney, for example; the match between their businesses was of vital importance to that deal, and the same can broadly be said for Disney’s other huge acquisitions, Lucasfilm and Marvel. (SoftBank’s purchase of Supercell, by comparison, was rather more of a straightforward market-share land grab.) What could this new hybrid, Activision Blizzard King, hope to achieve in terms of overlap that enhances the value of its various component parts?
Certainly, Activision has some properties that could work on mobile (I’m thinking specifically of Skylanders here, though others may also fit); some Blizzard properties could also probably work on mobile, though I very much doubt that Blizzard (which retains a strong degree of independence within the group) is a good cultural fit for King, and is deeply unlikely to work with it in any manner which gives up the slightest creative control over its properties. King’s properties, meanwhile, don’t look terribly enticing as console or PC games, and conversions done this way would almost certainly defeat the entire purpose of the deal anyway, since the objective is to bolster Activision’s mobile business. The prospect of a mobile game based on Call of Duty or another major console IP may seem superficially interesting, but we’ve been down this road before and it didn’t lead anywhere impressive. Sure, core gamers are on mobile too, but they’ve by and large been nonplussed at best and outraged at worst by the notion of engaging with mobile versions of their console favourites. It’s genuinely hard to piece together the various IPs and franchises owned by King and Activision and see how there’s any winning interaction between them on the table.
This is what makes me keep returning to those other mega-deals – to Star Wars, to Marvel, to Pixar – and finding the contrast between them and Activision / King so extraordinary. Each of those multi-billion dollar deals was carried out by Disney with a very specific, long-term plan in mind that would leverage the abilities of both acquirer and acquired to create something far more than the sum of its parts. Each of those deals had a very clear raison d’être beyond simply “it’ll make us bigger.” Each of those companies fitted with the new parent like a piece of a puzzle. King’s only role in Activision’s “puzzle” is that they do mobile, and Activision sucks at mobile; there’s no sense of any grand plan that will play out.
In all likelihood, Activision has just paid a huge premium for a company which is past the peak of its greatest hit title and into a period of managed decline, not to mention a company with which its core businesses simply don’t fit in any meaningful way. King’s a great company in many respects, but its acquisition isn’t going to go down as a great deal for Activision – and we can expect to see plenty of that $5.9 billion being frittered away in goodwill write-downs over the coming few years.
Apparenlty, the total gaming hardware marker in 2014 was more than $24,936 billion in 2014 and it slightly declined in 2015 to $24,684 billion. However, in 2016 it looks like that the gaming hardware market will increase to $26.118 billion and it will reach $28.253 billion in 2017.
However the record year for gaming hardware will be three years from now as in 2018 JPR believes that the gaming hardware market is set to grow to $30.092. Of course by then we will have forgotten that Mr Peddie made his prediction so if he gets it wrong no one will remember.
|PC Gaming Hardware Market||2014||2015||2016||2017||2018|
|Total – numbers in millions||$24,936||$24,684||$26,118||$28,253||$30,092|
In his report, Ted Pollak, Senior Analyst at JPR wrote
“This cycle, unlike any for the past 15 years, will inspire gamers to upgrade their displays. 27 inch and larger 4K/UHD displays are reaching mass market pricing levels and produce an incredible experience allowing much wider field of view and greater detail. The financial outlay for these display upgrades alone is billions of dollars over the coming years”.
Jon Peddie, President of JPR adds
“In addition to the cost of the new display technology, gamers are going to need the computing muscle to drive Triple A game engines at over 60 frames per second, and that horsepower comes at a premium”. Sixty frames per second is considered the gold standard in PC gaming and many prefer even faster speeds, at least twice that number if VR is involved. ”
It is interesting to note that the PC gaming peripherals market is projected to make $3.6 billion in 2015. These are cheaper and easier to change and gamers wear out mice, keyboards and headset much faster than other components.
JPR believes that mainstream gaming notebook and desktop will have to fight with TV gaming optimised PCs including the ones from Alienware iBuyPower and a few others. We do agree that many gamers will be changing their monitors to at least 25×14 or the full 4K experience. To run high end triple A games at 4K you would need a lot of gaming power and a card such as Greenland with HBM 2 from AMD or Pascal high end class from Nvidia. Both of these will arrive in 2016. Gamers who want over 60 FPS in current high end titles might want to get two of the Geforce GTX 980 or higher end cards or a dual Fury from AMD.
If you want the VR glasses in 2016 you will need double the power but we will have to see the adoption rate of these gaming devices before we think that will take off. VR gaming will become significant segment eventually but definitely not overnight.
Hideo Kojima has left the building. The New Yorker has confirmed that the famous game creator’s last day at Konami has come and gone, with a farewell party attended by colleagues from within and without the country – but not, notably, by Konami’s top brass. Only a couple of months after his latest game, Metal Gear Solid V: The Phantom Pain, clocked up the most commercially successful opening day’s sales of any media product in 2015, Kojima has left a studio facing shutdown – its extraordinary technology effectively abandoned, its talent scattered, seemingly unwanted, by a company whose abusive and aggressive treatment of its staff has now entered the annals of industry legend.
It’s not exaggerating to say that an era came to a close as Kojima walked out the door of the studio that bore his name for the last time. For all of Konami’s the-lady-doth-protest-too-much claims that it’s not abandoning the console market, actions matter far more than PR-moderated words, and shutting down your most famous studio, severing ties with your most successful creator in the process, is an action that shouts from the rooftops. Still, there’s some truth to Konami’s statements; it’s unlikely to abandon the console versions of Winning Eleven / Pro Evolution Soccer, or of Power Pro Baseball, any time soon, though more and more of the firm’s focus will be on the mobile incarnations of those franchises. The big, expensive, risky and crowd-pleasing AAA titles, though? Those are dead in the water. Metal Gear Solid, Silent Hill (whose reincarnation, with acclaimed horror director Guillermo del Toro teaming up with Kojima at the helm, is a casualty of this change of focus), Suikoden, Castlevania, Contra… Any AAA title in those franchises from now on will almost certainly be the result of a licensing deal, not a Konami game.
One can criticise the company endlessly for how this transition has been handled; Konami has shown nigh-on endless disrespect and contempt for its creative staff and, Kojima himself aside, for talented, loyal workers who have stuck by the firm for years if not decades. It richly deserves every brickbat it’s getting for how unprofessionally and unpleasantly it’s dealt with the present situation. It’s much, much harder to criticise the company for the broader strokes of the decisions being made. Mobile games based on F2P models are enormous in Japan, not just with casual players but with the core audience that used to consume console games. The transition to the “mid-core” that mobile companies talk about in western territories is a reality in Japan, and has been for years; impressively deep, complex and involved games boast startling player numbers and vastly higher revenue-per-user figures than most western mobile games could even dream of. Konami, like a lot of other companies, probably expects that western markets will follow the same path, and sees a focus on Japan’s mobile space today as a reasonable long-term strategy that will position it well for tomorrow’s mobile space in the west.
Mobile is the right business to be in if you’re a major publisher in Japan right now. It’s where the audience has gone, it’s where the revenues are coming from, and almost all of the cost of a mobile hit is marketing, not development. Look at this from a business perspective; if you want to develop a game on the scale of Metal Gear Solid V, you have to sink tens of millions of dollars (the oft-cited figure for MGSV is $80 million) into it before it’s even ready to be promoted and sold to consumers. That’s an enormous, terrifying risk profile; while the studio next door is working on mobile games that cost a fraction of that money to get ready for launch, with the bulk of the spend being in marketing and post-launch development, which can be stemmed rapidly if the game is underperforming badly. Sure, mobile games are risky as all hell and nobody really knows what the parameters for success and failure are just yet, but with the time and money taken to make a Metal Gear Solid, you can throw ten, twenty or thirty mobile games at the wall and see which one sticks. The logic is compelling, whether you like the outcome or not.
Here’s what nobody, honestly, wants to hear – that logic isn’t just compelling for Konami. Other Japanese publishers are perhaps being more circumspect about their transitions, but don’t kid yourself; those transitions are happening, and Konami will not be the last of the famous old publishers to excuse itself and slip away from the console market entirely. When Square Enix surveys the tortured, vastly expensive and time-consuming development process of its still-unfinished white elephant Final Fantasy XV, and then looks at the startling success it’s enjoyed with games like Final Fantasy Record Keeper or Heavenstrike Rivals on mobile, what thoughts do you think run through the heads of its executives and managers? Do you think Sega hasn’t noticed that its classic franchises are mostly critically eviscerated when they turn up as AAA console releases, but perform very solidly as mobile titles? Has Namco Bandai, a firm increasingly tightly focused on delivering tie-in videogames for Bandai’s media franchises, not noticed the disparity between costs and earnings on its console games as against its mobile titles? And haven’t all of these, and others besides, looked across from their TGS stands to see the gigantic, expensive, airship-adorned stands of games like mobile RPG GranBlue Fantasy and thought, “we’re in the wrong line of work”?
Kojima isn’t the first significant Japanese developer to walk out of a publisher that no longer wants his kind of game – but he’s the most significant thus far, and he’s certainly not going to be the last. The change that’s sweeping through the Japanese industry now is accelerating as traditional game companies react to the emergence of upstarts grabbing huge slices of market share; DeNA and Gree were only the first wave, followed now by the likes of GungHo, CyGames, Mixi and Colopl. If you’re an executive at a Japanese publisher right now, you probably feel like your company is already behind the curve. You’ve studied plenty of cases in business school in which dominant companies who appeared unassailable ended up disappearing entirely as newcomers took the lion’s share of an emerging market whose importance wasn’t recognised by the old firms until it was too late. You go home every evening (probably around midnight – it’s a Japanese company, after all) and eat your microwave dinner in front of TV shows whose ad breaks are packed with expensive commercials for mobile games from companies that hadn’t even appeared on your radar until a year or two ago, and none from the companies you’d always considered the “key players” in the industry. You’re more than a little bit scared, and you really, really want your company to be up to speed in mobile, like, yesterday – even if that means bulldozing what you’re doing on console in the process.
This is not entirely a bleak picture for fans of console-style games. Japanese mobile games really are pushing more and more towards mid-core and even hardcore experiences which, though the monetisation model may be a little uncomfortable, are very satisfying for most gamers; the evolution of those kinds of games in the coming years will be interesting to watch. Still, it will be a very long time before there’s a mobile Metal Gear Solid or a mobile Silent Hill; some experiences just don’t make sense in the context of mobile gaming, and there is a great deal of justification to the fears of gamers that this kind of game is threatened by the transition we’re seeing right now.
I would offer up two potential silver linings. The first is that not all companies are in a position to break away from console (and PC) development quite as dramatically as Konami has done. Sega, for example, is tied to those markets not least by its significant (and very successful) investments in overseas development studios, many of which have come about under the auspices of the firm’s overseas offices. Square Enix is in a similar position due to its ownership of the old Eidos studios and franchises, along with other western properties. Besides, despite the seemingly permanent state of crisis surrounding Final Fantasy XV, the firm likely recognises that the Final Fantasy franchise requires occasional major, high-profile console releases to keep it relevant, even if much of its profit is found in nostalgic retreads of past glories. Capcom, meanwhile, is deeply wedded to console development – it’s a much smaller company than the others and perhaps more content to stick to what it knows and does well, even if console ends up as a (large) niche market. (Having said that, if a mobile version of Monster Hunter springs to the top of the App Store charts, all bets are probably off.)
“Hideo Kojima left Konami because he wants to make a style of game that doesn’t fit on mobile F2P – and that’s, in the long run, probably a good thing”
The other silver lining is perhaps more substantial and less like cold comfort. Hideo Kojima left Konami because he wants to make a style of game that doesn’t fit on mobile F2P – and that’s, in the long run, probably a good thing. He joins a slow but steady exodus of talent from major Japanese studios over the past five years or more. The kind of games which people like Kojima – deeply involved with and influenced by literature, film and critical theory – want to make don’t fit with publishers terribly well any more, but that doesn’t mean those people have to stop making those games. It just means they have to find a new place to make them and a new way to fund them. Kojima’s non-compete with Konami supposedly ends in a few months and then I suspect we’ll hear more about what he plans; but plenty of former star developers from publishers’ internal studios have ended up creating their own independent studios and funding themselves either through publisher deals or, more recently, through crowdfunding. Konami’s never likely to make another game like Castlevania: Symphony of the Night, but that doesn’t stop Koji Igarashi from putting Bloodstained: Ritual of the Night on Kickstarter. Sega knocked Shenmue on the head, but a combination of Sony and Kickstarter has sent Yu Suzuki back to work on the franchise. Keiji Inafune also combined crowdfunding money with publisher funding for Mighty No. 9. Perhaps the most famous and successful of all breakaways from the traditional publishing world, though, is of a very different kind; Platinum Games, which has worked with many of the world’s top publishers in recent years while retaining its independence, is largely made up of veterans of Capcom’s internal studios.
Whichever of those avenues Kojima ends up following – the project-funding style approach of combining crowdfunding and publisher investment, or the Platinum Games approach of founding a studio and working for multiple publishers – there is no question of him walking away from making the kind of games he loves. Not every developer has his sway, of course, and many will probably end up working on mobile titles regardless of personal preference – but the creation of Japanese-style console and PC games isn’t about to end just because publishers are falling over themselves to transition to mobile. As long as the creators want to make this kind of game, and enough consumers are willing to pay for them (or even to fund their development), there’s a market and its demands will be filled. The words “A Hideo Kojima Game” will never appear on the front of a Konami title again; but they’ll appear somewhere, and that’s what’s truly important in the final analysis.
Over the last few years, competitive gaming has made huge strides, building a massive fanbase, supporting the rise of entire genres of games and attracting vast prize pots for the discipline’s very best. Almost across the board, the phenomenon has also seen its revenues gaining, as new sponsors come on board, including some major household names. Sustaining the rapidity of the growth of eSports is going to be key to its long term success, maintaining momentum and pushing it ever further into the public consciousness.
In order to do that, according to Newzoo, eSports need to learn some lessons from their more traditional athletic counterparts. Right now, the research firm puts a pin in eSports revenues of $2.40 per enthusiast per year, a number which is expected to bring the total revenue for the industry to $275 million for 2015 – a 43 per cent increase on last year. By 2018, the firm expects that per user number to almost double, reaching $4.63.
That’s a decent number, representing very rapid growth, but it pales in comparison to Newzoo’s estimates on the average earning per fan for a sport like Basketball, which represents a $14 per fan revenue – rising to $19 where only the major league NBA is a factor. To catch up to numbers like this is going to take some time, but Newzoo’s research has listed five factors it considers vital to achieving that aim.
Right now, MOBAs are undeniably the king of the eSports scene, and one of the biggest genres in gaming. The king of MOBAs, League of Legends, is the highest earning game in the world, whilst others like Valve’s DOTA 2 are also represent huge audiences and revenues, including the prestigious annual International tournament. Shooters are also still big business here, with Activision Blizzard recently announcing the formation of a new Call of Duty League.
Nonetheless, MOBAs are still the mainstay and if you don’t like them, you’re not going to get too deeply into competitive gaming as a fan. Although their popularity with the athletes is going to make them a difficult genre to shift, Newzoo says that broadening the slate is a key factor to growth.
The major tournaments bring players, and audiences, from all over the world, but it’s often only the very top tier of players who can find themselves a foothold in regular competition. Major territories like the US, South Korea and Europe have some local structure, but again League of Legends stands almost alone in its provision of local infrastructure. By expanding a network of regular leagues and competitions to more countries, eSports stands a much better chance of building a grassroots movement and capturing more fans.
Already a problem very much on the radar of official bodies and players around the world, the introduction of regulation is always a tough transition for any industry. However, when you’re putting up millions of dollars in prize money, you can’t have any grey areas around doping, match fixing and player behaviour at events. These young players are frequently thrust into a very rapid acceleration of lifestyle, fame and responsibility – a heady mixture which can prove to be a damaging influence on many. Just like in other sports, stars need protecting and nurturing – and the competitions careful monitoring – in order for growth to occur without scandal and harm to its stars.
Dishing out the rights to broadcast, promote and profit from eSports is a complex issue. Whilst games like football are worldwide concerns, with media rights a hotly contested and constantly shifting field, nobody owns the games themselves. With eSports, every single aspect of the games being played is a trademark in itself, with its owners understandably keen to protect them. However, with fan promotion such a key part of the sport’s growth, and services like Twitch a massive factor in organic promotion, governing the rights of distribution is only going to become a murkier and more complex business as time goes on. With major TV networks, well used to exclusivity, now starting to show an interest, expect this to become a hot topic.
Conflict between new and old media
That clash of worlds, between the fresh and agile formats of digital user-sourced broadcasting and the old network model is also going to be source of many of its own problems. One or the other, or even both, is going to have to adapt fast for there to be a convivial agreement which betters the industry as a whole. There’s currently considerable pushback from established media against the idea of eSports becoming accepted as a mainstream activity, fuelled in no small part by their audiences themselves, so a lo of attitudes need to change. Add to that the links between these media giants and many of the world’s richest advertisers and you can start to see the problem.
The console business will hit a wall in terms of sales in this generation, and that’s okay. According to Wedbush analyst Michael Pachter, the subsequent shift away from the traditional console model will be a catalyst for even more growth.
Speaking at DICE Europe last week, Pachter discussed a provocative and divisive topic: the end of the console era.
“The console installed base is as big as it’s ever going to get,” he said. “[This] generation is not going to be bigger than the last generation. We’re going to be about the same.
“The Wii U is going to sell 20 million units compared to 100 million for the Wii. The PlayStation 4 is going to sell 120 million or 130 million – that’s great. The Xbox One will sell 100 million to 110 million – that’s great. Add it all together and it’s 260 million units, maybe, and the last cycle was 270 million.”
This take on the trajectory of the PS4 / Xbox One generation must be assessed in the context of a world that contains far more people who play games than at any time in history – thanks in part to the impact of the Wii, and in larger part to the rapid emergence of smartphones and the app economy. If Pachter’s analysis proves to be accurate, it would suggest that consoles are a limiting factor on the growth potential of the games industry, putting some of the medium’s best and most alluring products beyond the reach of the vast majority of people.
“This is the last real console cycle,” Pachter continued. “I don’t mean that Microsoft, Sony and Nintendo will go bankrupt and shut down – they will not. Each of them will make another console, some people will buy them, and the next console cycle will be to this console cycle what the 3DS is to the DS. The 3DS is selling about 15 million units a year, the DS had five consecutive years where it sold more than 26 million. So about half as big.
“So when I say that this console cycle is the last console cycle, the reason is that console games shouldn’t require a console. And I’m not talking about the cloud.”
What games require, Pachter said, is a CPU, a GPU, storage, a controller, and a display. In the coming years, the need to purchase a console to access the first four will be diminished as smartphone and set-top box hardware becomes more sophisticated. By the time this console generation nears its end, “you’re going to have a CPU/GPU in your house that is connected to your television,” whether that be the latest model of the iPhone or a Fire TV box from Amazon.
The switch, Pachter suggested, was simply a matter of the hardware reaching a certain degree of technical sophistication; to use one of his own examples, the point when an affordable set-top box from Amazon can run Call of Duty, a brand chosen by Pachter due to its popularity among online console players. For a publisher like Activision that switch would be easy to justify, opening up the possibility of controlling the multiplayer revenues that currently go to Microsoft and Sony in the form of Xbox Live and PSN subscription fees.
For the consumer, the benefit is the removal of the need to purchase a console, and the ability to exert more control over their gaming habits.
“What happens when you lower the entry so nobody has to buy a console?” Pachter asked. “If Activision sells 20 million copies of Call of Duty to people with a console, how many people would buy it who don’t have a console? I’m guessing 20 million more. To make it easier for the Europeans in the room, how many more people would play FIFA if a console wasn’t required? Another 20 million.
Pachter shared some detailed speculation on how this structure might work, from a publisher charging a dollar or two for monthly access to its biggest online game, to the major publishers forming a consortium that charges one fee and portions out revenue according to which games received the most play. The point, though, is that console publishers have a clear incentive to work out the details, and the consumer has every reason to embrace the change.
“There’s plenty of 30 or 40-somethings who would like to play FIFA or Call of Duty, but they can’t,” Pachter continued. “They’re not going to buy a console for one game, and I’d say that’s true of every single [console] game made. There’s a market of probably several million people who would never buy a console to play the game, but would absolutely buy the game.”
This could be a solution to the problem that flat console hardware sales in a world crammed with gamers highlights. As the number of players on mobile and other accessible platforms continues to grow, making the biggest brands in gaming available to people who see no value in a $400 box makes a great deal of sense.
“I think the traditional gamer market – which has high standards – does broaden. But the only way you actually see a step function change in that is to pull the console out of the equation, and make it open to people who can’t afford or won’t buy a console,” Pachter said.
“I think this shift to full-game digital downloads, where everybody has the opportunity to play a game without having to invest $399 is a huge opportunity. It’s an opportunity for everyone in the value chain, except the retailer and maybe the console manufacturer.”
If Hideo Kojima really is on the outs at Konami, he’s at least going out with a bang. The embargo for Metal Gear Solid V: The Phantom Pain coverage hit last night, and the first batch of reviews are glowing.
IGN’s Vince Ingenito gave the game a 10 out of 10, lavishing praise on the way it adapted the series’ stealth-action formula to an open-world environment.
“Right from the moment you’re told to get on your horse and explore the Afghan countryside, Phantom Pain feels intimidating, almost overwhelming in terms of the freedom its open world affords and the number of concepts it expects you to grasp,” Ingenito said. “It’s almost too much, especially given the relative linearity of previous Metal Gears. But what initially appeared to be an overly dense tangle of features to fiddle with instead unraveled into a well-integrated set of meaningful gameplay systems that provided me with a wealth of interesting decisions to make.”
Whether players choose to sneak their way to victory or go in guns blazing, The Phantom Pain affords them a number of avenues to do so. The game’s day/night cycle and changing weather systems can make certain strategies viable (or not) at any given time. At the same time, a private army management meta-game lets players raid battlefields for resources and new recruits, which can then be put to use researching new technologies or using their skills to open up a variety of other strategic alternatives.
However, a perfect score doesn’t mean a perfect game, and Ingenito does identify at least one weak point in the game.
It’s a somewhat surprising criticism of the game, given Metal Gear Solid 4′s penchant for frequent and extended cutscenes larding the action with exposition and plot twists. While The Phantom Pain shows flashes of that approach (Ingenito noted the “spectacular” opening sequence), it ultimately produces a narrative he found “rushed and unsatisfying.”
Obviously, that failing was not enough to tarnish an otherwise fantastic game in Ingenito’s eyes.
“There have certainly been sandbox action games that have given me a bigger world to roam, or more little icons to chase on my minimap, but none have pushed me to plan, adapt, and improvise the way this one does,” he said. “Metal Gear Solid 5: The Phantom Pain doesn’t just respect my intelligence as a player, it expects it of me, putting it in a league that few others occupy.”
GameSpot’s Peter Brown likewise gave the game a 10 and praised its adaptable approach to missions, but enjoyed the story considerably more than his counterpart at IGN.
“After dozens of hours sneaking in the dirt, choking out enemies in silence, and bantering with madmen who wish to cleanse the world, The Phantom Pain delivers an impactful finale befitting the journey that preceded it,” Brown said. “It punches you in the gut and tears open your heart. The high-caliber cutscenes, filled with breathtaking shots and rousing speeches, tease you along the way. Your fight in the vast, beautiful, and dangerous open world gives you a sense of purpose. The story is dished out in morsels, so you’ll have to work for the full meal, but it’s hard to call it ‘work’ when controlling Big Boss feels so good, with so many possibilities at your fingertips.”
Brown said prior knowledge of the series isn’t a prerequisite to enjoying The Phantom Pain, but added that “Fans of the series will find their diligence rewarded in ways that newcomers can’t begin to imagine.” They’ll also, in his estimation, be enjoying the pinnacle of the franchise.
“There has never been a game in the series with such depth to its gameplay, or so much volume in content,” Brown said. “The best elements from the past games are here, and the new open-world gameplay adds more to love on top. When it comes to storytelling, there has never been a Metal Gear game that’s so consistent in tone, daring in subject matter, and so captivating in presentation. The Phantom Pain may be a contender for one of the best action games ever made, but is undoubtedly the best Metal Gear game there is.”
Eurogamer hasn’t published its full review yet, but Matt Wales weighed in with his impressions to date. Like Brown and Ingenito, Wales underscored the narrative approach as a major departure for the series.
“Beyond an outlandish, action-packed opening sequence… The Phantom Pain is a remarkably economical affair, telling its tale of ’80s cold war subterfuge through snatches of radio dialogue (courtesy of Ocelot), and the occasional return to Mother Base between missions,” Wales said. “It’s fascinating to see such restraint from Kojima, a man well known for his self-indulgence and excess, especially considering that The Phantom Pain is likely his Metal Gear swan song.”
On the gameplay side, Wales said The Phantom Pain “isn’t exactly a radical reinvention of the stealth genre,” but acknowledged the increased freedom players are given to accomplish the familiar assortment of objectives.
“Metal Gear Solid 5′s open world might not be vast, varied or stuffed full of things to do, but it’s a place of constant movement,” Wales said. “Night falls, day breaks, sandstorms sweep in, patrols come and go – and this organic sense of life means that missions are never predictable (no matter how often you play them) with tactical possibilities arising all the time. It’s a game of planning and reacting in a world that refuses to stand still, making every minute matter and every success feel earned.”
“The gameplay, storytelling, and protagonists in Metal Gear may shift with each new installment, but Kojima’s ability to surprise and enthrall gamers remains unchanged.”
He also applauded the way The Phantom Pain managed to adopt an open-world design without the genre’s standard glut of padding.
“[E]verything you do feels meaningful and consequential,” Wales said. “Guard posts and roaming patrols aren’t simply there for colour as you traverse the world: one careless move into hostile territory and every single enemy on the map will know you’re coming, with more search parties and increased security radically altering the way a mission unfolds. And while other games tout choice and consequence as a headline feature, the Phantom Pain just gets on with it. Even the smallest action can have unexpected consequences – some significant and others barely perceptible.”
Game Informer’s Joe Juba gave the game a 9.25, currently one of the lowest scores the game has received on Metacritic (where it has a 95 average based on 15 critic reviews). Like some of the above reviewers, Juba was a bit disappointed at The Phantom Pain’s approach to storytelling, but noted that having the narrative take a step in to the background puts the focus on the game’s strongest point, its open-ended gameplay.
“A series can’t survive this long without evolving, and The Phantom Pain is a testament to the importance of taking risks,” Juba said. “An open world, a customizable base, a variable mission structure – these are not traditional aspects of Metal Gear, but they are what makes The Phantom Pain such an exceptional game. The gameplay, storytelling, and protagonists in Metal Gear may shift with each new installment, but Kojima’s ability to surprise and enthrall gamers remains unchanged.”
The validity of framing the console market as a ‘race’ or a ‘war’ is open to question, but there’s no doubt that it’s a lot more fun when you do. The notion that there is a hard, immovable line between winning and losing simply doesn’t make much sense from a business perspective, but it makes for lively debate and – from an entirely selfish perspective – good copy.
For the first six months of this console generation that was certainly the case: the Xbox One tripping, stumbling and backtracking, with the PlayStation 4 marketing department lying in wait, pointed comments at the ready. Microsoft is dealing with the fallout from that disastrous period even now, its own reluctance to disclose hardware sales figures compounded by Sony’s eagerness to provide an update at every opportunity. At the last count, in July, the PlayStation 4 had sold more than 25 million units. The Xbox One, on the other hand, has sold…. well, we haven’t been given an official worldwide figure in 2015 so far.
In terms of sales, then, it’s very clear which console is ‘winning’ the generation, and it has been from the very first day. In terms of content, though, the debate is more nuanced, the outcome far less certain. Sony’s development resources have long been regarded as a unique strength when compared to Microsoft, effectively guaranteeing a superior crop of exclusive games regardless of how well the PlayStation hardware is selling. Whether that’s still true in terms of first-party studios is almost besides the point, because in terms of available, exclusive games there’s a strong argument that the Xbox has been a more attractive platform since the launch of Titanfall more than a year ago. By the end of this year, that point may well be beyond debate.
“I wouldn’t even say the gap has closed,” says Kudo Tsunoda, one of the leading executives in the Xbox games business. “We’ve got a lot more exclusive games than any other platform.”
Tsunoda and the various studios he oversees are celebrating the second Xbox showcase in less than two months. The first, at E3, is generally regarded as a key battleground within the console war, and a significant proportion of those who watched this year believed that Microsoft emerged victorious despite an impressive showing from Sony. The second, at Gamescom, was an Xbox victory by default, with Sony electing to steer clear of the event for the first time in years. Even so, Microsoft presided over 90 minutes of new games, not all of which were exclusive to the Xbox One, but none of which were on show at E3. Whether those exclusives came from first-party studios (Halo and Gears of War) or via chequebook-and-pen (Tomb Raider and Quantum Break) is largely irrelevant. For perhaps the first time in this console generation Xbox owners have an undeniable right to feel smug.
“There’s a reason we’re able to put on two shows of content together,” Tsunoda continues. “We’ve got seven exclusives coming this holiday, and then everything coming in 2016. Not just the blockbusters, but the ID@Xbox games, the indie games. We’re giving people a lot more.”
Microsoft’s early mistakes have been formative for the Xbox One, its underlying strategy switching from closed and controlled to open and inclusive. Sony recorded several huge PR victories by simply responding to those initial bad choices, but Microsoft has since proved more committed to the stance that Sony initially claimed as its own. An early indicator was Sony’s refusal to allow EA Access onto the PlayStation Network due to stated concerns that it didn’t offer “good value” to the consumer, but just as likely down to competition with its own planned streaming service, PlayStation Now. Microsoft allowed its customers to make that choice for themselves. Had you been asked to guess the stance each company would adopt even a few months before, it’s likely those roles would have been reversed.
Tsunoda repeats the idea that MIcrosoft is ‘listening to the fans’ throughout our interview, making it quite clear that it’s a message the company wants us to hear. However, while it would be naive to believe that any multinational corporation is motivated principally by altruism, the strategy for Xbox One is increasingly guided by consumer demand.
Two incoming services perfectly illustrate the degree to which Microsoft has pivoted since the days of mandatory online checks and a prohibition on used games. Xbox Preview is a more tightly controlled version of Steam Early Access, and just the sort of concept that walled gardens were formed to exclude. Backwards compatibility, meanwhile, demands little in the way of explanation. Equally, its importance cannot be overstated, to the consumers who spend so much on games every console generation, and to those who believe that companies like Microsoft should be treating their creative heritage with more respect.
“With backwards compatibility, it isn’t something that we just think gamers might want,” Tsunoda says. “We know. We’re looking for and soliciting that feedback. It was the number one most requested feature for Xbox One by far.”
Sony has no plans to match Microsoft in this respect, and the possibility of monetising those games through PlayStation Now makes it very unlikely that it ever will. For Microsoft, it’s part of a broader view of gaming with Windows 10 at its core, which should, in theory, unite the previously disparate tendrils of Microsoft’s sprawling organisation. PC and console, past and present, existing in harmony, each interacting with and complementing the other. Cross-Buy, Cross-Play, console to PC streaming; one might say that Microsoft should have been doing this for years already. According to Tsunoda, this is a first step.
“For a long time we’ve had PC gamers and console gamers who weren’t really able to play together,” Tsunoda says. “That’s why Cross-Play is still such a powerful idea. You should be able to play what you love, and play together, regardless of what device you’re playing on. It’s about connecting people.
“With backwards compatibility, it isn’t something that we just think gamers might want. We know”
“It’s a really unique value that only we can offer. You still need very gamer-focused values, but there are lots of things you can do with our technology. We’ve really got a lot more going on [than our competitors]. We’re doing things that can’t be done on any other console.
If Microsoft is pushing towards a more holistic approach to its games business, then a few reminders of its clumsier past still remain. One is perched just below the television directly to our left: Kinect, a device once positioned as an integral part of the future of Xbox, a future that Tsunoda was instrumental in selling to the press and public. These days, though, it feels additive, and that’s being kind. In more than 150 minutes of press conferences across E3 and Gamescom Kinect barely merited a single mention, while a new announcement, the Chatpad, offered a core-friendly alternative to the search and chat functions that represent a huge chunk of why anyone might still use it.
“I don’t think it’s an alternative [to Kinect]. It’s just about giving people a choice in how they can do things,” Tsunoda replies. “There’s still a lot of great voice capabilities that you can use with Kinect, but there’s also a lot of great possibilities for communication with the Chatpad. You can also customise a lot, with specific buttons for specific functions. With everything we do, we’re trying to give people the choice.”
In terms of games, though, Tsunoda offers only Just Dance 2016 as a specific example – which is developed and published by Ubisoft – accompanied by the vague promise that, “There’s still Kinect games coming as well.” This may be what ‘choice’ starts to look like when Microsoft loses faith in one of its possible futures. It should be noted that Kinect is now listed under the “More” section on the Xbox One Accessories page, beneath “Controllers,” beneath “Headsets and Communication,” grouped in the same vague category as the Xbox One Digital TV Tuner and the Xbox One Media Remote.
The fear of obsolescence created by the doldrum in which Kinect now resides also haunts the HoloLens, another promising device that Microsoft has just finished thrusting into the public eye. It stole the show at E3 with an immaculately orchestrated Minecraft demo, only for its limited field-of-view to be scrutinised by the press, and its early utility as gaming hardware to be questioned by none other than the CEO of Microsoft, Satya Nadella.
For Tsunoda, who is also closely involved with the development of HoloLens, the difference between watching a demonstration and actually experiencing it first-hand is more pronounced than any product he’s ever worked on – including Kinect. However, there is more common ground between the two devices than one might think.
“You should think about it in the same way that you would a phone or your computer. It does a lot of things,” Tsunoda says. “Obviously, gaming is a big part of what you do on those machines as well. But that’s what it is: an untethered holographic computer. You can do a lot in the gaming and entertainment space, but it has a lot of other functionality as well.
“Microsoft is a leader in depth-sensing technology: with Kinect, but also the stuff we’re doing with HoloLens as well. A big part of what we’re doing there is an environmental understanding that comes from having pushed our knowledge in depth-sensing. That’s what you’ll see us do as a company. [Kinect] is still a part of the platform, and there’s still Kinect games coming of course, but then also we’re pushing that depth-sensing technology forward with what we’re doing with HoloLens.”
It’s all a part of Microsoft’s future of gaming, whatever that turns out to be. Right now, though, Xbox might finally have emerged from PlayStation’s shadow.
The PlayStation business has had another phenomenal quarter in the first four months of 2015, selling three million PS4 units and turning in an operating income of $160 million from revenues of $2.365 billion. There are now 25.3 million PlayStation 4 units in the hands of players worldwide – a number achieved in less than two full years.
The console continues to be the company’s fastest seller – outpacing the PS2, which took two years and eight months to reach the 20 million mark. Furthermore, thanks to dropping production costs for PS4 hardware, a 12 per cent increase in sales from the same quarter last year translated to a massive 350 per cent rise in operating income.
A strengthening dollar again hurt Sony’s bottom line, having an estimated impact of 15.6 billion Yen on the revenue total of 288.6 billion Yen, but this was massively outweighed by the increase in sales and the efficiency gains of Sony’s operation. On the strength of the results, Sony has added another 20 billion Yen in operating income to the sector’s full year forecast.
The sales rate of PS4 shows a healthily steady growth in player base, returning to a gradual upswing after a huge blip in Q3, 2014. Sony has upgraded it full year forecast from 16 million units to 16.5 as a result – a figure which would show a substantial increase on 2014′s 14.8 million total. By Sony’s own reckoning, the end of Q1 2016 will see nigh on 40 million of the consoles in homes. Vita sales once again went unmentioned in the report, whilst the gradual decline of PS3 continued.
Hardware wasn’t the only success story. Network, (“Network includes network services relating to game, video, and music content provided by Sony Network Entertainment Inc.”) mad almost as much in revenues, netting around 105.8 billion Yen compared to Hardware’s 129.5 billion. The Other category (Other includes packaged software and peripheral devices) brought in 30.6 billion.
Overall, the corporation turned a healthy profit, banking $676 million in net from sales of nearly $15 billion. Whilst the PlayStation business is very healthy indeed, it’s far from Sony’s only, or even biggest, success story: Devices, Imaging, Financial Services and Music all continue to return a higher operating income.
It is possible that one day we will report on which companies made it through the night without being hacked or without exposing their users.
For now, though, the opposite is the norm and today we are reporting about a problem with gaming system Steam that, you guessed it, has dangled the personal details of punters within the reach of ne’er-do-wells.
The news is not coming out of Steam, or parent Valve, directly, but it is running rampant across social networks and the gaming community. The problem, according to reports and videos, was a bad one and made the overtaking of user accounts rather a simple job.
No badass end-of-level boss to beat here, just a stage in the authentication process. A video posted online demonstrates the efforts required, while some reports – with access to Steam’s PR hot air machine – say that the problem is fixed.
A statement released to gaming almanac Kotaku finds the firm in apologetic clean-up mode.
Steam told the paper that some users would have their passwords reset, those being the ones who might have seen their log-in changed under suspicious circumstances, and that in general users should already be protected from the risks at hand.
“To protect users, we are resetting passwords on accounts with suspicious password changes during that period or may have otherwise been affected,” the firm said.
“Relevant users will receive an email with a new password. Once that email is received, it is recommended that users log-in to their account via the Steam client and set a new password.
“Please note that, while an account password was potentially modified during this period, the password itself was not revealed. Also, if Steam Guard was enabled, the account was protected from unauthorized log-ins even if the password was modified.”
The firm added its apologies to the community.
The last of the console makers is ready to sign up to AMD chips, according to the latest rumor
Some details are now coming to light on Nintendo’s upcoming NX console. The console will be in the shops in a year’s time, but we might know who’s building the NX’s chips.
AMD will manufacture the CPU + GPU combo, giving the outfit total control of the console market. It was pretty much a no brainer. AMD created the APUs found inside the Xbox One and PlayStation 4. Although it is getting increasingly difficult to tell the consoles apart.
AMD’s CEO, Lisa Su, confirmed that the company had a new chip contract. Su said the deal could generate billions, but she did not identify the customer .
It now seems she was referring to the Nintendo deal, which means she is more optimistic about the products’ success than us.
The NX will be based around the Android operating system and should released some time next year. Nintendo is saying nothing about the deal at the moment.
AMD is needs more deals like this if it is going to turn around its dependence on the ever-shrinking PC market. There are only so many consoles that made every year and AMD appears to be inside them all.
Last week it was reported how Geeknet Inc. was in the process of being bought out by retailer Hot Topic for $16 a share or $37 million in cash.
However we have just discovered that deal was squashed because Thinkgeek got a better deal from Gamestop.
GameStop offered $20 per share and Hot Topic wanted away. GameStop’s $20 per share deal also includes $37 million in cash and comes out to a total valuation of $140 million.
Geeknet must pay Hot Topic a three percent “break-up fee,” which GameStop has agreed to reimburse.
What this will mean is that ThinkGeek customers can pick up ThinkGeek merchandise in GameStop stores.
The press release also mentions the potential of offering GameStop PowerUp Rewards members “exclusive, unique and cutting edge merchandise related to their favorite entertainment.”
The deal should be concluded by the end of GameStop’s second financial quarter of 2015, which will happen in August.
For a while now, people had been wondering what the next Wii would be called, with smart money being on the Number 2. However it seems that the new console dubbed the Nintendo NX has a few surprises under the bonnet.
According to Nikkei Nintendo is planning an Android console so that game developers would be able to port their games over with relative ease.
This could also indicate that games developed for the Nintendo NX could extend to other Android-powered devices like smartphones and tablets, play nice with the console.
Games developers have been ignoring the Wii U in droves so this might actually help Nintendo get back into the race.
Android-powered consoles have appeared before but they died horribly in the market place.
There’s something genuinely surreal about sitting down to write an article about region locking in 2015. It feels archaic and almost nostalgic; I might as well be writing something about blowing into cartridge ports to get games to work, or bemoaning the long load times for cassettes. Yet here we are. Years into the era of digital distribution, long after we reached the point where it became technically harder to prevent customers from accessing games from anywhere in the world than it is to permit the same, region locking is back in the news. Thanks, Nintendo.
The focus of this week’s headlines is the Humble Bundle promotion which Nintendo is running for a number of indie titles on 3DS and Wii U. It’s a great deal for some excellent games and is raising money for a solid cause; plus it’s wonderful to see console platform holders engaging with the Humble Bundle approach, which has been so successful at bringing indie games (and other creative works) to wider audiences on the PC. It ought to be a win, win, win for Nintendo, gamers and indie developers alike.
Unfortunately, though, the bundle only works in the Americas; North America and some bits of Central and South America. Customers elsewhere are entirely locked out, a matter which has been a source of deep frustration not only to those customers, but also seemingly to Nintendo’s own staff working on the project. The result is that what ought to have been a straightforward PR win for the company has turned bittersweet; there has been more widespread news coverage of the region locking debacle in the past few days than there has been for the bundle itself.
Although this is a terrible shame for the developers involved – and I sincerely hope that Nintendo can pull its thumb out of its backside and launch an international version of the bundle in short order – no sympathy is due to Nintendo in this situation. It’s a problem entirely of the company’s own making; the firm made a deliberate and conscious decision to embrace region locking even as the internationalisation of digital distribution made that look increasingly ridiculous, and until that stubbornly backwards piece of decision making is reversed, it’s going to continue causing PR problems for the firm, not to mention genuine problems for its most devoted customers.
Remember, after all, that the rest of the gaming world has ditched region locking en masse – Sony gave it up with the PS3, even making it painless to use digital content from different regions by creating multiple accounts on the same console, while Microsoft made region locking optional on Xbox 360 (making a bit of a mess where some publishers enforced it and others didn’t) before ditching it entirely on the Xbox One. At the same time Nintendo, ever the merry contrarians, went the opposite direction, not only maintaining region locking on the Wii and Wii U, but even extending it to the 3DS – in contrast to the company’s prior handheld consoles, which had been region free.
The idiocy of a region locked handheld is staggering; these are systems which are quite simply at their best when you’re traveling, yet lo and behold, Nintendo don’t want you to buy any games if you go on holiday or on a business trip. The excuses trotted out were mealy-mouthed corporate dishonesty from start to finish; it was all about protecting customers, honest, and respecting local customs and laws. Utter tosh. Had those things been a genuine issue, they would have been an issue in the previous decades when Nintendo managed to sell handheld consoles without region locking; they would also have been an issue for Sony and Microsoft when they removed region locking from their systems.
In truth, there’s only one reason for region locking in this day and age – price control – and Nintendo’s calculation must have been that they had more to lose from the possibility, real or imagined, of people buying cheaper 3DS games from countries overseas, than they had to lose from annoying a chunk of their customer base, be they keen gamers who wanted to try out titles unlikely to be released in their regions, expats who want to play games brought from their home countries or parents who find that a game bought in the airport on the way home from holiday results not in a pacified, happy child on the flight but in an angry, upset child with a game that won’t work.
In Nintendo’s defence, Satoru Iwata has recently been musing publicly about dropping region locking from the Nintendo NX, whenever that turns up. That the company is clearly planning to move down that path does rather confirm that it’s been fibbing about its motivations for region locking all along, of course, which might be why Iwata is being cautious in his statements; it’s a shame if such face-saving is the reason for Nintendo failing to keep up with industry moves in this regard, because the company is going to keep being periodically beaten with this stick until the problem is fixed.
Admittedly, there would be problems with removing region locking from its existing consoles – not least that Nintendo’s agreements with publishers probably guarantee the region locking system, so even if it could be patched out of the 3DS and Wii U with a software update, that can’t happen legally due to the contracts it would breach. What Nintendo could and should do, however, is to offer gamers a gesture of good faith on the matter by dropping region locking from all its first-party software from now on – and perhaps emulating Xbox 360 era Microsoft by making it optional for third-party publishers as well. I can envisage no legal barrier to that approach; it would earn the company enormous kudos for responding to its audience and dealing with the problem, and would cost them precisely nothing. There aren’t that many easy PR wins floating around the industry right now; Nintendo should leap on this chance to show itself to be on the customers’ side.
Wheels turn slowly in Kyoto, though, and it’s probably too much to expect the company to react in a startup-like way to the region locking issue. In some ways it’s Nintendo’s strength that it reacts slowly and thoughtfully rather than jumping on every bandwagon, but in recent years, it’s also been a weakness far too many times – and the thoroughly wonderful software that the company has been turning out in the past few years, perhaps the finest line-up it’s produced in decades, has been regularly undermined by bad decisions in marketing and positioning of its platforms, many of which can be traced to a failure to understand where the market is and where it’s moving.
Region locking isn’t the biggest problem. Fixing it would be cheap and easy but would hardly be a panacea for Nintendo’s issues – but it’s a problem that’s symptomatic, emblematic even, of the broader problems Nintendo has with putting its customers first and applying the same care and attention to its corporate aspects which it always applies to its software development. Fix a problem like this in a proactive, rapid way, and we might all start to believe that the company has what it takes to get back on top.
At Sony’s 2015 Investor Relations Day today, Sony Computer Entertainment president and global CEO Andrew House detailed the company’s strategy for the coming year, including how it will address some shortcomings.
House began his presentation on a positive note, talking up PlayStation 4 as “the fastest selling hardware platform in our history,” showing better-than expected growth and pushing PlayStation Plus subscriptions to twice what they were in fiscal year 2013. He said the company has a competitive advantage for the moment, and laid out three ways it hopes to maintain that. In addition to next year’s launch of the Project Morpheus virtual reality headset and continued cost reduction efforts, House said the company needs quality software.
“We are working very hard to continue very strong support from third-party pubs and devs,” House said. “Our first-party lineup is a little sparse this year, so I think this places even greater emphasis on getting good third-party support.”
That doesn’t necessarily mean exclusive third-party support. To date, House said Sony has been primarily trying to get multiplatform developers to simply take advantage of features the PS4 has over the competition, like SharePlay, or maybe include extra content in the PS4 version or give players early access to add-on content. Third-party exclusives are still an option, just not a frequently used one.
“I will admit that these are, in the current publishing landscape, few and far between, but we were able to announce a full exclusive around a franchise like Street Fighter so that Street Fighter 5 is a complete exclusive for PlayStation 4,” House said, adding, “Although given publishing dynamics and development costs, those are increasingly difficult to secure.”
House also talked about the decline in Sony’s other platforms. As much as the PS4′s growth has exceeded expectations, so too has the PlayStation 3′s decline. House said the system’s price simply isn’t as competitive in the market as the PlayStation 2 and PSone were after their successors launched, and added that the shift toward more connected console experiences has also made less capable offerings less attractive.
House also cast a dim view of the company’s handheld business. While he noted that the Vita platform remains “strong and vibrant” in Asia and Japan, his outlook for the current fiscal year included declines in the US and Europe. Additionally, he referred to the PlayStation Vita and its microconsole counterpart the PlayStation TV as “legacy platforms” when discussing a write-off of hardware components for the two.
“I would characterize 2015 as the beginning of a harvest period for the PlayStation 4 platform,” House said. “The beginning of a harvest period. That being said, we are also undertaking to invest in the future, and 2015 will also be a year of investment.”
That investment will be focused on a few areas. There’s the Morpheus, of course, as well as continued spend on original PlayStation entertainment content like the TV show Powers (which was recently greenlit for a second season). On top of that, House said Sony would be investing in the expansion of its PlayStation Vue television streaming platform and a continued re-architecture of its PlayStation Network with an eye toward increasing stability and reducing maintenance downtime.