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Forums - Gaming Discussion - Sean Malstrom: Alas, Microsoft-Why Microsoft will leave the console market

RolStoppable said:

It's a great article about Microsoft's videogame business and their questionable business practices. Malstrom is definitely right when saying it's not the question IF Microsoft will leave the console market, it is WHEN.

I also thought about the possible future of the videogame industry as a whole if Nintendo really totally dominates this generation with the Wii. If so, MS and Sony would take billions of losses since their loss-leading strategies will fail badly.

When Sony took the lead in this market they were competing against a weakened Sega and against an arrogant Nintendo causing 3rd parties to drop support. The N64 era was Nintendo's worst time in this industry considering their decisions and arrogance. The gamecube era was a lot better, although with going into the race again with 18 months trailing wasn't wise. The gc strategy wasn't good either, as we know trying to become market leader just by doing the same things as the competition better, does not succeed. The Wii is a totally different beast that will rise Nintendo back to the #1 spot, which they deserve.

So after this 7th generation Sony would have to compete with the strongest Nintendo we have ever seen. Just doing the same as Nintendo, only better won't give Sony again the lead. They would need to have some disruptive element to this industry again. After all, the new market leaders in this industry always took the top spot because they had disruptive business strategies.

Given the fact that Sony is/was never really innovative in this business I don't see any reason why they would have a chance against this mighty Nintendo. The risk to lose again lots of money in this business will be far too high for Sony. Plus they need a new brand since the PSP and especially the PS3 are hurting the playstation name.

As for Microsoft, well, they have the cash to do some more Xboxes, but why would they continue to throw money into this business once their primary reason to enter the industry has gone.


 Holy smokes dude. Could you put more anti sony, and more pro nintendo in something like that without trying to sound like an absolute fanboy?



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To be fair to Sony you really have to give them credit, not only did they push for Cd-rom based games, but they created a much friendlier environment for third parties, and their biggest acheivment is creating a market for mature games. Right now that's what Nintendo is doing expanding the market, but Sony was the first one to do it. Alot of older guys who considered gaming for kids started picking up playstations to play sports games then slowly shifted to other titles. Plus anyone who loves Nintendo now also has to thank Sony if it wasn't for them serving humble pie to Nintendo the last decade god only knows what crazy Nintendo cart based contraption we'd be playing right now.



fooflexible said:
To be fair to Sony you really have to give them credit, not only did they push for Cd-rom based games, but they created a much friendlier environment for third parties, and their biggest acheivment is creating a market for mature games. Right now that's what Nintendo is doing expanding the market, but Sony was the first one to do it. Alot of older guys who considered gaming for kids started picking up playstations to play sports games then slowly shifted to other titles. Plus anyone who loves Nintendo now also has to thank Sony if it wasn't for them serving humble pie to Nintendo the last decade god only knows what crazy Nintendo cart based contraption we'd be playing right now.

To be honest I really agree with what you say. (whoa that's one of those rare times)

Someone was talking about SE re-releasing their old games, and re-makeing them as well.

The DS could supposedly do a PS1 game, becuase the DS can do a N64 game. However games like FF7-9 are likely to never be seen on the DS, unless they would have diffrent cutscenes. Because it would need a 2gb memory to do that. And that is gonna be expensive to make. The PSP could easily do FF7-9. But since they are coming from the PSN, you would need to have a memory card. But Hey, the PSP can have (today) a 4gb memory stick, and in the near future a 8gb is coming... (88$ for the 4gb)

I think that for 'epic' games the DS has already screwed itself by going cartridge. Especially due to the cartridge's size. It's kinda. Small. (GBA size cartridge is better becuase of cheaper memory) There are so many games that are epic/quazi epic, and so many more coming. The DS, has some epic ones, but they all resemble SNES style Epic.



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I could be wrong but I don't think companies like Microsoft and Sony entered the gaming market because of the potential profits from gaming alone; besides market leaders (and Nintendo) there really isn't that much money to be made from being a console manufacturer. Ultimately, I think these companies are looking for their profit through leveraging their marketshare in the gaming market to gain greater profits in another market.

Personally I doubt that these companies would give up and leave the gaming market without either being forced out (from consumer rejection) or because their marketshare became too small to gain any benefit from staying in the gaming market.



HappySqurriel said:

I could be wrong but I don't think companies like Microsoft and Sony entered the gaming market because of the potential profits from gaming alone; besides market leaders (and Nintendo) there really isn't that much money to be made from being a console manufacturer. Ultimately, I think these companies are looking for their profit through leveraging their marketshare in the gaming market to gain greater profits in another market.

Personally I doubt that these companies would give up and leave the gaming market without either being forced out (from consumer rejection) or because their marketshare became too small to gain any benefit from staying in the gaming market.


 I'm not really sure what sony has to gain from being in the console market, other than profits from it, as the PS2 + PS1 did NOT look best on a high dollar sony TV, or a high dollar Sony sound system. Hell, the graphics looked rough on ANYthing.

What does microsoft have to gain? The lack of monopoly? The ability to say. "Hey, we do more than just consoles." 



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Whoa! I'm still on paage 8, but it's a great read. Love to comment more, but I must finish.



honestly Sony has been innovative.. two analog sticks, EyeToy, DVD-Drive, and HD Drive for gaming. They will innovate more, a lot more. Maybe not as much as Nini this gen but they are definitely adding to what they did in the past and improving upon them. HD EyeToy where you can scan yourself into a game, that one game eyedentity, Home.

 

but still good article.. yes M$ will probably pull out this gen.. they have a slim chance of making a profit with their over advertise everything style marketing approach.  And yes we will see Halo 3 ads for no apparent reason. Will it need it.. no. 



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Kwaad said:
HappySqurriel said:

I could be wrong but I don't think companies like Microsoft and Sony entered the gaming market because of the potential profits from gaming alone; besides market leaders (and Nintendo) there really isn't that much money to be made from being a console manufacturer. Ultimately, I think these companies are looking for their profit through leveraging their marketshare in the gaming market to gain greater profits in another market.

Personally I doubt that these companies would give up and leave the gaming market without either being forced out (from consumer rejection) or because their marketshare became too small to gain any benefit from staying in the gaming market.


 I'm not really sure what sony has to gain from being in the console market, other than profits from it, as the PS2 + PS1 did NOT look best on a high dollar sony TV, or a high dollar Sony sound system. Hell, the graphics looked rough on ANYthing.

What does microsoft have to gain? The lack of monopoly? The ability to say. "Hey, we do more than just consoles." 


So, why does UMD exist? Why does the PS3 use Blu-Ray? I'll give you a hint, one of the main factors attributed to the decline in Music sales is not piracy but is (in fact) that people are no longer rebuying the content they already own; how many 50 year olds ended up buying the White album on LP, 8-track, Cassette and CD?

Anyways, I can't say for certain what the motivating factors for Sony has (historically) been but I suspect that the original Playstation was released because Sony wanted to recover lost R&D costs from the SNES-CD; I can't recall all of what the PS2 was hyped to be, but Sony was promising a lot of web-tv functionality which was (for some odd reason) seen to be a big selling feature and a potentially profitable venture in 1998. I suspect the main reason we never saw a lot of the PS2's functionality fleshed out was that (most) people realized how useless it was before the PS2 launched.

 



Ms is software.  They should have entered the market as a software company.

 

so,  Apple console in 2010 ? Igame



Ok wow YOU HAVE TO BE KIDDING? Sony will leave the console gaming industry? ARE you talking about the same industry they currently have the lead in? the same industry that helped them so much in the Past.? The PS3 will sell this generation just fine. Even if Sony makes the decision to take heavy losses on PS3 to maintain sales dominance they will do it. The Fact is Sony and Microsoft compete with each other not with Nintendo.

The day has lok since passed that you could say Sony has not contributed to gaming. God of War is one of the best Ip's ever. Grand Turismo changed the racing sim. They pionered the DVD format (Nintendo got on board a lil late on that) Some of the most Epic games ever have been only on a Playstation system.

I guess if using the same damn characters in a handfull of Mediocre games over the last 15 years is innovation. Score one for Nintendo. You make one wierd motion controller and now all of a sudden Nintendo has been Innovative for the last 20 years? I own a wii I like it but I also had a GC and N64 those consoles never were better than my PS or PS2

Lastly the only way Sony or Microsoft is getting out of gaming is if they go bankrupt. I'll go 1 step further If Wii wins this round Nintendo needs to watch out because for the fist time Microsoft and Sony will be taking dead aim on them instead of each other.