Analyst: Console Industry in danger. PC and Mobile gaming keep growing

[Final-Fan]

shio said:

Final-Fan said:
His argument is weak IMO, and many supporting points are not substantiated in this article.

His argument is not weak. The biggest growth the console industry has is at the start of every generation, due to the release of new consoles. What he's saying is that, because of a deliberate prolongation of this generation, the console industry will grow slower without that impulse in sales. Then add the fact that other types of gaming markets are becoming cheaper and cheaper, like PC and iPhone.

His "two major concerns" are:  

1) Consumers have a rapidly increasing abundance of choice among low cost games and other entertainment products and;

2) The five-year console model that has driven industry growth in the past is currently not working for Sony and Microsoft.

1.  Many such games are on the consoles e.g. on XBLA, PSN, and WiiWare.  I don't know how he figures this is going to doom the console industry. 

2.  I presume (from the "Sony and MS" comment and from other parts of his article) that he's talking about the expensive-hardware, loss-leader-strategy consoles that have become popular in the last two generations.  Considering that the Genesis/SNES, N64/PS/Saturn, DC/PS2?/GC, and Wii have all avoided this strategy to varying levels of success versus the PS2?/Xbox and PS3/360, I would say that his "the traditional console generation model is doomed" theory seems very questionable, since his argument rests on the disruption of things that have not been happening for most console generations. 

Even if (as seems likely) Sony and MS do not attempt (in their next consoles) to have technology as cutting-edge as what their current consoles had at launch, there is still plenty of advancement to be had by a generational hardware refresh, not least of which may be the new consoles' controllers.  The next generation may (IMO will) start a little later, but to say that the consoles' generational model is going to be totally disrupted is IMO hogwash. 

His argument, in my eyes, rests on seeing the worst [edit:  and unlikeliest] of these situations: 
--The PS3 and 360 style of hardware advancement is unsustainable, so (instead of toning down the tech) the console generations will be torn asunder!!
--Nintendo has a more dominant third party, so (instead of much of that being due to former terrible third-party involvement and there being plenty of slices of an expanded pie to go around anyway) third parties will be crippled in a Nintendo-dominated market!!!