And thus the effects of a "red ocean" strategy are made apparent. The ultimate side-effect of competitiveness is that it always tends towards perfect competition (wherein nobody can win, as to the consumer, there is no significant difference in products).

Ultimately, you cannot win when you have a "red ocean"; everybody gets a piece, but nobody gets the lion's share.  If somebody does, it's because they're bigger than everybody else and can out-muscle them (as the PS2 did for the GameCube and XBOX).  The venture towards perfect competition happened at large with the SNES and Genesis, and it's happening again with the PS3 and 360. While one has technically inferior hardware (Genesis; 360), that system has the head start to keep it moving; but ultimately, the advantage will approach zero and be nullified.

As for what you can do about it, the only viable option is to start over from scratch with a new product that either follows a "green ocean" (invade a newly established market) or "blue ocean" (establish a new market) strategy. No attempt to shoehorn a system with disruptive innovations has ever worked (Sega CD and 32x are excellent examples; the SNES CD would have been too, had Nintendo not canceled it when they saw the failure of the Sega CD).

NJ5,

yes, MS, 5 years ago ...

 You think rpg fans will care about xbox once FF13 hits, get real dude.

Singstar Buzz PS eye and all the PSn games, what not casual mini game enough for you ?

There future line ups thats what sets them apart.  Sony far far superior 1st party sets them apart.

Sure you can have COD DMC GTA whatever on 360, but on PS3 you can have all that and all the huge franchises like Final Fantasy Gran Turismo Metal Gear Solid Gopd of War.

Its easy to see what the cinsumers will choose. 

yahh but BIG diffeance is

5 to 7 million will pick up MGS
5 to 10 million will pick up FF
while 360 has two 1.7 million sellers.

From those two games you just showed a potential market sales breakdown of 83% Sony, 17% MS

Those HUGE Fanchises set them apart. You get what iam saying ? Look at Forza and PGR compared to GT5p sales numbers, its clear as day they have failed to sway the GT/car nuts onto the 360 away from the PS brand. While 360 has good games, it does not have the huge franchises.

There is no brand confusion.

Theres only one console you will get

Final Fantasy
Gran Turismo
Metal Gear Solid
God of War
High def disk

360 only has the shooter advantage.
Halo
Gears

 you say the ps3 has a far more diverse line-up because of two games!?!?  great - i see your singstar and buzz and raise you viva pinata and Scene it.  I see your FF13 and see you blue dragon and lost odyssey.  I see your psn and raise you xbla.    resistance/halo - bioshock. uncharted/gears of war.  gran turismo/project gotham - forza.  these two systems are 90% identical and the first party on either system is tit for tat.

You say that the future line up is what sets them apart.  I think what you've done is make an assumption that the ps3 will see the same kind of diversity that the ps2 did but forgot to take into account that that diversity was made up of third party support not first party.  the very same third party support that is treating this gen like there are two systems:  wii and ps360. 

 Not at all.  He's talking about massmarket conditions, and your average consumer has no gaming PC.

In general, I pretty much agree with the OP.

Microsoft will hold a price advantage, and Sony holds the Blu-Ray advantage. Microsoft has more good games, but that should alter by the time the two consoles have mass market prices, by which time they'll be about equal on the gaming front.

the only thing that the ps3 has that the 360 doesn't have is Blu-Ray

other than that the 2 consoles are virtually identical for the gaming experience they offer.

both have online
both have shooters
both have rpg's


in terms of the average person- the casual person, Neither is the choice for them at this time.

however once both drop- for their main systems- to under 200, then and only then will it be worth it for the casual,

and then it'll be the ps3 that is the better Buy.. Because of the Built in profile 2.0 blu-ray player.

I don't think MS will make another console to compete with Sony. MS is in this for money, and the money is being made by Nintendo. Plus, Sony is in a much better position to make the next generation cheaper. MS already said it's going with digital downloads only on there next console, so I don't see it having 50 gig games.

This generation, it's very clear that there is a distinction, otherwise we would not have so many flamewars over it. Next generation will be even more clear because I think they will go after different markets.

I think MS will be successful in that direction too. There only drawback in both attempts at making a console was the hardware. Remove that from the equation (meaning make something that's not so cutting edge), and I think MS can succeeded on what they do best.

The 360 experience is a great one if the box would just stop breaking.