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Ballmer - Xbox 'Can Take Sony' In Next Generation
An anonymous reader writes "According to GameSpot, a Q&A with Microsoft CEO Steve Ballmer has him saying that, although the company's Xbox game console isn't making money (or bleeding them dry), the pain has been worth it. 'We have gone from nowhere to a significant player,' he said, adding: 'I am betting we can take Sony in the next generation.' Guess things are set to get even more interesting with the forthcoming next-gen console launches."
Sadly, I'm guessing that Ballmer's crass remark may end up being true if Sony take too long to release the PS3. At the very least Microsoft will make big inroads in western markets, and stand to do well in Asia if (a) the console is much sexier than the current version, and (b) they managed to sign some big Asian games studios. Admittedly neither of these is very likely.
I have no problem if Microsoft become a bigger player in the console market. The original XBox definitely raised the standards of what we could expect from console performance, and without XBox there would be no one to keep Sony honest*. What I don't want to see is Microsoft pulling a Windows on the console market. That would be very bad for all involved, and would just give Ballmer the meathead more to crow about.
*Yes yes yes. Gamecube, Dreamcast, Phantom, blah blah. Anyone honestly think they could keep Sony honest?
gadgetophile.com
Sony can take over the world ... in Japan
Microsoft hasn't successfully entered a market since the browser wars. When the histories are written in fifty years, Microsoft's peak will be said to have been in 2000. They are starting to lose share in browsers. They are not dominating the PDA market like they wanted to. They are not the king of set top boxes. They are slowly but surely losing the server market. Despite reams of hype and much marketting muscle on Microsoft's part, Sony still sells ten Playstations for every Xbox.
Microsoft is where IBM was in 1980. They are on top, but headed for a fall. The reason? Because despite the rhetoric, Microsoft can't innovate. They can only copy.
The cake is a pie
Wake me up when the next console is ready to be sold, give me full tech specs with game screenshots, and I might give it a nod.
If the world moves too fast on these, small to mid-sized developers won't have the time to develop a game for the current console -- they'll always be anticipating the next generation and games will cease to be polished.
Oh, in case you're one of the young ones and don't understand that last one, click here for the version that panders to your generation.
Suuuure Stevie! That Ballmer, he cracks me up.
The sad thing is that Balmer may be right:
1) The current Xbox is losing money, but the Xbox 2 will be built with cheaper materials (esp. Flash memory, instead of a hard drive)
2) The current Xbox has much better graphics than the PS2, and there is no reason to believe that this will change with the Xbox2/PS3 3) Microsoft is hell-bent on dominating the console market (watch the discovery channel special "Inside the Xbox").
4) They believe that if you control a family's entertainment, you essentially control the family (again, from "Inside the Xbox")
This is one market MS cannot afford to lose. They will throw everything they have at it.
"I'd guess they're just breaking even"
Last I heard, Microsoft was losing money hand over fist in their game console division. Part of the problem is that they lose money on every console sale. They might be breaking even in software sales; they're hampered a bit by an unwillingness to port to other platforms. Makes it harder to make money when you skip part of your potential market.
I think you overestimate the number of people in the world that are interested enough in Linux to try installing it on a game console. When we're talking sales in the tens of millions of consoles... the number of uberl337 linux haxors is pretty insignificant. ;)
the vast... and I mean VAST majority of console consumers don't know jack from squat when it comes to computer components, let alone the inner workings of Linux. I suppose the current Xbox attracted a few due to it's pc-esque architecture, but I seriously doubt that will happen again. Even if it does, as I said, we're talking about a miniscule percentage of the gaming populace.
But perhaps I completely missed your point? I tend to do that sometimes.
Get Virtual.
They always seem to get so ahead of themselves. They need to learn that using computer hardware may give the system a bit more power, but it also makes it ten times easier for people to rip apart and mod, and in the end it costs microsoft more money. Xbox2 may be a good system but they just dont have the backing like Sony does when it comes to game companies, Sony has Square-Enix, Capcom and other major ones putting their biggest games out on the PS1/PS2 and now PSP.
> But every four or five years, there will be a
> competitor or two with credible competition.
I don't believe this is the case with consoles.
Nintendo, Sega, Sony and maybe one or two others essentially created this market from scratch; MS was able to enter it only because they had such huge cash reserves that they could afford to buy their way into it. Very few other companies would be in this position.
The days of the likes of Coleco and Atari coming up with big innovations in consoles are well and truly past.
I wouldn't say Microsoft really came out of nowhere and almost tied Nintendo is representative of Microsoft's strength in the console biz. It's more along the lines of how weak Nintendo was earlier this year. Nintendo *really* stumbled recently, and Sony took a huge lead because of it. MS basically had a free ride because of that, as well.
There's a few things stopping MS from winning the console wars.
1. Japan is EXTREMELY Xenophobic. They aren't going to sell out their extremely LARGE (highest pre-selling American game: Zelda at 700k units. Highest pre-selling Japanese game: Dragon Warrior 7 at 3,000k units.) console market to a "Gaijin" company without VERY good reason. The XBox is NOT good enough to make them give up their stranglehold on the market.
If you don't get why Japan is where the console wars will be won or lost, let me point it out to you. 99% of all successful console games in the past 20 years have been from Japan. The only exception I can think of is Halo -- and that was a PC game which had it's XBox port released a year before the PC version. Unless Microsoft can invade and make progress in Japan, they will NEVER make any headway in the console market. Period.
2. Sony might drop the ball but the chances of them truely screwing up the PS3 is *very* slim. Yes, the cell processor is a gimmick and a scam, and will fall flat. The PS3 will almost definately be a success, however, because of sheer inertia.
The only thing that could really kill them is if their arrogance makes them do the same kind of stupid errors that Nintendo did in the late 80s that put Big N in the spot they are now (basically being arrogant asses, pissing on 3rd parties and trying to push people around). Granted, the PSP and their repeated micromanagement with stuff like Final Fantasy 11 in the US kinda hints at that same kinda arrogance... However. Nintendo would be far more likely to capitulate on this than Microsoft.
3. Nintendo is *not* going to be idle during all this. Nintendo blew *everyone* out of the water this E3. Sony had a mock up of a unfinished portable with a 2 hour battery life. Microsoft had games they announced a year ago. Nintendo had a playable version of their new portable and about 9 bombshell announcements, one after another. The "Reggielution" as it were got so many people fired up that it really breathed some very much needed fresh air into Nintendo's sails.
Nintendo is calling their next console the Nintendo Revolution. This represents Big N's new thinking -- that horsepower isn't going to be enough to win the next generation of console wars. They're right. The DS completely blew everyone away who saw it, not because it was so graphically potent -- although it was quite nice -- but rather, because it brought so many NEW THINGS to the table. Touch pad, Wireless Link, WIFI Internet on a portable, 2 screens, etc. These are going to bring new games, and new WAYS to play games, and that is going to push sales.
In other words -- Japan has 2 huge titans gearing up for a *huge* battle for #1. There's no room for some silly spoiled foreigner brat of a company to try and push their way in. Especially when all they can muster up for information at the largest console convention in the world is some new screenshots of a game that was announced at last year's E3. Unless Microsoft gets serious, they're not going to be getting anywhere.
Seriously, anywhere else a moneypit like the XBox would have been put down for the greater good.
...but it bled money, it was always sold at a loss. That doesn't strike me as a stellar business model.
I am not saying it is a crap piece of hardware, on the contrary I enjoy it, there are some sweet titles for XBox and the extras you get even on an unmodded XBox vs. the PS2 are great...
The real story is: how is MS going to make it profitable? There is money to be made in the console market... what's their angle?
They turn a profit. RTFA. MS is losing money on the Xbox. That pretty much means its not a successful product right there.
If you think that's not important in deciding whether or not it's successful, I've got some dot-com shares to sell you.
And the brethren went away edified.
1. Japan is EXTREMELY Xenophobic.
No they're not. That's a very old and closed-minded view from someone that obviously hasn't spent much time in Japan. You are simply perpetuating a stereotype and passing it off as an excuse as to why the Xbox didn't do nearly as well as it should have. Here's a hint: a console won't do well if the target marget is not interested in the games. Pretty simple.
dont know if anyone has mentioned this, but it usually takes MS three tries to get something functional and somewhat compelling.
we've seen this in categories like
desktop OS
Server OS
Databases
Browser
IDE
PDA OS
Smartphone OS
i'd really be shocked if they got it right on the second try, already it seems like the replacement of the hard drive with RAM seems like a step in the wrong direction.
this rule is particularly true in enterprise software- and typically factored in when planning long term strategy. with five years of breathing space, you can innovate quite a bit to stay ahead of the curve.
about 7 years ago, MS bought an Israeli based analytics company, and people predicted the end of ISV's like Cognos, Business Objects, Crystal and others. now, about 7 years later, they're kinda releasing a 1.5 product that people are chuckling at.
remember SQL server 6.5- no row level locking? version 7, heh, not bad...pretty good bang for the buck...
as a long time gadget freak, im actually pretty excited about the next generation MS smartphone, the motorola mpx220, which fixes all of the crappiness of the second generation.
remember great plains software? the basis of the MS CRM strategy? SAP's not exactly quaking in their boots, but you can bet their thinking about that third release in about five years...
if you believe Eillison's testimony, they're poised to take over the world, and he wakes up nights in a cold sweat.
of course, when that happens, there are countless nubile young asian women to dab his forehead with hundred dollar bills.
If you don't get why Japan is where the console wars will be won or lost, let me point it out to you.
The market in Japan for video games is shrinking. Even Satoru Iwata was quoted as saying the same. The Japanese market is not as signifigant as it once was. What is important, however, is Japanese developers. If they can get enough Japanese developers to sign on to Xbox, even if its only outside of Japan, they'll be fine.
99% of all successful console games in the past 20 years have been from Japan.
I dunno where you get your numbers, but thats certainly a -little- high. Tetris is the #2 best selling game of all time. And theres this little game called Grand Theft Auto from some American studio. Then theres all the Rare games. And Tomb Raider sold pretty well.
Yes, the cell processor is a gimmick and a scam, and will fall flat
True.
However. Nintendo would be far more likely to capitulate on this than Microsoft
Nintendo is doing fine. They have tons of money and are in a very good financial situation.
There's no room for some silly spoiled foreigner brat of a company to try and push their way in.
As I said, the Japanese video game market is going down. Japan is where a lot of the games come from but America is where the real money is made. Xbox can do well in Japan if they tried, but it might not be worth it in sales.
well, that carries two implications. #1 -- xbox didn't have japanese companies making their games. well guess what... it certainly wasn't for lack of trying. #2 -- microsoft was attempting to recruit developers and couldn't. why? no one expected the xbox to be worth the development time as it hadn't sold like crazy and just didn't have the numbers.
chicken+egg problem. it doesn't help that if you go to almost any japanese department store the ps2/nintendo/gba/etc section is enourmous and the xbox section is _itty-bitty_. just trying to find the ps2/gamecube title you're looking for can be excrutiatingly painful. why? too many titles all over the place! finding the xbox title you're looking for is a pain in the ass too. why? no one carries it. =]
jinkusu
This will become very difficult with the next gen XBox with the absense of a HDD, so no more storage of pirated games.
Not only that but there is speculations that the next XBox may feature a new shiny IBM PowerPC processor, (same source architechure as the Nintendo Gamecube) so that reduces the posibility of x86 software and linux development.
1. Japan is EXTREMELY Xenophobic.
:-)
The distribution network may be xenophobic (I have no idea really), but I'm pretty sure the great majority of consumers don't give a crap -- indeed, being non-Japanese may actually be an advantage because you might end up being considered fashionable (and yeah, a lot of American stuff is currently pretty hip in Japan).
However Japanese consumers do care about good games, in genres they like -- which MS pretty much completely failed to provide. The success of the PS2 was also strongly influenced by (1) hype (which Sony pegged, and MS -- though they tried a bit -- didn't), (2) compatibility with existing PS games, especially important near launch, (3) being a familiar and trustworthy brand-name that has in the past come out with plenty of popular games, and to some extent (4) good industrial design (design-wise, the xbox was a bloated mess).
In the case of the Xbox, distributor discrimination doesn't seem to have been a factor either, as the Xbox was promoted heavily and received a lot of prime display space in stores (to an extent completely unjustified by its sales, so I assume MS was paying a bundle for it), even in many small independently owned stores (which I figure might be a bit more um, patriotic). This was true for quite a long time, though in the past year xbox games seem to have been relegated to the back shelves (presumably because nobody buys them...).
This is all based on my personal observation, as someone who lives in Tokyo. As far as I can tell the ultimate reason the xbox failed was because most people said "I already have a PS2 and there are lots of games I like; why would I want an xbox?"
BTW, I don't own either one... (I have a gamecube
We live, as we dream -- alone....
The rest of your points are pretty spot-on, but...
Face it US corporations usually produce lots of rather lousy non intuive sequels, whereas japanes companies used to go for the riskier sides and didnt rely entirely on sequels and shooters.
This really isn't fair or particularly true. Sure, Japan gets more weird or niche games overall, but outside of a few exceptions that doesn't mean they ever sold all that well. Looking at the twenty best-selling games in Japan so far this year (via Magic Box's recent news), I only see two games that aren't existing franchises or sequels. Maybe it used to be better, but I think if you actually look back you will see it has almost 'always' been like that in Japan - niche games do niche business, almost always, almost everywhere.
And US game devs have made lots of innovative games, it was just that in the past you were more likely to see them on a PC rather than a Japanese console. This is even more true for European devs.
There is no excellent beauty that hath not some strangeness in the proportion. -- Francis Bacon
I never had a game machine growing up however my friends had Atari's and intellivisions.... Since I have a good job I thought I'd treat myself and buy the consoles that I wanted. Bought the PS2 first and got a bunch of games, wasn't happy w/ the load times on some. Next, bought the GC for my son where the load times are better but graphics not as crisp. I finally bought the Xbox on the advice of someone who doesn't care Microsoft vs Linux and have been happy w/ the graphics (HD!), sound, load times and of course Halo. I perfer the xbox now and buy only xbox games.
Do I like Microsoft? Not really but I think limiting myself to just one console/technology isn't a wise attitude. How else can you speak with any authority on a subject?
....... Thus ends my attempt at wit or whatever
Same thing happens to my dreamcast yet that was a HUGE success in Japan.
Do this for me: count the number of American cars you see in Japan. Count the number of Japanese cars you see in America. Japan has a very protectionist economy, it wouldn't surprise me if that's why the Xbox is down.
God Bless America. Why? Did it sneeze?
PS3 does not play PS1 games, only PS2. So if you want to play PS1 games you'll have to keep your PS2.
One could make the argument that the drive to lower the costs of manufacturing computer equipment is in part affected by the large chunk of the price of a new PC Windows takes.
Hardware manufacturers will jump through hoopes to save 5$ off the price of a board. Since the price of Windows has never gone down, Windows has in effect added to the pressure of price lowering and has an indirect role in the working conditions that exist for electronics manufacturing in Asia.