Does Microsoft Have First-Mover Advantage?
Gamasutra's question of the week feature just finished gathering up reactions to the query "Is the 'first mover' advantage an important factor in launching a next-generation console?" From the article: "For first mover advantage to work, the new platform must have credibility in two areas. First, it must be seen as being a significant technical advance over the current generation, otherwise it has no real purpose in the market. Secondly, there must be confidence in the new platform from both the public and the industry, without this the new platform will struggle to reach critical mass. The second mover can negate the first mover's advantage by having a higher level of credibility in these two areas. This explains the current tone of Sony spin."
Did SEGA have first mover advantage with the Dreamcast?
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The old Atari Jaguar was a highly unsuccessful first mover.
Quoted from TFA: You never get a second chance to make a first impression. The Atari 2600, NES, Genesis, and PlayStation were the leaders of their respective generations. They were also the first. Is this guy crazy? First of all, SNES outsold the Genesis on the worldwide market, with the Genesis barely outselling the SNES in the United States. Also, the PlayStation's launch was predated by the Sega Saturn, so the claim that they were the "first" is clearly wrong. Someone needs to work on their fact checking.
Yes, of course they do.
Rushed First out: Saturn
First out: Dreamcast
Yes, Sega was in deep financial doo-do for both, but that doesnt matter. Being the first is totally irrelevant to a hype machine (Sony) and franchise loyalty (Nintendo).
Though if the 360 has any kind of Halo at launch; even a Halo text adventure by Infocom (like it matters, people will think it's innovation), then they have a good chance at getting nearly their entire original Xbox customer base back.
What will end up making or breaking the Xbox 360 are the games that are available when the product launches. This article has a list of probable launch titles for the Xbox 360. Team Xbox also has a few predictions. The question is, are any of these killer apps that I just need to have and that I won't be able to get anywhere else?
A quick glance at the list and I know there isn't anything on there that I just have to play right away. Some of you might differ, but to me it looks like a lot of those games are more of the same old that will probably see PS3 versions with the possibility of slightly better graphics.
The launch titles are especially important for the Xbox 360 because there are still a lot of doubts about the compatibility of Xbox games. Apparently, some explanation has been given about hos it will work, but I've heard a few rumors that say backwards compatibility won't be there. If there aren't any games I need to have for the Xbox 360 and I can't play my Xbox games on them right out of the box, then do I really need an Xbox 360 right away?
The final factor is the price and what I get for it. Sony has called the Xbox 360, the Xbox 1.5, which I won't entirely believe, but does have a few points. Right now it has a plain old DVD drive in it. Where's the next-gen media format support? A recent EGM article hinted that this might be upgradable to HD-DVD if MS feels the need to do it. The Xbox will also serve as a media center, which I really don't need. So is $300 worth the price of admission? Considering that the PS3 is expected to launch for $400 or more and include more next-gen bells and whistles, I might consider waiting for that if I needed a media center. Then again, Nintendo is trying to ship their console for $200 or less. Granted that Nintendo isn't offering an all-in-one package, but it is an affordable gaming console. The only problem is that I'd have to wait almost another year for it to come out.
As metioned in the article, brand loyalty will certainly play a part in what people decide to do. Since I own all three major consoles, I don't really see myself as loyal to any particular brand. Each has its merits though.
If I had to make a prediction, I'm going to guess that the Xbox 360 will do quite well in America taking the number 2 spot and picking up market share, but will do poorly in Japan.
Being first can be advantageous, but it can also be a downfall. One need look no further then Sega to see the problems it had not only with the Dreamcast, but also the Genesis. Everyone knows the issues the Dreamcast had, but lets not forget how because the Genesis were first to market and technologically inferior to the SNES how it hurt them in the mid 90s. Even as early as 1994, the SNES was pumping out games like Final Fantasy 3, which, graphically, blew most Genesis games out of the water. In the next two years, developers would continue to push the limits of the SNES hardware, while the Genesis library received smaller and smaller additions.
The SNES got games like Donkey Kong Country, Yoshi's Island, and Chrono Trigger, while the Genesis was relegated to graphically inferior games like Comix Zone and Vectorman. Being first to market certainly helped Sega in the early 90s, but by the time the Genesis had reached its limits, the SNES was still pushing the envelope.
Microsoft's first mover advantage is balanced by Microsoft's "we can't put together a good first release to save our lives" disadvantage. I think Sony has little reason to be worried.
I see four major factors going into this question.
1. Is it compelling? Does it offer anything significant over what I've already got? The Dreamcast gave me a big "No" on that score.
2. Is it readily available? I *wanted* the PS2 at launch, but Sony didn't ship enough and I got knocked off the waiting list... so I waited well over a year to get one.
3. Is it worth the price? I didn't buy an XBox at launch, but I bought one when the price dropped below $200. I am impressed enough by the XBox to have the 360 reserved, however, and I fully intend to grab it on the day of release; the XBox is *easily* worth twice the price of a PS2 on construction value alone. (I've completely trashed three PS2 consoles. It says something that I bothered to replace them, though.)
4. What can I do with it? If the answer is "nothing" -- no games -- I'm not really interested. So backward compatibility is critical. The GameCube was the last console to enter my arsenal, because I didn't have an existing library it could use. The key factor there was a strong used game selection and a few killer games (e.g. Legend of Zelda: The Wind Waker).
That's what goes into my decisions. YMMV.
Microsoft cheerleader, blue flag waving, you got a problem with that?
If XBOX 360's implementation of Live can pull in enough users, and a few solid titles come along with it ... XBOX 360 should be a success. You see users will not only be invested in the system ... they'll want to remain connected to the friends they're connected to through Live. Since MS is planning on giving away basic Live on weekends for free, they should have a pretty solid connection to users, and I think their first-mover advantage WILL benefit them more than had they just released a game machine without any sort of community component.
I know I am pre-ordering one 360, and I may end up with another one if the first one is cool. I have three kids and a wife, and we all play games. Having a second console is worth its weight in gold for convenience and for multiplayer games. Anyway, if I pay $299 twice and buy a few games for $60, how likely is it that I will feel like paying $400+ for a PS3? I will eventually get one and a Revolution and a few DS and PSP handhelds, but not at launch.
Too lazy to create an account.....
AC
The number one factor in console sales is the games. It has nothing to do with brand loyalty, significant andvances in technology or quality and reliable hardware.
Its the games, games, games. XBOX is the most superior current generation console on the market, and it lagged behind an older PS2 simply because Microsoft did not secure enough exclusive titles for the XBOX. MOST titles are either PC ports, or were ported to PC (including Halo), or the titles could be found on other game consoles. The only reason why I didn't buy the XBOX is that having the PS2, I didn't find any titles on the XBOX I wanted that wasn't already offered on the PS2 platform. This is the only situation where being first had its benefits, when you start cross-platforming games.
For the XBOX360 to succeed, Microsoft needs to start creating some exclusive franchises that will ONLY be available on the XBOX360. This is why Nintendo is still surviving, because of their exclusive Mario, Metroid, Zelda, Pokemon, Kirby, Wario, etc, etc, etc titles. If Nintendo started whoring out every one of their characters to every platform, then they would have died long ago.
This also applies to the PS3, when it comes out second, if Sony does not secure enough exclusive titles, then the market share Microsoft built up with the XBOX 360 will affect sales of the PS3 if Sony just ports XBOX360 titles to their platform. But the XBOX360 market share will only gain momentum over the PS3 if there are enough good titles at launch to build up a large consumer base.
Games drive sales. I always say that if there are at least 4 to 5 titles available on a platform I realy want to play, I will buy that platform. But I won't rush out to buy the XBOX360 just because it is first, or it offers state-of-the-art technology. Buying a game console before having at least 2 games you want to play is kind of rediculous.
I haven't thought of anything clever to put here, but then again most of you haven't either.
Backwards compatbility is also a huge factor.
People could buy a PS2 risk-free, knowing that they could continue to play all of their old PS1 games and also play the new ones. It was an upgrade instead of a platform change, and people didn't have to choose between running two consoles and not being able to play their old games any longer.
That's important. It remains to be seen just how good XBox 360's half-assed backwards compatability is - if I can't play ToeJam & Earl III on it, it'll be quite a while before I get one.
"It is our blasphemy which has made us great, and will sustain us, and which the gods secretly admire in us." - Zelazny
Atari had first-mover advantage on other systems (Intellivision, Coleco), which was huge for them. I felt like an outcast for having Intellivision...
One man's Funny is another man's Offtopic.
Console development is cyclical. To claim any release in the cycle has "First Mover Advantage" is to start the 'calendar' at a point convenient to your argument.
The only "First Mover" in the console business is Atari.
That's it. Everyone else is coming out with successive and improved products. The question "Does Microsoft have First Mover Advantage?" belies a lack of understanding for what "First Mover Advantage" is.
Furthermore, there is nothing revolutionary or "First" at all about the Xbox. It doesn't have the fastest processor, GPU, bus or best resolution. It is Microsoft's latest product, in a long line of competing products. It isn't particularly special in any way.
And not to be partisan on the issue, but at least the PS3 is introducing a radical new CPU design into the equation.
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/. really is turning into the new Gama redirect...
Can't we just get a sidebar ala Blue's News for this stuff?
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Microsoft will probably regain their market share and do little more than that. The biggest problem the XBox had was that it's games were too focused on a small portion of the gaming market; the teenage or young adult male hard-core gamer population. When you look at games for the 360 you see little improvement in the variety of games available (mostly FPS, Racing games and sports games). What this means in that Sony will probably continue to have the largest market share because they have the most diverse line-up, Nintendo will have the most dedicated fan base because they have the most unique line-up, and Microsoft will have the geekest fanbase because they are too focused on a market.
Being out first will have next to no impact on their market share. The only instance I can think of where not being out earlier really hurt a company was Nintendo with the N64, if it was released a year earlier the N64 would have probably had almost double the userbase and developers would have been virtually forced to support it.
Coming out first was not what killed the Dreamcast. Sega did not have the "The EA Advantage"(TM), "The SquareSoft Advantage"(TM), or the "We Have Cash Coming Out of The Pores on Our Ass Advantage"(TM). Microsoft has like 2 of those 3, which makes this NOT LIKE THE PAST.
I hate how anachronistic we are.
I've been making console games for a long,long time. I've been through the ramp up, release, and milk the market with sequels phase of the console market many times over the years.
I really can't believe that articles like this are still written. Or that the topic seems to never go away.
Launch 'strategies' are irrelevant.
Debating launch times is useless. You can save your fingers typing out a response. It's been written before. Many,many times before.
1) Company X should release early and get 'head start' on building marketshare before company Y
2) Company X should hold off and make company Y show their hand
I've read those responses and their variations a few thousand times over the years. And they made no difference or provided any insight into the true nature of companies and consoles in question.
Compared to the much smaller, and it looks like shrinking, home computer game market, the console market is big business. With the big console developer and publishing houses approaching movie studio scale in sales. Although I hate the comparision, it is true in an absolute sense. I would not be surprise to see the console market get close to 20 billion in worldwide sales during the life of the PS3.
With these big studios and the big budgets for projects that are set in motion long before most people have even seen the early leaked specs or screenshots of the hardware, you are making major decisions that will impact your company for the next five years on a limited set of facts.
You have to ask yourself, who do I feel confident in to marry myself to for the next five years. Right now there realy is only one choice and that is Sony. No matter what you feel about Sony as a company, their products, the PSP, or their consoles THEY HAVE THEIR SHIT TOGETHER.
Nintendo has their shit together, but in a much more self centered, we don't need anyone to prosper way. I can safely ignore them and let them go right ahead with their plans. There are always going to be there if I decide I want to port some of my Sony titles to their latest. They are fine with that, and they are fine if we don't.
Microsoft is a disaster. They are so much of a disaster I don't think I can even wrap my brain about what exactly is wrong with these guys. All I can say is there is a reason Microsoft has failed to sign up any significant new IP or stolen any major franchises from Sony.
There is very little that will change the outcome of the marketplace winner for the next consoles. When any particular console launches is not irrelevant, but all it really does is shift the target installed base numbers for a particular console around in time.
You can think of a console's installed base as a sum of its exclusive titles/IP. There are a finite number of consumers that are going to buy a particular console with a given set of IP. Ignoring for the sake of simplicity that consumers buy a console for more than one system selling title very often.
Shifting a console's release date forward just gets those finite number of target consumers to buy your console earlier. There is no such thing as a 'head start'
With the current allocation of IPs/titles for Sony,Nintendo, and Microsoft you can predict the marketshare ceilings for the next consoles since the IPs each console maker has have remained almost exactly the same from the last generation.
Someone who didn't buy title A last generation or buy a system to play title A last generation is most likely not going to buy a new version of title A in the new generation of consoles. Exceptions yes, but in general true. Moving a console's release forward has no effect on the long term installed base. Consumers buy consoles to play specific games.
Launch strategy discussion should just go away. Look at the exclusive IPs to see which way the console market is heading. It is clear right now that it is heading, strongly, in Sony's direction.
Is that like First Post? Heh, kids these days... Coffeegate, First Mover, hehe.
Sony is going to come out a year later and at $399, is it even going to be a contest??
As long as MS wins North America and Europe, they've won next gen. It's as simple as that.
We'll be seeing much more of Xbox 360's true potential at three events - first GC in EU, then TGS in Japan, then finally X05 in EU again.
Nintendo was not the first mover on 16-bit. Sega was.
Sony was not the first mover on CD-ROMs for games. Sega was. 3DO was second. (CDI doesn't count.)
Sony wasn't the first into 32-bit, either. Sega was.
Neither was Sony or Microsoft first into the current generation - Sega came before them again.
Hell, I'm stretching here, but I should point out that Sega was first into console RPGs and had the first true real-time strategy game, and I bet a large number of the audience couldn't even guess what those games are. (Phantasy Star and Dune II if you're curious.)
As far as I can tell, there is no first-mover advantage. All the anecdote I can think of makes it pretty clear to me that, overall, being the first into a market is just plain stupid. You have bear the burden creating the market for said generation, and once that's done you have to deal with the reality that your system is way behind anyone else's because you were working with earlier and therefore poorer technology, and all the systems that come out a year after you are eventually going to leave you in their tracks.
Maybe it existed back in the 70s and 80s when the home console market was absolutely nothing like it is today, but nowadays it's just an urban legend for market pundits.
I'd doubt it considering he was amazed by the original xbox, and has preordered a 360 already, any console RPG'er I've ever come across were all extremely dissapointed with the xbox, and will not get a 360(although those mistwalker games sound nice 2 games isn't enough to spend so much money), and don't even mention all those PC style RPG's, they a the same genre in name only. Then again I think it's safe to assume that the GP was one of MS' astroturfer corps, aswell as many other posts in this story.
I think it is quite evident that the first mover does not always recieve a necessary advantage in the market. In theory, when all systems are essentially equal, the first mover would logically have a considerable advantage. However, in reality, a lot of factors come into play other than the order of launch--including the actual differences between the consoles, the companies' marketing strategies, consumer biases, and others.
The Dreamcast had the best/most successful console launch ever at that point in time. It was a smashing early hit. What killed it later was the lack of support from certain major publishers. This is not a problem with Microsoft, they already have those publishers on board.
Or, perhaps, it should say that the key to a winning console is to have Sega release a system right before you.
Genesis, Saturn, and Dreamcast are the wind beneath SNES, PSX, and PS2's wings.
A console's success is directly tied to its titles. The faster you can get more titles from bigger publishers the more successful you will be. Microsoft's early debut will help simply because they'll be given more time to acquire a greater game library (quantity and quality-wise) than Sony will have at their launch. Microsoft and Sony both have a critical mass of game developers. However, Sony does still have the most licensees.
Microsoft knows this, that's why they're attempting to release so early. Getting out early is going to put both systems with nearly an equivalent number of quality[1] titles three months after the PS3s launch (which is about the only time we could really start forcasting how this generation's console wars will go). The only way this won't end up with them on a fairly even playing field is if either of them (or their licensed developers) screws up royally.
Understanding these facts, one can clearly determine that the beginning of the war will be fairly even. Playstation still has a slightly greater number of hard-hitters licensed but Microsoft is closing that gap as fast as they can.
Even though I will never own an X-Box (OMG TEH M$ IZ TEH SUK! SONEH 4 TEH WIN1), I think Microsoft is going to pull ahead thanks to the developers they've just bought outright. Microsoft's acquiring a nice line-up of in-house developers, while Playstation seems to have forgotten that it was largely their in-house developments like Warhawk, Twisted Metal, etc. that got them ruling during the Playstation era.
To summarize: It is to Microsoft's advantage to be the first-mover. It does not give Microsoft the advantage.
[1] - For those that can't guess, I'm not trying to define quality titles in any artistic sense. By "quality" titles I mean games that sell well due to consumer satisfaction not simply hype. I personally find most of these "quality" titles to be average in execution and enjoyability, but my personal tastes don't define the gaming market. To summarize this footnote: Please don't try to argue with me about what makes a quality title. Chances are, I already agree with you.