Friday, March 13, 2009

Sane Gaming: State of the Industry

Thursday night's arrived at last, and with that, the likely not particularly awaited second part of my "Sane Gaming" post series. This time, of course, we take a look at the current state of the industry. We've got three major companies producing hardware for a market that has historically struggled to support so much as two consoles, and seems incapable of making more than one portable into a real success.

For the impatient, at least, this entry shouldn't be quite as long and rambling as the previous one, in keeping its focus on where each of the three major hardware producers are this generation, and issues that have resulted from that.

Sony: Playstation 3 and PSP

After a decade of completely dominating the market and becoming a near monopoly in the console market, Sony began to wear their arrogance on their sleeve. When the PSP released in 2005, it came under heavy criticism for a number of design flaws. The system's screen was - and still is - unprotected. It was known for its serious lack of durability, control issues due to a couple of shoddy buttons and an easily broken analog nub, as well as directional pad issues and some problems with the system ejecting its UMD discs. A considerably shorter battery life than Nintendo's DS, coupled with its lack of durability, also weakened its appeal as a portable device.

Naturally, Sony didn't take these criticisms lying down - Ken Kutaragi fired back that problems with the system's functionality were "features," stating that (to paraphrase), "you don't criticize a famous architect's designs because a door is badly placed." The gaming public generally responded to Kutaragi's bravado by stating that you would if said architect's door slammed on your fingers half the time.

Sony continued to embarrass themselves over the years with repeated embarrassing and controversial advertising campaigns. From borderline-racist American TV commercials to outright insulting attempts at viral campaigns in "All I want for Christmas is a PSP," and even fairly openly racially charged advertising on billboards in Europe. Not exactly the brightest way to market your product to the general public.

The PSP's UMD TV show and movie line eventually collapsed because there was little market for the discs in a market dominated by DVD. The prevalence of piracy on the platform also kept it from being much in the way of a force in software sales - especially in the face of the already massively successful DS, which had been released months before. The system did ultimately become successful - and continues to enjoy software sales - on the hardware end, while its software largely sits on shelves, since the system works as an ideal, highly hackable and modifiable portable multimedia device on which piracy thrives. Not quite the way Sony intended for things to turn out, as it turned out the gaming populace really didn't care about Sony's wellbeing or specific brandname in the market - and graphics weren't as crucial as they'd bet on.

Of course, like their previous platforms, its profitability has been cannibalized by the Playstation 3 - or PS3 - which has largely established itself as a reminder that Sony doesn't really know what they're doing in gaming hardware. After a decade of market dominance largely through following Nintendo's NES-SNES strategy and moving things into 3D alongside the N64 and Saturn, Sony decided that the praise Microsoft received in the wake of the Xbox 360's launch meant that it was the new industry big dog to mold themselves after.

The mistake here, of course, was that the original Xbox failed to turn a profit and develop more of a market foothold than being a dedicated Halo machine for most of its owners. And the Xbox 360 had more than its fair share of market challenges that it wasn't overcoming, either - the mass market isn't interested in buying an expensive console geared towards rehashing the previous generation's gameplay and control experiences, requiring an expensive high definition television. (Which most people don't have, can't afford, and most who do don't have set up properly.) Like Microsoft, Sony bet on an unquenchable market demand for extremely expensive high-end graphics that doesn't exist. The gaming market has never made market leaders of the best graphics or most expensive hardware. But in following their own corporate hubris, both Sony and Microsoft assumed their companies' brandnames allowed them to tell the public what they wanted, instead of doing market research and building gaming hardware to the market's interests.

When Sony first announced that the PS3 would cost $600, the public laughed in their faces. They then went on to insist that people should "work extra hard" to afford one, and announced that they didn't need games in order to be successful and sell their first 5 million units. Technically, they weren't entirely wrong about that second claim - in Sony's decade of market dominance, they developed an obsessively devoted and obnoxious segment of their following into fanatics hostile to all other brands, as all gaming brands seem to whether they actively attempt to or not - and they managed to get enough fanatics to blindly throw their cash behind the system from early on, despite a lackluster software library.

This is something that hasn't particularly changed since, as Sony's continued to attempt to sell the PS3 as their take on the Xbox 360, all the way down to an overt focus on graphic intensive first person shooters - perhaps the most stagnant and overrepresented genre in the market these days. After the initial release window holiday season, PS3 hardware and software sales slipped into a relative freefall, with only occasional bumps here and there upon the release of a very few higher demand games. And even its most beloved title - Metal Gear Solid IV - is more movie than game (With even the best of this generation's programmers struggling to work with the PS3's hellish multi-core Cell processor technology, which doesn't work well for gaming), with much of the system's gameplay being rehashed from last generation. (And forgiven for its faults for more as a result of buyer's remorse and desperate fanaticism around the console and its brand.) Even MGS4 relied on copious amounts of in-game advertising for real life products to turn a profit as well. Most games on the system don't make money, and following the hardware's current trajectory, they won't.

After entering the industry largely out of spite toward Nintendo in the mid-'90s, Sony's shown themselves largely to be a one-trick pony. Gaming itself is a market that relies heavily on innovation and originality, and Sony's been at the forefront of the industry's stagnation. For three generations now, they've used the exact same basic controller - extremely lazy design on their part, considering that at its core, it's basically a Super Nintendo controller with a couple more shoulder buttons and awkwardly placed analog sticks - which only looks even more unintuitive this generation next to what the Wii does for game controls. Rather than providing a solid centralized online system for third parties like Microsoft and Nintendo, they've provided a system solely for their first party releases (On which the system thrives, which says something considering how lackluster and derivative the vast majority of their first party offerings have always been. It says something when Sony - which has always relied on tremendous numbers of third party exclusives - has to fend for itself on the software front in so many capacities.), leaving third parties to put together their own online gameplay server setups.

And to provide additional content in response to Nintendo's extras, Sony's begun putting out an extremely advertisement-laden digital magazine with demos called "Qore," which they actually charge for and require that you watch commercials throughout. In addition to that, they launched an effectively useless, microtransaction oriented response to Nintendo's Mii avatars - naturally minus the entire creative aspect of Miis, as well as the flexibility and functionality in actual game software - which encourages you to spend money on for virtual clothes and furniture for your zombie-like ultra-realistic avatar. In response to Microsoft's achievement system, you fill an apartment with furniture purchased with real money as well as a clumsy trophy display conceived to copy achievements conceptually as best they could figure. In the virtual mall setting of this program - Home - you can run around and wait in lines to play games like bowling, which aren't instanced by design, making for some incredibly poor design decisions for a setting intended for use by huge numbers of people. And the userbase is largely comprised of the most obnoxious of Sony's fanatics, openly harassing anyone who makes the mistake of logging in with a female avatar. Conceptually, Home's something that could have been neat, but it's completely ruined by terrible execution on Sony's part and their abhorrent userbase.

Additional problems with the system have come down to countless different versions of the system being released at different price points - none of which are really worth the money to ordinary people, who should always be your focused target audience in the industry - with all sorts of backward compatibility issues. Sony spent quite a while making up their mind up about backward compatibility this generation before ultimately deciding to scrap the ability to play PS2 games - a pretty huge mistake on their part. Forced installs to play many games - essentially wasting the potential better uses for the system's internal hard drive - limit the convenience of playing games on the PS3, since you can't just pop any game in and play it at any time like in previous generations, when that's the whole appeal of console gaming over PC gaming to begin with - both Sony and Microsoft lost sight of that console gamers are not looking for a return to the confusion and inconvenience of PC gaming that led to the rise of console gaming over PC gaming. And in general, installations were only made necessary to compensate for the abysmal loading times of its mediocre Blu-Ray disc drive - half the system's cost, and simply a cheap effort to act as a trojan horse and push Blu-Ray disc media into households in a time when no one was asking for an even more expensive variety of disc media to try to replace DVD.

Sony's lost a tremendous amount of money overall as a result of the PS3's failure to catch on as anything close to market leading. It's currently locked in a battle with Microsoft over a distant second place position in the market, but Sony's future in the industry - as well as that of the Playstation brand in general - is speculative at best. Since its failure, Ken Kutaragi was effectively removed from that branch of Sony and pulled from the spotlight, and just recently, Sony Computer Entertainment - the branch that handles the Playstation line - was merged into Sony proper to be headed by Howard Stringer, as the system and company continue to struggle, with no idea how to appeal to the masses, and continuing to openly treat the market with arrogance and condescension, insisting they're doing just fine. Odds are very likely that we won't be hearing from them in the industry for too much longer, as they don't have the resources to sustain a failure of this capacity that Microsoft does, and at the rate it's going, the PS3 will eventually become a threat to Sony as a whole, which already isn't in the most stable of places.

Microsoft: Xbox 360

Microsoft first entered the industry last generation with the Xbox, carrying themselves with an attitude not unlike Sony's: that a specialized industry like that would be cake for such a major corporation like them to break into and monopolize. Not exactly shocking, given Microsoft's established history of aspiration to monopolizing every industry they possibly can.

The Xbox was ostracized by the masses - only selling a little more overall than the Gamecube, but built on high end hardware that they couldn't turn a profit on. (As opposed to the Gamecube, which was high end in and of itself, but well-built and designed as so to be both cheap to make and extremely durable, geared towards high profitability, like Nintendo's systems tend to be.) It simply managed to set itself apart from the competition as the first console with a solid (though paid) online system, and drew a base in with that feature, largely through the Halo series, sports franchises, and the Elder Scrolls: Morrowind game. Western games sold. Japanese games did not.

This is a sales trend that has continued on the Xbox 360. The 360 hit the market to a mix of praise and criticism. From its very first 24 hours on the market, the Xbox 360 started suffering from serious hardware problems, commonly known as "Red Rings of Doom," in which internal problems would turn the 360's green ring of light red, and it would cease to function. Microsoft has lost millions to repairs and replacements as a result of this problem, which still hasn't been completely resolved. They've released revisions of the hardware that reduce its failure rate, but there's still a failure rate higher than a successful mainstream console has ever seen before.

Despite its issues, the Xbox 360 strangely still quickly became a media darling and celebrated as "the system for hardcore gamers" in an almost suspicious manner despite its initially slow start on the market. Microsoft went out of their way to court Japanese developers, recognizing the need to establish their console's brand there after failing to do so in the previous generation. As a result, they've gotten plenty of paid Japanese exclusive games - and occasionally helped to bankroll some, as they did with the founding of former Squaresoft president Hironobu Sakaguchi's new developer, Mistwalker. The problem? The brand still isn't taking off in Japan. Western gamers aren't buying Japanese Xbox 360 games, and Japanese gamers largely aren't buying the Xbox 360. So for all of Microsoft's efforts, they've failed largely in trying to win what maybe an unwinnable uphill battle in Japan - where consoles in general are in sales decline in recent years, with most just owning DSes there - and attempting to diversify what sells in America, where the HD crowd in their fixation on "realistic" graphics has caused them to largely reject Japanese games this generation on those platforms, with few actually turning a profit after the huge financial investment necessary to develop for either of the two HD systems.

At its core, while more of a mainstream darling than it deserves to be in many capacities, the Xbox 360 is largely simply an upgrade to their previous console. They improved their online services and expanded into larger scale profiles to track "achievements" - essentially little pats on the back for doing different things in games, an extremely popular and fairly controversial feature in games these days - and corresponding "gamerscores." (Essentially, a numerical score that crowd tends to use to say "Hey, I'm a better gamer than you!" when it means nothing at its core. A much less useful feature than achievements themselves.) They introduced Xbox Live Arcade on the system - updated gaming classics with new features and original software, all for download - which led to competitive responses in the less successful original PSN titles on the PS3, and even more successful WiiWare service on the Wii. But despite using a player-to-player connection oriented online system with plenty of problems and downtime here and there virtually identical to Nintendo's on a functional level, they continue to charge for yearly Xbox Live subscriptions to actually play online, which is only getting harder for Microsoft to justify.

Trying to remain competitive, Microsoft looked to both the Wii and PS3 this past fall in releasing a new major system update that had some people cheering and others pulling their hair. They completely redesigned the system's main menu in order to give it a more Wii-like appeal, having been open as they have about their wanting to tap into the Wii's audience - which isn't working, so far, as like Sony, they're completely out of touch with the market and why the Wii is a hit. At this rate, nothing is going to turn the Xbox 360 or PS3 into "the next Wii." Fans weren't happy with the unwanted menu redesign that they hadn't asked for, and they threw in an avatar system that was clearly meant to be their version of the Wii's Miis, but with far less room for creativity in design. (And now they're looking to charge actual money for accessories to by which to customize those avatars as well.) They plug into a few games like Miis, and unlike the PS3's Home avatars, but nowhere to the level that Miis do, since they weren't designed for full-on in-game integration. In most cases, they're just there to be a face somewhere on screen in the few XBLA games that use them so far to represent the player, and nothing more. They also took Sony's game installation feature - though they made it optional, at least - which the 360 needs far less than the PS3 to begin with.

In taking the huge losses they are on Red Ring of Doom repairs and system replacements, Microsoft's future in gaming is somewhat questionable too. Whenever this is publicly suggested online, this tends to be met with a lot of kicking and screaming, backed up by insistence that Microsoft will keep funding the Xbox line and keep releasing new systems because they can afford to, regardless of the millions in losses. But this is a pretty blind, ridiculous statement. Microsoft's a hypercompetitive company largely known for their efforts to conquer any industry they can and push out the competition - they aren't succeeding in gaming, and instead, are taking massive losses on it. Nothing that they can't theoretically keep supporting for a long time, but the question is, why should they? Shareholders in general aren't going to keep the Xbox line on life support forever if they can't turn them into profitable products. Having a stake in the video game industry isn't worth anything if you're losing millions on it each year. And at this point, it's going to take a lot of turnarounds and major reevaluation of their entire strategy in video games if Microsoft ever wants to be competitive. Their current hardware route isn't going to take them to the top, despite the amount of love the self-proclaimed "hardcore" heap upon them. Nor is bankrolling exclusive games, since more often than not, taking money for exclusive support ends up being a bad business decision for the developers who go along with that. Only a very narrow subset of disc games tends to turn a profit on the 360 - it's all about western gamers and their dark, competitive online play-oriented shooters.

Nintendo: Wii and DS

Lastly, we get to Nintendo's hardware, the only fully and truly successful hardware on the market this generation, and the only ones to achieve widespread mainstream success, much to the chagrin of Sony and Microsoft's fanatics. The DS has around the processing power of an N64 - as opposed to the PSP's not-quite-PS2 power - and the Wii has roughly twice the Gamecube's power, four times or so the PS2's. More than enough to make for affordable hardware production - even with their reliance on unique control features between the DS's touchscreen and microphone and the Wii's motion controls. In breaking with the status quo and opting to be very powerful - reasonably so, unlike their competitors - pieces of hardware in comparison to their predecessors and focusing on new control styles and "blue ocean" marketing strategies geared towards normal people rather than the established gaming audience, both systems have easily crushed their industry rivals.

The mass market isn't fixated on expensive high-end graphics and never has been. They don't want games getting even more expensive - while new game prices shot up another $10 to $60 on the PS3 and 360 - when $50 is fairly prohibitive for most people to begin with. And they weren't asking for the exact same thing as the previous generation all over again with fancier graphics. Nor were they calling for a focus on online play in lieu of a meatier single player or local multiplayer experience, when it's become a common trend on the HD consoles this generation to see truncated single player games in the name of focusing on shooting at each other online.

Video games as a medium are all about an interactive experience. Sony and Microsoft are trying to appeal to a very conservative audience that doesn't want the same basic experience they've been enjoying since the mid-'90s or early 2000s to chance - just to get prettier, as their hardware focuses on smashing into that graphical ceiling as soon as possible at the expense of the improvement of gameplay experiences. This is a conservative crowd that wants the pretty online shooters they play to become the industry standard and for the masses to fall in love with those, when that isn't going to happen.

The Wii and DS brought the gameplay experience growth and changes - as well as the much larger variety of software - the industry has needed to experience significant growth, now that Sony and Microsoft's sole focal market segment is observably shrinking and making themselves into a less relevant crowd in the industry. Those of them that openly antagonize the Wii - as many of them do - are only helping to further undermine their presence as consumers in the industry, when they could instead be influencing the industry to focus on evolving their preferred genres on the Wii. But they're too focused on their preferred brandnames to even consider that. Rather sad two-dimensional thinking, that.

The DS and Wii are far and above the most successful hardware this generation, the Wii on track to establish itself as this generation's equivalent of the PS2 in terms of success, with the potential to even surpass the PS2 in time. The DS is already very close to surpassing the PS2, and has already established itself as the best-selling portable game system of all time.

The DS is poised to see its sales explode even higher with the launch of the DSi in Japan late last year, which arrives in the west this spring. It will include features such as a lower resolution built-in camera that can have its photos downloaded to the Wii's Photo Channel, a new Wii-like main menu interface, SD card support, and internal storage space for downloadable games and software like the Wii's Virtual Console and WiiWare, in the form of DSiWare. Use of Nintendo's creative Mii plug-in software avatars has also been confirmed in DSi software. Though all this comes at the expense of the original DS and DS Lite's Gameboy Advance cartridge slot.

The Wii, for all it's earned its massive mainstream success, isn't without its problems and flaws. The controllers themselves - the Wii remotes - require the use of 2 AA batteries, lacking the internal rechargeable batteries of the rival systems' controllers. But this is something easily remedied through the purchase of a set of rechargeable AA batteries. With some good ones, a pair can easily last half a year or so before they stop holding much of a charge. The system's internal storage space is lacking compared to the PS3 and 360's as well - though at least there isn't a huge amount simply being wasted by multi-gigabyte disc game installs - and larger Virtual Console and WiiWare games can add up quickly, as can the system's channels. A solution to this issue is in the pipeline, however, with Nintendo having announced expansion of the Wii's SD card use through a firmware update coming this month, which will allow Wii users to play Virtual Console and WiiWare games directly from SD cards, as well as access save files on them. This will allow Wii users to expand their Wii's available storage space by gigabytes - which will allow for a tremendous amount of content storage on the Wii - for the small cost of an SD card itself.

To get this update, of course, you have to be connected to the internet. And while it's very popular to troll the Wii's online features on the internet, comparatively, the system has a very adequate online setup with many enjoyable bells and whistles. The Wii was a bit behind the game in that Nintendo didn't have their Nintendo WiFi service working with any games until over half a year after the system's launch - just as the DS had to wait about a year before it started seeing online games as well - but they had plenty of other features right out the door. Each Wii gets a system number - as opposed to a specific username - which players can exchange with friends online to send Wiimail to one another's Wii message boards through the system's great free email service. (A nice Gmail-esque touch to the system.) Players could also exchange their Mii avatars, and by keeping their systems connected to the internet when even in sleep mode - as opposed to simply powering down completely - via WiiConnect24, they could build a Mii Parade of up to thousands of others' Miis to check out through the Mii Channel. The Photo Channel allows for some playful Mario Paint-style photo-editing and slideshows using photos posted to the Wii message board or stored on an SD card, which can also be shared with friends via Wiimail. You can also log onto the Wii Shop Channel to purchase classic video games for the Virtual Console emulation feature - the selection presently including games for the NES, Super Nintendo, Genesis, Sega Master System, NeoGeo, TurboGrafx-16, TurboCD/TurboDuo, N64, and most recently the Commodore 64, with new games released every monday - as well as new weekly WiiWare game releases and the occasional new channel. With its regular weekly updates, the Wii Shop Channel gets more downloadable content - and frequently higher quality content - on a consistent basis than the PS3 or Xbox 360. You can also get local weather forecasts through the Forecast Channel, the latest news through the News Channel, and surf the internet on your Wii if you opt to pay 5 bucks for the Internet Channel. Other free channels include the Everybody Votes Channel - through which you can vote in various polls and guess their outcome, attaching stats and votes to up to 6 Miis - as well as the Check Mii Out Channel, through which you can look at others' uploaded Miis, vote on them, participate in contests, and upload your own Miis. The Nintendo Channel functions like a sort of digital video magazine, allowing you through look through a full database of Wii, DS, WiiWare, and Virtual Console games, watch all sorts of preview videos and trailers, behind the scenes and commercial materials, and even stream DS demo downloads to your DS, like the demos found on retailer display DS units. If you buy the Wii Speak voice chat accessory, you can also download the Wii Speak Channel and set up fairly large voice chat conferences with friends, as well as send them Wii Voice Mail.

There aren't as many games with online play on the Wii as there are on the other two as of yet - a point of complaint often being the separate friend codes you have to exchange in order to ararnge to play with friends, though despite the nuisance they are, they're better than paying for an online system functionally just like Microsoft's. Another point of complaint is the lack of voice chat as a standard feature, with Animal Crossing: City Folk being the only game that uses Wii Speak at this point, though the highly anticipated online first-person shooter coming this summer, The Conduit, will sport voice chat as well. But with any luck, we should start seeing some online WiiWare games update to add some amount of voice chat functionality eventually, and see Wii Speak integration become more of a standard in disc games with online play, seeing as the accessory was only just released late in 2008. In the least, while there aren't as many games to play online on the Wii, there's more variety to them than the shooter-centric high-definition consoles.

Third party support in general is still one of the biggest hurdles the Wii has yet to overcome. First party software alone is frankly more than enough to sell the system, Nintendo's released so much great stuff on the system already. But there's a lot of great third party games that don't get the support they're due - more often than not due to a lack of actual advertisement. Third parties have a rather misguided view of the Wii this generation, especially when compared to its rivals, which are willing to pay for exclusive games - Nintendo doesn't actually need to do this, and you'd think more third parties would have the business sense to realize that the much lower development costs coupled with much higher software sales on the Wii when you actually advertise your games is a much smarter and more sustainable alternative way to approach the market than effectively taking bribes from companies whose consoles don't have reliable software sales outside of massively hyped blockbuster titles in a very limited selection of genres. At this point, ignoring the Wii is akin to ignoring the PS2 last generation, but it seems that in the decade of Sony's market dominance, many third parties simply forgot how to be competitive in getting used to financial kickbacks for exclusive support.

Overall, the Wii and DS are in the strongest positions in the market. They completely disrupted people's previous conceptions of gaming and previous success in the gaming market. From what president Satoru Iwata's said, their next goal is going to be to find a way to disrupt the Wii next generation. I can't even begin to tell you what that could mean, but suffice to say, with Nintendo on top of the market again and leading the way with the first truly innovative hardware in decades, it's an exciting time to be a gamer, and I'm looking forward to seeing what they do next. I just hope third parties wise up soon.

Okay, this ended up being much longer and more rambling than I intended for it to be. Once I start rambling, it's hard to stop. Hopefully this information will be of use to somebody.


M. Ferreira said...

Just wanted to comment on a few things:

1) MS - XBOX Live - You're paying for indefinite online support; a guarantee that any game you put in (that's not made by EA) will be playable even 6 years ago. MS owns the servers and maintains them for every single game, still. So, if I really wanted, I could pop in a copy of Crimson Skies and still be able to potentially find games. :) It's pricey, but I can see the point, since the devs shut down servers on Wii and PS3 once a game goes out of the public eye.

2) The Wii isn't the only console that uses AAs. The 360 wireless 'motes also require two AAs unless you buy a recharge pack or Play 'n' Charge kit

Benjamin Fennell said...

Ah, thanks for the follow-ups. I wasn't aware of that aspect of Live. Even then, charging what they do for it is pretty steep compared to the competition, though that's a damn nice feature.

And I wasn't aware that the Wiimote wasn't the only controller that potentially required batteries, so thanks for the corrections on that front as well.