Upcoming November, the tenth, Microsoft will release the Xbox series X and S. However, Microsoft doesn’t hide the fact that their image of gaming isn’t centered around the console. Microsoft’s Game Pass is rising quickly and it seems to be no secret that Game Pass will get prioritized over the traditionally expensive console.
Microsoft consoles will go head to head with Sony’s PlayStation 5 into the console battle. Quite accurately explained, the console generation battles go a little something like this: Sony and Microsoft introduce a new console once every 5-7 years. Both machines are heavily improved on technical features, allowing better gaming experience. Both claim their machine is ground breaking and next-gen, completely disregarding the superior technical possibilities of PC gaming. And in the end, Sony wins (VGChartz, 2020). As a PlayStation owner of all generations, my opinion can certainly be taken with a grain of salt, but Sony did win in actual console sales quantity.
The strategies for the next battle, of the consoles released this year, show obvious comparisons with the last battle. In 2013 Sony’s PlayStation 4 won with a straightforward tactic; console gamers want a console, let’s give them one. It improved on several aspects but the idea is clear. Microsoft on the other hand viewed the console as a home video hub. It also bundled with a Kinect motion system, making the device expensive. About a 100euro more expensive than the PS4. Making the expensive and slightly inferior machine significantly less popular. The resemblance with the current battle lies in the fact that Sony once again recycles the straightforward approach while Microsoft is trying to disrupt the whole industry by offering subscription based games. Every game related thing Microsoft does seems revolved around the game pass. Phil Spencer, executive at Microsoft, spoke the following about it: “If this is not the year when a family wants to make a decision to buy a new Xbox, that’s OK. Our strategy does not revolve around how many Xboxes I sell this year. We’re focused on delivering services through Xbox Game Pass, which allows people to build their library for a monthly fee.” Microsoft is trying to get as many people as possible on a subscription base and has several technique to do so (Gamesindustry.biz, 2020). Starting with the unprecedented Xbox all access scheme, in which the consumer gets the console and game pass for a subscription for two years (Xbox, 2020). Then it is nice to know that game pass allows gamers to access their game library not just on the next gen console, but also on PC and current console (Xbox, 2020). Furthermore, the cloud solution xCloud is part of the game pass subscription, meaning that if cloud based gaming takes off, there is no reason to buy a console. Finishing off with the pricing; series S is only half the price of the series X and certainly lower than the PS5.
All the things named above clearly indicate that console revenue isn’t the priority. However, Microsoft amassed a huge fanbase of the Xbox, which can’t just be let down. The subscription based library of games, sometimes even Xbox exclusive, is playable on for high performance PC and the current generation console works fine still. So it seems Microsoft is trying everything in it’s power to disrupt gaming as it is now, while taking down its own console. Battle after battle was lost, but it might just be that Microsoft will win the war. The results are rolling in, starting upcoming November when the consoles release. A month which will be essential for Sony. But Microsoft releases just another machine to support the game pass. A machine which is brought to life, not for income but for the fanbase. A next generation, cutting edge technology, high priced product which even Microsoft finds unnecessary. Or in other words, just a legacy product.
Is Microsofts next-gen console a legacy product?
3
October
2020
Hi Jimi,
I think you bring up an interesting topic and it could certainly be argued that the new Xbox is a legacy product. I however am of the opinion that this is not the case (yet). I don’t think the console market necessarily competes with the PC market. For the people who game on PC buying an Xbox may be unnecessary as the Game Pass is available on both platforms, but the people who game on console would be less likely to switch to PC in my opinion. The console is maybe more of a convenience product, and since the next generation of consoles is going to offer a better experience, I think the new console of Microsoft is actually necessary.
I do think that the Game Pass and the Cloud gaming platform that you mentioned could be huge disruptors in the gaming industry. We already see that the prices of games for next generation consoles have gone up. Furthermore, the majority of people has now gotten used to digital library subscription services like Netflix and Spotify, so a similar service for games just seems like the most obvious next step. Cloud gaming, which maybe a little further away from us that subscription services, also has a lot of potential. As you mentioned, gaming systems would become obsolete and the leading company in the industry would only be decided by who has the better cloud platform.
Overall, I think Microsoft has a lot going for them, especially with the Game Pass and xCloud. I do think that Microsoft’s branding is their biggest issue right now though. Consoles may be at the brink of becoming obsolete, but right now the competition is still primarily about consoles. Unless Microsoft can make a breakthrough with their new technologies, I think they are failing with their branding. We saw that the moment pre-orders became available for the new Xbox Series X, the old Xbox One X was sold out on some platforms. The branding is confusing for customers who are not so familiar with the systems and this has been an issue for a while.
Hello Jimi,
This is definitely an interesting subject to look at, especially each time a new generation is about to arrive. Every time it is curious to see how Sony, Microsoft and to a lesser extent Nintendo decide to approach the market and combat each other.
I definitely agree with you that Sony won last time, it seems like Microsoft made an estimation error with regards to how important the actual gaming aspect is for these consoles. However, as Microsoft is Microsoft one weaker console generation is not really doing any damage to them. I do not know if you have seen it, but Microsoft recently bought the game publisher Bethesda for 7.5 billion dollars. Such actions are of course an extreme power move, and a reminder that Microsoft is actually so much bigger than Sony. I think the strategy you are describing is kind of in the same vein. Microsoft is able to apply strategies that might be extremely costly. But as they are such a huge company, with the gaming market only being a small part of their business. They can afford to make such pricey decisions, even hurting their own console just to win the market.