The very first shift in power within the video game console industry came in 1986, when it became clear that the Nintendo Entertainment System would become the leading choice for console gamers around the globe. Previous to that, it could be easily observerved that the market was dominated by Atari with their Atari 2600 console. According to history, that domination ended in 1983 with an industry wide crash, disappointment to consumers on a devastating level and a landfill full of unsold E.T. cartridges. Arrogance, mismanagement and poor assumptions on the needs of the consumer have all been cited as major catalysts for this event.
The next major shift in power came in 1996, when it became clear that Sony's Playstation console was a major contenter and not going the way of the 3DO, Jaguar and CD-i. Sony's dominance became an undisputable truth in mid-1997, when Nintendo's N64 console had failed to overcome many of the technical limitations along with a lack of quality software. Sony was the biggest player in town, with Nintendo and Sega quickly slipping into secondary positions. Like ten years previous, arrogance, mismanagement and poor assumptions on the needs of the consumer have been recorded in history as the reasons for why this happened.
Now in 2007, we come to the end of another 10 years cycle, for what seems to be another shift in power. Sony's Playstation 3 console is trailing far behind the Wii and Xbox360 in worldwide sales. Sony has taken alot of negative press in both the game specialized and mainstream media over the fact that the PS3 has been outsold by the Wii and Xbox360, and over the fact that the PS3 is too expensive for the average consumer. As Sony scrambles to make the machine more affordable for both itself and the consumer, they have taken alot of criticism as to the ways in which they have done so. As always, arrogance, mismanagement and poor assumptions on the needs of the consumer are being talked about in regards to Sony and their current situation. On this point of view, I couldn't disagree more.
At the risk of destroying the momentum of this writing, please allow me to interject my own opinion on the fact that Sony has been "arrogant" in the media as of late with regard to the Playstation 3. In this regard, Sony has certainly fallen victim to unfair and narrowminded commentary. While promoting their Playstation 3 product, Sony has been steadfast to reinforce that they believe their product to be the best and that consumers are clamoring for it. Whether they are correct in those statements or not is not really a relevant issue. What would Sony say publically otherwise? How would they be expected to win consumer confidence at the price they are asking if they did not appear to have confidence in their own product as well? Comments such as "we know we will sell out of PS3's whether we have games available for the system or not" should have been read as "upcoming software shortages will have very little impact on the consumer confidence regarding the quality of our Playstation 3 product". In my opinion, had these statements been issued by a competing company, the reaction would have been much more docile, if there was a reaction at all.
If we use the model of arrogance, mismanagement and poor assumptions on the needs of the consumer to explain Sony's current situation, the only one of these that may vaguely apply is the last one...poor assumptions on the needs of the consumer. While many would speculate that price would be the culprit, in the sense that Sony overlooked the consumer's need for an affordable product, I assert an altogether different reason. Sony overlooked the consumer's need for differenciation. While Sony may have thought they knew what exactly that meant for them in order to be successful, one would be hard pressed, especially in their market position, to realize that we have come to the end of an era.
When I refer to "the end of an era", I am not refering to the end of Sony's market dominance....though that interpretation is almost logically applicable. The end of the era in which I speak of is the end of the era of dominance, not specifically for Sony, but for all three of the major companies in the console manufacturing business. We have arrived at a point now where there are so many different people who play games all over the world, that a thriving market has come into existance that transends the usual boundries of game player's taste graphics, gameplay, features, affordability, new and experimental concepts and lust for next generation hardware. The sales of the DS and Wii have shown us that new and casual players can still be lured in. Strong Xbox360 sales have shown us that the market for hardcore gamers desiring the "next generation" is alive and well. Strong sales of the Playstation 2 have shown us that the market for last generation hardware and software is far from over. These market trends should now show us that the video game market is not just one market, but has matured into a conglomeration of different markets.
Did Sony realize this when designing it's Playstation 3 console? I suspect that they did, but I also am of the opinion that they may have realized this far too late. Honestly though, with ten years of market dominance under their belt and record-breaking sales of their Playstation 2 console, could anyone have come to a different conclusion if they were in Sony's shoes? While the failure of the PSX in Japan and the defeat of the PSP at the hands of the DS worldwide could have been an indication, it's very hard to say for sure. Indeed, those products represent Sony's vulnerabilty as of late, but a console in the "numbered" Playstation line may carry enough consumer recognition and confidence to overlook the real reason these products failed*. The real reason these products failed is they were designed for a concept that no longer exists: market dominance.
(* Please note: When I refer to the failure of these products, I refer to their failure to dominate the mass market. In reality, the PSP has an extremely healthy installed base and should rightly be considered a commercial success in many ways)
The Playstation 3 was also designed much in the same way. While being unrivaled in graphics, sound and storage capacity, Sony had found a way to do so while using a custom processer and media format. From a business standpoint, this is a very profitable venture with little risk, considering the vast R&D devolopment resources and product strength that Sony is in a unique position to enjoy. Unarguably, the PS3 potentially can offer the best sound, visuals of this generation while never having to worry about storage capacity while doing so. Unfortunately, having the best visuals, sound and storage capacity doesn't mean as much as it used to. Most people either don't have the equipment or the knowledge to realize why Sony's product is the best on the market in terms of power. Sony's hardware advantage at present is invisible to the average consumer.
As far as the Playstation 3's other features are concerned, they lack the aforementioned differenciation. Unfortunately, these features were rushed or unfinished at the time of the Playstation 3's release, or altogether ill-concieved. Let's take a look at these features and allow me to explain why there is a lack differenciation:
Playstation's Online service is still not finished in regards to the standards Sony themselves have been talking about over the last few years. Obviously Sony's online service pails in comparison to Xbox Live, but it still doesn't encompass all the features Sony themselves desire. Seamless intergration between the PS3, PSP and PS2 platforms, an effective online business model for third parties and intuitive online player experience that goes beyond multiplayer are things that Sony has yet to achieve. The bottom line is, as far as online goes, the Xbox 360 does it better.
The Sixaxis controller is something that I can't decided whether it was a good decision or a bad one. On one hand, it brings a feature that will allow the PS3 to share in some of the Wii developed titles, such as driving games or any game where you pilot a vehicle. One the other hand, it is so severely limited, that one has to wonder whether Sony would have been better off releasing a peripheral that perfectly mimics the Wiimote's functionality at a later date. The Wiimote is a superior motion sensor controller to the Sixaxis controller in every way. The limitations of the Sixaxis won't incline Wii developers to release Playstaion 3 versions of thier software, rendering the feature almost useless from a competitive standpoint. The bottomline is, as far as motion sensing control goes, the Wii does it much better.
Due to lack of space this rest of this blog will be posted at a later time.....apologies.
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