New video consoles from Sony, Microsoft face changed entertainment, gaming landscape
NEW YORK — Remember a time before “Angry Birds,” the iPad and the iPhone? No?
When Sony and Microsoft last came out with new video game consoles — seven and eight years ago, respectively, the companies touted the machines’ high-definition graphics, powerful processors and ability to play DVDs, and in Sony’s case, Blu-ray discs.
But a lot has changed since then. People are playing games on a broader array of devices than ever before, and they have more options to stream movies, TV shows and music. Connecting with friends online is the norm, not an obscure activity for young people.
That’s the world the Sony’s PlayStation 4 and Microsoft’s Xbox One enter. The PlayStation 4 goes on sale Friday and the Xbox One will be released next week. As Sony and Microsoft once again spar this holiday season over who has the brawnier machine and more enticing online features, hardcore gamers are all but certain to fall for the shiny, powerful new consoles. But what’s less clear is how the gadgets will compete for the attention of people who now look to their tablets, smartphones and other devices for entertainment.
“It’s turning out that these consoles, in fighting each other for the love of the hardcore gamer, run the risk of failing to capture people in their homes,” says James McQuivey, an analyst with Forrester Research.
Both Microsoft and Sony position their gaming systems as entertainment devices meant to take over the living room. The Xbox 360 started streaming movies from Netflix in 2008 and the PlayStation 3, which already served as a Blu-ray player, soon followed, along with a bevy of other entertainment options. Experts wondered whether gaming systems would soon replace cable set-top boxes.
Not so fast, was the reply from a host of other gadget makers. Along came Google’s Chromecast, the Roku player, Apple TV and, of course, a slew of tablets. There are many ways to stream movies, TV and music into the home now. In that sense, the Xbox One and the PlayStation 4 are no longer in a traditional, head-to-head battle.
“It’s really these consoles against everything else,” says Scott Stein, senior editor for the tech blog CNET.
While game console sales have been falling in the U.S., the worldwide video game market is growing, helped by mobile and online games and downloadable console games. Those sales are more than making up for a declining demand for game discs. Gartner Inc. expects the total video game market to hit $93.3 billion this year, up from $78.9 billion in 2012. The research firm sees the market rising to $111 billion by 2015.
Both new gaming systems are expected to be in brisk demand around the holidays. Sony expects to sell 5 million units of the PlayStation 4 by the end of its fiscal year in March. The PlayStation 3, in comparison, sold 3.5 million units in that time period seven years ago. Microsoft declined to offer a sales outlook for the Xbox One through the holidays, but demand should be comparable, says Wedbush analyst Michael Pachter. He expects 3 million Xbox Ones to be sold through December and 4.5 million through March.
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