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Generation Next: the future of consoles

 

FOR CONSOLE GAMERS, there are few things as exciting as witnessing the newly revealed capabilities of a new era of gaming machines. But it’s something that we’ve seemingly – and uncharacteristically – been deprived of at this late stage in the current generation’s life cycle.

 

As the latest batch of sequels with incremental improvements and refinements rolls around for PlayStation 3 and Xbox 360, many players have begun to yearn for something extra, something revolutionary, something novel – something that’s likely not possible on existing systems.

 

There was once a time when, in a similar fashion to Moore’s Law for computing, the life span of any game console hardware could be accurately predicted based on previous cycles. Almost like clockwork, all hype and developer interest in the systems of the time appeared to fade away after roughly five years, coinciding with the announcement and imminent release of its successor. From the Nintendo Entertainment System, the Mega Drive, the PlayStation, right through to the introduction of this current generation – it’s been a fairly consistent and accurate cycle; successors have reared their heads after about half a decade. Presumably manufacturers felt consumers were ready to throw down more cash on newer hardware after this amount of time.

 

The current generation bucks this age-old trend. The Xbox 360 is well into its sixth year, with the PlayStation 3 (released roughly 18 months later) nipping at its heels in the longevity stakes. In itself, this is no cause to declare that the sky is falling, but with nary an official word spoken of a successor for either platform – and with rumours we won’t hear of one for at least another year – it's evident there’s been some kind of sea change.

 

I spoke to two well-known industry analysts to find out why.

 

Bigger and better currently makes no financial sense

 

Michael Pachter, Wedbush Securities’ managing director of equity research, has established a reputation as one of the gaming industry’s foremost commentators when it comes to hardware and software trends. He’s not always spot-on with his predictions, and he’s known for revising his forecasts and reserving the right to do so. He once famously claimed that Rockstar’s Bully would turn out to be a failure and that chances of a sequel were unlikely. He eventually apologised for the former, admitting inaccuracy, but it seems that he was on the money regarding the latter. On another occasion, he was once vilified for projecting a US$50 price cut on the Xbox 360; it eventually came into fruition some five weeks after the date initially predicted.

 

Fortune telling has never been an exact science, but it seems the grey area inherent in many of his predictions has not left him with the best reputation in the eyes of forum-trawling gamers. Nevertheless, his strike rate must surely cause even the most sceptical to acknowledge his insight into gaming trends.

 

In 2004, Pachter made a dramatic call: this current generation of consoles would be the last. In the latest edition of "Pach-Attack" – a video segment in which Pachter addresses viewers’ questions about the industry – he recounts a similarly bold revision to this call that he made two years ago concerning the likely release of a new console generation.

 

“I was asked when I thought the next consoles were coming out, and I said 2013 or 2014, and everybody laughed in the audience,” he muses. “And there were two other analysts on the panel – I won’t name them – who said I was crazy, and said they were coming out 2012 at the latest. And here we are, halfway through 2011, and obviously no new [Xbox or PlayStation is] coming out next year.”

 

Before this episode of Pach-Attack was published, I picked Pachter’s brain about this very topic. I asked him what was behind this seemingly spot-on prediction, and what made this generation different to except it from the traditional pattern.

 

“The biggest reason for the length of the current cycle is that we are approaching the point where further returns on investment aren’t possible,” Pachter states matter-of-factly. “The human eye can see frame rates faster than 60 [frames per second] and can discern textures at higher than 1080p, but the differences are relatively small above those levels,” he continues. “Somebody could make a console with a 240/second frame rate and output at 8 million pixels, but to do so would require a very fast microprocessor and an expensive graphics card, coupled with a new monitor that can output pictures at those specifications.

 

"That would entail a very expensive set of hardware, and to illustrate the game at that level, development teams would be huge. Thus, games would cost a lot more and take longer to make, while hardware would be prohibitively expensive.”

 

Certainly as the cost and the investment in development grows, the consumer’s unwillingness to spend above and beyond the current prices for hardware and software remains unchanged. However, Pachter’s argument that we’ve hit a veritable ceiling in terms of technical capabilities is flawed. Neither of the two main consoles take full advantage of the frame rates, resolutions and 3D features already possible on current HDTVs. In fact, gamers with HDTVs are unequivocally better served by their PCs for living-room gaming performance. That’s not to mention the shopping list’s worth of respective weaknesses each console has that are surely to be plugged in the next iterations.

 

So while the investment in hugely superior technology may not necessarily be financially worth it for the key players right now, the potential technical capabilities of consoles have certainly not hit a wall.

 

It's easy to understand the apprehension of key players when it comes to investing in next-gen tech, particularly when appreciating the fact that the best-selling machines in recent years haven’t been the most technically capable. Nintendo’s Wii – an inferior console to those from Microsoft and Sony when it comes to specifications – has outperformed its peers, almost achieving the combined lifetime sales of both of its competitors, with over 87 million units shipped to date. This is despite the fact that it launched in the same period as the PlayStation 3 in November 2006. Consequently, Microsoft and Sony are now showing signs of anxiety and uncertainty about the nature of the next gen.

 

It is not clear that there is sufficient market demand to justify such an investment,” continues Pachter. “No console manufacturer has indicated a willingness to be the first, and over-engineering its PlayStation 3 put Sony in a hole this cycle, so nobody wants to be in the same situation next cycle.” As for Nintendo’s upcoming offering, Pachter dismisses the Wii U as “...merely a catch-up to the current generation with an integrated tablet”. And it seems that, with neither of its direct competitors in any apparent rush to kick start the next wave, playing catch-up may not nearly be as dangerous a strategy for Nintendo as many first feared immediately following E3 this year.

 

For another perspective I turned to David Riley, executive director of the NPD Group. The monthly software and hardware sales figures cited by most of the mainstream gaming press are based largely on the sales-tracking data compiled by the NPD Group, so he is in a unique position to provide insight into industry trends.

 

While he largely echoes Pachter’s sentiments, he adds that consumers appear to be content with the current crop of consoles. “The asserted life cycle for current generation home video game consoles, Xbox 360 and PlayStation 3, is said to be 10 years, which doubles the lifespan of previous-gen platforms,” begins Riley.

 

“Whether this 10-year cycle is true or not is anybody’s guess, but it’s apparent that both manufacturers have learned to maximise the life cycles of their products. The technology contained within the Xbox 360 and PS3 gives developers the ability to create games that rival anything available on a PC, yet developers are far from truly testing the limitations of these platforms.”

 

No doubt there will be many who disagree with that last sentence. The days where a console multi-platform title could toe it with its PC counterpart are well and truly behind us. It’s for this reason that EA has opted to lead with PC for the upcoming Battlefield 3, scaling back many of the graphical features, map sizes and player counts for the console ports. And it’s a tack that more publishers will follow should Sony and Microsoft continue to prolong this generation’s lifetime.

 

Riley also contends that the “home entertainment hub” aspect of current generation consoles pushed by both manufacturers – their increasing usefulness for media streaming and other activities besides gaming – means that this generation is a completely different ball game to those before it. This is true (and truer still abroad); consoles are no longer strictly targeting core gamers, and that’s something that’s going to affect the level of investment of their respective install bases.

 

“Keep in mind that these particular platforms offer services that go beyond traditional gaming, which also adds to the extended life cycles,” explains Riley. “Considering the growing installed base for Microsoft and Sony’s respective platforms, I don’t see any danger in not rushing out with a new product. Why try to fix something that isn’t broken?”

 

The end of disc-based media?

 

The incorporation of internet connectivity for consoles stepped up drastically with this current generation, along with the apparent dissatisfaction of publishers at the level of control over their own property. As a result, one could speculate that a strictly digital distribution model is on the cards for the next gen.

 

For a variety of reasons, though, both analysts posit that the next generation is unlikely to be the first to drop traditional disc-based media altogether. The reasons put forward by Riley are the same that are all-too familiar to New Zealand gamers.

 

“Obviously, tablets and smartphones are a pure digital play, and there are developers and publishers that are able to capitalise on this, but it needs to be put into perspective,” he says. “The digital channel for video games is in its infancy; damn near still in the womb from where many of us stand. There are too many variables: bandwidth, wireless service fees, memory limitations, all add to headaches for consumers that could end in a ‘no sale’. For now, it’s best to look at digital distribution as an additional sales channel, not as the only channel.”

 

Pachter, on the other hand, suggests another perhaps less widely understood reason as to why manufacturers won’t ditch the disc any time soon: as it currently stands, all of the buying power remains firmly with physical retailers. It’s for this reason, he argues, that digital pricing won’t drastically undercut physical retail in the short- to mid-term future.

 

“So long as there is retail, digital copies of games will likely be priced the same,” he begins. “Wal-Mart and GameStop have clauses that say that they can buy games at a discount to the lowest price offered by competitors, so if a digital copy sells for less, Wal-Mart and GameStop will pay less.”

 

Pachter’s assertion that there are internal political barriers preventing the digital revolution from occurring in the console space is interesting. But, increasingly, developers are voicing their frustration with the physical media model. American McGee of Alice: Madness Returns fame recently argued that retailers are a waste of resources, and that the digital revolution has indeed already begun in China, home of his studio Spicy Horse. Earlier this year, Matias Myllyrinne of Alan Wake developer Remedy championed a digital model, claiming it will benefit everyone but the retail sector, which he did not “feel sorry” for. And Guillaume de Fondaumière of Quantic Dream says the industry must do something to address the second-hand market, which he claims cost his studio some €10m in sales of Heavy Rain.

 

Third-party publishers are themselves still in the early stages of attempting to navigate the murky waters of setting up their own online storefronts. But it’s a development that Pachter doesn’t expect to play into the hands of publishers if it continues to fragment the consumer base.

 

“We’ll see if EA’s Origin storefront is successful; I don’t expect it to be,” he declares. “Consumers prefer retail aggregators, whether online or brick and mortar.”

 

Of course, Pachter also agrees with Riley’s assertions, based on the limitations a digital distribution model would impose on consumers.

 

“I don’t expect mandatory digital downloads for a while, as that would shut out a large portion of the addressable market that is either uninterested in being online all the time or can’t afford a high-speed internet connection. I think that there will be disc-based machines for at least one more generation, likely lasting 10 years.”

 

This may well be true, although if disc drives do feature in the next generation, they likely will not be the primary focus of gaming or even video content delivery. Despite the politics of the retail sector, as global internet infrastructure improves, consumers and publishers are increasingly crying out for a digital model. It’s only a matter of time before retailers are forced to embrace such a model, even to the point where they’ll establish their own digital presence.

 

The technology stalemate

 

Sony recently and publicly fired a pot shot at Microsoft, claiming that its arch-rival imposes certain exclusivity requirements on third-party publishers in aid of “protecting an inferior technology”. An argument has long been floated that the lower technical capabilities of Microsoft’s machine have been holding the industry back as a whole, and the comments made by Sony’s vice president of publisher relations, Rob Dyer, appear to reflect this.

 

According to Pachter, however, Sony is “making an issue out of something that isn’t really an issue.”

 

“I think Sony is using the issue as an opportunity to trumpet their technology,” he says. “As a practical matter, few developers will spend the time or effort to make different SKUs for the Xbox 360 and PlayStation 3, so virtually all multiplatform games are the same. The only real difference is in the size of the respective [discs], and there have been Xbox 360 games that were sold on more than one DVD.”

 

The point Pachter appears to miss, however, is that it’s not the volume of content that’s the issue – it’s the technical capability. His first point is valid: common sense dictates that studios will take the path of least resistance when developing for two technically similar platforms. But is that path at the expense of more ambitious development in order to accommodate the less-capable machine? Are truly revolutionary gameplay elements left to the cutting-room floor to fit an aging console, the capabilities of which have seemingly topped out? It’s certainly starting to feel that way.

 

But where does all of this leave the next generation? If the comments made by both Riley and Pachter are anything to go by, it seems that the next generation – which could still be a couple of years away before we hear the first details – may only present an incremental upgrade to what we’ve enjoyed over the past six years or so. “The next machines will merely be iterations of current ones, with bigger hard drives, faster internet connectivity,” says Pachter. “If there is a next generation, I expect greater emphasis on multimedia capability, cloud access, huge hard drives, DVRs built in, maybe a TV tuner or a 4G chipset built in.”

 

Riley simply explains that there’s no real reason yet for the big players to increase the offering, and that consumers simply aren’t clamouring for it. “There is no indication that consumers are growing tired of current-gen hardware.”

 

“We aren’t any more ‘tired’ of the current generation of game consoles than we are ‘tired’ of HDTV,” adds Pachter. “When something else better comes along, we’ll be interested in a change, but until then, this generation is spectacular, and anyone who has a PlayStation 3 or Xbox 360 is continually amazed at how great the games are.”

 

As we ready ourselves for the seventh Call of Duty game to hit PlayStation 3 and Xbox 360 and anticipate a console version of Battlefield 3 that will underperform when compared to its PC counterpart, I have to wonder.

 

http://www.gameplanet.co.nz/features/137949.20110922.Generation-Next-the-future-of-consoles/page2/

 

 

 

“So long as there is retail, digital copies of games will likely be priced the same,” he begins. “Wal-Mart and GameStop have clauses that say that they can buy games at a discount to the lowest price offered by competitors, so if a digital copy sells for less, Wal-Mart and GameStop will pay less.”

 

this is interesting so we now know why digital copies are also same priced.

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There is yet another factor which has been pointed out by various sites/blogs: the ability to patch the console firmware/games.......just take a look at how far the xbox interface has come from the blade menu to the current kinect enabled menu; or the way ps3 has made strides in its feature sets. A lot of these alone would have prompted a new console in the past.

 

M$ just released a firmware to increase another GB on their discs. I dont think it would have been possible with ps2 in its era when online presence was sparse. the willingness to M$ to do this simply means they want to play longer than usual

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There is yet another factor which has been pointed out by various sites/blogs: the ability to patch the console firmware/games.......just take a look at how far the xbox interface has come from the blade menu to the current kinect enabled menu; or the way ps3 has made strides in its feature sets. A lot of these alone would have prompted a new console in the past.

 

M$ just released a firmware to increase another GB on their discs. I dont think it would have been possible with ps2 in its era when online presence was sparse. the willingness to M$ to do this simply means they want to play longer than usual

good point .

yea online firmware-software upgrade is changing the world....intelligentely written software code can do much more than a expensive hardware also....it is amazingv that you can change so much thing with just software ..... to be honest software>>> hardware.

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they just might grant your wish and do a skyward-sword/wii-u thing with halo 4/xbox-us

 

also; they must have closely looked at sony's strategy with ps2/ps3; and might as well continue with that while kinect is the craze......

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My opinion is : It'll be another 2, possibly 3 years before the next gen comes around. Even today, franchises like GTA/MW/BF sell millions of copies. And no one is complaining about the graphical quality of games as yet. Even on huge LED screens, games like Uncharted look amazing.

 

Ganne se jitna juice nikalta hai, nikalo. Hence, PS3/360/Wii-U will hang around as the top consoles for the next few years. And if Sony is to be believed, PS3 will have a long long life as the PS2 does.

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Braid dev would like Xbox 720, PS4 now

 

Jonathan Blow, the outspoken creator of XBLA hit Braid, has told our friends at Edge that upcoming open-world puzzle game The Witness is unlikely to be released on PS3 or Xbox 360.

 

The indie developer said porting the game to current consoles would be too much effort given their RAM limitations.

 

"We like 360 and PS3, but their specifications are over five years old now, and that's a lot in computer years," he said. "The kind of tricks we'd have to perform to get this game working on those platforms are such a lot of work that to port it over at this point is just not worth it for us.

 

"For this type of game, I do wish the new generation of consoles had come out by now. Even if it only meant a slightly faster graphics processor and a lot more RAM.

 

"Having more memory would make a huge difference to being able to bring a game like [The Witness] to a console," Blow added. "It makes it much easier."

 

http://www.computerandvideogames.com/320459/braid-dev-would-like-xbox-720-ps4-now/

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Searched and saw nothing so apologies if already posted.

 

Found at: http://www.product-reviews.net/2011/10/03/microsoft-developers-prepping-xbox-720-games/

 

http://sillegamer.com/?p=4231

 

The latest issue of Xbox World is reporting via the rumor section that a number of Microsoft developers are currently prepping a wave of brand new titles for the unannounced successor to the Xbox 360.

 

According to the November 2011 edition of the publication' date=' a notable selection of high-profile development studios are now in the process of manning big-budget teams for a bout of new games for the Xbox 720.

 

Recent rumors floating about include the possibility that Turn 10 are hard at work on Forza 5 for the fabled next generation console, in addition to powerhouse developer Epic supposedly developing Gears of War 4 as a launch title for the device – tantalizingly rumored to be pegged in for a 2013 release.

 

Check out the rumor below and in the November 2011 edition of Xbox World, out now.

[b']

”Rare, Lionhead and Turn 10 all have teams in place too – Rare, we hear, are even prototyping ideas for a new ‘mature’ title.”[/b]

Xbox 3 in Fall 2012! Believe!

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