CoRNuCoPia

Sitting Still

In 2010 PS3 and XBOX will have motion control capabilities to "match" the Wii.

Consolemakers prep for motion control battle

Nintendo's rivals are prepping for a major battle next year when they plan to take the motion control fight to the Wii.

I highly doubt Nintendo is stilling still without any plan of action.

Since the Wii lacks HD capability, announcing a HD (720P to 1080P) refresh of the console would put them on par with MS and Sony. 

Nintendo must balance between choosing what technology to use after four years of moore's law driving costs/heat/size down (2006-2010) and disruption caused by designing a refreshed console to use the new technology.

Cough** BullS&^t **Cough

Why the writer doesn't doubt MS ' statement is probably more of a surprise than the silly claim MS isn't even looking at Sony's prices.

Microsoft: Xbox 360 Price Drop Timing Coincidental

Microsoft's director of product management for Xbox Live Aaron Greenberg is doing his best to dismiss assumptions that the Xbox 360's price drop was reactionary. He's popped up in several locations in the last 24 hours claiming the timing of the 360's price drop was simply "coincidental."

I don't doubt him. It's that time of year, and getting out in front of the holiday action is essential.

Reporters amaze me at times. Sure late summer is the time price cuts happen because it sets up product for the holiday season. No surprise about the general season for price cuts but announcing a $100 cut the day after Sony's $100 announcement?  It was a reaction.

If the $100 cuts was already planned then why unilaterally cut the XBOX Elite price $100 if Sony's PS3 stayed at $399?  Why not $50?

Frankly, Greenberg's denial is silly and appears more worried than in control.  Admit you reacted and say you're a competitor on price and value.  If I ran MS, I'd get him some better PR help. 

If I ran PC World, I ask why are we not more skeptical?

Shrinking

Some visual  side by side comparisons consoles and redesignes starting with the PS3 and Slim.

The shrinking game console: A history | Web Crawler - CNET News

Sony's announcement of the PlayStation 3 Slim on Tuesday was no surprise for most gamers and industry experts.

What's surprising about the Slim, though, is that Sony was the second-most recent of the three companies to have released its console, yet it's the first to offer a completely new form factor.

... And a recently unearthed patent at the FCC filing shows that a 250GB model is just around the corner.

So is it normal to release a heavily revised version of a gaming system within three years of the initial release? It depends on who you are. Let's take a look at some notable shrinkage from the last three generations of consoles. I think that you'll notice a trend.

I do disagree with the article's statement that MS hasn't revised the XBOX, in fact of the vendors, I thought they did the most.

Sony's changes have been cost-cutting like removing PS2 hardware from the PS3 and adding value such as larger capacity harddisks.

No XBOX "Slim"

Xbox 360 Slim rumours quashed by Microsoft

“We feel like our system has done very well for us in the current form,” 360 product management director Aaron Greenberg told Kotaku.com. “We have no plans for a slim.”

No new XBOX form factor!?! 

Uncharacteristically, MS used Sony's terminology, "slim" which for them is unfortunate.  It implies XBOX 360 stays as is i.e. a "fat" console.

I would expect MS to have said they already have shiped a slim XBOX.  MS did improve the XBOX internals and cut power usage.

The long-awaited Jasper-based versions of the Xbox 360 have finally emerged on the market. These new consoles have a redesigned motherboard with the new 65-nanometer version of the ATI (now AMD) graphics chip that doesn’t run as hot as previous versions. There are other changes that improve the reliability and usability of the system as well.

...Another summary

The new Xbox 360 features lower power requirements and lower heat output by shrinking the size of the CPU and GPU chips. The latest model of the Xbox 360 ships with a 65 nanometer CPU and GPU which should help to increase reliability. Less
heat means fewer chances of mother-board warping and resulting in the "Red Ring of Death" we've all come to know and love about the Xbox 360. Also, because the chips consume less power, a lower wattage power supply was called for in the form of a 150 watt supply versus the older, 175 watt supply. Finally, the on-board system memory has been raised to 256MBs, allowing even units without a hard disk drive to enjoy the New Xbox Experience.

Possibly, since this change in 2008 addressed reliability problems aka "Red Ring of Death", MS spokespeople do not reflexively talk about the redesign.
 
I am surprised at MS's weak response to the Slim. Generally, MS reacts quickly, like to step on competitors announcements and at best are snarky if not out right derisive about their competitors' technology and marketing.  MS is in a fight for 2nd place and failure is possible. 

First Contact, PS3 vs Elite

PS3 Slim Beating Lower Priced Xbox 360 Elite

Unlike the PS3 Slim price cut, buyers do not appear to be snatching up Xbox 360 Elite's at a fervent pace

When the PS3 Slim went on sale at online retailer Amazon.com, it immediately shot up to the number one sales spot on Amazon's hourly bestsellers list for video games. It has remained fixed in that spot now for 10 days running.

The PS3 Slim is new. A smaller, more efficient version of the PS3.

XBOX Elite isn't new. It's surprising that MS countered the PS3 Slim with only a price cut. Maybe MS didn't factor they'd face a redesigned PS3 (SLIM) so soon. Assuming Sony would cut price on the current design.

I expect MS will put out a smaller form factor XBOX. They will need to if their goal is to hold on to second place.

Fail and Fail again

Not a scientific survey - self selecting for those who had a failure and are motivated to complain over those satisified....but 54%?

Survey: Xbox 360 failure rate is 54.2%

In fact, a Game Informer survey of 5,000 readers found that the Xbox 360 has an astounding 54.2 percent failure rate. That means 54.2 percent of Xbox 360 consoles fail in one way or another.

That's well above the reported failure rates of Sony's PlayStation 3 (10.6 percent) and Nintendo's Wii (6.8 percent).

However, when the results hit newsstands in the September 2009 issue of Game Informer, gamers were surprised with the results. No, they didn't think 54.2 percent was a high rate - they thought it was low.

"We're not sure what future techno-utopia this poll was conducted in," wrote Griffin McElroy of Joystiq, "but a 54.2 percent Xbox 360 failure rate sounds awfully low. Had the survey's participants been comprised entirely of Joystiq staffers, it would have been a bone-chilling 100 percent."

Furthermore, 41.2 percent of Xbox 360 owners suffered a second hardware failure after sending their console back to Microsoft for repair, according to the survey. PS3's second-failure rate was 14.7 percent, while the Wii's was 11 percent.

PS3 Price cut

The 2nd battle of this generation has begun.

Sony unveils $299 PlayStation 3 Slim - USATODAY.com

The PS3 got off to a rough start for two reasons, says Divnich. "First, the recession made consumers over-sensitive to pricing. It didn't matter what the price of the PS3 was, the fact that it was the most expensive, compared to its competitors, hindered sales. Consumers simply could not justify purchasing the 'latest and greatest'. Second, the Wii revolutionized how we view the hardware life cycle. Nintendo went against the grain and said, 'We are going to introduce a hardware system that anyone can enjoy and everyone can afford.' The late majorities or price-sensitive consumers did not have to wait three years before systems like the PS3 or the Xbox 360 were within their price range."

I agree, recession and the Wii.

The success of the $250 Wii and MS's expensive attempt to compete on price, a $200 XBOX 360, isolated the more expensive PS3. 

The recession made it hard for consumers to justify the high end PS3 and it took cash away from Sony which was unable to further subsidized price cuts, that is greater losses, to gain market share.

Now, Moore's Law, lower costs due to economy of scale for Blu-Ray parts and manufacturing advances, finally put the PS3 within the current price point for game consoles.

Summer 2009 will be thePS3 low water mark.  Sony's refusal to cut features to gain market share (like MS's XBOX Arcade) and now a competitive price on a full feature unit, is very aggressive.  MS and Nintendo probably would have cut prices for XMAS, however Sony moved first to gain attention.

A $299 US price point is significant.  Below $300, other factors will matter to consumers. JoeSez the added value of Blu-Ray, wealth of existing games as well as form factor, a reduced size and power consumption, will draw consumers to the PS3 Slim.

My guess; as of Sept, Sony will outsell the XBOX globally, forever on.  In the US, it will be close but the PS3 with 1080p BR will be a popular family XMAS purchase that is justified by it offering games and adding value to owning a HD TV.

One wild card; if RedBox begins to carry 20% or more titles in BR format, Sony PS3 will hit an inflection point. Access to BR content will move consumers to PS3 and away from XBOX.

Free ride

 

It's like a tax.

“There will be one-size-fits-all pricing, and as a result, you’ll see the industry will be more egalitarian in terms of its revenue base,” said David Robertson, publisher of the Nilson Report, which tracks the credit card business.

People who routinely pay off their credit card balances have been enjoying the equivalent of a free ride, he said, because many have not had to pay an annual fee even as they collect points for air travel and other perks.

“Despite all the terrible things that have been said, you’re making out like a bandit,” he said. “That’s a third of credit card customers, 50 million people who have gotten a great deal.”

I understand from this week's consumer reports (may)

6. Offer to pay cash. Merchants don’t like to pay transaction fees to credit-card companies. Such fees are about 2 percent for larger retailers and as much as 8 percent for small ones.

My last bill was over $2,500 of which an amount ranging from $50 to $200 went directly to MasterCard for the privilege of my using the charge card.

That's what David Robertson calls a "free ride". 

In California we call 8% the sales tax and is payment for services like highways, police and fire depts.

If the banks want to charge good customers for using cards, they find fewer card holders and consumers rethinking habits.

PS3

Death Spiral?

Sony's PS3 is in dire trouble. It's notoriously difficult to program, which doesn't endear it to developers. Games don't sell as well on the PS3 as other consoles, which makes publishers skittish. Sony's flagship console needs a big price cut, but it's unclear if the PS3 can be cost-reduced enough to support it, given the continuing high cost of its components. The company may have no choice, if it wants to remain in the game.

Problem 1, Cost reduction?

Finally, one key advantage of the PS3—its stellar Blu-ray playback—is becoming eclipsed by the wave of cheaper and, arguably, equally good dedicated Blu-ray players.

Cheaper BR players mean more volume and manufacturing efficiencies.  That means cost reduction for the BR components, one of PS3's more expensive subsystems.  

Problem 2, Game Sales?

There are two key points to consider in those numbers. First, Resident Evil 5 on the Xbox 360 outdid RE5 on the PS3 by 60%. The second point is that Killzone 2, a PS3-exclusive and a major release for the PS3 didn't hit 300,000 units sold. That has to be a blow to Sony.

Problem 3, The Competition?

And third, Microsoft dropped the price on the Xbox 360.

Ahem, Wii is the dominate console. MS price cuts hurt PS3 but their main competitor is the Wii in both units and game sales.  Both MS and SOny have problems given the high cost put into console development.

The PS3/MS comparisons don't tell the full story.  The macro problem for both MS and Sony is the Wii is the most popular console and the 3rd party developers were burned by both MS and Sony when Wii became the run away hit.

Ironically, MS needs the PS3.  PS3 / XBOX ports spread out devleopment costs. There might not be a RE5 for XBOX if the PS3 wasn't around.  

Also, game sales still reflect the fact MS's installed base has a 1 year head start over Sony.   

Finally, PS3's KillZone's sales reflect game quality and interest.  

The best summary of where the game consoles are going.

Three excellent points.

“I actually think we’ve seen the last generation of consoles,” stated Pachter. He predicts that Nintendo will upgrade the Wii to high-definition version.

Microsoft is in a strong enough position to try another generation of Xbox, but Pachter said, “I think the publishers will tell them to pound sand. ‘We haven’t made any money this cycle, and we’re not going to support it.’” Sony, he said, won’t make another console until they make a profit on the Playstation 3. “They will make a profit in 2015.”

Cole notes that Sony have said they have a 10-year plan. “From a financial standpoint, they need that 10 year plan to work.” But he believes it’ll be closer to 2012.

Sony's 10 year plan was a worse case.  They're living it.

Nintendo has enough room to add HD video (720p). This upgrade would enable new games and  revitalize popular franchises with a new, follow-on game in HD. 

MS is the worse off. Their XBOX is not the most popular, like Wii, or multi-purpose, like the PS3.  They can't afford to reve the hardware and break compatibility and adding Blu-Ray support would only validate the PS3.

IMHO, MS blew it when they didn't add HD-DVD support to the core XBOX360 unit the day the PS3 shipped (which was 1 year after the XBOX360 shipped).  Had MS modified the core platform and begun making only HD XBOX360's, they would have crushed the PS3. Their existing base could add an external HD-DVD and game developers continue to use DVD fomrats since HD-DVD units were backwards compatible.  

MS would have put real pressure on the PS3 and also helped fuel a format war that I think MS and Toshiba would have won at Sony's expense, maybe even broke Sony's back.