If the winner of the next-generation console war were to be decided today, Sony would undoubtedly walk away victorious. The Xbox One debut has been an unmitigated PR disaster for Microsoft, which didn’t bother to ensure that it had simple, clear explanations in place for its various confusing policies surrounding used games, game-sharing and connectivity requirements. As a result, blogs have been reporting misinformation and gamers have been getting angrier and angrier. To make matters worse, several Xbox One policies aren’t very gamer-friendly, so many people remained upset even once the air had been cleared. But despite the PR nightmare Microsoft and its public relations firm are dealing with right now, it’s still way too early to declare a winner in the coming battle for gamers’ hearts and wallets.
“The bloggers have been quick to declare Sony’s PS4 the winner of this year’s E3 conference battle of the new consoles, a reversal of Microsoft’s victory in the 2005 faceoff between the PS3 and the Xbox360,” Sector & Sovereign Research analyst Paul Sagawa wrote in a recent research note. “However, the reasons for the enthusiasm for PS4 are decidedly conservative.”
The analyst notes that bloggers are listing the PlayStation 4’s lower price, more lenient DRM policies, better game-sharing and used games policies and lack of a connectivity requirement as reasons the PS4 will dominate the Xbox One in the coming years. He says that while Sony’s “decidedly conservative strategy” of making the PS4 user experience nearly identical to the PS3 experience might pay off in the near-term, it could potentially hurt Sony in the long run since the company isn’t thinking outside the box or introducing any exciting new technologies.
“I think it is way too early to declare a winner in the multiyear battle that will not even begin until November,” Sagawa wrote. “Xbox One is more expensive, but the package includes the new and improved Kinect. The previous version had sold for an additional $100 when combined with the older Xbox 360 console. Sony also offers a motion sensor, the Eye, considerably less sophisticated than the new Kinect and a $59 option for PS4 buyers.”
He continued, “The new Kinect is a technical marvel – able to track movements of 6 different people across an impressively large coverage area, sensitive to finger movements, facial expressions and even heartbeats, and able to see in the dark with its infrared sensor. This industry leading gesture and voice control system is a new variable in the equation, opening a range of options to game and application developers that is limited only by their imaginations.”
The analyst says that Microsoft’s connectivity requirement is controversial but understandable considering the console’s reliance on cloud services. He also says that while users are taken aback by Microsoft’s DRM policy, developers love it — and gamers tend to go where the best games are. Additionally, DRM isn’t necessarily a barrier to used game sales, of course.
“Over time, I expect Microsoft will let the console price come down as volumes drive cost improvements,” Sagawa wrote. “Moreover, gamer appreciation for the benefits of the Kinect and the Xbox Live cloud will also grow with time and exposure. Those benefits go far beyond the gaming market, as Xbox One is also designed as a game-changing media access box as well, fronting the living room cable-box with that slick Kinect interface and delivering web streaming video content over the Xbox Live cloud service.”