Nintendo, Microsoft and IBM Get Shrewd
By Jeff Chappell -- EDN, May 18, 2005
Well, now that the E3, the annual big gaming tradeshow, is underway this week, there are all sorts of new details about the next generation gaming consoles from Microsoft, Sony and Nintendo.
And the more I think about it, the more I think that Nintendo is right: it's not about the hardware at all but what you do with it; it's about the games and the gaming experience.
Now it might be easy to pooh-pooh that as the rallying cry of the also-ran. Nintendo, despite having the longest history in the biz compared to rivals Sony and Microsoft, and probably having the most diehard, dedicated fans of its proprietary titles, is the No. 3 player. Barring a revolution – its next generation console, incidentally, is codenamed Revolution – it will probably remain No. 3.
And the 'net has been abuzz with technical specs and further speculation, and side by side comparisons of the specs of the three next generation consoles. While Revolution is no slouch in the hardware department, it can't stand up to the next Xbox and PS3 on a chip-for-chip basis.
But Nintendo, perhaps by virtue of having been around the longest, knows that for many casual gamers, the hardware is a secondary concern – what matters is the gaming itself.
Nintendo may be No. 3, but it is a solid No. 3. With a cheaper console and titles that trace their genealogy back to the venerable Donkey Kong arcade game, it serves a market Sony and Xbox do not, and in some ways can't. You can pretty much guarantee that everyone under the age of 35 in the Western world and much of Asia has heard of Donkey Kong or Super Mario.
In fact, Nintendo likes to market the idea that because its hardware is simpler and less expensive, it means more easily developed, and consequently cheaper game titles – it's friendly to the game player and the game developer. In other words, it's about the games.
And in what may prove a stroke of genius, Nintendo says Revolution users will be able to download any Nintendo game from throughout its history, from the original Donkey Kong to the latest Super Mario titles. I'm sure there will be a lot of 30-something Generation X'ers like myself who will find that difficult to resist.
Which brings me back around to my point: Nintendo is right, it is about the games, ultimately, not the hardware. Hardcore gamers will just buy both the Xbox 360 and the PS3, if not the Revolution as well. But the margins will come in game sales to the casual users who don't really get caught up in the gee-whiz factor of the hardware.
Take someone like myself. I'm enough of a computer geek that from a tech standpoint, I would rather have the PS3 than the Xbox 360. While I salivated over the Xbox 360 hardware specs last week, Sony's Cell processor has eight cores running at 3.2GHz. 'nuff said. Furthermore, based on the reviews I've read from E3, the PS3 achieves better graphics performance than the Xbox 360.
In fact, I almost bought a PS2 several years ago, but then an IT geek friend who happens to be a much bigger gamer than myself, not to mention a staunch Microsoft hater at the time, showed me Halo, the futuristic, first-person shooter game developed by Microsoft gaming subsidiary Bungie. I was immediately hooked; Halo sold me and a lot of other people on the first Xbox, which helped it jump into the No. 2 game console spot.
Then Halo 2 came out last autumn, and I absolutely loved it – but not for the reasons you might think. The game play is amazing, as are the graphics; it definitely pushes the Xbox hardware to its limits. But I loved it because the characters that drove the first game returned, and new ones were introduced, and all these characters were developed much more deeply. They became enmeshed in a much more involved plot that ended in a cliff hanger. Halo wasn't the first game to ever take this approach, not by a long shot; it just happened to be the first one to get me hooked.
And now Bill Gates has confirmed in Time magazine this week that indeed Halo 3 will be released when the PS3 launches next spring. I know we all love to hate Micro$oft, but you gotta admire the folks in Redmond; that's a brilliant tactic. It will keep people like me on the Xbox rather than the PS3 or Revolution – much as I might like to play Donkey Kong again, or be awestruck by the PS3's graphics, I'm not enough of a gamer to justify owning more than two time-wasting boxes (the other being my television).
But will this be enough to let Microsoft capture the No. 1 spot in game consoles? Will Nintendo capture us old-timer gamers who remember Mario before he was Super, as well as the techno hipsters and kids, allowing it to recapture the market it once owned?
Time will tell, but I doubt it. Sony has its own proprietary titles with their own set of devoted fans, as rabid as us Halo fanatics. As does Nintendo. Ultimately, there may be some changes in the pecking order; some casual gamers like myself may wait for the PS3 next year, while others will plunk down for an Xbox 360 later this year. Myself, I'll buy an Xbox 360 the same day Halo 3 comes out.
But I think as long as all three console players remember that in the end it's all about the games, there will be room for all three in the market place.
You Go, Big Blue!
You have to hand it to Big Blue, too; Microsoft isn't the only shrewd, sly tactician in the game console saga. IBM Corp. has made its marketing and technological faux pas over the years, but when it comes to the growing gaming console market, they've trumped their competitors at AMD and Intel Corp., among others.
While AMD, and to a lesser extent, Intel, have gone after the PC-based gaming market, IBM now pretty much has a lock on the processor business for game consoles.
It hasn't really made a big marketing fuss over it, but IBM is directly involved in the CPUs of all three major next generation game consoles: Microsoft's Xbox 360, the Sony PS3 and now Nintendo's Revolution.
The details are still sparse, short of Big Blue confirming it will be inside Revolution when it appears next year, but the word on the 'net is that there will be a beefy version of its Power PC architecture inside Revolution. Meanwhile, it is supplying a custom three-core processor in the Xbox 360, and is at the heart of the gee-whiz Cell processor that will appear in the PS3. The Cell will be one of the most advanced pieces of chip technology on the market – any market – when it appears next year.
So essentially, in the gaming console wars, IBM is an arms dealer supplying all three sides. You just have to admire that. And before the e-mails start flying forth to tell me that I'm overestimating the importance of the gaming market – and I know they will – consider this: the gaming console market alone was a $10 billion business in 2004.
And whichever way it goes – the do-it-all entertainment consoles of Sony and Microsoft, or the pure gaming machine of Nintendo – IBM gets a piece of the action. Props to you, Big Blue.
