Game Consoles Are Dying: A GDC Talk

[pepharytheworm]

[@Dsh - I would propose that Mr. Cousin's argument is flawed. I think the very fact that, once again, we are arguing about pricing is significant. Pricing must be pertinent to the issue if we never seem to move away from it.

Let's put aside the fact that he no one can really address every part of an argument as complex as "why consoles are going to continue to lose significant market share" in 25 minutes. Of course he leaves things out that are worth considering. For me, that's not the point. I also don't care much, at this point, about the validity of his conclusion.

What I DO appreciate, and what does intrigue me is that he adds some new wrinkles to a stale debate. I'd just like to think we could talk more about those wrinkles, those specific parts of his argument, rather than say that they have no merit because the conclusion doesn't take into account contingency X or Y.

Could you make some foot notes of these "wrinkles" so we know what we can comment on? You can post it in your first post.

[Flake]

@Dsh

But he is talking about a paradigm shift. That is too significant a change in consumer habits to forgive the omission of any element as large as pricing scheme.

He lists two examples: Game consoles to Arcades and Movies to Television. He uses these, ratherly lazily, as parallel and equitable examples. With arcades, he has a point: The arcade has largely died in America. The arcade is still a profitable venture but only under specific circumstances.

But movies are still doing very, very well - because they were able to diversify. New features have been added, studios have explored new venues for presentation of their product. Yes, movies are not doing as well in terms of market share as they were in the 1930's but the medium is scarcely hurting for revenue. And this is what we are seeing the platform holders doing, as well. No mention of this in his 26 minutes of doom, however.

He is also shamefully negligent in his use of market share as a benchmark of industry health. What about attach rate? What about some demographic other than "a person who is breathing"? Such figures he throws out but without context I can scarcely take him seriously. The market share of luxury items decreasing during a global recession? Apparently, this is not an issue for Mr. Cousins. Or how about examining the number of people with the three major consoles who ALSO have smart phones and comparing that to people who either exclusively have angry birds or exclusively have the new halos? Or any kind of scientific approach?

I will have no truck with a person who screams that the sky is falling without being able to explain how or why, and that is the problem this man has: A controversial premise backed up with anecdotal evidence that depends entirely on ignoring his logical fallacies.

This is why we return to talking about prices and sales: This man has a 26 minute power point presentation of nothing.

[dsheinem]

[@Dsh - I would propose that Mr. Cousin's argument is flawed. I think the very fact that, once again, we are arguing about pricing is significant. Pricing must be pertinent to the issue if we never seem to move away from it.

Let's put aside the fact that he no one can really address every part of an argument as complex as "why consoles are going to continue to lose significant market share" in 25 minutes. Of course he leaves things out that are worth considering. For me, that's not the point. I also don't care much, at this point, about the validity of his conclusion.

What I DO appreciate, and what does intrigue me is that he adds some new wrinkles to a stale debate. I'd just like to think we could talk more about those wrinkles, those specific parts of his argument, rather than say that they have no merit because the conclusion doesn't take into account contingency X or Y.

Could you make some foot notes of these "wrinkles" so we know what we can comment on? You can post it in your first post.

Well, those "footnotes" would be what the video was about, which is why I suggested people watch it before chiming in. Some folks have talked about it, but many have resorted to old/tired arguments (not that those arguments have no merit, but they are not part of what this video was discussing).

Among the arguments made in the video:

-death of arcades:explosion of consoles market::death of consoles:explosion of mobile gaming`
-the role of exponentially faster chip development coupled with lower power requirements
-the increasingly sharp decline in console profits after the widespread adoption of iOS devices in 2008/2009
-the precedent of larger companies overtaking the industry (Sony and MS:Nintendo and Sega in 1998-2001::Google and Apple:Sony and MS in 2010-2013 (roughly))

There was more, but I don't see it as my role to provide a cliffs note version of the talk.

[dsheinem]

@Dsh

But he is talking about a paradigm shift. That is too significant a change in consumer habits to forgive the omission of any element as large as pricing scheme.

He lists two examples: Game consoles to Arcades and Movies to Television. He uses these, ratherly lazily, as parallel and equitable examples. With arcades, he has a point: The arcade has largely died in America. The arcade is still a profitable venture but only under specific circumstances.

But movies are still doing very, very well - because they were able to diversify. New features have been added, studios have explored new venues for presentation of their product. Yes, movies are not doing as well in terms of market share as they were in the 1930's but the medium is scarcely hurting for revenue. And this is what we are seeing the platform holders doing, as well. No mention of this in his 26 minutes of doom, however.

He is also shamefully negligent in his use of market share as a benchmark of industry health. What about attach rate? What about some demographic other than "a person who is breathing"? Such figures he throws out but without context I can scarcely take him seriously. The market share of luxury items decreasing during a global recession? Apparently, this is not an issue for Mr. Cousins. Or how about examining the number of people with the three major consoles who ALSO have smart phones and comparing that to people who either exclusively have angry birds or exclusively have the new halos? Or any kind of scientific approach?

I will have no truck with a person who screams that the sky is falling without being able to explain how or why, and that is the problem this man has: A controversial premise backed up with anecdotal evidence that depends entirely on ignoring his logical fallacies.

This is why we return to talking about prices and sales: This man has a 26 minute power point presentation of nothing.

His argument about movie theaters and arcade games isn't that they went away, it is that their presentation shifted to a new platform. Of course movies are doing well, but small local movie houses are not.

Again, I am not trying to defend his conclusion, and my hesitancy to do so is exactly for the reasons that others have offered in this thread and that you so eloquently state above. But I don't want to discount the individual arguments/comparisons he makes, either - I think they have some merit, and that the comparison of market share/profitability matters. The global recession you mention is absolutely a factor that he does account for - it is what he starts his discussion with regarding recent console sales. Since that recession isn't really over, I see his argument about how investors and developers must adapt in the here and now regarding resources spent on consoles as having a lot of clout...

[pepharytheworm]

Could you make some foot notes of these "wrinkles" so we know what we can comment on? You can post it in your first post.

Well, those "footnotes" would be what the video was about, which is why I suggested people watch it before chiming in. Some folks have talked about it, but many have resorted to old/tired arguments (not that those arguments have no merit, but they are not part of what this video was discussing).

Among the arguments made in the video:

-death of arcades:explosion of consoles market::death of consoles:explosion of mobile gaming`
-the role of exponentially faster chip development coupled with lower power requirements
-the increasingly sharp decline in console profits after the widespread adoption of iOS devices in 2008/2009
-the precedent of larger companies overtaking the industry (Sony and MS:Nintendo and Sega in 1998-2001::Google and Apple:Sony and MS in 2010-2013 (roughly))

There was more, but I don't see it as my role to provide a cliffs note version of the talk.

I didn't say it was your role to make cliff notes but you said there were new and interesting points being made and I have heard to an extent his discussion before, so I was curious what you thought was new. Plus you are wanting the conversation to go a certain way and I thought it would help.

[Breetai]

Downloadable is fine, the companies like it because they make more per unit since it cuts out manufacturing costs. If you switch exclusively to retro that just tells me that you aren't actually that interested in new games.

One thing you're overlooking is that the very price of the console itself becomes unworth it to buy if the library for it becomes too expensive. That might make Microsoft and Sony shrug their shoulders, but as Breetai said, people who buy used games often also buy new ones.

It's not that complicated.

Exactly. Most of my buys are used older stuff, but somehow I did end up with a new copy of Skyrim when it was released. I got a used God of War III, but I bought a new God of War Collection HD along with it. Maybe that's only a couple new titles a year, but if a new console is not going to allow me to by used games for it I am unlikely to even make the investment in the console. That is the entire point, and I'm glad you were able to write what I wanted to saw in another way.


Wow, three more pages in a few hours. I've only read up to the end of page 3!

So you're saying that you're unwilling to purchase a console unless there are X games you want to play on it? Do you have to be able to purchase them all right away? Or can you stretch the purchases over 5 years?

But that's just the thing! In the first year of a console's life, there are maybe 5-10 titles I want. I am not likely to buy them all right away. Then they build up over the years to 30-50 titles. I, and others, need to pick and choose which ones we can buy new, and then catch up a few years down the road when we can afford the ones we missed out on. Unfortunately, if there is a $30 premium being charged to "unlock" that used copy of God of War IV that we bought 2.5 years after release, why even bother?

Furthermore, less people are going to buy those games because they can't resell later (ESPECIALLY in Japan, where game rentals are illegal. Come to think of it, how many rental shops are still around? Not many in my city of 120,000 people anymore). If people aren't buying and reselling, then the market WILL shrink. This will cause the new medium of smart phones/tablets to gain a larger foothold even quicker. Is that Sony's and Microsoft's goal? It almost seems like it, which is baffling.

Whats the point of buying a console if there are no games to play with it? Atari 2600 woodgrain model, FZ-1 3DO and Model 1 Mega/Sega CD with Model 1 Genny/Mega Drive sure look nice but I wouldnt want to buy them just so they could look nice on the shelf.

Speak for yourself! Actually, most of us buy these largely because they look good on the shelf. Most of the 2600 games we'd play are available on compilations on the PS1/PS2. Most of the top Genny games are available on the PS2/PS3/360/online. All of them are readily available through emulation (Wii, PC, etc.). Most of the recommended 3DO games are also on the Saturn/PS1/PC. Do some of us REALLY own a 32X just to play Kolibri? Come on, that, or probably any other 32X game, is not something any of us play regularly that we can't easily play on a modern system. I would bet money that most of us here buy this stuff because we like looking at it on our shelves. Otherwise, we'd all be into emulation instead (despite the Saturn being difficult to emulate).

Do realize I'm speaking in jest here. I actually agree with your post that I quoted, but my point about lots of us buying over emulating does have something to do with how awesome it is to see this stuff on our shelves.

...the video is looking at things from a different perspective - one that's not this same old "used game sales/DRM/DLC/etc." argument. I have never said I agree with the points that the video makes (I am still mulling them over, tbh), but I was hoping the discussion could be about the points raised in the video...

[MrPopo]

So you're saying that you're unwilling to purchase a console unless there are X games you want to play on it? Do you have to be able to purchase them all right away? Or can you stretch the purchases over 5 years?

But that's just the thing! In the first year of a console's life, there are maybe 5-10 titles I want. I am not likely to buy them all right away. Then they build up over the years to 30-50 titles. I, and others, need to pick and choose which ones we can buy new, and then catch up a few years down the road when we can afford the ones we missed out on. Unfortunately, if there is a $30 premium being charged to "unlock" that used copy of God of War IV that we bought 2.5 years after release, why even bother?

I see, so a $10 online pass that you likely wouldn't use 2.5 years after release (multiplayer is either dead or only full of people obsessed with the game) or included optional DLC (optional) is the same thing as $30 to be able to play the game at all.

Furthermore, less people are going to buy those games because they can't resell later (ESPECIALLY in Japan, where game rentals are illegal. Come to think of it, how many rental shops are still around? Not many in my city of 120,000 people anymore). If people aren't buying and reselling, then the market WILL shrink. This will cause the new medium of smart phones/tablets to gain a larger foothold even quicker. Is that Sony's and Microsoft's goal? It almost seems like it, which is baffling.

You're confusing the number of people having played game X with the market for game X. People who buy a used copy don't increase the market. By your logic piracy increases the market and keeps back the smart phones/tablets.

[pepharytheworm]

By your logic piracy increases the market and keeps back the smart phones/tablets.

Please elaborate. He states a legal way and you state an illegal way. One keeps stores in business the other doesn't.

[Damm64]

I watched like 20 minutes of the video, i can't watch more... it's kind of boring. Sounds like this guy it's speaking nonsense to me. You can't compare a game in fisical format (call of duty) that cost 60$ brand new against angry birds witch is like 5$ or something.
Both are games but for way diferent use, angry birds is perfect if you have to kill time waiting in the bus stop for example.

By your logic piracy increases the market and keeps back the smart phones/tablets.

No. By this logic he speaks about the option that I as a consumer have to buy/sell my stuff so i can buy more new stuff, and the people who buy the used item still can enjoy it.

[o.pwuaioc]

I don't think anyone does, except maybe rich Microsoft IT guys.

Thanks for helping turn an interesting discussion about the impact of mobile gaming and its effect on console-profits into a platform for rehashing the used games debates and launching ad hominem attacks. I'd a bit surprised that you went down this road...

That's not what it meant and you know it. If I were to have said MrPopo's opinion was irrelevant because he worked at Microsoft, that would have been an ad hominem. But I wasn't. I was pointing out that he's well wealthy enough to be able to have a purchasing habit that the large majority of gamers don't.