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The Future of Console Gaming

part 2/page 1


Just where is the video game industry going today? What will be wowing the masses tomorrow? Who's going to be the next big star, make the next big title? When can you expect it? How much is it going to cost? ...and most important, will it be worth it?

These are the all-important questions in the video game industry. Questions that were just as relevant 20 years ago as they will be 20 years from now. In order to understand where we are going, it is important (as with all things), to understand where we have been, and what got us where we are today.


Part 2 - The Five Year Plan
[ by: R.I.P. ]

   Since the dawn of modern console gaming, one truth has been proven time and time again. There is no money in hardware (maybe there was back in the mid-70's, but that was then). Today's modern video game companies make their profit from software. In fact the majority of publishers work with software because it's just plain cheaper. The hardware manufactures both publish software and collect what amounts to a tithe from "third-party" publishers for the right to release software compatible with their hardware.

   Publishers have had varying opinions over these manufacturing charges throughout the years. For many it is clearly an irritant as evidenced by the number of companies who have gone about manufacturing games beyond the control of the hardware company who builds the platform. Some of the more high profile examples of this are Activision with the Atari 2600, Atari/Tengen with the NES, and EA with the Genesis to name but a few. It is worth mentioning that all of these publishers ended up in lawsuits which were resolved to varying degrees.

   So with that said, let's get some insight into the hardware manufactures who generally drive the industry at it's most basic levels.

   To begin with, we have the "old-standby" Nintendo. In all the years that Nintendo has been competing in the industry, they have shown that they obviously are operating on a larger scale than just "bigger and faster". Over the years that I've followed the company, I've learned two things:

   First, Nintendo seems to consider themselves more of a toy company, and they use their console systems to allow them to deliver their visions... their toys.

   Second, Nintendo will do what Nintendo will do. You can speculate and second guess and write them off as many times as you want, but Nintendo will do what they want, when they want, and they have the positive cash flow to back it up. On any given day, you may even see physical evidence of an activity at their company that points to any possible number of outcomes. But, up until the day that something actually ships, all bets are off.

   Before I go on though, it is important to remember that Nintendo isn't necessarily the end-all-be-all of nice guys. There once was a time when Nintendo was out to control with a strangle hold on the U.S. videogame market during the late 1980's. In fact, many still feel that the U.S. market would probably not be as it is today had it not been for the legal intervention taken against Nintendo at the time. Intervention that is attributed to helping open up competition and allowing more companies to get their products on store shelves. Although, it should be noted that what happened seems to be a common event with companies who gain dominance in a specific market. I think it has to do with the survival attitudes which are present when a company is initially "up-and-coming" into its own. Also, to some degree it can be argued that Nintendo's stringent control of the market may have helped up to a point in reestablishing consumer confidence in videogaming products. Let's face it, before Nintendo launched the second wave of console gaming in this country, the Atari crash with it's glut of mediocre software had left a lot of late entry consumers feeling like they had wasted their money on console gaming. Fortunately, Nintendo seems to have matured since then, as has the market. It would be difficult these days for another company to reach the level of control that Nintendo enjoyed at their worst.

   Today though, the best quote I have run across covering Nintendo's philosophy about what they want to do and where they are going as a company can be found in a December 1999 IGN interview with Jim Merrick, Software Engineering Manager for Nintendo. When asked about technology convergence (such as the proposed merging of PCs and consoles) and expansion capabilities of their upcoming system (code-named "Dolphin"), he replied:

"Oh, we've always had expansion capability in our systems. If you turn over your NES, or your Super NES or your Nintendo 64, there is an expansion connector on the bottom. There are lots of things you can do with it. Now Cable modems, that's a simple interface. You can do that through a controller port. It's no big deal. We're certainly not going to close the door on expansion options. When you're creating a system that is inherently as powerful a computer as the Dolphin is, there's a lot of things you could do with it. But from Nintendo's perspective, we are first and foremost a game company. We don't have a massive consumer electronics division out there, we don't own film studios, we don't own a lot of record labels -- we're not really that concerned about having a piece of the online distribution of electronic media. We really want to make a great machine for gaming. That's what we do and that's what we know." (1)

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