Wednesday, April 25, 2012

From Dinosaurs to Birds: Wither Gaming Consoles?

I'm a digital media, data mining and mobile advertising sort of fellow, and - although I am an an active, non-apologetic gamer - I have never touched a line of game code in my life. (Well, I did write a Towers of Hanoi application in LISP for an AI course once, but that doesn't really count.)  So imagine my strangeness yesterday when I found myself at the LA Games 2012 Conference in Hollywood.

The experience was interesting - not quite "fish out of water," since I knew a surprising number of people there - but close. There were several people that I knew from my life in mobile, who apparently moved over to gaming through the mobile experience. Games on iPads, games on Android phones, that sort of thing. 

Opening Slide for Ben Cousin's
GDC Talk
I got there early, which allowed me some time to walk around, network and - most importantly - duck in to other panels. There was a theme that ran through some of the panels, and the afternoon live-panel debate on what monetization strategy will win, concerning gaming consoles. Some of the panelists and industry insiders are predicting the death of high end gaming consoles. One panelist even went so far to say that the PS3, XBox and Wii consoles were "dead man walking," and would be supplanted by tablets, phones and PCs as early as 2016. (I suspect this sentiment was given credence last month when ngmoco's Ben Cousin's called the death of the console an inevitability at the Game Developer's Conference. It's a convincing argument - you can see Ben's talk over at Blog Games.) 

Interesting theory - but it feels shortsighted. (Or, more to the point, surprisingly self-serving, since some of the advocates of this idea ran mobile gaming concerns.) There are a couple of reasons why this feels shortsighted to me.  To begin with,  there are two types of gamers. The first type I would call "arcade gamers" - sitting on your phone for 5 minutes a shot to play relatively simple, yet satisfying games, like Plants vs. Zombies or Angry Birds is a fine way to kill a few moments of time. And while I fully realize that the sophistication, and therefore gaming capabilities, of mobile devices will increase over time, there are just inherent limitations of gaming on mobile: the device itself is the controller, which limits the activity choices and availability. 

The second type of gamer can be thought of as the premium gamer: on a couch with a controller, a gaming console connected to a television (or high end PC), and a beer, a premium gamer will spend hours at a shot immersed in a game (either alone or online) playing a complicated, cinematic game through to completion. Both types of gaming are completely legitimate, but they are completely different experiences. 

However, the primary reason that the belief that the console is going away doesn't quite feel right is the reason I was at LA Games in the first place. I was asked to sit on a panel called "Entertainment on Consoles: Reinventing the Media Hub of the Living Room," moderated by Chris Marlowe over at Digital Media Wire

Game console penetration, for just the XBox and PS3 alone, is around 50M units. Unlike other consumer products, the hardware refresh of a typical gaming console is around 10 years. The reason for this has to do with the complexity involved in developing and engineering games for these systems - a typical game for your iPhone can be constructed in months with just a few people, whereas a premium game for a high end console is more like a movie production: there are hundreds of engineers and game designers, voice and motion talent, set design, etc. It takes upwards of a year or two to create, so having a box that gets hardware refreshed in any timeline faster than a decade is not going to attract a lot of developers. (Why spend 18 months and millions of dollars engineering something only to have the hardware requirement change on the 19th month?)

So, in order to combat consumer fatigue, modern gaming consoles are designed to be as future proof as possible for the technology of the day: high end processors (both CPU and GPU) are designed into systems that can be reprogrammed with new firmware. Constant internet connections to the mothership are made so that new software, operating system changes and business models can be injected onto these systems through upgrades. (For instance, the ability to buy games directly through the Playstation Network wasn't available when the PS3 was launched, but it is now.) The systems are typically sold at a loss to the company that is making/supporting the console, with promise of payouts on the backend for licensing deals, game developer fees, and consumer subscriptions.

All of this makes these boxes attractive purchases for consumers - you are almost guaranteed that the $200-$400 you spent on a box in 2006 will still be a viable device in 2012. 

It also makes these boxes excellent trojan horses: they are quite powerful out of the box, and once installed at a consumer's home, more and more functionality can be added remotely. Modern gaming platforms, most notably the PS3 and XBox have re-invented themselves to be more than just game platforms. These devices now allow users to rent movies from their in-device stores, or download applications such as Hulu+, Netflix and Amazon Instant Video to get film and television through these other sources.

Both the PS3 and the XBox have recently retooled themselves to reflect this additional tour of duty: the PS3 version of Netflix is the only one that outputs in 5.1 audio, and is the only gaming console at all to carry Amazon Instant Video. In January, Microsoft released a complete UI redesign for the XBox reflecting not only the "Metro Tile" look and feel to the XBox, but actually de-emphasizes games as the primary driver on the XBox in lieu of applications. The XBox app category downloaded most frequently? Video applications. (The HBO GO App on the XBox is a thing of beauty, especially when paired with the XBox Kinect.) 

I suspect that the next game console hardware refresh we see (from both Sony and Microsoft) will contain quite a few changes. Some easy to guess predictions: no physical media, higher bandwidth connections, Thunderbolt output, easy mobile connectivity for session shifting (this has already started in the case of the PS3), options (either physical or wireless) to use mobile as controllers, and higher resolution output. They will be smaller, easier to connect, less power hungry, and more discrete devices - perhaps deals will get struck with cable operators similar to what Xfinity just released with XBox, freeing us from cable boxes forever.

So, is the gaming console really the dinosaur of gaming? Sure, but dinosaurs never really became extinct, they just morphed into birds...


Unknown said...

It's very difficult to say what *will happen, but, in an unusual bout of difference of opinion from you, I can predict with confidence what *might happen, and it may very well be the death of consoles.

Specifically, I think what you're overlooking, as you analyze the way in which mobile games are currently played, the fact that there's absolutely nothing mandating that they continue to be played in this manner.

There's a terrific clip on youtube illustrating how TODAY you can download any number of old console emulators (NES, SEGA, etc), plug your Android phone into your TV via an HDMI cable, and control the games with a PS3 style bluetooth controller! If you don't look over to see where the game is coming from (PS3 or your phone) you have NO idea, and you don't care (and why would you?).

So... I can easily imagine a very very near future in which everyone has a dock for their phone that connects to their Receiver via HDMI and you plug your phone in and use it as the console.

Obviously the phones already have just about as many streaming video offerings, and it's entirely a business decision how many more they will get in the future (and I predict they will have them all).

Granted, a PS3 has more horsepower than a phone... but that's today. 3-4 years from now it will be as powerful, maybe more so.

You obviously have a very valid point as to the complexity of games, but that too will port, if the devices promise to be powerful enough to support these game products for a couple of years per title.

So, yes, as it stands today, no one is going to dump their PS3 for their Nexus, but it doesn't take a whole lot of imagination to see where in the VERY near term such a move would be entirely rational (and maybe even kind of sexy).

Rob DeMillo said...

Thanks for the comment, always appreciated...

There's a few things holding me back from that future - which, by the way, is the future that Ben Cousins was suggesting: consoles replaced by docks (either physical or wireless) for your mobile device.

While that will work well for most video - in fact, you can do it now with HDMI out or DoubleTwist from Android devices or AirPlay from iOS devices, looking towards that sort of a world of mobile/console convergence leads me to two issues...

The first issue is horsepower: mobile will never catch up. Even though the hardware refresh on consoles is about 10 years, the initial offerings for a AC powered, always on, wired console will outstrip the offerings of a cutting-edge mobile device for many years into the future. (Consider that the PS3 sitting by your television has enough graphics processing power to generate all of the CGI scenes from Jurassic Park in realtime.) By the time a mobile device catches up to the console, it will be time for a new console hardware refresh which will leapfrog it past mobile again. The land of premium gaming will forever be in the hands of the gaming console.

The second issue I have with it is: why? What would be the advantage to taking a phone out of your pocket, plugging it into a dock, picking up a controller and starting your game? What has been gained, exactly? What experience has been enhanced? I'm all for convergence, but there comes a point where form factor of a device dictates its usage. A mobile device has an appeal as a game unit only in the field: at the bus depot, lying in bed, waiting in line... playing a game like Mass Effect on a phone in the field doesn't seem very appealing, so why consume memory with a 15G game that you would only play at home on a larger screen?

Further, as you point out, this exists now... but who does it? I'm not aware of anyone who does, actually. You are right, my Android phone plays Joust beautifully, and I can plug it into my television over HDMI and play it that way...but I don't. There's no appeal. Android tablets can accept XBox controllers - it's a great trick, but no one does it because that's not typically how you use a tablet.

While you make a convincing argument, I still stand by my original premise: there's a bifurcation of gameplay between casual gamers and premium gamers, and those two different usage models (and mindsets) will keep mobile gaming and console gaming separate. Both will change dramatically, and maybe even invite interplay between the two (a la PS3 and PSVita or using a mobile device as a controller for a console), but I don't see replacement of what for the other happening anytime soon.