The Return of the One Console Future

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The Return of the One Console Future

Mon, Mar 17, 2008

In an earlier article, I disputed the idea that the video game industry was heading toward a one console future with Google as its ringleader. The idea has reared its ugly head again, this time with Denis Dyack of Too Human fame yelping about it. An interview with him over at 1up as part of a follow-up to an earlier podcast plumbs the depths of his intellect about this Utopian future.

Initially, Dyack brings up a very good point. He points out that the video games market succumbing to the lure of commoditization:

Commoditization is related to performance oversupply, which we also didn't get to talk about on the podcast. Performance oversupply means technology is giving people more than what they need, which in turn means that technology is losing its value socially. You can see it with cell phones when they started to do more and more things. You can send texts, listen to music, watch videos, take pictures, all that kind of stuff. With the consoles it's other stuff, like being online. Sony's Home service is a really good example of where I think consoles are moving toward performance oversupply. It's really questionable if people need Home as an interface. A lot of work is going into it, and it's really hard, but do gamers need that? Whenever you start seeing performance oversupply it means that particular type of market is moving towards a commoditized market. We're giving the consumers more than what they need, and people are going to start caring less and less.

As someone who has done his best to avoid any innovations in the phone market, I can sympathize with this complaint. I see no reason to desire the ability to watch video on my phone or take pictures or listen to music. I avoided buying a cell phone for a long time because I didn't want more technology cluttering up my mental landscape. Now that I've given in, I prefer the most pared-down cell phone possible. Okay, work requires the use of a Blackberry, but that's the biggest concession I'm willing to make.

When I saw videos and descriptions of what Home would be like, I thought that it was an awfully neat little innovation, but I didn't see any reason to get excited about it. I don't want my console to try to expand into some chatroom-avatar-enabled device. I saw Home, shrugged, and said, "Meh." The only added functionality I like out of my console is the ability to play whatever video format happens to be en vogue at the moment. If it plays games and functions adequately as a video player, then I'm happy. I don't use voice chat on Xbox Live, and the only reason I use any of the text messaging abilities in Live is to set-up games with my real life friends. Once that's done, I don't need any extra functionality.

Saying things like this makes me feel like some sort of cranky old man, sitting in his rocking chair on the porch, cradling a shotgun, and yelling at the neighborhood kids, but I can't be alone in this sentiment.

When Dyack begins to discuss the possibilities of a single console market, I lose my tolerance for his argument:

Everyone needs to firmly understand that the console manufacturers have a closed model. If they win market dominance, it moves the market toward a monopoly, because it's not an open, competitive market. If Nintendo wins 95% of the market, it definitely becomes a monopoly, because if they control the hardware, they control everything else. The current parties who are involved in pushing forward closed systems will never want a single-console future, because it goes against the current business model that they're trying to apply. What I'm saying is going to happen is that the economics of the industry will not continue to support multiple closed models. It's too difficult, it's becoming too expensive to create games, and eventually -- it's really switched from back in the really early days of the NES, when people would do almost anything to get a Nintendo license to work on the hardware. Now look at Grand Theft Auto IV and how Microsoft is paying lots of money to get it as an exclusive or even just get it on their system.

This statement needs clarification. When he discusses a single console future, he means he wants a standardized "game console" like televisions are standardized:

People make the mistake of thinking a one-console future means that all the consoles will be exactly the same. That's not necessarily true; it just means they follow a standard. Using cars as an example, people steer cars with a wheel, and there's a pedal to go. That's an open marketplace. These kinds of standards are what we need for videogames, because they doesn't really exist right now. I think it will happen, and I think it will be good for the industry when it does. It will mean cheaper games, cheaper consoles, and more competition.

Guess what. There already is a single console platform in existence: it's called PC gaming. The mouse and keyboard the standardized input devices, and Windows is the operating system. In this one console Utopia that Dyack envisions, where do one console manufacturers compete? It certainly can't be entirely on price. No. Naturally some manufacturers will start producing consoles with better graphics cards or larger hard drives. They will strive to differentiate themselves through technology. Unless there is only one manufacturer, which is the definition of a monopoly, there will be a tendency toward that commoditization that Dyack fears.

Consumers don't stand to benefits with an array of console clones in the marketplace. It's confusing enough for a consumer to choose between Dell, HP, and Lenova for a laptop, let alone whatever new manufacturers end up vying for the hardware market.

The only people who benefit in a one console system is developers:

It's not a matter of console manufacturers wanting to change, it's a matter of whether the economy of the videogames industry can continue to support the current model. If you talk to developers and publishers, you see a lot of groups disappearing now, a lot of closures of developers, because the economy is so hard. If all the third parties go away, there's not going to be a games industry, so something's got to give somewhere.

And that's the root of Dyack's argument. He is the head of a third-party developer, so his concerns are filtered through those lenses. He knows that multi-platform releases sell far better than most exclusive titles, and yet it is expensive to develop simultaneously for the Xbox 360 and the PS3. The easy solution to Dyack's worry is to maintain a policy of multi-platform releases. Development costs will go up, but the market share for each console won't tend toward this monopolistic system he imagines.

The best system for consumers, in fact, is the current system where consoles are split along demographic lines. The Wii is the choice of the mass market and the 360 is the current choice for hardcore gamers. Why force the mass market to buy a machine of the 360's capabilities when they are satisfied with the Wii? The fact that the 360 and PS3 are trying to get into the casual games market doesn't prevent this broad demographic line from being drawn.

The real loss in a one console future: no more flame wars between Sony and Microsoft fanboys.