Other Gadgets

Who is winning the gaming battle?

Anuj Srivas | Updated on August 27, 2014

Xbox One

Smartphones with hot new game apps have crossed swords with gaming consoles and handhelds. The latter have an advantage.

Seven years after Apple unveiled the iPhone— and. in the process, kick-started the modern smartphone wave—the results have been devastating. A quick online search will lead to a number of articles that are usually titled something like ‘30 Things your Smartphone Replaced’.

And yet, not every consumer electronic industry has resigned itself to the inevitability of oblivion. A quick peek at some recently revealed sales figures paint a surprising picture: Sony and Microsoft have sold 10 million PS4s and 5 million Xbox Ones in less than nine months.

Nintendo, which is hurting from the poor reception to its Wii U console, revealed that its 3DS handheld system continued to be a bright spot for the company. The Wii U’s games have also done exceedingly well, with sales of Mario Kart 8 almost hitting 3 million copies within a month of its launch.

On the other side of the mobile-first fence, the picture is not so pretty. Mobile game companies like King, which develops the highly popular Candy Crush Saga game, are struggling in their monetization efforts. Devices like the iPad, which were expected to take chunks out of gaming console sales, are seeing a substantial reduction in sales (down nine percent year-over-year last quarter).

Convergence?

The classical bear argument against handheld and console gaming centers around whether consumers and gamers will agree to carry and use ‘yet another device’ apart from their smartphone. Incidentally, this argument also holds true for MP3 players, point-and-shoot cameras and any other device whose core function has been subsumed by the smartphone.

A crucial sub-argument here is that handheld gaming devices, and indeed few video gaming consoles, cannot compete when it comes to hardware specifications. For instance, the touchscreen of the Nintendo 3DS (400 X 240 pixels) is atrocious when compared to any modern smartphone’s screen resolution.

An iPhone or iPad, therefore, on paper, suits the casual gaming needs of children and adults far more than any handheld or video game console.

Yet, Sony, Microsoft and Nintendo (to a lesser extent) appear to be thriving. The handheld and console gaming industry on the whole seems to be a bit more resilient than many in the tech world may have first believed.

Console-dation

The console’s industry’s first source of strength comes from its excellent user experience and interface. No matter how convenient it is to see iOS and Android mobile gaming as a classic low-end force of disruption, it doesn’t take away from the fact that the touchscreen is well suited to games that are most enjoyed while killing time. A console or handheld device, with comes its built-in game controls, provides a far better experience for more serious and well-designed games.

Behind this first advantage lurks a second strength. With the quick adoption of the smartphone, the gaming market has been divided into a casual user base (mobile games) and a dedicated section (console and handheld devices). This helps in solving the question of whether consumers will agree to carry and use ‘yet another device’. The dedicated gaming device, be it a console or handheld device, is worth the extra money because it provides a much better user experience.

We see this bifurcation in another consumer electronic industry as well. In the digital camera industry, the smartphone devoured the low-end—which primarily consisted of point-and-shoot cameras—while leaving the high-end DSLR cameras mostly untouched.

The last and final reason why the gaming industry should continue undisrupted is that its classic formula still holds true. Microsoft, Sony and Nintendo have by and large relied on selling hardware at a loss while recouping their money through game licensing and selling games.

These companies have always, therefore, sold their console and handheld systems by bundling them with mass-market, category-defining, company-exclusive games. The games are what sell the system: Tetris sold the Game Boy, Super Mario 64 sold the Nintendo 64, the Halo series sold the Xbox 360 and the Metal Gear Solid series was responsible for making the PlayStation what it is today. Casual gamers who play Candy Crush, however, do not buy smartphones in order to play Flappy Bird.

Not as futuristic

This does not mean that the gaming industry can rest easy. Nintendo is a clear embarrassment when it comes to the post-smartphone world—where the purchasing of games, installation of software and overall ownership experience are vital. Why, for instance, are Nintendo customers not allowed to digitally transfer their game purchases onto every new piece of hardware that the company churns out? Tying down a game to a particular device seems positively 20th century.

The immense popularity of the OUYA microconsole—which allows the illegal emulation of classic Nintendo games— also shows how badly Nintendo has botched the market for its old gaming titles. Illegal emulation is the easiest, and, for some, the only way to play classic Nintendo games. Sony and Microsoft, though slightly better, also have some catching up to do.

However, as long as these companies continue to delight its users with the perfect combination of hardware and games, the dedicated console and handheld market will still be here for a long time to come.

Published on August 27, 2014

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