Competition: Bad for consoles?

[Psaakyrn [deprecated]]

Because I just like making discussion posts, here's an overly elaborate post I made in Joystiq.

Actually, in my opinion, consumers are losing because of this competition, instead of gaining. Here are my reasons.

a) Seperation of standards

Remember the Netscape/Internet Explorer problem? When two companies (or more) have competiting products, they'll tend to make themselves different. Whether it's good or bad, is a different matter, but in my opinion, it's currently heading towards "bad". Different online implementations, different online expectations, different hardware configurations.. In the end, people have to buy more than one console to get everything. This doesn't happen with computers, and is markedly reduced with browsers as well.

b) Bloatware

Also because of the need for seperation, occasionally stuff that aren't really important are added in. Some would argue that the inclusion of tilt in the Sixaxis and the inclusion of BluRay are examples of such occurances. Whether or not they are in the end is incertain, but in the case of BluRay, many people seems to agree.

c) Power War

Usually competition leads to a price war. Occasionally, it leads to a power war instead, like the Cold War. In this case, it's obvious that something similar is happening with XBox 360 and PS3, which are sacrificing general affordability for even more power. Just because I can get an alienware (or Dell gaming) laptop for a couple thousand doesn't mean I should, especially when a laptop suffice for my general gaming needs.

d) Exclusitivity, forced purchase

Because of the need to be unique, every console has exclusives. This means that in order to play everything, I MUST get all three consoles. Unlike a PC, which as long as I have a good enough computer and graphics card, irregardless of manufacturer, I will still be able to play any game on the PC market.

e) Risk-adverse

Sometimes competition creates more interesting products. Sometimes it just causes parties to play cautious. When everyone is looking out for their bottom line, they cannot take risks that might give them a weekness that others can strike. Because of this, certain risks may never be taken, like investing in an "unknown" director for a field he's new to, even it he's top-of-the-line for a directly related field.

f) Questionable practices

Because the competition is fierce, companies must make use of any advantage they can manage to obtain, even if some are questionable, such as the Lik Sang situation.

Conclusion: competition is not always good. Sometimes it may end up absolutely self-destructive.

Discussion: Is the current competition (meaning Nintendo/Microsoft/Sony) in console space harming or helping the average consumer?

 

[Archon]

I'll take the pro-competitive counter-position.

a) Seperation of standards
On the contrary, during the First Browser War, innovation was coming fast and hard. And now the arrival of Firefox has forced Internet Explorer to step up its game after several years of lethargy. Separation of standards gives consumers a choice of which they prefer; and in the long run the winner take all nature of platform competition means one ultimately wins -- the one the consumer prefers.

b) Bloatware
A console that includes stuff that's not important to the consumer will get out-competed by a console which focuses on what's important. The market will determine whether BluRay or Sixaxis were bloatware or not.

c) Power War
The pursuit of a "power war" inevitably leads to the commodization of the power that was the focus of the struggle. The net result is consumers soon have access to better, faster, stronger hardware sooner than they otherwise would, and the price drops fast as the manufacturers race down the learning curves and gain economies of scale.

d) Exclusitivity, forced purchase
A wider variety of consoles, with separate standards, expanded features, and tons of power (as you describe above), gives game developers opportunities to create new and different types of games. Games that are exclusive to the console they're designed for. It's like Nintendogs and the DS -- it's a good thing, not a bad thing. Yes, in an ideal world we'd all like to have all the consoles and all the games, but that's not the actual alternative to competition -- the actual alternative is generic consoles with generic games.

e) Risk-adverse
Sometimes competition creates risk-taking. Like creating a console that demands a broadband internet connection. Or one with a silly name, and a wacky control scheme. Or one with an ultra-high-end DVD format.

f) Questionable practices
Monopolies and oligopolies are even more likely to engage in questionable practices, because they can abuse the market place with letter worry that the competition can respond. Competition may be cut-throat, but ultimately the consumer can choose to back the company they like.

Let the debate begin!

 

[Lex Darko]

In my opinion, consumers are losing because of this[console] competition, instead of gaining.

Here are my reasons...

a) Seperation of standards...

b) Bloatware...

c) Power War...

d) Exclusitivity, forced purchase...

e) Risk-adverse...

f) Questionable practices...


Discussion: Is the current competition (meaning Nintendo/Microsoft/Sony) in console space harming or helping the average consumer?

I completely dissagree. Competition is necessary in the videogame industry. Without good competition the videogame industry would have remained dead way back in 1983 and we'd all probably be watching movies, reading books, or gasp going outside for fun, scary very scary.

If Microsoft didn't yank open the lid (that Sega loosened) on online console gaming, online multiplayer wouldn't be such a big aspect with console games and shooters wouldn't as viable on consoles and important for a console launch.

If Everquest never came along the MMO genre wouldn't be as diverse as it is today.

Competition is vital, the strong products will succede and move forward and weak will be discontinued and forgotten.

 

[Psaakyrn [deprecated]]

I'll take the pro-competitive counter-position.

a) Seperation of standards
On the contrary, during the First Browser War, innovation was coming fast and hard. And now the arrival of Firefox has forced Internet Explorer to step up its game after several years of lethargy. Separation of standards gives consumers a choice of which they prefer; and in the long run the winner take all nature of platform competition means one ultimately wins -- the one the consumer prefers.

Rebuttal: During the first browser war, innovation was fast, yes, but at the expense of there being a complete segregation of two standards. IE still hasn't recovered from the first browser war; As far as I know, there still isn't a standards-compliant manner in which to implement Flash in IE. The only reason why the current gen browser wars aren't causing another segregation of standatds is because the current war is also to comply with the proposed standards, as opposed to direct power-battles.

b) Bloatware
A console that includes stuff that's not important to the consumer will get out-competed by a console which focuses on what's important. The market will determine whether BluRay or Sixaxis were bloatware or not.

Rebuttal: The problem comes when there's other benifits which comes with the PS3, which consumers can't bare to part with. I'm sure you've heard of how Metal Gear or Final Fantasy will manage to sell PS3s irregardless of how expensive it is. This doesn't mean that the bloatware is benificial to the gaming consumer.

c) Power War
The pursuit of a "power war" inevitably leads to the commodization of the power that was the focus of the struggle. The net result is consumers soon have access to better, faster, stronger hardware sooner than they otherwise would, and the price drops fast as the manufacturers race down the learning curves and gain economies of scale.

Rebuttal: This is also largely dependant on product availability. Let me just offer a scenario: Sony decides to divert all PS2 resources to PS3. This would mean that even though the old technology had a price drop, consumers are still forced to purchase the more powerful version. And in order to ensure that more powerful versions are constantly developed, resources that could have been spent on making current technology cheaper, is instead spent on making more powerful technology. Granted this hasn't happened yet, but I won't be surprised it it does happen, to cut Sony's existing losses, and to ensure that they can hit their target PS3 levels.

d) Exclusitivity, forced purchase
A wider variety of consoles, with separate standards, expanded features, and tons of power (as you describe above), gives game developers opportunities to create new and different types of games. Games that are exclusive to the console they're designed for. It's like Nintendogs and the DS -- it's a good thing, not a bad thing. Yes, in an ideal world we'd all like to have all the consoles and all the games, but that's not the actual alternative to competition -- the actual alternative is generic consoles with generic games.

Rebuttal: Opportunities are also created by having a simple unified, but powerful standard. The important point is not of different standards, but of versatile standards. Having many standards just increases the cost of developing for them all, which occasionally leads to products simply not developed to specific standards. (example: PC gaming always had a generally unified standard (other than PC card bonuses, but the differences between both didn't really factor that much into how good a game really is), but it still innovates anyway)
[/quote]
Rebuttal: Yes, Nintendogs is indirectly created from the differing DS standard. But the bigger problem is when the exact same functionality is done differently between two systems. Remember the era of IE-optimised/Netscape-optimised webpages? Similarly, we have XBox exclusive/PS2 exclusive/GC exclusive games, even if they share the same input system. Non exclusive games have to be tweaked, or even build up from basics, instead of being able to run on any system, like how the W3C envisions websites should be in any browser.

e) Risk-adverse
Sometimes competition creates risk-taking. Like creating a console that demands a broadband internet connection. Or one with a silly name, and a wacky control scheme. Or one with an ultra-high-end DVD format.

Conceded: I will admit that this point doesn't quite apply for this generation.

f) Questionable practices
Monopolies and oligopolies are even more likely to engage in questionable practices, because they can abuse the market place with letter worry that the competition can respond. Competition may be cut-throat, but ultimately the consumer can choose to back the company they like.

Rebuttal: I do admit that monopolies can also lead to questionable practices, the bigger question would be which side of the equation is more problematic. Nintendo practically had a monopoly on the portable market until the PSP came along. The Lik Sang issue, as far as we know, is directly related to the PSP. Granted, Nintendo had the occasional (utterly unsuccessful) challenger and the PSP is about the first which really took a significant amount of marketshare.

Added note: A key problem in the competition regarding consoles is that all three are behemoths. In practice, the consumer has almost no capability in altering the placement of the three in the market; Even if their positions change, they'll still be in 1st, 2nd, and 3rd place respectively, and none of them seem likely to drop out anytime soon.

Ball is back at your court.

to Lex Darko:
A monopoly is not necessarily bad: compare a good monarchy vs a segregated democracy. One way of viewing how competition may not necessarily be good is by looking at politics; it's not necessary that products will be strong, only that weaker products die. In addition, because the cost of entering the console market is unimaginable, people can't just enter to set things right, sort of like politics as well.

Competition might have gotten us to where we are, but at the current competition status, it may be more harmful than helpful.

 

[Lex Darko]

A monopoly is not necessarily bad: compare a good monarchy vs a segregated democracy. One way of viewing how competition may not necessarily be good is by looking at politics; it's not necessary that products will be strong, only that weaker products die. In addition, because the cost of entering the console market is unimaginable, people can't just enter to set things right, sort of like politics as well.

Competition might have gotten us to where we are, but at the current competition status, it may be more harmful than helpful.

With a monopoly there is no choice. Which means companies don't have to improve thier product. Currently there is no better example of this than EA's Madden series the only real difference between Madden'04 and Madden'06 is QB vision and of course the rosters.

If there was no competition Nintendo wouldn't have bothered with the Wiimote, MS wouldn't have flushed out Xbox Live, and Sony wouldn't bothered with future proofing the PS3.

Competition breeds innovation which is good for consumers. If Everquest was never challenged they would still be making expansions and there would be no Everquest 2 because there wouldn't be a need to improve it.

Without competition there is stagnation and stagnation in an industry like this is never good for anyone as proved by the 1983 crash.

And I don't see how giving people choice is ever harmful. Also consumers buy value not price or all the next gen consoles would cost $200 or under.

 

[Psaakyrn [deprecated]]

A monopoly is not necessarily bad: compare a good monarchy vs a segregated democracy. One way of viewing how competition may not necessarily be good is by looking at politics; it's not necessary that products will be strong, only that weaker products die. In addition, because the cost of entering the console market is unimaginable, people can't just enter to set things right, sort of like politics as well.

Competition might have gotten us to where we are, but at the current competition status, it may be more harmful than helpful.

With a monopoly there is no choice. Which means companies don't have to improve thier product. Currently there is no better example of this than EA's Madden series the only real difference between Madden'04 and Madden'06 is QB vision and of course the rosters.

If there was no competition Nintendo wouldn't have bothered with the Wiimote, MS wouldn't have flushed out Xbox Live, and Sony wouldn't bothered with future proofing the PS3.

Competition breeds innovation which is good for consumers. If Everquest was never challenged they would still be making expansions and there would be no Everquest 2 because there wouldn't be a need to improve it.

Without competition there is stagnation and stagnation in an industry like this is never good for anyone as proved by the 1983 crash.

And I don't see how giving people choice is ever harmful. Also consumers buy value not price or all the next gen consoles would cost $200 or under.

It's not the option of choice that's harmful, it's the competition, which may drive down the value of choices, as opposed to improve them. There's two ways to win a competition, either by being better, or by making the competition worse. In addition, "being better" does not necessarily make the product actually better (like offering fries with meals, as opposed to making the meals healthier).

 

[Lex Darko]

It's not the option of choice that's harmful, it's the competition, which may drive down the value of choices, as opposed to improve them. There's two ways to win a competition, either by being better, or by making the competition worse. In addition, "being better" does not necessarily make the product actually better (like offering fries with meals, as opposed to making the meals healthier).

No one is forcing consumers to buy a new console it's all thier choice. If there is no significant value in upgrading people won't. So companies have to make sure they are producing a quality product. It's like it more like offering fries as opposed to not offering fries, and if your competitor was already offering fries you give poeple more side options other than fries.

 

[Psaakyrn [deprecated]]

Just a link which helps explain my point here: http://thewiikly.zogdog.com/article.php?article=51&ed=5
(aka: How the current competition is actually against each other directly and to further their objectives, as opposed to giving what the consumers want, and how Nintendo is exiting the "Competition" to actually benifit gaming)

To Lex Darko: The problem here, is that the Sony and Microsoft are just adding more fries, in direct competition. People might actually want something else, but gets more of something they don't want, which actually increases the cost of what they're getting.

 

[TomBeraha]

Just a side note : Psaakyrn that was a wonderful article you linked to there.

 

[Lex Darko]

One of the things that's starting to get me sick of the whole "War of the Consoles" is that so many people keep assuming.

No one really knows who is going to do better, or who will win the "war" until January 2008 so why do keep discussing this in such absolutes.

The problem here, is that the Sony and Microsoft are just adding more fries, in direct competition. People might actually want something else, but gets more of something they don't want, which actually increases the cost of what they're getting.

In which case people won't buy it and they'll go with something else such as the Wii, which is what competition is about.

Side note: that article is one of the worst pieces of writing I've read in a while. It kept repeating its self, making fallacious statements and gave me quite the headache with false feelings of deja vu.

 

[generalissimofurioso [deprecated]]

And Capitalism continues to grind on...

 

[arrr_matey]

My problem has always been that what Sony and Microsoft seem to be competing over is never anything I, and many other people I talk to, even care about. I don't care about more realistic Madden characters. I don't care about yet another first-person shooter (now you can hide behind things and see glass breaking when you shoot it!) And I certainly don't care about being able to download new outfits for my character for $2 a pop (I barely spend as much on my own clothes!)

As soon as there's some competition over compelling storylines, well-rounded characters, novel ideas, unique art styles (let's get away from the boring-ass Tom Clancy realism), new genres, then we'll see a real competition. Right now, Sony and Microsoft are just competing to see who can make the most Halo-clones, Final Fantasy-clones, and Grand Theft Auto-clones.

Boring!

And Nintendo's route is the opposite direction we should want gaming to go. Are we really going to pretend that being able to pretend to flip eggs in a virtual frying pan is the way of the future?

I realise that competing over creativity is not going to make these companies millions like their Halos do. But throw us a bone now and then, eh? Where's Microsoft's answer to Shadow of the Colossus? Does anyone else feel like Bioshock is the only genuinely interesting game that's been announced for the "next generation"?

 

[Lt_Storm [deprecated]]

No one is forcing consumers to buy a new console it's all thier choice. If there is no significant value in upgrading people won't. So companies have to make sure they are producing a quality product. It's like it more like offering fries as opposed to not offering fries, and if your competitor was already offering fries you give poeple more side options other than fries.

The basic problem is that, while I could decide not to buy a new console, this will eventually prevent me from getting new games. A year or so from now, there are going to be very few new games for the current generation of consoles. This means that if I want new content, I will eventually have to buy a new console, whether or not I like the "improvements" that were made over the old one.

 

[[HD]Rob Inglis]

The problem is that there are a few main gaming companies. I'm glad they're not monopolies, but as stated, exclusiveness SUCKS! I like to be able to play some really fun games from one system but then I want to play a game from another platform that has sweet games, take the XBOX360 vs. WII. Both have fun games, but I have to buy both which in the end means both companies get money, and there was no real gain to either by the competitiveness.