Newsweek: Xbox 360 Won't Win the Console War

[Jack Torrance]

Slightly OT, but seeing as this deals with the PS3's and Blu-ray's direct competition, I believe this is relevant:

http://biz.gamedaily.com/industry/feature/?id=15564

Newsweek: Xbox 360 Won't Win the Console War

Sure, Microsoft has already sold well over 10 million 360s, and they have a rock solid online plan and a great library of games, but things should be going even better than they are, claims Newsweek's N'Gai Croal. He talks about why the 360 won't come out on top when the battle is over.


As part of N'Gai Croal's "Level Up" section, the Newsweek columnist has put together a new piece that outlines some of the problems Microsoft camp is facing with the Xbox business, and why the 360 ultimately won't be on top when all's said and done.


The article "Redmond, We Have A Problem, Or, What's Wrong With the Xbox 360" (which follows his "Tokyo, We Have A Problem, Or, What's Wrong With the Playstation 3"), acknowledges the advantages Microsoft has (a year's head start, large library of games, a cheaper SKU, etc.) but it also points to a few shortcomings.


For example, Xbox 360 sell-through has been lagging behind the original Xbox, and while roughly half of 360 owners never purchased an original Xbox, owners of the first Xbox have been slow to adopt the 360. "Part of the problem is that in the absence of a new Halo game, there's been a slower-than-expected conversion of Xbox owners to Xbox 360. As of last fall, half of the people playing Halo 2 were doing so on the original Xbox, not the Xbox 360," explains Croal. "That's why the upcoming Halo 2 map pack will only work on Xbox 360--Microsoft needs to force recalcitrant Halo-lovers to buy their new machine. Another challenge for Microsoft may be that most Xbox 1 units sold at $199 or less; in fact, when Halo 2 shipped in November of 2004, the price of the Xbox had been set at $149 for seven months."


Croal doesn't believe the 360 has what it takes to become a true mass market machine in the way the PS2 did either. He states: "What the original Xbox proved, and the Xbox 360 is proving even more so, is that Microsoft has learned how to strip-mine the hardcore gamer. (The evidence? Gears of War is one of the biggest console hits in recent history, yet the Wii is kicking the 360's ass and taking its name. And as we stated earlier, even before the Wii and PS3 launched, the 360 was steadily producing one or two hits a month, yet monthly hardware sales were consistently below 300,000 units, and were often closer to 200,000 units.)"


So where does that leave the Xbox business? "The worst case scenario for Microsoft, then, is one in which the Xbox 360's bid for the mass market is blocked by the Wii for the next two to three years, at which point the aging and underpowered Wii gives way to a cheaper-than-it-is-now PS3 with a selection of AAA titles that's far wider than what the PS3 has at the moment; new installments of Playstation's own popular and casual-leaning games; and a slew of new franchises from Sony's much-larger studio operation. The best case scenario won't manifest itself until Xbox 720," Croal says, who adds that there's an "interim scenario" that "best explains the current overall state of the industry" but he's saving that scenario for another article apparently.