The holiday season is almost upon us and gamers are excitedly waiting for next-gen consoles from both Sony and Microsoft to hit shelves. PlayStation and Xbox fans have been following the console wars between these heavyweight firms for many years, and they are fascinated to see who will prevail this time around.
Thousands of articles, blog posts and social media salvos will be published on this topic in the weeks ahead. Everyone will speculate as to which console will sell the most units and who will win the latest round of the battle.
However, a closer examination suggests that Microsoft actually has little desire to wage war with Sony in 2020. Could the console battle therefore be consigned to the history books?
The Ultimate Goal
Most analysts agree that the PS5 and Xbox Series X will form the final generation of hardware consoles. The industry will then fully migrate to cloud gaming. Yet Xbox chief Phil Spencer says Microsoft is already looking to the future, and it no longer sees Sony as a competitor.
“When you talk about Nintendo and Sony, we have a ton of respect for them, but we see Amazon and Google as the main competitors going forward,” said Spencer in an interview with Protocol. “That’s not to disrespect Nintendo and Sony, but the traditional gaming companies are somewhat out of position.”
Microsoft has invested tens of billions of dollars in cloud capability in recent years, leaving it well positioned to dominate a gaming market that is tipped to be worth $300 billion by 2025. However, its big tech rivals have also made similar investments.
“I don’t want to be in a fight over format wars with those guys [Sony and Nintendo] while Amazon and Google are focusing on how to get gaming to 7 billion people around the world,” said Spencer. Ultimately, that’s the goal.”
An Alternative Viewpoint
Nintendo actually pulled out of the hardware console battle several years ago, but it has since enjoyed great success with innovative devices like the Wii, DS and Switch. The so-called console wars have essentially become a head-to-head between Sony’s PlayStation and Microsoft’s Xbox.
The PS2 prevailed comfortably against the original Xbox, but the Xbox 360 then gave the PS3 a run for its money, before the PS5 blew the Xbox One away. You could actually argue that the console war is a thing of the past because Sony wiped the floor with Microsoft and left it behind a long time ago.
The PS2 is the bestselling console in history, while the PS4 and the original PlayStation are comfortably nestled in the top five. The only Xbox console in the top 10 is the Xbox 360, which still sits below the PS3 in eighth place. You do not come to the Xbox one until you get all the way down to 15th place. That essentially represents a landslide victory for Sony.
You could accuse Spencer of getting his excuses in early in case the PS5 massively outsells the new Xbox. The PS5 will have more exclusive games, and the jewel in the Xbox Series X’s crown, Halo Infinite, has already had an inauspicious year, so the PS5 would be the favourite to prevail. You could also ask why Spencer has bothered to release a new console if he does not see console providers as rivals.
Yet there is a lot of substance behind his points. Every other industry has switched from hardware to cloud storage. Nobody buys DVDs or CDs any more. If the PS5 is the last console that Sony will release, it might fade into obscurity after that, as it does not have the infrastructure to target 7 billion people with video games. Only Microsoft, Amazon and Google have that.
Microsoft is therefore launching the Xbox Series X in conjunction with cloud gaming service Project xCloud and Netflix-style gaming service Game Pass. None of its titles will be exclusive to the Xbox Series X.
Spencer says he wants customers to be able to enjoy the games they want with the people they want to play with, anywhere they want. Microsoft is striving to bring Xbox games to as many people as possible, regardless of whether or not they buy the Xbox Series X.
“As our content comes out over the next year, two years, all of our games, sort of like PC, will play up and down that family of devices,” said Xbox Game Studios director Matt Booty in an interview earlier this year.
Nowadays the world’s most popular games are multiplayer titles like League of Legends, Fortnite and CS:GO, or they have strong multiplayer components. Check out the popular esports featured on Unikrn and you will see that these are titles played in the cloud, with friends who live anywhere.
Tens of millions of people watch gaming content on Amazon’s Twitch and Google’s YouTube Gaming each day. Microsoft may have folded its Mixer platform, but it still believes that the cloud is the future. If that proves to be the case then consoles will soon be obsolete.
The Next Nokia?
Another school of thought says that consumers will still desire gaming hardware at their disposal for many years to come. Google Stadia has not exactly taken the world by storm, and it shows how convenient it is to have a high-quality console.
One day advances in VR and AR technology will totally change the face of the gaming sector, but we are still a long way off that day, so Sony could still thrive with hardware consoles for several years.
Yet the future narrative will almost certainly be dominated by the cloud wars rather than the console wars. It is therefore easy to see why Microsoft feels confident in its ability to succeed, as it has made a major investment in cloud infrastructure. Sony certainly prevailed in the console war, but it is a minnow in the battle for the future attention of billions of people.
History is littered with companies that won thrilling battles in their time, but faded away after failing to innovate. Nokia, Yahoo, Blockbuster, Kodak and Xerox are all prime examples, and Sony could eventually join them on the scrapheap if it is not folded into a company like Amazon or Google.