The utter waste of a console war

Next Generation has an interesting column up playing with the idea of creating a universal platform for video games — a single standard like the CD or DVD, so there would be a bunch of systems that could play any game. I’ve been thinking about this idea lately, when I get sent games that are nearly identical on the PlayStation 3 and Xbox 360 or read breathless features about “new” games that have already been out for five months on another system.

I’m not sure a universal format is the answer so much as a return to the monopoly of one dominant console. Or rather, whether or not it’s a good answer, the answer in the short term for pure business reasons is likely to be the return to a monopoly. (A universal game format is really a matter of hardware, and nobody’s going to agree on a universal hardware format for a long time.) But I might be okay with a monopoly, or a monopoly on the cutting-edge with Nintendo as a balance.

Either way, having multiple, similar consoles is troublesome for the sheer economic waste it creates. Sony and Microsoft spend billions on R&D for what are very similar systems. Game developers have to spend millions extra to make an essentially identical version of the same game (each referred to in the biz as an SKU, or stock keeping unit) if they want to release it on both consoles.  That’s millions or billions that could be spent on more productive endeavors or for creating new and better games, millions that wouldn’t be partly subsidized by consumers.

In theory, video game competition is good. Microsoft never made money on the first Xbox, but the online gaming model wouldn’t have changed so quickly without the groundwork laid by the original Xbox Live. The first PlayStation succeeded in large part because Sony understood that optical media was the future, while Nintendo stubbornly stuck to cartridges (and even when Nintendo switched, they kept a proprietary format instead of just using CDs or DVDs).

Still, it’s worth considering whether once-a-generation (or every other generation) innovations are worth the billions in wasted dollars that console wars create.

— February 19, 2007

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