After a one-year hiatus, and summer 2020 show that was really nothing more than a scattershot of trailers for titles that wouldn’t even drop the same year, gamers were treated to an E3 2021 experience that was markedly better than the year prior—you know, back when all those new consoles had release dates announced, but had no games?
Yeah, well, as one would suspect those days are behind us. And now with life returning “back to normal,” such words also suggest that no matter what we have learned in the last year, the release of a new console will always mark the commencement of a corresponding console war. You know what I’m talking about: those things gamers say “don’t matter,” but in actuality, they—to a certain degree—well, uh…do? Because after all, if a console maker does not win, or show a potentiality to win a console war, then that perceived loss will snowball into corresponding losses of exclusivity agreements, third party accessory releases, and general developer interest—all of which cycle back around to the customer’s propensity to buy the console hardware that is already being sold at a loss.
And if you think what I am saying is bullshit, then maybe you should have spent the last 8 years on Xbox—because it’s really not, and I’m just telling you the hard truth. The truth of the matter is that regardless of the opinions of journalists, common dipshits on Reddit, or your homies trying to cope with their crappy purchases, console wars absolutely matter. While sure, older gamers such as myself have learned how to take on a more diplomatic stance by padding most of these heated discussions with “just play what you like bro,” many of us saying this know that it is a flawed statement: And we know it is flawed because the person that owns the losing gaming console tends to have fewer titles to pick from—which ultimately means that said console gamer has less inherent ability to play what they like, short of buying the other console.
This was the world of limitations that I had been exposed—and had grown accustomed—to while playing on Xbox One as my console for the previous generation. And from 2014 all the way to 2020, I would watch year after year of multi-plat announcements and fly-by-night indie titles along with a waning roster of exclusives that felt increasingly laughable and esoteric in their conceptualization.
And why was this the case? Because Microsoft had intended to deliver a console experience that was about a generation ahead of the curve with cloud gaming, and the gaming community—which is woefully unimaginative in its own right—lost its ever-loving fucking shit.
“Y sYsTeM sPeCs So LoW?”
“Y iS RaM sO sHiTtY?”
“Y nO 1080p 60fps?”
“I dOn’T wAnT tO aLwAyS bE cOnNeCteD tO tHe InTeRnEt. Y nO oFfLiNe MoDe?”
And while there were answers to every single one of these questions readily-fucking available—the short answer being that the entire Xbox One was designed for game streaming from the ground up—nobody wanted to look for them, and instead, they wanted to make noise. In 2013, Microsoft announced a console experience that would be completely tethered to the internet, where games, titles, and friends would always be available from the moment you logged on. And while many people were impressed with these promises, even more people didn’t know the bit about cloud gaming, and if they did—they certainly didn’t care.
But really, the thing that made people go bananas, was the fact that the Xbox One with all of its presumably shitty technical specs, was asking for 500 bucks while the PS4 was only asking for 400—and could deliver 1080p 60FPS out of the box, had greater processor bandwidth, a cool shape, would suck your dick, iron your clothes, and held a black belt in karate all at the same damn time… Ok, so maybe I made up the last bit, but people who could read basic computer spec sheets were able to tell that the PS4 had what seemed to be markedly better technical specifications—never mind the truth that the Xbox was designed to do the same thing with cloud computing technology, but fuck facts right?
Naturally, this would put Microsoft at a loss that pushed many exclusive developers away from the console—and corresponded to a 2:1 sales ratio of Sony to Microsoft consoles sold by the end of the cycle. In many ways, the console wars were decided before they even got a chance to begin—and not because the Xbox was objectively shittier, but because gamers are not nearly as smart as they like to think that they are. Take note, dumbfucks: we still ended up in the same damn place. Most video games have to connect to the internet—even single-player ones. Most video games are purchased digitally, and yes, all of them have DRM authentication on them. Games are offered as a service, nobody uses their console while disconnected from the internet, and finally, people stream games.
The irony of it all is that for every single qualitative point that Microsoft was docked for almost 9 years ago, gamers are gung-ho about these things today.
The Playstation 4 would go on to be Sony’s Second best-selling console—in no small part due to the company being able to convince an already disgruntled group of gamers that a traditional approach to console making would provide a superior entertainment experience. That by them focusing on the classic-yet-potent mixture of system specs and titles in tandem, gamers would ultimately come out as the winners in the end… And for a while, they did. Gamers were treated to unique-and-fresh titles such as Bloodborne, Horizon: Zero Dawn, and The Last Guardian, as well as classics such as God of War, Uncharted, and Grand Turismo.
Xbox, by comparison, was a joke. Xbox was a meme. A device with good intentions that simply didn’t get it right—ever, like an incompetent stepchild. So when Xbox Gaming chair Phil Spencer announced Xbox Game Pass midway through the console cycle in February 2017, most Sony executives looked at it as an unsustainable gimmick instead of what it actually was: a powerful weapon in deciding the next console war—a weapon that Sony did not have, and at the time, quite foolishly did not want. So they never responded with a service that could effectively compete.
So let’s fast forward to last week—both of the new consoles are out, and have been out for a while now. This time, both have nearly identical system specifications. While Sony may still have the edge on games, this is a temporary advantage at best and is becoming increasingly debatable with Microsoft having bought up around two dozen gaming studios, including Starfield producer Bethesda. And while I have seen trailers for some exclusive IPs, such as Final Fantasy Origins: Stranger of Paradise and Horizon Forbidden West, most of the things that I have seen players get excited about are mostly multi-plat titles that will also be coming to Xbox. Personally, however, I don’t think exclusives are that important to gaming platforms. Sure, some can be good, but for the most part, I do not lose very much sleep over exclusive titles as the ones for PlayStation are usually outside of my genre preference, and the ones for Xbox usually just suck.
This is to say that it will not be technical specs, exclusives, or even price difference that determines which of these two consoles will be preferred by consumers. Instead, with Sony having recently announced that “some” PS5 titles will be $70, the deciding factor in this console war will not be how many exclusive titles a console has, but rather, how people pay for titles in general. If players wanted access to Outriders on PS5, they had to pay $70 for it upfront—even if they play it for a week, or several months. If players wanted to access Outriders on Xbox, they just needed to pay the $15/mo subscription that they would already be paying (even if Game Pass didn’t exist because Xbox Live used to be $20 a month) and download it when the game came out. Even if outriders was the only game I played on Game Pass in the last several months (which it is not), that would still mean that the itemized cost of my purchase would have been around $45 at the time of this writing. That is a preeetttty big difference in cost factor. And if you deducted the cost of Xbox Live, the itemized value of my time playing the game would be closer to $30.
So far, Sony has not yet come up with an effective way to respond to this—and in a marketplace where the cost of making AAA videogames is becoming progressively more expensive, not less. Considerably, the thing that Sony fans may not fully understand—or appreciate yet—about the Xbox conference was that outside of the sheer abundance of titles that were announced and expected to be released within the next year, most of what was up on that stage were intellectual properties expected to be released on Game Pass Day 1. Furthermore, all of the exclusives will be released on Xbox Game Pass, Day 1.
The reality is that out of 8 titles I saw coming out over the course of the next year that got me excited, I may only have to pay for 3 of them. If that isn’t a winning formula for most gamers, I really don’t know what is, but something that Microsoft has that the PlayStation doesn’t is the fact that when you buy their console, a library of games—good games—comes with it. The reality of the situation is that in the last several years since I have purchased Game Pass, the amount of money that I spend on video games per year has dropped by close to ¾. Inversely, if I were on PlayStation, that number would likely swell by 1/5.
While Sony may very well respond with their own version of Game Pass—and they should—with 15million current subscribers, it is quite possible that the damage of Microsoft’s killer app has already been done. It will only be a matter of time before we understand with certainty if the games as a service space is characterized by the same first movers’ advantages as the video as a service space. Assuming this is true, then Xbox Game Pass may very well have already positioned itself as “The Netflix of Games.” If that is the case then—lets be candid—Sony is fucked, because nobody beats Netflix.
Then there is the other, lesser-seen problem that few within the gaming community are talking about: It is not entirely clear if Sony can release a competing service at all. While the PS4 was Sony’s second best-selling console, it also accounted for much of the corporation’s profit structure—or in other words, the PS4 was making more money than any other product in Sony’s portfolio of goods. This is also to say that much of Sony’s success as a corporation is heavily tied to the success of their PlayStation line of products. If they dropped Playstation today, the company would lose somewhere between 18-23% of its total cash flow. Sure, they make fabulous cameras, and (sort of) nice headphones, but both of these spaces are heavily fragmented between many brands—so competition is stiff. Their TV line is regularly undercut on price by American competitors such as Vizio, they axed their laptop line, and their audio devices have been rendered irrelevant by Bluetooth speakers, iPhones, and a smorgasbord of Android devices. Finally, they offer zero B2B infrastructure services, release shitty movies, and almost had their entire cell phone line obliterated by their over-fetishization of making a bunch of proprietary bullshit.
The truth of the matter is that when you look past their consoles, Sony doesn’t offer much in the way of other products—and that is a problem when it comes to a space that is rapidly hurtling itself towards cloud gaming, subscriptions, and games as a service models for releasing titles. So this is all said to say that Sony gives quite a lot of shits about the PlayStation 5 being successful. But why do other products matter? Because if other products are profitable, then that profit can go back into their corporate war chest to expand operations in any product category…. Or even simply pad things out in case they fail.
For an example of this, you can look no further than Microsoft—whose #1 products are B2B cloud services, followed by Microsoft Office, and finally Microsoft Windows. The truth of the matter is that for as much as fanboys liked to entertain the idea that the Xbox One’s abysmal sales figures would effectively run Xbox Games out of town, Microsoft doesn’t give a fuck about whether or not it’s Xbox gaming division is profitable. It is statistically insignificant on their revenue sheet. It has actually been said before in the previous console cycle that Microsoft is financially capable of running the entire division at a loss and still being profitable as a company overall—and due to the robustness of their greater product portfolio.
And so that brings us back to why Sony might not be able to respond with their own version of Game Pass: because part of what makes Game Pass successful is Microsoft’s ability to pay large sums of money upfront for developers to release their games on the service, and then a royalty based on the overall number of subscriptions. We are talking about shitloads of money here—money that you have to acquire from either rendering an essential service or providing a wide variety of beloved products. The problem is that in a content-intensive business model like video game subscriptions, service providers need to effectively reach out to various publishers to negotiate for what are essentially, limited distribution rights to a game. This is why certain games will leave Game Pass only to return later—or sometimes never at all. Microsoft pays these companies upfront for their games to be on Game Pass for a pre-determined amount of time, and if they want to keep the title on Game Pass after the terms of the contract have expired, Microsoft has to pay these companies again—just like Netflix. So if Red Dead Redemption II is on Game Pass, and then it leaves, Microsoft has to pay Rockstar for Red Dead Redemption II to come back. It’s no different than Netflix paying hundreds of millions of dollars to NBC in order to keep common variety hipster-grade bull crap like The Office on their roster—because people “like to just have it on in the background.” Compare that to exclusives, where money is spent upfront one time for a title, only for profit shares to be split between the publisher and the console maker—thereby helping the console maker generate profit. My point is that in order to compete at this level, Sony needs to already be running an operation that is cash-rich—because they are going to be making a lot of upfront payments for some titles, and plenty of recurring payments for others. And even if they did, it wouldn’t do much to mitigate Microsoft’s sheer ability to buy AAA studios and lock in certain titles and franchises on Xbox Game Pass—and one would have to ask themselves, would a PlayStation Game Pass ever have Fallout? Skyrim? Starfield? Nope, probably not. Even with all of the exclusive games that they have released and sold, Sony can’t even guarantee their player base that all-new exclusives will be available on PlayStation Now, Day 1.
Instead, what they have to offer are titles that people have played, gushed over, and talked about many times before—while presenting a host of new exclusives that are impressive, yet still prepackaged, itemized, and overpriced. And for as much as Sony pummeled Microsoft with traditional business tactics in the X1/PS4 Cycle, I’ve learned anything steeped in tradition will always run the risk of being outstripped by innovation. The truth of the matter is that the PS5 as it stands today, is a console that is still mired in fighting last generation’s console war—a console war that was more predicated on system specifications and exclusives than it was on sheer access to content. While PS5 currently has the power, and it has the games—for now—a critical question that Microsoft asks with Xbox Game Pass is this: If owning a PS5 equates to paying more money for games, how can you claim that PS5 is better for gamers? Sony has not yet answered this question. I am curious to see if they ever will.
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