Wednesday, February 19, 2014

Playstation's Gaming Bests XBox's Entertainment Console

In the gaming platform wars of 2014, the PS4 has sold to date over 5.3 million units while XBox One has sold 3 million consoles.  But why did the PS4 beat the XBox One?  Certainly both are big numbers especially given that they both sold new devices for the holiday season.  But the winner is Sony over Microsoft.

In my own household, my son also made the choice to buy a PS4 having been on the XBox 360 prior to that.  His response was that the PS4 was a better gaming console.  And perhaps too that the price of the PS4 was less and that he was not required to buy the camera.  The fact though that he chose gaming over entertainment may be at the heart of the two strategies.  His primary motivation was gaming; that it also connected to Netflix and MLB TV was nice but not a decision breaker.

Still Microsoft clearly believes that its entertainment strategy is the right one.  And they are staying on that course with its recent hiring.  "Microsoft announced Tuesday that it has named Jordan Levin executive vp at Xbox Entertainment Studios. Levin will report to president Nancy Tellem and will lead the creative team responsible for developing scripted and unscripted original content for the game console and other devices."  So now Microsoft is a content creator.

The challenge though will be for them to be both content and distribution.  I question the approach.  For other content companies, like Amazon, Netflix, and Hulu, the goal is to get content accessible on many devices.  For Microsoft, putting their content on devices outside the XBox platform dilutes the purpose of making the XBox a must have product.  And I am not confident that consumers will rush out to buy the XBox for untested content.  Even if they develop a winning show, I expect many will stay pursue content more readily accessible.

The key to the XBox platform catching up on the PS4 will be a more aggressive gaming strategy of exclusive content and synergy across devices.  Yes, content is king, but in this case, the content is the games themselves.