OpEd: Discussing Microsoft, Sony And Slimmer Consoles

With Sony stealing all the headlines regarding the fact they were shrinking that monstrosity of a system called PLAYSTATION 3, my first thought was that Microsoft finally had a contender.  However the folks behind the Xbox 360 aren’t laying down at all.

Microsoft’s first real statement on the matter came to the good folks over at Arcs Technica when they asked for Microsoft’s thoughts on the PlayStation’s latest price reduction. They received a surprising response.

“A smaller console size does not necessarily mean more value for consumers. Starting at $199, Xbox 360 offers the best gaming and entertainment experience at the most consumer-friendly price on the market.”

Is it me or does this statement come out as just a little defensive for Microsoft?  Standard PR speak aside Microsoft is clearly sitting up and taking notice of Sony’s actions, and apparently rumor has it that Microsoft is considering killing off their Pro model and replacing it with a micro version of their own.  Fuel added to this theoretical fire comes from Microsoft’s recently announced price drops.  Just this week, in responding to Sony’s recent cuts, they have effectively reduced the Elite edition to $299, with the soon to be discontinued Pro model going for $250.

But would they release a ‘slim’ version like Sony has? Actually a better question to ask is what would drive such a model to market as historically Microsoft have never released such a revision for the Xbox line of consoles thus far.  Take Microsoft’s original comment to Arcs Technica in a new context, in that a new model might not be about size at all as like the ladies tell me all the time, size really isn’t all that important as opposed to the experience.  Of course this is reinforced by the fact that earlier in the week that Microsoft have no plans to release a ‘slim’ model.

So whilst a slim model looks rather unlikely, what about upgrading the Xbox 360 instead?  PC gamers can play games at different qualities based upon their system specifications, so is an upgraded ‘Xbox 540′ that hard to imagine?  A new model 360 with improved graphic capabilities and updated speed wouldn’t be considered innovative for the industry as the PlayStation 2 saw half a dozen small revisions, improved hardware and speed, Saying that, there were some titles which released later in the PS2 life cycle which were unreadable for the early adopters due to the nature of the dual-layer discs being used, those games being Grand Theft Auto: San Andreas and Gran Turismo 4.  We’ve never seen a true generation bending console, in that a one has never been successfully upgraded to tackle new challenges and new ideas in ways that were previously impossible.  Adding credence to this, a rumor in late 2008 surfaced that claimed that the third generation Xbox console would only be an enhanced existing model. Furthermore Electronic Arts‘ Creative Chief Rich Hilleman hinted at this very possibility earlier this week when he stated the following,

“I expected we’ll see a PlayStation 3.5 before we see a PlayStation 4 and an Xbox 560 before we see an Xbox 720.”

But would an interim hardware upgrade alone be enough to drive a new console model?  There is a good chance that Microsoft has something up its sleeve that almost assuredly will bring new hardware. How about Project Natal?

Unless you’re completely green to the gaming world, you’ll have to realize that Project Natal is a potential game changer not just for Microsoft, but for the whole industry.  Nintendo changed the mold of gaming with the Wii when suddenly you weren’t stuck in a world ruled by your thumbs, your very physical movements were being reflected in the game.  This paradigm shift resulted in millions of new ‘casual’ gamers, and gave Nintendo a huge leg up on winning the sixth generation console war.  Now with Nintendo leading the pack, Sony plans to follow up with their own motion controls, yet Microsoft’s full feedback video response system hopes to trump them all.  Due to the hardware being able to track forty-eight points of the human body, of up to six players on the fly, Natal was awarded an E3 Best of Show award.

So how does this back the idea of a new model of Xbox 360? Because we’ve already heard this rumor before from Microsoft’s vice president Shane Kim regarding Natal:

“(It’s) similar to how you would think of the launch of a new console. It’s got to have a great launch line-up. That’s the same thing here.”

A playful little slip of the tongue? What better way to launch a console sized product then with… a new console! Heck, even Steve Ballmer, CEO of Microsoft had a much publicized, and later retracted, statement that claimed Natal was Microsoft’s next console.

So when might we be seeing the much talked about couple bundled together?  Well the ideal time would have to be the upcoming holiday season, the time of the year when the industry sees it’s biggest sales numbers.  The fact that Microsoft has remained quiet on the issue of a release date suggests hesitancy;  they don’t want to rush Natal, thus are unsure that they’ll make such a date.  Most experts are inclined to believe an early 2010 release is most likely, yet I’m inclined to go against the trend.  Even a December release for the highly touted Natal would be an instant Christmas hit, and would assuredly sell out.  Sales aside, it would carry a healthy buzz well into the 2010 year for Microsoft to lead with.

But as I said, it all comes down to timing.  Indicating that they do not wish to rush Natal out the door, Microsoft want to get this right the first time where Nintendo had to follow up with MotionPlus.  But if Natal will not be ready for 2009, does this mean an upgraded Xbox might be released independently this year?

It would be foolhardy to think Microsoft would release a new Xbox 360 model mere months before they would release yet another ‘Natal-ized 360′.   But even more fundamentally, given the current economic state will gamers buy an upgraded model at all?  If Microsoft creates a hardware divide among its established base, the potential backlash from loyal early adopters could be costly.  History has taught us that typically after a system has been released, those specs aren’t for changing, regardless of desire to do otherwise such as when SEGA touted the 32x addon for the Sega Genesis.  The device was so popular that it exceeded sales predictions with regards to preorders, although with a rushed product, limited resources and high price put paid to any plans SEGA had to extend the life of Genesis.  In the end it only ended up selling around 200,000 units, so how will Microsoft be able to convince the crowd that Natal will not only work, but work well.

Price drops, rumors of a slimmer form factor, and incoming hardware upgrades.  These are just classic business signs that Microsoft is getting ready to release something big, and soon.  Quietly reducing your current stock of existing hardware with price cuts and promotions is the norm of the tech industry when you’re getting set to push out something large; in other words, out with the old before the public sees the new.  While Microsoft is rather notorious with their release of new models, it all seems to be coming together like two trains on the same track.  The looming release of Natal with the projection of a newer, cheaper and potentially slimmer system.

Photo credit: gamerlimit.com