There's talk that the US is already in a recession, but the video
game consoles are flying off the shelves this holiday season. Microsoft
and Nintendo recently launched the Xbox and the GameCube, respectively,
in a challenge to Sony's PlayStation 2 (PS2), which has been on the
market since late last year. For its part, Sony, the market share leader
in the gaming industry, just introduced its "Metal Gear Solid 2" game,
which the Chicago Tribune (November 19) described as "the most
anticipated game of the year." Taken together, these events have sparked
a frenzy of interest in the $20 billion interactive video gaming
industry.
Preliminary media coverage indicates that stores everywhere are having
demand for these consoles that far outstrip supply. Newspapers reported
that kids camped out on the sidewalk outside consumer electronics stores
in order to make sure they could buy one the first day they were
available.
Business Week (November 19) noted that Microsoft, Nintendo, and Sony
have allocated more than $1 billion worth of marketing to promote
their respective products.
Microsoft being Microsoft, its launch of the Xbox drew plenty of
attention from the media. There seemed to be mixed reaction to the Xbox
in terms of it being the software company's first move into hardware for
video games. For the most part, the reviews of the Xbox itself were
highly favorable, yet a bit cautious about its $299 price tag. A
number of articles couldn't say enough good things about the Xbox's high
quality graphics While playing "NFL Fever 2002," you can see the sweat
on the football players' faces, a young gamer told The Harrisburg
Patriot (November 16). The fact that Xbox enables online gaming was
often mentioned, but rarely discussed in detail.
In analysis of how Microsoft and the Xbox will fare in the gaming
industry, there was more debate about whether it would be able to
capture a sizable share of the market at the expense of Sony or
Nintendo. Sony was credited with being the industry leader with a strong
background in consumer electronics, while Nintendo was often cited for
its experience in the video gaming industry. These reports indicated
that Microsoft might not have an easy time entering the gaming
market.
Reviews also saw an advantage for Sony in that its PS2 has been on the
market for more than a year and is still selling well. Articles pointed
out that the significance of this was that the initial sales frenzy was
over and new buyers would have no trouble finding the PS2 on store
shelves. Furthermore, there are hundreds of games available for the PS2,
while both the Xbox and the GameCube consoles are each compatible with
only a handful of games so far.
Interestingly, there were a few reports that positioned the software
companies as the big winners in the console wars. Companies that hedge
their bets and provide games for all of the different consoles were said
to be the biggest beneficiaries of the increased interest in the gaming
industry.
Of course, the public is also benefiting from all of this intense
competition for market share as these three companies battle it out for
their money with ever-more realistic games for consumers of all ages. No
doubt gamers everywhere will be asking Santa for one of these three
consoles.
Evaluation and analysis by CARMA International. Media Watch can be found
at www.carma.com.
