Are Video Game Consoles Dying?
By Movieguide® Contributor
As individual game consoles begin to cost as much as an iPhone, some question if gamers will continue to buy them for such a steep price.
This question has been raging on for decades as the cost of video game consoles rises and falls with advancements in technology. There are numerous factors, however, that contribute to this debate.
There are currently three major companies producing video game consoles: Nintendo, Microsoft’s Xbox and Sony’s PlayStation. All three have cornered a different market and have found success serving different audiences. Nintendo, for example, focuses on creating family-friendly games that often cater to in-person, multiplayer experiences. Xbox and PlayStation, meanwhile, cater to older audiences and attract different games through exclusive games offered only on their platform.
While the competition between these three companies is fierce, there seems to be room for all three as their current generation of consoles have all been successful. However, gamers eventually become bored with the current console generation’s limitations and clamor for more powerful devices to play on.
Sony, for example, announced the PlayStation Pro earlier this week, which will be the strongest gaming console when it hits the market. However, at a $799 price tag, it may be harder than ever to sell.
Instead, some gamers may choose to put that money towards a strong PC that can play most of the games available on game consoles while also being able to perform a wide variety of other functions. In fact, gaming consoles offer little advantage over their more general-use counterparts aside from the exclusive games available on them. PCs, for example, can often run games at higher graphic levels and with smoother frame rates. Smartphones, meanwhile, can run games with the same qualities as the Nintendo Switch while matching its major selling point: it is extremely portable.
Despite this, game consoles are not truly in danger of dying out. Most gamers are passionate about the consoles they play on and truly love the exclusive games they have access to. This alone would fuel the industry for years. On top of that, however, all but the most exclusive games now offer cross-compatibility, meaning Xbox players can play games with their friends who are using a PlayStation, Switch or even a computer. Thus, even if their friends switch to a new game system, they are not required to in order to game with them.
“There’s always this imminent, existential threat around the console, and it just historically doesn’t happen that way at all,” said Joost van Dreunen, a gaming industry professor at NYU Stern School of Business.
“There will always be a subset of die-hard people that just want to have dedicated, high-definition gaming software,” van Dreunen added.
Movieguide® previously reported on the gaming industry:
Gaming remains the last entertainment sector to rely primarily on sales, but the industry has been undergoing a massive shift as companies and consumers eye a subscription model for video games.
“We’ve seen this huge transition in the games industry of moving away from the traditional, what I would call ‘unit-sales-based’ business model, towards an ‘engagement-based’ model,” said Karol Severin, MIDia Research’s senior games analyst and VP of data. “I would dare to say that the number of game subscriptions is going to grow much faster than the number of games sold for the next decade.”
This trend is in line with the music and entertainment industry, which have gone from primarily sales-based to nearly entirely subscription-based in roughly a decade. The streaming wars for gaming are now heating up as even non-gaming companies look to join the fight.
Netflix launched the gaming leg of its business at the end of 2020 and has since amassed over 70 titles as an add-on to its entertainment library. Though the service remains largely unused roughly three years later, the company still views gaming as a key component of its future.
