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Xbox One vs PS4: Is the Console War Already Over?


By Daniel Kline | More Articles
May 13, 2014 | Comments (7)
If Microsoft (NASDAQ: MSFT ) wants its Xbox One to beat Sony's (NYSE: SNE ) PlayStation 4 in the console wars -- at least in the United States -- than it has to unbundle its Kinect motion sensor from the gaming device, which would theoretically allow Microsoft to sell its console at the same retail price as Sony's. Xbox One currently sells for $499 while PS4 retails for $399.

Xbox One is not sold without the motion sensor, but Kinect is sold as a stand-alone device to pair with Microsoft's previous generation console, the Xbox 360, at a price of $99.
A preview of a new research report from International Data Corporation shared with GamesIndustry International, predicts that PS4 will have sold 51 million units globally by 2016. The report forecasts that Microsoft will take the lead in North America and be a closer competitor globally only if it unbundles Kinect.

"The presumed unbundling of Kinect and Xbox One, which should facilitate rough price parity between it and the PS4, should lead to a spike in Xbox One sales; assuming the console and sensor are unbundled in 2015, IDC expects Xbox One to recover and emerge with the largest installed base of any console in North America by the end of 2016," the firm told the gaming news website.

Why has Microsoft kept Kinect?
Microsoft does not want to simply win the console war, it wants to be the entertainment center for the family with control of the living room. Kinect and its voice and motion controls are a key piece of that strategy, or so the company believes. On the Xbox page the company touts the virtues of "voice-controlled entertainment" as offered through Kinect.

"Combine Kinect with Xbox LIVE, and you can kick back and enjoy your favorite shows on ESPN, HBO GO, Netflix, and Hulu Plus in a whole new way. With Kinect, you can play, pause, and rewind the action -- all with the sound of your voice."

Those features were also very prominently touted during the Xbox One introduction press conference, and in theory they are very cool. In reality they don't work that well and a big question remains as to whether consumers want them.

The Boston Globe's Hiawatha Bray reviewed Xbox One at the time of its release and while he was complimentary about the console's overall appeal as a home entertainment hub, he questioned some of the Kinect-specific features. He explained how the voice commands worked and laid out their shortcomings in his review. He was also critical of how the hand commands work.Microsoft can theoretically improve these things with software updates, but as Apple (NASDAQ: AAPL) has shown with its Siri voice assistant, people might like the idea of voice commands more than the reality. I know I question whether an Xbox will respond correctly to my voice commands when my iPhone calls my friend Bob every time I ask it to call "mom." If Kinect's voice and gesture commands worked, they might be a neat way to flip between games, TV channels, and other content but it's not like using a remote control is some sort of horrible chore.

The market Microsoft and Sony are going after
Neither Sony nor Microsoft makes any significant revenue from selling game consoles. The real money comes from the sales the companies can make once they have gained a customer. Game sales are an important piece of revenue, which should only increase going forward as the IDC report sees sales of physical games at retail as being in decline.
"Given current trends, more than 50% of total game and direct app/service spending across all consoles will come through digital channels by 2019 (just over the edge of our forecast window)," said Lewis Ward, IDC research manager.

That is potentially huge news for Microsoft and Sony as not having a retailer taking a piece of each sale leaves more money for the companies and possibly their partners. Having games sold digitally also removes retailers like Gamestop (NYSE: GME) from the used game sales loop, allowing Microsoft and Sony to take a piece of those sales too.

The console makers are also looking to make money by selling apps and subscription services like Netflix (NASDAQ: NFLX) or Hulu of which the "store" typically gets a 30% cut (though deals can vary greatly). Microsoft has the added sales channel that it requires an Xbox Live subscription, which costs $60 a year for customers who pay for 12 months up front, to view premium apps like Netflix and Hulu.

For Microsoft and Sony having a console powering the main TV in the house will increasingly become like having a store located in millions of living rooms.

Unbundle Kinect or give it away
Sony has been winning this generation of console wars so far and if nothing changes it will be winning a few years from now. Microsoft needs to make Kinect an option or -- if the company truly believes Kinect will lead to more sales once a customer buys an Xbox One -- just lower the price and take the hit. The last Microsoft console, the Xbox 360, was released in November 2005 and it's still growing strong so it's reasonable to think it will have remained a major player for at least 10 years. There is no reason to believe the same won't be true for Xbox One.

A teardown of Xbox One done by research firm IHS in November 2013 pegs Microsoft's cost to build Kinect at $75. If that number holds true and the company dropped Xbox One's price to $399 and gave away the Kinect in order to grow from around 5 million units sold to 50 million it would be a $3 billion-plus giveaway. But if the company sells 10 million more Xbox Live subscriptions, it makes back $600 million each year it has those added subscribers -- keep them from 2016 through 2021 and the deal is roughly break-even on that revenue alone. Add in game sales, app revenue, cuts from subscription services, and that $3 billion invested between now and 2016 could be a sound investment for Microsoft if the company believes the Kinect is ultimately integral to the success of Xbox One.

IDC might predict a global lead for Sony but Microsoft has the money to make a move this bold, and it's hard to argue that PS4 is a better console than Xbox One if both are the same price and Xbox One throws in Kinect for free. Whether it makes Kinect free or unbundles it from Xbox One, it's clear the time for Microsoft to make a move with Kinect now before Sony builds too big a lead.

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Daniel Kline is long Microsoft. He wants an Xbox One but his lack of success at Xbox 360 games has caused him to delay that purchase. The Motley Fool owns shares of GameStop and Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

 

If I was going to buy one right now it would probably be the xbox one but they are still to expensive for me. I am still using my xbox 360 and I just started playing it again. I dont play much xbox or playstation like I used too.

 

Couple friends have Xbox one and couple have ps4. The xbox gamers seem most satisfied so far. I'm still rocking the last gen xbox360 I think it's called the slim.

 

*Thanks guys for voting & posting
I thought we had a lot more Gamer's on the MCF (maybe we `do (?) & they are playing Now & not logging `on 2 see this ><>LOL>

Look 4ward to seeing the voting results & what our Gamer Member's post & what they like>prefer...


*Note > I'd rather `PLAY then WORK 4>Sure...I need a `job that pays me 2 Play ?
Anyone hiring ?

 

I've always loved sony products I got they tvs and mp3s. I've had a playstaion since the first one. That being said I have the ps4. Waited thanksgiving night with the gf to get it. Also if anyone on here got a ps4 feel free to add me owens_neko. A lot of my friends still have the ps3

 

I haven't really considered myself a gamer in a few years but I have always liked the Xbox but I think this would be the generation I would buy a Playstation.

 

Thanks guys for your posts/votes & sharing
I know that I was addicted to playing & wasn't getting outside...It was difficult to withdraw 4>Sure...
I love to play & wish I could only on bad weather days, but I was playing every chance I got...

Now, I have life in better balance (?) OK, I'm still ready to fall `off & get back in2 it (LOL)...

Below is a informative article (?)
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Video Game Addiction: Signs, Problems, Risks, & Treatment

By Dr. Brent Conrad

Clinical Psychologist for TechAddiction

What is video game addiction?

Currently, there is no single universally agreed upon definition of video game addiction. There is no set number of hours one must play in ordered to be considered addicted to video games. Most definitions of video game addiction refer to excessive play which results in negative emotional, social, relational, educational, or career - related consequences.


Instead of devoting energy to "real-world" activities and pursuits, a video game addict spends most of his or her time playing games. Someone who has developed a video game addiction prioritizes gaming accomplishments over all other activities such as spending time with friends and family, school achievement, work performance, and interpersonal relationships.

Video game addiction may also be defined as a serious loss of control over gaming that leads to significant harm for the player in the real world.Note: For TechAddiction's huge review article on children who play video games excessively, see Child Video Game Addiction - Facts & Solutions.

Can video game addiction be diagnosed?

Video game addiction is not currently considered a diagnosable disorder and does not appear in any official mental health classification system. There is however, a push among some mental health professional (and video game addicts themselves) to have video game addiction recognized as a "real" disorder. However, the next version of the Diagnostic and Statistical Manual of Mental Disorders (DSM-V)will not inlcude a diagnosis of video game addiction. Future editions of mental health classification manuals may include internet and video game addiction as impulse control disorders, but for now the terms are informal descriptions rather than official diagnosable conditions.

What are the signs of video game addiction?

Initial efforts to define video game addiction were made by modifying the diagnostic criteria for known addictions such compulsive gambling. However, this informal method has not been widely adopted and as such, psychologists, psychiatrists, and researchers have been forced to define video game addiction without standardized diagnostic criteria. Definitions of video game addiction often include the following symptoms:

• Significant negative impact on work performance, school achievement, and / or interpersonal relationships

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• Spending most of one's free time playing video games

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• Frequently playing video games for six to eight hours non-stop

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• Loss of interest in social activities

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• Avoidance of personal responsibilities or commitments so that gaming can continue - Often staying up very late to play video games which regularly leads to feeling very fatigued the next day

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For more information see The Symptoms of Video Game Addiction

Also see the scorable Video Game Addiction Test for Parents

What problems are caused by video game addiction?

Video game addiction obviously does not have the same impact on everyone who experiences it. In general though, the problems associated with unhealthy video game habits can be classified according to the five following categories:

Emotional Problems


People struggling with video game addiction may be at a greater risk fordepression, loneliness, social anxiety, anger, and feelings of shame or embarrassment for spending so much time playing games. Note that these issues may be the result of video game addiction but may also play roles in the development of excessive play.

• Financial Problems

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This is not typically an issue for children, but adults and adolescents may find themselves spending large sums of money on new computer equipment, consoles, subscription fees, and of course, new video games. Additionally, financial difficulties can occur when the person loses the motivation to work (a frequent occurrence), has his or her hours reduced due to poor job performance, or is fired.

• Health Problems

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People addicted to video games often develop poor sleep habits (due to late night gaming sessions), may neglect personal hygiene, may get very little physical activity, and may make poor choices with regard to eating (e.g., frequent snacking so that gaming can continue rather than having proper meals). Excessive video game play has been linked to childhood obesity.

• Social Problems

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As the addiction worsens, video game addicts tend to spend more time playing and less quality time with friends, family, or significant others. The addict may claim that he or she has "lots of friends online" yet still experience loneliness, depression, and social isolation due to the lack of in-person contact with others.

• Family Problems

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Family problems may be the most common difficulty for those who are addicted to video games. Although poor family relationships may increase the likelihood of video game addiction, video game addiction often leads to family conflict. Someone addicted to video games may accuse concerned family members of trying to interfere in his or her life, may be verbally or physically aggressive when others attempt to limit gameplay, and may try to hide just how much he/she plays. Parents with children or teens addicted to video games may disagree about how much of a problem it is or how to intervene.

What are the risk factors for video game addiction?

• Being male

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• Having higher levels of trait aggression and neuroticism

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• Positively evaluating one's personal intelligence and negatively evaluating one's social skills

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• Favoring online role playing games

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• Having a greater degree of impulsivity and limited ability to regulate emotions

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• Having a lot of free time and little involvement in structured activities outside of work or school

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What makes video games addictive?

Researchers and clinicians are starting to closely examine exactly what makes video games addictive. To date, research on video game addiction has generally found that certain games and game genres are potentially more addictive than others. That is, all video games are not equally likely to result in excessive use.

Most research suggests that massively multiplayer online games (MMOs) like World of Warcraft and first person shooter games (FPS) like Call of Duty tend to be more addictive than other genres like platformers, fighters, racers, and casual games.

What is becoming clear is that the more addictive games often intertwine well-established psychological principles into gameplay to encourage longer and more frequent gaming sessions. In general, the most addictive video games:

• have no end…which means that someone can play forever without "beating" the game and receiving the clear signal that the game is over and it is time to move on

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• encourage online social interactions with other players…which often requires great dedication and commitment to a team of fellow gamers to accomplish tasks / goals, even if this means neglecting "real world" responsibilities

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• are based on a variable ratio interval reward schedule…which rewards the player after a predetermined average number of in-game responses…and is well-established as the form of reinforcement that is best at keeping a behavior (any behavior) alive even when rewards become less frequent (which is often true of video games)

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• frequently reward the player for minimal effort in the early stages of gameplay and then gradually increases the amount of time and effort that is necessary to receive a reward as the game progresses…and by this time the player is already "hooked"

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For more information, see the full article at TechAddiction "Why Are Video Games Addictive?"

What percent of children play video games?

In the 1960s it is safe to conclude that video game addiction was not a problem as video games simply did not exist (at least for the general public).

Home video game consoles were introduced in the 1970s there were those who spent hours upon hours depositing quarters into video arcade machines, "addiction" comparable to what we see today was extremely rare.

In the 1980s video game consoles made their way into homes - significantly increasing the ease of access to gaming.

In the 1990s, PCs and home consoles surpassed the graphic capabilities of arcade machines and turned video gaming almost entirely into a home experience.

Consoles of the early 2000s had improved graphics and online connectivity which increased the immersive and social aspect of video games, resulting in even greater popularity.

Presently, videos games can be played virtually anywhere the player chooses (PCs and consoles at home…laptops, netbooks, tablets, handheld systems, ipods, and smartphones everywhere else).

With each decade, video games became more immersive, more interactive, more engaging, more commonplace, and more accessible. Not surprisingly, the percentage of people who regularly play video games has increased as well and today 97% of children play video games.

What percent of children are addicted to video games?

This has been a difficult question to answer because as previously mentioned, there is no official set of diagnostic criteria for video game addiction. Consequently, different studies and surveys have been forced to develop their own definitions of video game addiction. Not surprisingly this has lead to inconsistent conclusions about the prevalence of video game addictions in children and teens.

At present however, most research on video game addiction suggests that from 2 to 10% of all children who play video games are addicted. Recalling that virtually all children play video games, even a 2% rate of addiction translates into many many children with very unhealthy gaming habits.

More accurate and consistent estimates of video game addiction prevalence will be possible if video game addiction is eventually granted official status as a clinical disorder with clear symptoms for a diagnosis.

What treatment is available for video game addiction?

Because video game addiction is a very new development in the world of mental health, there are relatively few treatment options available for those who recognize the need to change their excessive gaming habits.

In general, cognitive-behavioral therapy (CBT) has been the treatment modality of choice for video game addiction. CBT involves changing the thoughts (cognitions) that contribute to unhealthy gaming habits and also, modifying one's actions (behaviors) to slowly reduce the amount of time spent playing video games.

Treatment options for video game addiction include:

1. One-to-One counselling with a psychologist or therapist who has expertise in treating video game addiction. This may be the best option if one is able to find an affordable and qualified therapist in his or her area, but unfortunately video game addiction specialists remain quite rare (although this is changing as the problem becomes more prevalent).

2. Family therapy which involves modifying the family systems, interactions, and family dynamics that may contribute to excessive gaming habits. Family therapy is more common when the identified client is a child or teen. Family therapy may be helpful for video game addiction, but it may be quite challenging for all the necessary family members to commit to the process.

3. Video game addiction treatment centers which offer intensive in-patient recovery programs administered by a variety of mental health professionals. These facilities are far more common in countries like South Korea than in the United States. Although these programs are extremely expensive (often costing tens of thousands of dollars) there has been very little research on treatment outcomes.

4. Wilderness therapy involving the complete removal of the individual from environments where video games are accessible. Wilderness therapy has been used as an intervention for a variety of child and adolescent behavioral problems and is starting to be offered for video game addiction as well. Similar to in-patient treatment for video game addiction, wilderness therapy is generally very expensive and may not be offered locally.

5. Video game addiction books offering self-help treatment for excessive gaming. For those who are unable to find a qualified therapist or afford more expensive treatment options, step-by-step guides to stopping video game addiction (for oneself or for someone else) can be a very convenient and helpful alternative.