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Gates: Sony "didn't know what they were doing" | |
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| Time: 12:01 EST/17:01 GMT | News Source: Official Xbox Magazine UK | Posted By: Byron Hinson | ||
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In an interview with MercuryNews.com at CES, Bill Gates has commented on Microsoft's rivals in the next-gen console war with renewed fervour. Highlighting Sony as "our most direct competitor" he isn't dismissive of Nintendo, stating that the company "did some things right" in launching the Wii. | ||
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| #1 By 3653 (68.52.143.149) at 1/19/2007 1:04:33 PM |
| in the world of competitive business, gates is so the alpha dog. |
| #2 By 7390 (24.188.166.243) at 1/19/2007 1:04:34 PM |
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The best game console is my modded original xbox running xbox media center.
1. I haven't found a video format that it can't play 2. streams anything from my PC 3. built in FTP server 4. Copies any and everything. 5. I have about 25 download games from bit torrent (I have only played about 10) 6. lol, it even tells me weather. it never heard of DRM |
| #3 By 7390 (24.188.166.243) at 1/19/2007 1:06:31 PM |
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#1, I get the sense that his wife kicks his ass at home.
"listen here windows man, I need 1 billion to go shopping..and be quick about it" |
| #4 By 23275 (68.17.42.38) at 1/19/2007 1:34:25 PM |
| #3, Really? I think their foundation suggests a real partnership and the rest suggests they've managed to keep all else as private as it should be. #1, No kdding. He can summarize a business case like few others. |
| #5 By 7754 (216.160.8.41) at 1/19/2007 5:14:01 PM |
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Gates is obviously very smart, but unless the author has some trouble with English and/or transcribing, there are parts of the interview that are nearly unintelligible:
"We think they’re get better on us." Or maybe he was riffing on "All your base are belong to us"? ;) Maybe it has something to do with Asberger's syndrome (if he does indeed have it), but a lot of the transcripts I've seen read this way. He's not one of the best communicators. And yet, he's still one of Microsoft's best presenters. (In other words, they could use some work in that department.) |
| #6 By 12071 (124.168.196.214) at 1/19/2007 10:04:00 PM |
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#2 So the best console for you is a hacked pc running open source software.. excellent :) I agree that the xbox is great for exactly what you described - a very cheap, capable media center, but that does not make it a console in any sense of the word. Most of the people I know that have an xbox use it for exactly the same purpose and rarely play games on it, let alone online games that require a monthly subscription fee (although a few of those do pay a monthly fee for WoW so I guess they don't really have too much time for any other games.
Gates is without a doubt a shrewd businessman but this is nothing more than coming out and well gloating I think is the right word given the failure that the PS3 has been thus far. I'm probably Sony's least biggest fan and the PS3 is of no interest to me whatsoever but they'll most likely bounce back and given that the PS2 is still outselling the xbox and xbox360 consoles combines they're not struggling just yet (although perhaps they should - might teach them a lesson). Then there's Nintendo, the only company that's been in this business longer than any other and always managing to make a profit on their consoles! Now who's the shrewd businessman! And Mr Gates is questioning their longevity! Don't get me wrong the Xbox360 has a lot going for it but aside from Mr Gates and the other 5% of the gaming public, everyone else cares about gameplay over graphics every second of the day and twice over the weekend. That's why the DS has been such a huge success (well huge doesn't really describe how well it's done...) and that's why the Wii will be a huge success. Because they've stopped competing in the number of parallel processors and number of polygons game (i.e. pissing contest that Sony and Microsoft are in concurrently - although for Sony it is a good indication that their 1st gen games look as good as Microsoft's 2nd gen games) and brought back fun into gaming. Not the kind of fun where you need 10 or more buttons on a controller and spend half your time learning the button combinations required to pull off all the available moves but the fun where you can pick up the controller and at be able to have at least a basic control of any game, even if you have never played it before. I guess this is why most gamers are purchasing either a ps3 + Wii or xbox360 + Wii because the games for Xbox and PS3 are very similar. |
| #7 By 23275 (68.17.42.38) at 1/19/2007 10:33:48 PM |
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#6 You nailed that one so solidly! Fun. Ease of use and just as easy to learn.
Forget all the details. The game that is the most fun we have ever played in our house is the original Crimson Skies for the PC. Three modest PC's - three Force Feedback 2's [two purchased at clearance for 60 bucks and three copies of the game [two bought for 9 bucks each, the same night we picked up the other two controllers]. The graphics aren't fancy and the flight controls are super simple. For all that it is not, the experience is pure fun. When the game was released for the original Xbox, we were devastated - played it once and never again. It was everything and it was nothing - like the original, which we still play. We thought Blazing Angels might come close - nope and we got burned again. For games for really, truly casual gamers like we seem to be - meaning, I guess that we like them, but we don't have time to invest time to learn them, simple games are the best. I hope we some more like the original CS. All that said, we still love our Xbox 360 - but it is used far more often as a conduit for downloaded and recorded media than it is anything else - the hardware scaler, while not the best made, does a bang up job of delivering great video that we download from the web. DL.TV's latest episode is playing now. |
| #8 By 20 (67.9.176.193) at 1/19/2007 11:44:58 PM |
| You know, as much as I believe Gates is right and that Xbox will eventually emerge as the frontrunner, I tell you one thing: I'd like to be the big idiot Sony making billions of dollars in the mean-time though :) |
| #9 By 3653 (68.52.143.149) at 1/20/2007 1:09:48 AM |
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IF (and that a big big huge IF) sony ultimately fails with the PS3... it will go down as one of the biggest incumbent blunders in business history. They will be analyzing it in biz schools for decades.
Speaking to the xbox... I've played right at 12 hours of GearsOfWar this week alone. No wonder Gamespot, Joystiq, and GameDaily named it "Game of the Year", even beating ole nintendo's zelda. That game is insane fun. credit where credit is due... kabuki #6... first solid balanced and overtly insightful comment I've seen from you. Keep it up. |
| #10 By 50038 (81.243.131.75) at 1/20/2007 11:14:57 AM |
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Maybe it's just me, but if Sony sells its ps3 as a Blu-ray player, they can't go wrong.
$499.99 for the basic ps3 as compared to about 800$ for a Blu-ray player. So basically for 500$ I can get a Blu-ray player with a free games console (of the 3d generation) function. Maybe they are marketing it too much at the games console market, and not enough as a home entertainment center, home entertainment in this case meaning movies and games. Sounds more like a marketing problem than an unsuccessful product to me. |
| #11 By 23275 (68.17.42.38) at 1/20/2007 12:13:00 PM |
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#10, If I may offer an opinion - PS3 as a BD player is flawed in one very significant way - it lacks a hardware scaler - so if one does not have a 1080P display, it will drop to 480i. Worse, it can't upscale SD DVD, which reduces its value as a player. It also has no media remote - making its control less familiar. It also lacks a "late start" capability, which can require users to muck about - inserting BD discs and restarting the machine and dreadfully slow data transfer rates [max 9MB/Sec - vice a standard 16MB/Sec found on a regular old DVD ROM drive]. That makes BD based games highly improbable - further negating any benefit to the inclusion of the BD drive in its present form.
It is improbable that Sony will be able to overcome the lack of a hardware scaler in software alone - not without giving something up. Sony's trouble and the delay in launching it are all related to what I have listed above and they all result from Sony's initial plans to use the CELL processor to support all things video. That effort failed and Sony had to compromise - adding an Nvidia GPU and dropping plans to include a scaler. It is highly probable Sony will add a hardware scaler before too long and it is equally probable that they'll be able to salvage the PS3 over time. Sony's is enormously powerful and rich - making most of their money through their financial services division, which dwarfs their consumer electronics division in money, power and influence - this last reason likely being why Sony stumbled with the PS3 - a lack of not focus or capability, but emphasis. ***Don't be shocked to see Sony buy Apple's Computer line - Jobs may have no choice about that, either. ****Hmmmmm OSX on a PS3a? Make for interesting press, but it would fail against such powerful dev tools on the PC/Xbox 360 side of the house. |
| #12 By 3653 (68.52.143.149) at 1/20/2007 1:21:44 PM |
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cleenwe, there's also the issue of making cold hard cash. Media players (DVDs/VCRs/etc) aren't traditionally sold at a loss, where the PS3 is certainly currently sold at a huge loss... to be made up later with game and peripheral sales. To put a full PS3 into millions of non-gamers' hands does nothing to bring on step 2 of that process (the important step: making $).
Does anyone have an idea how much sony might make on non-sony bluray movies? For comparison, I've read that video games pay an $8-$10 royalty to the console makers per game sold. |
| #13 By 23275 (68.17.42.38) at 1/20/2007 11:04:48 PM |
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#12, Yes, attachment rates are critical to the success of any platform and especially so for consoles like the PS3. They are as important to retailers as well - who are equally dependent upon software and peripheral sales as the console manufacturers are. As to what Sony makes, or any media house makes on the sale of media, one can have a really tough time finding a clear answer. I'll try [but likely get at least half of it wrong - which by the way, wouldn't be too bad in such cases] - for a hint of what I mean, try and get the real take from a relevant transcript from a Sony earnings call, http://seekingalpha.com/article/19332 - as you can see, many specific questions aren't or cannot be answered directly, or well. This is pretty common actually, and there is as much art as there is science in successfully interpreting such material and success is highly dependent upon a lot of experience in the related industries - for example, as mother glass sizes go up, and production costs go down, one might think that profits would as well - unless one factors in that screen sizes at retail increase as well - so costs and profits remain flat - as these evolutions take place, there are narrow windows where a company like Sony can make more money. So here goes...
Some facts, courtesy of iSuppli, a leading analysis company devoted to assessing these issues, reflects some dreadful realities for Sony opposite the PS3 in its present state, an in-depth teardown of the PlayStation 3 shows that the materials and manufacturing costs of the system amount to $805.85 and $840.35 for the 20GB and 60GB version, respectively. Details here, http://www.isuppli.com/news/default.asp?id=6919 IGN analysts so far, sharply disagree with early Forrester researchers, who predicted BD would win out over HD DVD – Forrester seemed to ignore the 11 to 1 sales rate of HD DVD players over BD player sales and now over 11 million Xbox 360's and their low cost HD DVD attachment - leveraging only Sony's anticipated BD format lift via the PS3. Forrester notes that the attachment rate for Xbox/HD DVD is far higher than BD, or any BD PS3 combination – oddly, contradicting its own analysis. And don't forget... so far all we're adding up is PS3 manufacturing costs and not its marketing, sales, distribution and support costs! What these are and what they actually add up to be, is much less clear. This also explains why we do not see more aggressive HD DVD and or Xbox 360 advertising against BD - it isn't necessary. All that said, the analysis is still early and suffers a lot from pre-PS3 stumble assumptions - persisting for example, in the early position which held that PS3's BD player was going to decide the issue. Fine, it has a BD player, but without a hardware scaler its value is blunted and Sony is going to have to address that - adding one to newer builds will anger early buyers and almost certainly result in a recall - which as I see it, is Sony's only decent move - re-release the PS3 in two versions, and recall and replace all existing units. Version one without a BD player at all and version 2 with a BD player and a proper scaler and included HDMI cable. If they don't they will lose to Xbox 360 at the high end and Wii at the low end and BD will lose any hope of overtaking HD DVD's increasing lead. Cont... |
| #14 By 23275 (68.17.42.38) at 1/20/2007 11:09:48 PM |
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Much of it [profit] comes down to how media content is sold - in libraries, where many parties share various portions of the sale of each copy - or rental, as the case might be and this tracks similarly to how these libraries are leased in theaters - please note, I said similarly, and not exactly. In many cases, Sony will make less on its own libraries than it does on libraries it does not own and at the same time, make it back in one branch or another within its financial services division. In reality, it doesn't look good [in the US Market], for Blu-ray, HD DVD, or DVD - where all will see between 20 and 30% decreases in both demand and profit. The reality is that sales and demand are pretty flat.
Some say the market is saturated – I say the market is both bored and diversifying. I think that the consumers of media are learning that they have some say about all of this – that say comes from people feeding their own insatiable appetites for new interactions and social experiences. So from where I sit, the problem is with formats, resolutions, scalers, or even DRM – the problem is with what the traditional media houses are putting on all that media and how we are rejecting it with increasing regularity. Our pressure and our own choices, more than anything else, is driving down the price for disc based content. The reality is that sales and demand are pretty flat. Based upon all I could find, I pegged the amount Sony makes at about 5% of a BD title's retail price for non-Sony content, and as much as 20% for their own libraries. If I posted all that went into that, the Awin staff would ban me and Latch would scold me worse than he does for being so wordy. I chose instead to include as much relevant material as would help drive a better understanding about all that influences the subject. Why hasn't HD driven better media sales - HD DVD, or BD? Cont... This post was edited by lketchum on Saturday, January 20, 2007 at 23:38. |
| #15 By 23275 (68.17.42.38) at 1/20/2007 11:27:12 PM |
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Now, I'm not going to be one to jump on the entire "it's all about on-demand content and distribution, or web 2.0 band wagon" that might leap-frog over disc based media - it isn't - not yet, in any case, because the experience just isn't there yet and the networks aren't either - IPTV will change that and in the end, Microsoft is going to make Sony's presence as a media house look small - it is in fact, Microsoft's future [please don't think that is a singular perception - by media, I mean software].
It is about how Hollywood has failed us. They show us a view of what they wish us to be and wish us to believe rather than what we are and do believe. At the same time, talent replaced skill - by this I mean, Hollywood elevates people with talent and ignores people with skill. To see what I mean, compare the acting skills of those in a Hollywood blockbuster with those of the classically trained British actors in the HBO series ROME? The skilled actors from Great Britain, classically trained, mop the floor with those elevated in Hollywood. To end this, Mr. Gates is wrong - Sony knows what they are doing, but like all but Microsoft, they can't do anything about it. Where Mr. Gates is right about what he says, is that Microsoft can do something about it and they are - watch as media tools reach around those that elevate the merely talented and into the hands of the skilled - there is a chance what will come out it will be worth watching - regardless of format. This post was edited by lketchum on Saturday, January 20, 2007 at 23:30. |
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