Sony Shines At E3, While Analysts Predict End To Consoles: Exclusive
June 12, 2014

Sony Shines At E3, While Analysts Predict End To Consoles: Exclusive

Peter Suciu for - Your Universe Online

The Electronic Entertainment Expo (E3) once again took the City of Los Angeles by storm as the video game industry showed off the upcoming titles that will keep gamers enthralled in the coming months – and in some cases, years.

Sony and Microsoft approached the show differently, and, as redOrbit reports, each attempted to outdo the other in their respective bombastic press conferences.

In the end, analysts said there was a clear winner this year. Sony was on top, coming into E3 with big sales and having doubled down on its offerings – which included much more than games and clearly had its sights on what the PlayStation 4 could deliver as part of a living room entertainment system. In other words, Sony's messaging sounded a whole lot like what Microsoft tried to say about the Xbox One a year ago.

"Sony owned this E3 primarily because they moved against Amazon and pretty much ignored Microsoft and Nintendo," Rob Enderle, principal analyst at the Enderle Group, told redOrbit. "Amazon is trying to position Fire TV as a game machine that is tied to the cloud and with an increasing number of high performance cloud titles they represented the bigger risk."

Without a line of hardware launches, this year's E3 had a different vibe, according to industry insiders.

"It’s a different sort of E3 as compared to last year," said Susan Schreiner, senior editor and analyst at C4 Trend. "The focus was on the games as the driver for hardware sales this year."

On the game front, it was also Sony's show. Microsoft's press conference was game heavy but it also "lowered" the price of its Xbox One by ditching one of its key components in the process.

"Sony's titles were as strong as Microsoft's and Microsoft's biggest title, Halo 5, is delayed until next year," added Enderle. "Microsoft, which had bet heavily on Kinect being a strategic advantage, found the cost made it more of a disadvantage and again had to be forced to remember price is really important with a product that is generally bought for someone else.

"Ironically, they did this same thing to Sony with the Xbox 360. There is some real irony in Sony doing it right back to them," noted Enderle. "Sony even did an early design refresh which they also appear to have learned from Microsoft. In the end though, the announcements indicate Sony agrees that gaming is moving into the cloud and that they plan to play hard in this new arena. Cloud vendor Microsoft appears to have missed this meeting and I think that Nintendo is not getting that the market for games has moved to a place where they aren't."

Microsoft took this E3 to specifically NOT discuss hardware, which perhaps it had emphasized. Nintendo also hardly had anything to say about hardware.

"Microsoft certainly de-emphasized hardware and didn't speak of it," Schreiner told redOrbit. "Whereas Sony spoke about it within the context of the end-to-end entertainment ecosystem, and (Reggie) Fils-Aimes, Nintendo America president, said that Nintendo is fundamentally a content company. That's its DNA and its content that drives the sales. That's why Nintendo is particularly pleased with the launch of Mario Kart 8 and its quick uptake, and that it was also driving sales of Wii U. Sounds like its success also opened renewed interest by third parties."

Nintendo might have to do more than just get interest from third parties. It was reported Ubisoft is playing a wait-and-see game while Electronic Arts has pulled support for the Wii U. Nintendo instead doubled down by betting on its own games. Those could be too little and too late.

"I was hoping Nintendo would pull a rabbit out of its hat," said independent video game analyst Billy Pidgeon. "But the big titles like Zelda won't be here until next year, so we have to wait until 2015 for the good stuff. I expected more from Nintendo but it seems like they are now trying to make the best of it as they bide their time until the next console round."

Pidgeon said that titles such as Mario Kart 8 could help drive sales, but added, "[Nintendo needs] more big exclusive content if they really want to catch up."

The other common trend at this year's E3 was the all too common "more of the same" in what the developers offered. Sequels once again were in abundance – with new editions of Halo, Tomb Raider, Assassin's Creed, Call of Duty, Battlefield and Uncharted. Many of the games were once again bombastic, loud and in a word, violent.

"It is a matter of personal taste," Pidgeon told redOrbit. "We are seeing a lot of 'copycat-ism' take hold with AAA games, so even when there is a new franchise, it looks really familiar and like most the games out there. There is a risk involved in launching something new, but it is annoying when all the games have the same thematic stories over and over."

The other trends that caught Pidgeon's attention were indie games and free-to-play offerings. To the former he said, "Once again, Microsoft talked about supporting independent studios but Sony again delivered. It is good to see the industry supporting these smaller titles as these are bringing something fresh to games."

However, Pidgeon was less kind about what free-to-play means for console games, especially where the game may be free but every upgrade, item and add-on costs something – making the game anything but free.

"I can see supporting free-to-play on portables, but on the consoles it can lead to bad things like 'pay to win,'" said Pidgeon. "It leads to value erosion. People who buy a game for a console pay more and expect more in the process. They don't want to be nickel and dimed with free to play."

This year's E3 could also be seen as the start of a changing business for all the companies in the game industry, especially the console makers, as the traditional console system could find itself not so much as merely squeezed out of the market, but actually killed by the evolution of set top boxes and apps.

"We are seeing the beginning of the end for traditional consoles and the start of the major move to shift titles to the web and far larger potential audience," said Enderle. "In the end, given the console vendors generally lose money on the consoles, this should be a move more of them get excited about. But change comes hard."