February 20, 2013
More than 10 years ago, Sony executive Ken Kutaragi predicted that one day videogame consoles would become one with a network that linked players together, thus eliminating the physical console and allowing gaming to require only a display and controller. Now, Sony is preparing to reveal its newest PlayStation, on which gamers will be able to stream games via the Internet — one step closer to Kutaragi’s vision.
“The addition of streaming exemplifies how the videogame industry is searching for new ideas to cope with dramatic shifts in technology and consumer behavior,” writes the Wall Street Journal. Videogame companies like Sony, Nintendo and Microsoft “used to depend on their twice-a-decade launches of new living room consoles to spur a new wave of spending on consoles that typically cost hundreds of dollars and games priced at about $50 or more. But the Web, mobile phones and tablets have spurred the creation of new, more convenient ways to play games free of charge or for a few dollars.”
Because of this, sales of new titles, consoles and accessories are shrinking. According to numbers from PricewaterhouseCoopers, “global spending on console games will shrink nearly 1 percent in 2013 and rise only 3 percent next year — far less than the 28 percent growth the industry saw in 2007 after the last batch of new consoles were released,” notes the article.
This is occurring while sales of mobile devices continue to rise, creating a large market for inexpensive game apps. In January, Apple reported to have sold more than 500 million iPhones, iPads and iPod Touches since 2007, besting cumulative sales for the three major home gaming consoles combined.
Videogame companies need a way to compete. As of now, streaming games via the Internet can lead to slower than desired results. But if it can be improved, “streaming could have implications beyond well-dedicated game machines, potentially allowing Sony’s smartphones and televisions to tap into graphics-heavy games they can’t play now,” according to the article.
There is a “recognition on Sony’s part that the cloud and cloud-streaming technologies are going to have a profound and possibly a very positive impact,” Andrew House, head of Sony’s videogame unit, said after the company acquired gaming company Gaikai.