The Future of Gaming May Be Tablets from Amazon, Apple and Google

  • Nintendo sold an estimated 400,000 Wii U consoles on Black Friday and Cyber Monday. Rivals Microsoft and Sony are also expected to release new iterations of their popular video game consoles in the new year.
  • But even with strong launches, the new consoles “represent a rapidly decaying ecosystem,” writes Fortune contributor Kevin Chou.
  • “The eighth generation of game consoles we will see in the next 12 months will, over their life spans, sell in lower quantities than the generation that preceded them. That will be a first,” says Chou, who is the CEO of game maker Kabam. “The best guess, both from inside our company and from industry analysts, is the fall-off will be more than 30 percent. Much of the decline will be in the out years of sales, after the most loyal fans have snapped up early units.”
  • “If this happens, there will be a one-word explanation: tablets,” Chou continues. “There can be little doubt that tablets from the likes of Amazon, Apple, and Google are the new consoles.”
  • The typical gaming console release schedule is between five to seven years. Tablets, on the other hand, can be released every year as technology improves. Already, the latest iPad from Apple has a more powerful graphics processing unit than that of the new Wii U.
  • Also, the consumer behavior toward software has changed. Rather than coughing up $60 for a new game, customers are opting for freemium games on tablets and smartphones.
  • “This will be doubly true as more software companies adopt the iterate-and-improve development model of the tablet makers,” the post states. Rather than monetize customers up front, developers are drawing in consumers who will pay for updates over several years.
  • Lastly, gamers want convenience. Not only are tablets more portable, the sheer number of games available on mobile devices dwarfs that available on consoles.

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