The launch of the next-generation consoles, the Xbox Series X and Playstation 5, are just a few short months away, with the current rumored release date around mid-November 2020. Over the course of the current generation, Sony had a very clear lead over Microsoft, with the PS4 selling over 100 million units while the Xbox One sold around 50 million. With such a huge existing player base, it is likely that despite the Xbox Series X being a more powerful system, the Playstation 5 will likely be the more popular console. But Microsoft are perfectly fine with “losing” the next console war.
Xbox vs Playstation
Since multi-platform gaming has been a thing, there have been “console wars” where fans actively hate on the system they don’t play on. This is no different to people disliking rival sports teams or other really pointless things fans care about, yet the companies they support don’t. But this will likely continue as long as there is more than one console choice available on the market. The Playstation 4 has sold over double the amount of Xbox One consoles, giving it a very clear win this generation; the total sales were approximately 110 million vs 50 million. That means that, going into the next generation, there are already a lot more people who own a Playstation 4 vs Xbox and will likely continue to play and support Playstation during the upcoming generation. When it comes to specifications, the Xbox Series X is more powerful than the Playstation 5, but having an exclusive library that isn’t so exclusive will likely play a huge part in Microsoft once again losing the “console war”. But Microsoft are actually OK with this, as they intend on expanding beyond just a singular gaming platform and have been putting the wheels in motion over the course of the current-gen.
Lack Of Exclusives
If Microsoft were releasing games exclusively on the Xbox Series X, it would have a fantastic library that definitely rivals Sony. Of course, “better” is always subjective; someone may think Halo is the greatest game ever, whereas someone else may think that The Last Of Us is. Neither of these people are wrong; it is just their opinion. But looking at the recent reveals during the Xbox Games Showcase, there were some fantastic looking games: Halo Infinite, Fable, Forza, Avowed, The Medium, Grounded, the list goes on. However, these aren’t exclusives despite being Microsoft IPs. While they’re not releasing on Playstation, they aren’t exclusive to Xbox.
During the Xbox Games Showcase, it appeared that every game shown would also be on PC via the Windows 10 Store, a few of them (such as Halo Infinite) will be coming to Steam, and some will also be playable on the Xbox One. This gives players a lot less incentive to buy an Xbox Series X, because if they have an Xbox One or a fairly decent PC, they can just play most of the games on those instead of buying a new console. So if those players do want to get in on the next-generation, they will be more likely to just buy a Playstation 5 and buy the Xbox games on PC. This isn’t an oversight by Microsoft, though. This is all part of their plan.
The Netflix Of Gaming
It is widely known that consoles lose money when sold or, at least, don’t make a big profit. I covered it in a recent article that you can check out here. At launch, the Playstation 4 cost $381 to manufacture and retailed for $399, giving Sony just $18 profit per unit sold. In some instances, consoles have cost more than the retail price to produce. As time goes on and parts get cheaper, a profit can be made, but console prices usually lower too over time, meaning that profit from console sales never really happens on a large scale. Both companies make their money on software sales and subscriptions. Hardware accessories are also a profit maker, but not as much as software.
Over the course of this current generation, Microsoft have been putting the pieces in place to expand beyond just having the Xbox as a games console. They are attempting to become extremely accessible to anyone rather than limiting their potential market to just be Xbox owners. On the flip side, Sony is still very much focused on the console sales and that being where their market lies. It is no secret that Microsoft also own Windows, very likely the operating system you are using right now to read this if you are doing so on a PC or laptop. Windows has a 77-87% market share globally, with a large majority of home computer user using the current Windows 10 OS. On Windows 10 is the Windows Store, which is a store where users can download various things from apps, to music, movies and even games. This is another platform where Microsoft can sell their games outside of the Xbox console. In recent months, we have seen both Sony and Microsoft start to utilize Steam as a platform to sell their games. We have seen various Playstation exclusive games such as Horizon Zero Dawn and Detroit: Become Human go to Steam, while Microsoft are even selling their system-selling launch title, Halo Infinite, on Steam on day 1. With Halo Infinite being available on a non-Microsoft platform on day 1 of its release, it shows that Microsoft aren’t looking at making sure the Xbox Series X sells; they are focused on selling their software.
In addition to simply buying games, players can now subscribe and play games via the Game Pass service. Game Pass allows players to download any game from its library and play as if they owned it. The only downside to Game Pass, much like Netflix for film and TV, is that the titles do cycle in and out, so the same titles aren’t always available, though if you’re enjoying the game, you have the option to buy it at a discount before it leaves the service. Sony has a similar service called Playstation Now, except with PS Now, players need to stream the game over the internet rather than downloading it, often causing a lot of issues, and the experience isn’t usually as smooth as if the game was downloaded to a hard drive.
During the Xbox Games Showcase, all of the games revealed will also be coming to Game Pass, meaning players don’t need to pay potentially $70 to play the latest game and can instead pay $9.99 per month to play every new title from Microsoft and many more third party games. Game Pass currently has around 10 million subscribers, giving a sizable amount of revenue to the company. However, Game Pass isn’t massively profitable for Microsoft right now, but they are focused on giving huge value for money to the player so they continue to promote the service to their friends and followers to gain more subscribers, eventually making it a very profitable service for Microsoft.
Many of the Game Pass games can also be played on Game Pass for PC, rather than needing an Xbox Series X, players can also pay $14.99 to get Game Pass Ultimate, which includes Xbox Live, Game Pass, and Game Pass for PC. From September Game Pass Ultimate subscribers will also get access to Microsoft’s Project xCloud service, which will allow games to be streamed to users phones and tablets. At launch there will be over 50 games, such as Halo MCC, Tekken 7, Forza, and more, I imagine more will continue to be added over time too. This will make Microsoft’s games and brand the most accessible in gaming, something neither Sony or Nintendo can offer right now.
Accessibility Over Sales
Microsoft’s end goal moving forward is to become an accessible brand, with players being as unrestricted as possible when it comes to being able to play their games. If you want to play Halo, you can play on Xbox One, Xbox Series X, PC via Windows Store or Steam, and even on your phone or tablet. The best part is, for all but on Steam, you don’t even need to pay for the game, you can simply pay a small monthly subscription and play Halo and many other games. Whereas, with Sony, if you want to play the latest Sony title, you need to buy their console as well as the game. Or wait a year or 2 and stream it on Playstation Now either on the console or PC and hope your internet can handle it. While Sony may win the “console war”, only time will tell as to whether Microsoft can become the brand it intends to become, which could be a victory even greater than Sony’s.
Which next-gen console are you planning on getting? Are you a Playstation 5 fan? Or do you prefer the Xbox Series X? Let us know in the comments.