The Next Generation Console Wars

We’ve all heard the news. The biggest makers of videogame consoles are each rolling out their next machine, and every one of them is being filed under that magic phrase: “next-generation.” With the dawn of the year 2000, the companies are obviously going to use the turn of the century as an advertising tool, and the console makers are taking full advantage. But will this be the beginning of the next great console, or the end of a console company forever? Neither? Both? Let’s explore the options. Welcome to the next console generation…

The players in this war are the prominent Sony, the returning Sega, and the shadowy-but-cutesy Nintendo. Right now Sony and Nintendo are the only ones with consoles on US shelves, but that changes fast. September 9, 1999 marks the start of the console wars stateside: Sega’s Dreamcast, a 128-bit system, launches that day. Skeptics say it’ll have little reign, it isn’t doing as well as expected back in the Japanese videogame motherland, but the US is a different story. Look at the pre-order sheets at KB Toys, Toys R Us, Electronics Boutique and Software Etc. and you’ll see literally thousands of Dreamcasts already spoken for. Sega is geared up with a 15-game launch list and slick specs, including a built-in modem at $199.

Both Sony and Nintendo have new machines on the drawing board, but neither is finished. Sony’s PlayStation 2 promises DVD and full-time FMV and looks genuinely impressive, but critics are whispering $500 and up, a price many won’t pay even if the thing plays games, plays movies, tells the future and butters your toast. It’s due roughly a year out, around spring or summer 2000. Nintendo falls behind everyone, with its system (codenamed Dolphin) due late 2000 or, more likely, 2001. It’ll be a late journey, but if you know Nintendo, they can handle it, they launched the Super Nintendo well after the Genesis and still succeeded. Dolphin will be DVD too, with specs equal to or better than PS2, and Nintendo is promising it cheap thanks to IBM’s 0.18-micron copper technology.

So how do the wars play out? Here’s my call. Dreamcast launches in September and sells very well; PlayStation and N64 sales dip but not enough to scar anyone. Dreamcast keeps ruling and is still ahead when PS2 arrives. Months later PS2 still trails Dreamcast but finally picks up some speed. Then the Dolphin drops into the heat of it. After a slow, steady start its sales catch PS2 in far less time than PS2 took to get there, and eventually the Dolphin pushes past everyone, winning by a close margin on the back of more loyal supporters (remember the Saturn), with Sega close behind and Sony lurking at the back.

You may say, “Adam, you idiot, Nintendo winning?!” Yes. Look at the strategies. Sega: release early and play out the competition, then follow up with cheap add-ons that improve the machine, cheap and good appeals to more people. Sony: raw power defeats all, let it do everything, blow the field away. Nintendo: play it cool, wait for everyone’s specs, then build something cheap, awesome and better than the rest, release late but make the dev kits easy and available so the launch line-up is deep.

Now the mistakes. Sega: no DVD, and lingering distrust after the Saturn. Sony: a price point near $500, plus word that the dev kits are hard to program for, which means few launch titles and games that don’t use the hardware’s full power. Nintendo: waiting this long, the strict rules that keep most Nintendo games cutesy, and the carts-over-CDs hangover from the N64.

Why not Sega? The system will do well, but the early release and missing capabilities the others have could leave it obsolete, needing paid updates that not everyone will buy, and that means segregated games. Why not Sony? The price locks out too many buyers, and those tricky dev kits mean a longer wait for games that actually flex the hardware. Why Nintendo? Loyalty from classic gamers, the money to do it right, a price point that looks great (sub-$250), easy dev kits for more games, and a far-off date that leaves room for a big launch line-up. That’s my story and I’m sticking to it, for now. Long live videogames!