Amazon, sleeping giant of the console market?
The gaming industry is pretty unique. There seems to be plenty of room for both Sony and Microsoft to co-exist relatively happily. Why? Maybe it’s because the industry has grown to be worth more than US$160 billion (NZ$280b)?
All of that money doesn’t go to Sony and Microsoft, of course. The hardcore PC gaming market will take a significant cut; the game developers get fairly compensated too.
That said, the console sector is still reported to be worth approximately US$50b, with Sony and Microsoft making up over 75 per cent of the market. This has been the case, more or less, since Xbox debuted its first console back in 2001.
With that in mind, and with the money flowing in year after year, I find it both unsurprising and mind-blowing that things look set to continue as they are for the foreseeable future.
This Christmas season is when Sony and Microsoft are due to release their new consoles, the PS5 and Xbox Series X.
This week both companies gave us glimpses of what their new consoles will look like in terms of specs. And they’re virtually identical.
Both consoles have AMD Zen 2 processors; AMD RDNA 2; 16GB GDDR6 memory, 825GB1TB SSD storage; 4K Ultra HD Blu-ray optical drives; and 4K+8K HDR support.
I’m not arguing that these aren’t welcome upgrades. The move away from HDD to SSD alone will have a huge impact on game-load times. Similarly, the new processors and GPUs will finally allow the consoles to compete with PC games in terms of refresh rates (120Hz) and screen resolution (8K).
The cut-throat smartphone industry shows you what genuine competition and innovation looks like. Take a look at the quality of a picture taken on an iPhone 8 compared to what the new iPhone 11s are capable of, and you’ll soon see what I mean regarding progress. Better still, ask anyone with an iPhone 11 about their device’s battery performance.
This pacey innovation isn’t happening in the games console industry. Why? I suspect it’s because the money is rolling in and there’s no need for it to change.
I find it annoying and amazing that Sony and Microsoft rely on third-party suppliers to make their consoles tick. It seems to me like the industry is wide open for a challenger brand to mix things up.
For a long time, I thought that brand would be Google or Apple. However, both entered the gaming market in different ways last year.
Google Stadia and Apple Arcade look like they’ve adopted different routes, though. Which only leaves one obvious deep-pocketed brand. Amazon.
I know it seems far-fetched at first. But not when you think about it.
Anyone who’s bought a video game from a games shop in the last few years will know that it’s a largely redundant process. As soon as you insert a disk into a console, you have to download tens of gigabytes of extra data in order to play the full game. And anyone who’s used Sony’s servers will know what a slow and painful process that is.
Soon, if we’re not already there, buying games in disk-form will become outdated. Gaming will move to a subscription model in the same way TV, film and music has. Playstation Now and Xbox Live are early versions of this. And for this to work, games consoles will need to lean heavily on their cloud computing infrastructure.
And guess who is doing really well in this industry? That’s right, Amazon.
All it needs to do now is build a rival console using high-end third-party specs, just like Sony and Microsoft do, and convince game developers to make their content compatible on its console too.
And I can think of a few billion reasons why they want to make that happen.