The Consolidation of Consoles: Why Sony Will be the First to Fall

The gaming industry is evolving fast. Physical media is growing increasingly obsolete as a digital-dominated future is on the ever-approaching horizon. Much like other forms of entertainment (i.e. movies, music, etc.) gaming is moving away from the traditional retail model, which undoubtedly brings with it a slew of changes, including the consolidation of the console market. We are slowly moving away from the era of game cartridges and memory cards; in fact, DVD and Blu-ray formatted games will soon feel like a thing of the past. As such, there will be no need for gamers to purchase multiple consoles to accommodate various types of media.

In addition, we've begun to see the fading importance of exclusive games, as the majority of high-profile franchises have gone multi-platform. Because of this, the idea of owning multiple gaming machines is beginning to feel a bit archaic, especially when looking at progressive gaming platforms like Steam. As a result, we'll soon see competing console manufacturers (i.e. "The Big 3") drop out of the gaming hardware space to focus on their roles as publishers and/or developers. I believe that the PlayStation brand will be the first to go, but before you write me off, hear me out as I dissect the strategies of each of the three major players.

Note: I have nothing against the PlayStation brand. In fact, it is currently my primary gaming console, so please save your fanboy accusations for another time.

Microsoft and the Xbox are relatively new to the world of gaming, but that hasn't stopped the company from elevating its platform to the leader in the online space. With a robust online platform that trounces that of the competition, Microsoft's prowess in social networking and software development has helped to redefine the gaming space. Ever since the dawn of Xbox Live, Sony has been playing catchup and Nintendo hasn't even bothered trying to compete. The fact that the company owns the Windows platform doesn't hurt either. As they continue to learn from the Apple model and unify all of their Windows/Xbox powered devices under a single user-friendly experience, the more rooted Microsoft will become in the gaming space.

I pointed out the evolutionary nature of the industry in the introduction of this article, and I want to return to that notion as we explore the future of Microsoft's role in this regard. A gaming console is becoming more than just a device to play video games. With applications like Netflix, Twitter, ESPN and HBO, Microsoft is proving that the Xbox platform is so much more than a gaming machine. The appeal of the smart phone lies in its multi-functional nature as everyone seeks after that all-in-one device. It should be pretty clear at this point that Microsoft plans to make the Windows/Xbox platform the central all-in-one experience that will allow you to seamlessly communicate between all of your devices. If Microsoft can achieve this, they will be able to capture the portion of the market that hasn't taken to Apple's appealing line of unified devices.

The reason Microsoft isn't stepping out of the gaming race anytime soon is because of the company's big-picture focus and willingness to associate hardcore gaming experiences with the rest of entertainment. Apple has the casual gamer wrapped around its finger and if Microsoft can do the same with PC loyalists and hardcore Call of Duty fans, they'll be able to elevate the Xbox and Windows platform to new heights.

Nintendo is undoubtedly the black sheep of this gaming trio, which in the end serves as the company's greatest strength. Microsoft is taking gaming to a whole new level of entertainment, while Nintendo seeks to focus on what makes games fun in the purest sense of the word. In many respects Nintendo is evolving into a toy company rather than a competitor in interactive entertainment. Software sales for the Wii have been far from impressive, but that hasn't stopped the console from becoming one of the most popular in the history of the industry. Nintendo's console quickly became the Wii Sports machine and while that may not have been what the typical gamer wanted, it raked in more profits than Nintendo could have ever expected.

Innovation is the name of the game over at Nintendo and this will be key to the company's future. If Nintendo can continue to convince consumers to shell out their hard-earned cash to get in on the company's latest innovation, they'll be able to stay relevant simply because they're carving out new experiences that can't be found anywhere else. Plus, with signature franchises like Mario and Zelda, Nintendo can always count on brand recognition to keep them afloat. Is it possible that one day Nintendo may drop out of the gaming hardware business and work solely as a publisher/developer? Absolutely. Back when the SNES and Genesis were duking it out, no one would have ever thought that Sonic would end up on a Nintendo platform. If for whatever reason one of their next major hardware innovations fails, there's no doubt that Nintendo would find incredible success by adjusting their goals and outlook. Considering Nintendo's impressive track record however, it doesn't look they'll have to worry about that anytime soon.

Sony and the PlayStation brand have faced some ups and downs since the gaming division got its start back in '94. The original PlayStation launched with incredible success, showing that Sony could give Nintendo a run for its money. Then, the following generation the company took it one step further and released the PlayStation 2 which served as the most popular console at the time, beating out both Nintendo's cute purple lunchbox and Microsoft's massive PC-looking machine. So why is it that I believe a company with such a stellar track record would be the first to go? Well if the PlayStation 3 and Sony's handheld devices are any indication, they've got some serious work ahead of them if they want to remain relevant in the industry.

Sony has been in a perpetual state of catchup ever since the PlayStation 3 released. The foolish decision to include a Blu-ray drive and overly expensive processor made early adoption of the PS3 far too expensive for the average consumer. In addition, a weak launch lineup and behind-the-curve online functionality only worsened the situation. Ever since that time the PlayStation brand has been slapping band-aids over its gaping wounds in an effort to reach the ever rising bar of the Xbox 360. Free online gameplay has been the system's biggest selling point alongside a slew of first-party exclusive content, but it hasn't been enough to tear away the gamers that have become rooted in Microsoft's Xbox infrastructure. Trophies will always feel like a rip-off of achievements and much of the additional content (Netflix, Hulu Plus, etc.) was on Microsoft's console months before the competition.

Let's face it, the reason that Sony is still around today as a video game hardware manufacturer has a lot to do with their past success. Unfortunately they can only ride that wave for so long, as Sony is starting to sink as a company. The PlayStation parent company Sony Corp. has been losing money four years in a row now, so it's fair to say that they're currently in some rocky water. And while yes, Sony does have an amazing lineup of first-party franchises like Uncharted, Killzone and God of War, they simply don't sell as well as Microsoft exclusives like Halo and Gears of War. Plus, the surge in multi-platform games is chipping away at Sony's once unbeatable library. Series like Grand Theft Auto, Final Fantasy and Metal Gear Solid were major reasons why the PlayStation brand was so successful, and since these are no longer exclusive to PlayStation, there are becoming fewer and fewer reasons to buy into the hardware.

Additionally, Sony has proven its reluctance in learning from past mistakes. Poor marketing campaigns continue to plague the brand as well as the company's incessant need to try and break into the portable market. The sole reason why the PSP was a success is because of Monster Hunter's insane popularity in Japan. Since they've lost that exclusive to the 3DS, there's no doubt in my mind that the PS Vita will end up being a failure for the company. Smart phones are taking over the handheld gaming space and Nintendo basically has every other inch of the portable market on lockdown, so there's really no need for the Vita. Instead of pumping all these resources into a platform that is doomed to fail, the company should have been pouring money into the PlayStation 3. Beefing up the console's online space, marketing push and exclusive content would be far more beneficial to the company than launching the PlayStation Vita.

While I'm not saying that the PlayStation brand will die out in the immediate future – we're sure to see "the big three" endure at least another generation – I am saying that between Nintendo, Microsoft and Sony, the PlayStation brand is the one most likely in danger of fading from existence. Of course this is all just speculation and opinion, so be sure to tell us what you think in the comments below.