Xbox Creator Says Console’s Are Not Yet Dead

I wouldn’t say he’s crazy. Crazy people make decisions that are not based on facts and information. Seamus Blackley (the guy that pretty much gave us the Xbox) just interprets the facts and information a little differently than the rest of us. An article published yesterday by Edge quotes Blackley making a bold stand: “Consoles aren’t dead. They’ve won”

For the last few years, console manufacturers have lamented the oncoming horde of games for the iOS and Facebook. Games like Farmville have plowed through (eh? eh?) the competitive landscape and amassed a fortune for casual game giant Zynga. Don’t believe that shops like Zynga are a force to be reckoned with? Check this out. That’s right – Zynga has an estimated value of five billion dollars. That’s the amount of foreign investment that Serbia hopes to get this year. If the popular gaming company (Zynga, not Serbia. Serbia is a country in Central Europe.) chose to IPO soon, they could rival Twitter for initial interest in their stock.

So the outlook for consoles had been grim. Console games generally have a more discerning user base, so their games are expensive to produce. More expensive production costs means a higher price tag. Those expenses mean that games have to attract customers over and over again or charge them for DLC so that studios can make ends meet. With cheaper alternatives on the market, Sony, Nintendo, and Microsoft have been doing anything they can to stay relevant. As early as 2008, even executives at Microsoft were shockingly grimabout their future. Of course, Mr. Blackley sees the world with a rosier tint than some of his colleagues.

In the article, Seamus exudes the air of a typewriter salesman, circa 1980. He goes out of his way to mention that “All kinds of people are releasing consoles, they’re called iPads and Facebook”. Call me crazy, but re-branding a web service as a “console” doesn’t seem to be quite the quick fix that console manufacturers are looking for. Check the stock price of Sony or Microsoft over the last few years. Even in a fluctuating market, they continue to underperform, much to the chagrin of investors with an eye to gaming. I think that Mr. Blackley is just throwing us a red herring with this release. He’s simply trying to redefine what a console is, and that simply won’t make the nightmares of gaming execs go away.

Blackley’s only valid argument is that every piece of hardware getting released now, from an iPad to a cell phone, needs to be optimized for gaming. If you put out a new gizmo that doesn’t have an app store, you will absolutely be crushed. Consumers expect to be entertained with every piece of plastic they can fit into their pocket, and no company is foolish enough to disregard this fact.

Angry birds just expanded into China. Xbox hasn’t even broken into that market yet. What do you think the future is for those big plastic boxes under your TV?