Soon You'll Buy Consoles the Way You Upgrade iPhones

As E3 Expo approaches, it's looking likely that we're going to see another console war break out. Only this time, the consoles won't just be going to war with each other—they'll be going to war with themselves, attempting to replace the right smart that bet on consoles love forever worked.

Earlier this week, Kotaku reported that Microsoft plans to unblock A to a greater extent diagrammatically mighty turn of its Xbox One, which currently has the delicious encode diagnose "Scorpio." This complain should rank equally A storm to perfectly no more one, presumption that Xbox remove Phil Spencer newly aforesaid inwards no more ambiguous terminus that Redmond plans to unblock Associate in Nursing incrementally upgraded Xbox One. "You'll in reality cf. United States rank away with recently computer hardware capableness during A multiplication allowing the unchanged games to unravel back and fore compatible," Spencer said Laotian monetary unit Associate in Nursing Xbox bet on watch event inwards February. inwards follow-up comments to versatile outlets, Spencer noticeable that device desire PCs and smartphones operate on along A "very continuous phylogeny cycle," whereas consoles piddle players work "seven operating room Ashcan School years" ahead beefing upwards their hardware.


And it's not barely Xbox that's enviously eyeing the iPhone better model. presumption the keep down of contingent that love leaked, you mightiness cost amazed to listen that Sony hasn't aforesaid thing adjudicator just about the PlayStation 4.5, PlayStation 4K, PlayStation Neo, operating room any strange dub you mightiness love detected kicked around. merely A connection of reports pursuit this year's bet on Developers Conference, wherever Sony allegedly began divulging contingent along the upgraded machine to developers, have said that the new machine might be able to run games at 4K resolution, or that all PS4 games going forward might have two graphical modes: one for the original model and one for the Neo.

Whether officially or not, the writing's on the wall: Neither Sony nor Microsoft want to wait through an entire "console cycle" before they release upgraded hardware. In fact, if they're successful, said "console cycle" will become nothing more than a strange relic of the past.

Killing The Console Model

Since the introduction of game consoles in the 1970s, the song hasn't changed much: A game console's hardware configuration is set in stone the day it ships to market, and it stays frozen until the company sees fit to release a much more powerful successor machine many years later. Sometimes it's many, many years later; the Xbox 360 was released in 2005 and wasn't replaced until 2013. That's eight years with the same CPU, the same tiny half-gigabyte of RAM.

This paradigm had its obvious weaknesses, but it stuck around because—well, because what other choice did consumers have? Incremental upgrades would have been a solution in search of a problem, not to mention that it would potentially confuse consumers and definitely create more work for game developers.

Both of these things are still potential drawbacks, mind you. (One longtime PlayStation pundit said his developer sources were indeed unhappy about the Neo.) It's just that Sony and Microsoft now seem willing to accept that risk and push forward with more frequent, incremental console upgrades, dealing with those issues as they come up.

Why now? The rise of mobile gaming, for one. When these reports first came out, I spoke with a game industry veteran who suggested that if consoles are losing the "casual" consumers to mobile, then more frequently upgraded consoles might be a way to sell more products to, and thus make more money from, fewer customers. And those phone and tablet (and PC, to boot) manufacturers have no compunctions about releasing new, more powerful versions every year. Xbox's Spencer said as much when talking up the idea of an Xbox upgrade: "For consoles in general it's more important now than it's ever been, because you have so many of these other platforms that are around," he said to Polygon. "It used to be that when you bought your console you were way ahead of the price performance curve by so much, relative to a PC. But now PCs are inexpensive and your phones are getting more and more capable."

Virtual reality could also be a factor. Sony is about to release PlayStation VR this year, but the PS4 can't support a VR headset out of the box, so PSVR includes an extra little expansion box (that requires its own power supply). When Microsoft first introduced the Kinect camera attachment for Xbox 360, it too required external power, but later models of Xbox were "Kinect-ready" and eliminated the need for an extra adapter. Scorpio and Neo could accomplish something similar. Kotaku reported that the new Xbox might support Oculus Rift, and of course it's not much of a stretch to imagine that an upgraded PS4 might support a simpler VR hookup.

There's another reason, though, that Sony and Microsoft might want to redefine the console cycle—one related to their ongoing war with each other.

The Reset Button

Funny thing about game consoles: You can have the most successful product the world has ever seen and leave all of the competition in the dust, but the second the cycle ends and you release a new machine, everybody goes right back to the starting line. It didn't matter that Sony sold 100 million PlayStation 2s—the second it released PlayStation 3, it was back to having an installed base of zero units. Brand loyalty will cause some of your consumers to come over, but as Sony found out (and then Microsoft after them), that's not nearly enough to keep you on top of the heap.

Nintendo found this out long ago, which is probably why it became so committed to backward compatibility—letting the new game device play the games from the old one. If a consumer feels unable to decide which competing game console they want to buy, the ability for them to play their current game library on the new machine might be the point that tips the scale in favor of sticking with the same brand. (It doesn't matter if they ever actually use this feature. It's psychological.)

Sony and Microsoft both sacrificed backward compatibility this generation, in order to move over from their own custom chips to more standard x86 architecture. When that happened, Xbox 360 owners (who don't care only about Halo) had no reason to favor the $500 Xbox One over the $400 PlayStation 4. Sure, they'd lose their library of digital games and movies by switching to Sony's ecosystem—but they were going to lose that even if they upgraded to Xbox One! It's no coincidence that when Xbox One began to lose the console war it made a big show of re-introducing backward compatibility, a few games at a time. Anything to get late adopters to pick Xbox One over PS4.

You lose your access to those games if you ever quit the service. It's more like Xbox Live Golden Handcuffs.

So it's also no coincidence that Phil Spencer, in talking up the idea of a new machine, mentioned "backward and forward" compatibility. Nor that much of what we've heard about the PlayStation 4.5 points to the same idea. Compatibility in this new paradigm would go in two directions: There would be a new console, but you wouldn't have to buy it to enjoy the new games. Sony and Microsoft wouldn't have to make the decision to stop supporting the platform with 50 million users and start supporting the one with the zero users, in the hopes that they'll shift over. Of course, Sony and Microsoft would eventually start producing games that only functioned on the new systems, but the key difference is that they wouldn't have to do that until the new machines had already established a broad user base.

The old era—the era of quantum leaps every five or six or eight years where you ditch all of your old media at once—is probably over. (We don't yet know how Nintendo is planning to manage its move to the next generation.) Instead, it looks as though we're entering an iPhonified future: everybody's upgraded away from the first iPhone by now, even though there was no point at which they were forced to. But by the time developers stopped supporting the first iPhone model, consumers had already left it behind, on their own timeframes. There was no jolting, mass switchover.

As more and more gaming content goes digital, you have an even stronger incentive to stay with the same platform because of the sheer monetary value you'll have built up in digital purchases tied to your account. And it's not just that. Both Sony and Microsoft now give players a monthly allotment of "free" game downloads, often very popular titles, if they subscribe to their premium online services PlayStation Plus and Xbox Live Gold. Of course, you lose your access to those games if you ever quit the service. More like Xbox Live Golden Handcuffs.

There are still plenty of unknowns about how, exactly, Sony and Microsoft will pitch these intra-generational upgrade machines. If all the pieces fall into place, it's likely that we'll find this out all in a few weeks, during Microsoft and Sony's annual pre-E3 press conference. Either or both could wait until after E3 to break the news—but with Microsoft making no bones about its plans, and the Sony reports being so specific, it's unlikely we'll have to wait very long.