Xbox Exec Thinks Handhelds Are a Bad Bet

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Xbox Exec Thinks Handhelds Are a Bad Bet

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Microsoft thinks that investing in home consoles is a much better idea right now.

Dennis Durkin, the chief operating officer for the Microsoft division that - among other products - handles the Xbox, says that he isn't sure that releasing new dedicated handheld devices is such a good idea at the moment and questions whether Sony and Nintendo have made the right decision in doing so.

Durkin said that the handheld market was not only very full at present, but that there was a lot of change going on in it. He pointed out that sales of the 3DS had been much lower than people had been expecting - something that Nintendo has also acknowledged - and said that there were better places that Microsoft could invest its resources. "You only have a certain number of bets you can make as a company and you have to decide what you want to put your wood behind and I'm just not sure [handheld gaming is] a place that I would put mine."

He said that Microsoft was much more comfortable focusing on the Xbox 360. He said that the 360 was where Microsoft was able to best differentiate itself from its competitors, and that he was excited about the future of the console. "It's been very, very consistent and I think it speaks to the trends that you're seeing in terms of sales and velocity over the last 2 years ... So I feel very good about our relative position relative to both of our competitors. I certainly wouldn't want to trade hands with either of them."

Some of Durkin's comments should obviously be taken with a pinch of salt - he's unlikely to say, "Yeah, Sony really has us on the ropes," any time soon, even if it was true - but he's certainly not wrong about the changes in the handheld market. The proliferation of smart phones and tablet computers since the release of DS and PSP has changed the landscape, with many casual players able to get a gaming fix without shelling out for a dedicated device. Obviously, there's still a market for these devices, but it isn't the same market as existed in 2004/2005 when the DS and PSP launched.

Source: Industry Gamers

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Of course Microsoft is saying this, since they bet heavily on two separate lines that both failed: the Zune, and Windows Mobile/Phone. Neither platform made it to the stage where it could be used for gaming (the Zune never made it past a weak ipod clone and is now fully dead) so MS has no handheld of its own.

erbkaiser:
Of course Microsoft is saying this, since they bet heavily on two separate lines that both failed: the Zune, and Windows Mobile/Phone. Neither platform made it to the stage where it could be used for gaming (the Zune never made it past a weak ipod clone and is now fully dead) so MS has no handheld of its own.

I agree they're doing this as a bit of propaganda but there's some issues to your post.

The Zune player is dead but Zune isn't dead, it lives in through Windows Phone which is alive, albeit selling slowly. Mango should help garner further mind and market share. Xbox live integration is weak at the moment, it would be good to see a XBLA section for WP with tighter integration.

That said Windows Phone does have the potential to be a force in the mobile gaming market like iOS and Android are. With their prior knowledge of gaming behind them (something Google and Apple sorely lack) they could make a compelling platform.

You know what sucks. Rare cant make games for the 3ds like they did for the ds, because of the window 7 phone.

iOS and Android markets are hurting the handheld gaming market, so it's harder than ever now, good choice.

Griffolion:

erbkaiser:
Of course Microsoft is saying this, since they bet heavily on two separate lines that both failed: the Zune, and Windows Mobile/Phone. Neither platform made it to the stage where it could be used for gaming (the Zune never made it past a weak ipod clone and is now fully dead) so MS has no handheld of its own.

I agree they're doing this as a bit of propaganda but there's some issues to your post.

The Zune player is dead but Zune isn't dead, it lives in through Windows Phone which is alive, albeit selling slowly. Mango should help garner further mind and market share. Xbox live integration is weak at the moment, it would be good to see a XBLA section for WP with tighter integration.

That said Windows Phone does have the potential to be a force in the mobile gaming market like iOS and Android are. With their prior knowledge of gaming behind them (something Google and Apple sorely lack) they could make a compelling platform.

Yeah, I'm sure the threat of Fable Darts is gonna really make Android obsolete as a gaming platform.

zombie711:
You know what sucks. Rare.

I mean, seriously, do you really think having Rare not doing something for a platform is a bad thing? Look at the recent games they made. Kinect Sports 1 and 2. Do you honestly look at the 3DS and think it needs more insubstantial games? If you loved the old Rare, its time to face the music and acknowledge that they're dead. Before they can break your heart any more.

In other words, Microsoft don't think they can get into the handheld gaming market, so they're going to rip into those that can.

Handhelds are doing fine ~

But they're choosing to invest it in motion controls another over-saturated market..

Yes, the obvious solution is to compete with the PS3, Wii/Wii U and the PC instead of the handheld market which only has 2 competitors.

I agree he'd say it whatever the case, but he's probably right, the handheld market will be the first to be eaten up by smartphones. Still what with selling 50 million PSPs, I don't think Sony or Nintendo have blundered at all. They'll both make tons of money, it's just not a market worth MS investing in

Anyone care what Xbox execs think? Especially if they think Kinect is the future.

Yeah handhelds are a bad bet if they haven't got a clue how to market them, look how right the DS got it during it's brain training years it had a clear and focused target audience and it sold millions on the strength of one game.

I like dedicated devices. I like having my music player, gaming device and phone as separate devices. Nothing is worse than getting into a game or listening to your favorite song and getting interrupted by a phone call.

Funny thing is that my friends were practicing some dance thing for school and the lead person had the song on their iPhone and they played the song off of that. It took them forever to get through the song without an incoming text or phone call screwing it up.

OutrageousEmu,

I never mentioned anything about being obsolete, but they have the potential to be a compelling gaming platform. There's room in the market for a third, especially one that has XBox behind it.

Griffolion:

The Zune player is dead but Zune isn't dead, it lives in through Windows Phone which is alive, albeit selling slowly. Mango should help garner further mind and market share. Xbox live integration is weak at the moment, it would be good to see a XBLA section for WP with tighter integration.

That said Windows Phone does have the potential to be a force in the mobile gaming market like iOS and Android are. With their prior knowledge of gaming behind them (something Google and Apple sorely lack) they could make a compelling platform.

I'm inclined to agree, XBL is probably the best social/online game platform, so to see that extended to mobile gaming would be amazing. I use an iPad with Game Center but it's not the same, I can imagine mobile/console cross-platform games right down to just being able to collect Gamerscore for playing Angry Birds.

Whilst I respect that MS have obviously put a lot of time and research (not to mention money) into these ideas, it would be a damn cool thing were it done... Properly Better than the Zune.

erbkaiser:
Of course Microsoft is saying this, since they bet heavily on two separate lines that both failed: the Zune, and Windows Mobile/Phone. Neither platform made it to the stage where it could be used for gaming (the Zune never made it past a weak ipod clone and is now fully dead) so MS has no handheld of its own.

Yeah exactly.

Why do we even give these companies attention when they're out flaming the competition?

As for the 3DS, perhaps its decline in sales was due to a decline in the dedicated gaming handheld market. Or perhaps it was due to the fact that Nintendo went to launch with no heavy-hitting first party titles to sell it. Or perhaps it's because the main selling point of the device (3D) is something that can't be advertised effectively.

Or maybe it's a combination of different reasons. Too early to tell.

I doubt the smartphones will cause any major waves within the Handheld market. Games on you smartphone are still different from games found on the PS...V? and the 3DS. Both smartphones and Handhelds can survive in this currant market... or atleast I hope im right about this...

OutrageousEmu:

zombie711:
You know what sucks. Rare.

I mean, seriously, do you really think having Rare not doing something for a platform is a bad thing? Look at the recent games they made. Kinect Sports 1 and 2. Do you honestly look at the 3DS and think it needs more insubstantial games? If you loved the old Rare, its time to face the music and acknowledge that they're dead. Before they can break your heart any more.

Yeah but Rare's games for the ds (diddy kong racing & Viva Piņata: Pocket Paradise ) were very well received, much better than what they have been making for microsoft

Dexiro:
In other words, Microsoft don't think they can get into the handheld gaming market, so they're going to rip into those that can.

Handhelds are doing fine ~

This, both Nintendo and Sony have their own niches and it would difficult for Microsoft to carve something meaningful out of either of those when you take the loyal fan bases into consideration.

OutrageousEmu:
Yeah, I'm sure the threat of Fable Darts is gonna really make Android obsolete as a gaming platform.

No, bad decisions by Google will make Android obsolete as a gaming platform. Let's consider the hardware for a second (assuming the most recent models only); Apple only has the iPhone 4 and iPad 2. Two systems. Very easy to make an iPhone game, because everyone's iPhone is the same (again, ignoring the outdated platforms). With WP7, there's several models, but every WP7 has minimum hardware requirements, and in order to sell WP7 you have to agree to Microsoft's terms, one being "any phone you sell can only be one update behind". So while there's several models, they're similar enough that a game will run equally well on the HD7 or the Mozart.

Then there's Android. Hardware specs are all over the place. Updates are chaotic for some phones. When I went smartphone shopping a few months back, I was eyeing up the Xpereia Mini Pro, a tiny Android phone with slide out qwerty keyboard. I asked "which version of Android does this run?" Was told 1.6. "But aren't we up to 2.1 now?" "Yes, but Sony Ericsson are rather slow with updates. 2.1 is coming for that phone in a few months, don't know about any other updates".

Google, in an attempt to spread openness, have caused chaos. This will bite them in the arse unless they have a radical overhaul of policy.

As an aside, one of my uni lecturers mentioned that with Android phones, the developer can sign their own security certificates. Assuming I actually heard him right, all I can say is WHAT THE FLYING FUNK GOOGLE!? WHAT IS WRONG WITH YOU?

orangeapples:
I like dedicated devices. I like having my music player, gaming device and phone as separate devices. Nothing is worse than getting into a game or listening to your favorite song and getting interrupted by a phone call.

Funny thing is that my friends were practicing some dance thing for school and the lead person had the song on their iPhone and they played the song off of that. It took them forever to get through the song without an incoming text or phone call screwing it up.

That's just a case of someone needing to lern2airplanemode. :)

To be honest, I'm a bit the opposite. I've been looking at handhelds for downtime at work as I can't risk having my workstation's resources tied up with games (And I'm bored of playing MUDs, it's the 21st century already FFS!) but there's no games out that really grab me for handhelds that I can't already play on my droid.

Sinketi:

Griffolion:

The Zune player is dead but Zune isn't dead, it lives in through Windows Phone which is alive, albeit selling slowly. Mango should help garner further mind and market share. Xbox live integration is weak at the moment, it would be good to see a XBLA section for WP with tighter integration.

That said Windows Phone does have the potential to be a force in the mobile gaming market like iOS and Android are. With their prior knowledge of gaming behind them (something Google and Apple sorely lack) they could make a compelling platform.

I'm inclined to agree, XBL is probably the best social/online game platform, so to see that extended to mobile gaming would be amazing. I use an iPad with Game Center but it's not the same, I can imagine mobile/console cross-platform games right down to just being able to collect Gamerscore for playing Angry Birds.

Whilst I respect that MS have obviously put a lot of time and research (not to mention money) into these ideas, it would be a damn cool thing were it done... Properly Better than the Zune.

Yeah that's basically it. The one thing people forget is that MS is primarily an enterprise and R&D company. They do those two things incredibly well, that's where they initially made their fortune. What they lack (which is what Apple has in droves) is the ability to put the products on a consumer level. Apart from the XBox team which have done really well, the rest of MS have trouble connecting to the average joe consumer. Which is probably why Zune died in the face of iPod and may be why WP isn't selling as well as they'd like.

WanderingFool:
I doubt the smartphones will cause any major waves within the Handheld market. Games on you smartphone are still different from games found on the PS...V? and the 3DS. Both smartphones and Handhelds can survive in this currant market... or atleast I hope im right about this...

Yeah, but Microsoft is probably worried that between the Sony and Nintendo handhelds, and the smartphones, they can't find a market. Makes perfect sense. Sony and Nintendo can survive in the market as they have established products. At least, I hope they can. It would really suck if smartphones destroyed handheld systems, due to the popularity of casual games.

About 90% of all gaming I do these days are handheld. Whether it's the DS, the PSP or the iPod Touch. If Microsoft doesn't want my business in that department, that's their decision. Just means one less system for me to carry around lol.

WanderingFool:
I doubt the smartphones will cause any major waves within the Handheld market. Games on you smartphone are still different from games found on the PS...V? and the 3DS. Both smartphones and Handhelds can survive in this currant market... or atleast I hope im right about this...

We really dont know that yet. With the 3DS sales being rather dissapointing only time will tell if its because people think 3D is shit or because of the smartphones stealing part of the market. Right now there is probably a 50/50 shot of it being either one and microsoft is right in saying its not a good market to invest in right now.

Where Microsoft has failed and others have won at......

They are going to throw a hissyfit?

Well take your ball and go home...Ill be enjoying my DS

TELL THAT TO MY POKEMANS

I'm most concerned that a Microsoft exec is telling us where he wants to put his wood.

Seriously, though, I think MS are trying to downplay the importance of handhelds because they can't figure out how to dominate the handheld market. The Zune pretty much failed. It wasn't even a particularly bad device, they just couldn't get the public to show much interest. Windows Phone 7 is also failing, and the few I've seen in the wild have dissatisfied owners who tell me they wish they'd bought an Android phone or an iPhone.

Saltyk:

WanderingFool:
I doubt the smartphones will cause any major waves within the Handheld market. Games on you smartphone are still different from games found on the PS...V? and the 3DS. Both smartphones and Handhelds can survive in this currant market... or atleast I hope im right about this...

Yeah, but Microsoft is probably worried that between the Sony and Nintendo handhelds, and the smartphones, they can't find a market. Makes perfect sense. Sony and Nintendo can survive in the market as they have established products. At least, I hope they can. It would really suck if smartphones destroyed handheld systems, due to the popularity of casual games.

Don't worry as much about that last part of casuals over unning us because there are more of us gamers than the casual core so i doubt the smart phones will outdo our handheld systems.

Shadow-Phoenix:

Saltyk:

WanderingFool:
I doubt the smartphones will cause any major waves within the Handheld market. Games on you smartphone are still different from games found on the PS...V? and the 3DS. Both smartphones and Handhelds can survive in this currant market... or atleast I hope im right about this...

Yeah, but Microsoft is probably worried that between the Sony and Nintendo handhelds, and the smartphones, they can't find a market. Makes perfect sense. Sony and Nintendo can survive in the market as they have established products. At least, I hope they can. It would really suck if smartphones destroyed handheld systems, due to the popularity of casual games.

Don't worry as much about that last part of casuals over unning us because there are more of us gamers than the casual core so i doubt the smart phones will outdo our handheld systems.

The problem, as I hear it, is that casual games are very cheap to make compared to traditional games. And with smart phones, they can be delivered directly to the consumer for a small cost. On any handheld, you have to go to a store and buy physical media. The cost of a casual game is generally cheap, so it's more of an impulse buy.

I also doubt that there are more hardcore gamers than casual gamers. Most hardcore gamers would be willing to buy a casual game on their phone to play while they wait in lines or in an office. If anything the casual market is far larger.

In the end, casual games could take a bite out of the handheld market simply by making developers decide that its more cost effective and profitable to produce casual games. Though, I don't see handheld systems dieing anytime soon.

uhm...wha??
I dunno, seems like a pretty weak statement to me. Nintendo's 3ds sales were lower because its just a another DSi with headache inducing 3d capability. Its not the best thing to base your opinions about the future of handheld gaming on. PSVita is looking mighty sharp and powerful i must say. I would actually like to get one - and i never gave a hoot about handhelds before.

Microsoft is definately feeling a bit pressured by their competitors moves, and a statement like this was expected. Xbox360 has been around for a long time, something drastically impressive needs to appear on that system to ensure people that it is still the best choice for gaming (kinect is too casual at the moment). Otherwise they're just gonna be left in the dust.

jck4332:
Yes, the obvious solution is to compete with the PS3, Wii/Wii U and the PC instead of the handheld market which only has 2 competitors.

Between tablets, smart phones and dedicated gaming devices, the hand-held market has plenty of competitors. It's better for MS to sell games on Windows Phones than to enter this crowded market with more hardware. Now we can argue about Windows Phones, but that would be another topic.

Shadow-Phoenix:

Saltyk:

WanderingFool:
I doubt the smartphones will cause any major waves within the Handheld market. Games on you smartphone are still different from games found on the PS...V? and the 3DS. Both smartphones and Handhelds can survive in this currant market... or atleast I hope im right about this...

Yeah, but Microsoft is probably worried that between the Sony and Nintendo handhelds, and the smartphones, they can't find a market. Makes perfect sense. Sony and Nintendo can survive in the market as they have established products. At least, I hope they can. It would really suck if smartphones destroyed handheld systems, due to the popularity of casual games.

Don't worry as much about that last part of casuals over unning us because there are more of us gamers than the casual core so i doubt the smart phones will outdo our handheld systems.

Really more of us gamers than the casuals? Last I checked the highest selling console game was around... what? 12 million copies?

Farmville has over 80 million players.

Overrun and then some!

Handhelds are a bad bet? Look at Nintendo DS sales, and tell me that again.

Now granted, 3DS sales have been disappointing so far, and in fact I myself do not yet own one. However, this year at E3, a lot of titles that will actually make people want to make the hardware upgrade saw the light of day. Once these titles start launching, I'm predicting a pick up in sales for the 3DS.

Well, MS at least realizes that they'd get their backsides kicked by nintendo anyway, even if sales are down.

in other news i will never make a console because right now there is just no place in the market for another one so i think all consoles are crap.

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