A market analyst firm believes that Microsoft’s console is on the “downside of its lifecycle.”

Kinect, the new motion controller for the Xbox 360, might be designed with the casual market in mind, but analysts DFC Intelligence think that despite its best efforts, Microsoft will struggle to garner mass market appeal with the device.

“In terms of changing the overall video game hardware platform market share we see [Kinect] having a negligible impact,” said DFC in a monthly brief. “…Microsoft is putting almost all its eggs into the Kinect as a way to appeal to the ‘casual’ consumer and expand its user base … Unfortunately, based on what we have seen, DFC continues to feel that Microsoft is going to struggle to expand beyond its core audience.”

DFC thinks that the Microsoft’s biggest problem is that it is not an entertainment company and so it’s efforts to create a Wii Sports or Wii Fit of its own are unlikely to succeed: “Almost every time Microsoft has tried to emulate successful entertainment products they have failed … [with the exception of] PC gaming prior to the Xbox, and then the Xbox platform itself.”

“In its business software, Microsoft has been successful in analyzing what works for users of other products and incrementally incorporating those features into Microsoft products,” DFC said. “The problem is developing hit entertainment products simply does not follow that model.”

It seems a little premature to write off Kinect at this incredibly early stage, when the advertising and buzz is just getting started. Considering we don’t know for sure how much Kinect is going to cost or what will come bundled with it, making solid predictions about how the mass market will react seems like it would be incredibly difficult.


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