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Thread: This guy says Revolution will win.

  1. #1
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    This guy says Revolution will win.

    Theres a summary at the bottom. Its still good to read though for obvious reasons.

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    Talkin' bout a Revolution: Q&A with analyst Michael Pachter

    The Nintendo Revolution as the winner? The Xbox as a paperweight? PS3's bodacious Blu-ray bet--wise choice? One analyst discusses and dis's the new hardware platforms shown at E3.
    LOS ANGELES--For every platform: an opinion. For every business strategy: an opinion. For every game: well, you get it.

    Sharp as a diamond cutter's knife, Wedbush Morgan Securities senior analyst Michael Pachter spent some time with GameSpot at the end of Day 2 of E3 in LA.

    We addressed news that had recently surfaced on the Microsoft, Sony, and Nintendo next-gen consoles.

    GameSpot: Michael, has anyone seen enough of the Revolution? And is three times faster enough in this gazillion-times-faster-is-not-enough environment?

    Michael Pachter: I'm taking Nintendo at their word that Revolution is a multiple faster than the Game Cube, but not a ten- or twenty-fold increase in speed.

    So it's not going to be as powerful. But it's obviously going to be priced less expensive than a PS3 and Xbox 360. So strategy wise, I guess what Nintendo is making a bet on is something that's probably beyond their control--the development community and publishers that are going to only make a few games for the Xbox 360 and PS3.

    GS: The faster kids on the block lose?

    MP: Instead of seeing our normal 200 games each console after a couple of years, we're going to see fewer. And mostly because of development costs. And probably it's going to take more time to make games. It means that there'll be bigger risks and it will be harder to greenlight a project.

    GS: But more games on the Revolution?

    MP: Nintendo has a deep library, so they are able to bring their new Marios, Zeldas, Kirbys and whatever they can bring out on the Revolution.

    And Nintendo has good relationships with Japan, so they'll probably get some support from third-party Japanese publishers.

    GS: Sounds like they may approach a win...?

    MP: When the US publishers start to weigh the economics of chasing the Xbox 360...even if the installed base is twice as big as the Revolution, if the cost is twice as much, then the US publisher should be indifferent as to whether they make one game for the 360 or two games for the Revolution.

    I talked to Nintendo and their strategy is to try to ensure that all the big games that are made for 360 and PS3 are also made for Revolution. If they succeed at that, they're going to do very well.


    GS: But how can you succeed if the graphics aren't the same, if the experience isn't the same?

    MP: I've seen demos of the 360 and the PS3...I'm not talking about the Sony presentation, actual in-booth demos. So far, I'm not impressed.

    The 360 and PS3 look great, but they don't look appreciably different than the very best I've seen on the current Xbox. I'm sure that part of the reason that I'm not really impressed yet is that they haven't spent enough time to make everything totally fluid, motion fluid. But if the Revolution is two or three times faster than the Game Cube, why can't they get something that looks very realistic? I think they will.

    GS: It's early, but can you feel a winner in this crowd of three?

    MP: I honestly think that they're the same box. I mean, yes, Sony will tell you that they have more RAM and Microsoft will tell you they have three cores, but I think, largely, they're very similar.

    GS: Market share?

    MP: Microsoft clearly is going to have 100 percent market share for the first year, but it strikes me that if Microsoft doesn't give me a real reason to switch from PS2 to Xbox 360, and if the consumer believes that the PS3 is just as good as the 360, then I'm not going to switch.

    So the only way Microsoft gains appreciable marketshare is for Nintendo to fail.

    GS: Can you drill down on those numbers?

    MP: If Microsoft is going to get 100 percent of the sales the first year, the people who buy that largely are going to be Xbox owners. I doubt that more than 20 percent of the first movers are going to be people who only had a PS2. They'll be the hard core guys who already have an Xbox or who already have both.

    When Sony launches the PS3, if the lineup is comparable, and if it's fully backward compatible, plug and play without a software patch, then I think Sony keeps most of their customers.

    So my guess is that it'll take a while for Sony to overcome that first year advantage, but in five years [it will look like this:], Microsoft at 30-35 percent, Sony at 45-55 percent, and Nintendo at what's left.

    It's possible Nintendo wins if developers don't support either the Sony or the Microsoft platforms with sufficient game quantity to drive people to switch over. And if there are more games available on the Revolution, the Revolution will do better than people expect. I don't think that'll happen, I think that Microsoft and Sony are going to get a lot of support, but we'll see.

    GS: Do you read any sort of a change in terms of the way these companies compete? Is this just another launch year, or preface to a launch year, or are the stakes a little bit higher?

    MP: Microsoft never, ever intended to be the dominant console of the last cycle.

    GS: But are they now?

    MP: I don't know whether they are, but I know that this time they think maybe they can be.

    GS: With the MTV special, Microsoft took it to consumers early, they didn't wait for E3. Was it smart of Microsoft to play to the bleachers like that?

    MP: I think it was lame. Because I think the people who watch MTV are a subset of the audience that they want to appeal to. They want to appeal to an age demographic. And I will grant you that 19-24 year olds are the largest age demographic that watch MTV, but all 19-24 year olds don't watch MTV, and all Xbox owners aren't 19-24.

    I think that they picked a target that was a very narrow subset. And obviously cost was a consideration.

    GS: A better option would have been what?

    MP: I think the free press is the best way to advertise. That "advertising" is not costing them anything. This article is not costing Microsoft anything, and more relevant eyeballs are going to read these words than watched MTV.

    They're very funny. I don't think MTV is the gamer. Spike TV is the gamer, G4 is the gamer.

    So I think [MTV] was a dumb thing. I don't know if you noticed, but they had the woman, the Asian, the Black English guy....You know what? That's just lame. It's cheesy. The people who buy the Xbox 360 are not women

    Now, if it didn't cost very much, then I don't care.


    GS: Now tell me what you know about 360 and PS3, any particular attribute you think is genius?

    MP: Genius or a disaster: Blue-ray. It's either going to be an absolute driver of sales or it's going to be just an irrelevant feature that doesn't help you at all. If Blue-ray becomes the home video, the movie HD-DVD standard, Sony's brilliant to put it in the box.

    I don't know about you, but I got a PS2 at launch and I did not buy a stand-alone DVD player for two years. I used that thing to watch movies for two years.

    I will do the same thing with the Blue-ray HD-DVD drive if, in fact, there are films in Blue-ray format.

    The bet is that the HD-DVD format doesn't win, or they merge--and I think Howard Stringer, as chairman of Sony, is keenly aware that this is a priority for the company. I think he's taking the company in the direction of making Blue-ray work.

    So that is a huge differentiator, because if you buy an Xbox 360, conceivably you're going to have to buy a separate HD-DVD player and keep your Xbox under the TV for those games that aren't backward compatible. So three boxes? With Sony it's one box. Brilliant.

    GS: Going into E3 week you probably had an idea of what would transpire in the transition year, next calendar year. After you've been here and heard the pitches, you've picked up a little bit of the vibe, maybe you've seen some games....Can you give me an idea what's going to happen next calendar year?

    MP: The big surprise to me is that Microsoft is not taking any more Nvidia chip-sets after this quarter. And that means to me that once Microsoft runs out of the chips that they've inventoried, that they've stored to make future Xboxes, there won't be anymore Xbox.

    I don't know how many that is. Microsoft was kind of cryptic about it. They very artfully stated that they would support the Xbox well into 2006. They didn't say they would produce the Xbox well into 2006. I don't think they would stockpile more than those, and so we may see Xbox discontinued by the end of this year.

    GS: Are they leaving money on the table with that move?

    MP: They aren't leaving profits on the table because they're not making any money on the Xbox hardware.

    I think what their view is, and I'm guessing because they haven't announced it, is that if they stop making Xboxes, but you like our product, you'll buy the 360, so that will help the 360 installed base to grow more rapidly.

    The problem is, what retailer is going to carry current generation Xbox games next year if there's no Xbox being made? If you remember back to the N64 when the Game Cube came out, we saw no more N64s. What happened to N64 games? They disappeared.

    GS: If it's cheap you might buy it.

    MP: Well, that's the point...The point of extending the life of the legacy console is that you sell your legacy console, your PS2 for $99. You bring in a customer who doesn't have that much money, who wants to buy a bunch of $20 games. He's not going to buy a 360 and buy a bunch of $20 games.

    And in theory, for every next-gen box you sell, somebody throws away a legacy box. But if you sell a new legacy box to a brand new consumer, you maintain the installed base at a certain level, and that drives catalogue sales of older games. The retailers will carry it, and the publishers make a lot of money. Consumers have a lot of choices at low price.

    Microsoft seems to be taking the strategy that they are going to abandon the current-generation console...they don't really care about legacy software sales. But it hurts the publishers, it gives consumers fewer choices, and the Xbox essentially is going to turn into a paperweight in 2006.

    By Curt Feldman -- GameSpot
    POSTED: 05/20/05 10:24 PM PST

    http://www.gamespot.com/news/2005/05...s_6126354.html

    ---------------

    -MP believes Nintendo's say on the Rev's power and that it probably won't be as powerful but cheaper

    -Believes Rev will have more games than the other two because its the cheapest and easies to developer for.

    -Since more games are coming to the Revolution the fact that Nintendo has the best 1st party makes them a plus.

    -now this is big, he believes developers will decide to make one game for the xbox or two for the Revolution. He also believes that Nintendo will make sure that all the big games on PS3 and Xbox will come to Revolution. I look at this generation and you're looking at GTA, MGS, DMC, FF (regular), FPS (besides halo and PD), etc

    -Believe that 360 and PS3 are the same machines

    -believes MS will only do good if Nintendo fails. Remember what Mr. Gates said?

    -still thinks MS and Sony will get good third party support

    -he gives his oppinion on how dumb and lame it was to show Xbox 360 it on MTV. Makes sense.

    -believes PS3 will be the better media machine. Xbox 360 owners will have to buy an HD-DVD or Blu-Ray Disc player if they want to watch movies on the soon to be mass use for a movie player and that they'll have to keep xbox for the older games. So he looks at PS3 as one machine and Xbox 360 kept with two other machines to equal multimedia since he believes PS3 has it all

    -Heres something interesting. Xbox will be supported in 2006 but MS has stopped Xbox production. MS plans to rely on getting more people to buy a 360.

  2. #2
    Veteran Citizen alpha's Avatar
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    He didn't say revolution would win, but good article...yeah.
    The sun shines on me no more.

  3. #3
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    So my guess is that it'll take a while for Sony to overcome that first year advantage, but in five years [it will look like this:], Microsoft at 30-35 percent, Sony at 45-55 percent, and Nintendo at what's left.

    THat is one sad quote (not for nintendo, for him cuz he said it )

  4. #4
    Zelda's Boytoy
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    I dont really think its bad.. if Nintendo has 25-30% of console share, they have 90% of the portable market.. sure the PSP looks good, but it has a long way to go of owning the market.

  5. #5
    Phazon Infused koten's Avatar
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    A fairly interesting article, but I think he's counting out Nintendo too much from those market share numbers.

  6. #6
    Veteran Citizen Lynk Former's Avatar
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    Nintendo will help bring about new developers in the future; just you all wait and see. I can see what Nintendo is doing as clear as they can. They're leaving the old gaming generation (or what's left of it) to Sony and Microsoft and creating a new generation of their own. They did it with the NES; they plan to do it again with the Nintendo DS and the Nintendo Revolution. It's all about attracting people that aren't gamers, it's all about supporting those developers that don't have high production limits, and it's all about reaching out to all the factors that people have been ignoring all this time.

    At E3 we saw Nintendo reveal a very interesting aspect about their nextgen system, the ability to play 20 years worth of titles on it. Nintendo is showing us that they will still support the fans that have stuck with them all along for what they have been doing in the past. What they have shown us with the Nintendo DS is a preview of what the Revolution will do for gaming, but on a larger scale. They will continue to make games that please the fans they already have and then they will make games that will attract a new group, and they will also make games that aren't really games that will attract yet another group of people who aren't gamers. This is what they haven't shown yet, the new features and ideas that will attract that new generation of people. In the past Nintendo hasn't really bragged this much about changing the way we play games until the announcement on the Nintendo DS and Nintendo Revolution. They have also stated that because their will be 20 years worth of games available for this console, the future controller will have to be able to work with ALL of those older games. The controller Nintendo has for the Revolution will definitely be able to play the way we've always been able to play, but it will also be able to play in ways we haven't yet experienced thanks to a new feature or features. I'm betting it's more than one feature that is going to make the controller different from the rest. Microsoft had that groovy X button in the middle for its live abilities and Sony's controller hasn't changed AT ALL. But Nintendo will allow us all to play games the way that the others will never hope to be able to do for the next generation.

    I believe Nintendo will pull out all the stops with its mascots for the next generation. You can see it happening right now in fact. The number of games featuring Mario that's about to come out is astounding. We have a new Zelda and another one announced for the Revolution as well as another Zelda, Animal Crossing for the DS and a rumoured Animal Crossing for the Revolution, Metroid Prime 3, Wave Race, Smash Bros, and a rumoured Kid Acarus game. New franchises are said to be coming about. And now because Nintendo is aiming for the more efficient path, they hope to attract more third party developers. I believe they will be able to do that. The disk format is right for the job, DVDs are cheap, and the Revolution is said to the three times more powerful than the GameCube but extremely similar to develop for. Developers will have very little to worry about, they will be able get straight into making games for the system. Nintendo is known for working closely with third party developers, they should also help new developers get on their feet, encourage them and help them out, and in return those developers will be very loyal to Nintendo.

    I can see exactly what Nintendo is planning, and I like what I see. I have no doubts that Nintendo will make an impact in the next generation.

  7. #7
    Zelda Fanboy Kliq's Avatar
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    Hmm, I don't knwo who told Nintendo that up-to-the date graphics aren't going to sell consoles. The only thing I heard my friends saying over E3 were "WOW, look at those Ps3/Xbox 360 graphics". Mainstream gamers don't care about innovative gameplay. They want the eye candy.

    Hopefully Nintendo's plan for cheaper development costs works though, because that's the only way I can see Nintendo jumping ahead of XBOX 360 is if they get that crucial 3rd party support.

  8. #8
    Banned KaizerOumft's Avatar
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    Well, according to Mr.Miyamoto's comments, Revolution's chips, "Boradway" and "Hollywood", aren't finished being developped. Maybe it will be more on par with the Xbox 360 than we think.

  9. #9
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    Quote Originally Posted by Kliq
    Hmm, I don't knwo who told Nintendo that up-to-the date graphics aren't going to sell consoles. The only thing I heard my friends saying over E3 were "WOW, look at those Ps3/Xbox 360 graphics". Mainstream gamers don't care about innovative gameplay. They want the eye candy.

    Hopefully Nintendo's plan for cheaper development costs works though, because that's the only way I can see Nintendo jumping ahead of XBOX 360 is if they get that crucial 3rd party support.
    Mainstream gamers say it but they don't show it. If it was all about graphics it would be Xbox in 1st place, GCN in 2nd place, and PS2 in 3rd place.

  10. #10
    Citizen DLazare91's Avatar
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    ^We can hope and imo the rev looks the coolest so thats a plus.

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    FREEDOM!! dwhittenempire's Avatar
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    Yeah. I would rather have a system with more games than a system with better graphics. I have confidence that Revolution will have a huge library of games.

  12. #12
    Banned KaizerOumft's Avatar
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    ^We can assume that Revolution already launches with the most titles (20 years worth).

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    Citizen WadeTyhon's Avatar
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    Quote Originally Posted by KaizerOumft
    ^We can assume that Revolution already launches with the most titles (20 years worth).
    Actually Sony still launches with the largest due to it's backward compatability. 10 years of 1st 2nd and 3rd party software on PS/PS2 is much more than 20 years of only 1st party software.

    I'd say his points are very valid, and if he's proven right then Nintendo has a bright future.

  14. #14
    Banned KaizerOumft's Avatar
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    ^ Nintendo is working on getting 3rd party games out as well, besides, if the Sony games aren't downloadble on PS3, then it will be really hard to find PS1 games.

    I was wondering, if two systems have similar graphics chips, but diferent processors, don't they look pretty much the same? I mean, having an insanely high processor chip (like PS3) would be for multi-tasking and such, right ? Why would Revolution need a high processor if its purely for games ? I mean, no next-gen game could possibly require all those gigs in processing, right ? So the games would look pretty much the same all accross the board. This explains how Iwata was saying that Revolution can play both "masterpieces and innovative games."

  15. #15
    Citizen
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    hmmm...
    acutally interview seem long as nintendo make profit, they are not willing to change how do there business. Which is bad, I think.
    It does not matter how much it cost to make game, yes RS games are might be cheaper to make, but if you only could sell million copies, and you sell multi-million copies, if I am maker I will make the game for multi-million seller. User base is very important, look at current suituation, more user base more games released. Nintendo had great library of games NES and SNES, due to user base, soon as PSX came out in market and had advantage of user base, most of makers went to PSX. If nintendo think long as they can make profit they will be find, but by doing it so they are losing more market share and soon or later Nintendo will become pure fan base console, which only first party support the system.

  16. #16
    Banned KaizerOumft's Avatar
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    ^Ummm, it has to be seen whether people are goin to flock to PS3 and Xbox360 after Revolution is unveiled. Also, if a company can't afford to make a game for the "multi-million" user console, then they wont. They will go with the console they can afford to make games for.

  17. #17
    Veteran Citizen Lynk Former's Avatar
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    I've seen A LOT of people who own a PS2 and/or Xbox say that the Revolution has caught their attention over the other two nextgen consoles. What Nintendo is doing seems to be working.

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