Michael Dell: PC gaming not ready to throw in towel

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NEW YORK CITY--When people think of founders of high-profile computer companies--be it hardware or software--they may think of wiry bespectacled geeks that are socially awkward and a tad drunk on power, maybe. Yet if there were ever a Battle Royale of execs in the tech industry, the smart money might gravitate to Michael Dell, founder, former CEO, and current chairman of Dell.

Like other visionaries in the industry, Dell founded his company with little more than an idea. His concept was to make computers that custom-fit consumers' needs by dealing directly with those who were willing to shell out the dough. His company was such a success that he dropped out of college to run the company full time. He was 19 years old at the time.

Fast-forward to now. Dell is 40 years old but could pass for being in his mid-30s. He is confident, though without being cocky. He's bigger than one would think, at or near six feet, and he seems to wear a perma-grin. Perhaps he's excited to be away from Dell's Round Rock, Texas, headquarters and in the city so nice, they named it twice. Or perhaps it's because only 20 (give or take a couple) people in the world can say they have more money than he does.

Dell invited GameSpot over to New York City for the company's announcement of its new gaming PC line and held an intimate roundtable (sans the table) to discuss Dell's position in the PC gaming industry. Immediately following Dell's press event in New York City on Tuesday, the chairman was the centerpiece of a discussion about the company's future in PC gaming. And GameSpot was one of seven media outlets represented.

One of the most obvious questions regarding PC gaming deals with the onset of next-generation consoles and their obvious threat to the PC's market share among gamers. With the progress of the current-generation Xbox and PlayStation 2, gamers (and developers) have had simple plug-and-play units to tinker with, leaving the high maintenance of PC gaming behind. As a result, interest in PC gaming has noticeably dwindled. Dell, which has recently targeted gamers with its game-centric XPS line of computers, doesn't buy into the decline.

"The PC part of the gaming market is still pretty strong and pretty active. What's particularly interesting to us is online gaming," said Michael Dell, who earlier in the day admitted to playing World of Warcraft--with the caveat of time restrictions, being a chairman of one of the biggest American companies. "The massively multiplayer online games are where the PC really excels. The users are seeking out products like this [the XPS line] so they can play these games."

The industry, on the other hand, moves where the money is, and it increasingly backs games made for the PS2 and Xbox. Though some games are still clearly designed and targeted for PCs, particularly strategy ones, fewer top-tier games are seeing their way to the PC marketplace. One only needs to look at the sales charts to realize that PC games aren't viable competition for console games. Michael Dell, however, not only sees the PC gaming glass as half full, but also he sees it as constantly evolving, something that consoles can't do between generations.

"When we talk to the game developers, they say the PC platform is alive and well. From a hardware standpoint, the strategies of a console versus a PC are vastly different. In a console, you come out with a platform and you ride it as long you can, and never change it. And right when it comes out, it's the top technology. But by the time you get to the last year or two, it's not all that great."

Evangelizing the edge PCs have over consoles, Dells adds: "The difference in the PC [is] we come out with [new] things every couple months...this is generation six of the XPS. Plus, PCs have enormous capabilities, in terms of interactivity of storing and forwarding information in an online sense, that these consoles don't have. Consoles are fine, [but] you don't see World of Warcraft on those kinds of devices."

When asked about the future of PC gaming, Dell reiterates that the technological evolution of PC gaming won't be left in the dust of the large leaps between generations of gaming consoles. "It doesn’t take too much imagination to see four [processor] cores." He goes on to say, "We have a good idea of where this technology is going." Dell is also confident about attacking the PC gaming-centric market that Alienware currently owns. "At Quakecon, the XPS 600 stole the show, so to speak," he says.

With next-generation consoles becoming more PC-like (think multimedia functions and rumored peripherals such as a keyboard and mouse for the Xbox 360 and PlayStation 3), Dell brushes off the advances simply as manufacturers making something that simply can't keep up with the malleable PCs.

"When we talk to the gaming publishers, they tell us that they're totally committed to PC gaming, so we don't see that going away. And while [consoles] will have more capabilities, we'll put more capabilities in the XPS."

As for the simple question of why a casual gamer would take an XPS (running at more than a grand) over an Xbox 360 (priced at $399), Dell simply answers, "Because maybe you want to do more than just play games."

Though Dell has recently tapped into the portable music player market with the Dell DJ and the Dell Ditty, don't expect any portable gaming from Dell. Mr. Dell says no such plans are in the works for a Dell version of Sony's PSP.

Even with PC gaming clearly becoming a smaller share of the burgeoning gaming market, Dell isn't ready to give up any space to the next generation of gaming consoles. "We think that PC gaming is going to maintain a healthy percentage of the market, and it's going to be particularly successful in the intense gaming community, like with the massively multiplayer online games. The growth of that has been just enormous, and that's all been PC-driven. Online gaming is still basically a PC concept. Yeah, there are consoles, but they're still a bit more cumbersome."

Though Dell remains confident about the future outlook of the sector he contributes to, his biggest challenge includes more than Microsoft, Sony, and Nintendo--or even Alienware and others that make PCs tailored for the tastes of hardcore gamers. It's the gamers themselves Michael Dell must sway. As the next-gen consoles take center stage, Dell's biggest challenge will be to convince the devotees of gaming that PCs are the place to be.

"Those users are seeking out products like [the XPS line] so they can play the games. We want to understand what they're looking for. Is it the dual graphics? The massive displays? The 3D sound systems? Dual-core processors? We're putting a lot of effort into it."

All eyes now wait to see if those efforts will pay off.