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Next-gen leaders talk about their consoles

Corporate mudslinging between game console makers begins as leaders on all sides size up the competition.


The Electronic Entertainment Expo marked the start of the next-generation console war. With all sides gearing up for full conflict, opening volleys of insults and predictions are starting to surface in the media at large. The Japanese newspaper Asahi Shinbun's Friday edition featured an article with comments taken from the heads of the three console makers: Microsoft senior vice president and chief Xbox officer Robert J. Bach, Sony Computer Entertainment president Ken Kutaragi, and Nintendo president Satoru Iwata. All three contenders talked about the strategies behind their own consoles and tossed harsh words over the corporate walls toward each other.

Microsoft senior vice president and chief Xbox officer Robert J. Bach--

(NOTE: Bach's comments are translated from Japanese and not directly quoted from his English statement.)

Asahi Shinbun: What do you think of the competitors' machines? Will Sony continue to dominate the gaming market?

Robbie Bach: The other two companies' presentations [at E3] weren't surprising. Sony's [PS3's] capabilities are the same as ours. Nintendo is aiming for the niche market [with its Revolution]. The current-generation Xbox sold more than the PlayStation 2 in North America last Christmas. We will become the market leader with our next-generation console.

Sony's [PS3] will be able to use seven controllers simultaneously and connect with two high-definition TV sets. But it's hard to share a single screen with seven people, and it's also difficult to imagine a room with two high-definition TV sets. We don't know about the selling price yet, but to say the least, our cost of manufacturing [an Xbox 360] is less than Sony's [PS3].

AS: Why doesn't the Xbox 360 adopt a next-generation disc format?

RB: The next-generation disc standard hasn't been solidified yet. Sony is taking a risk. We can decide after the standard has been created.

AS: What has Microsoft learned from its previous game console release?

RB: We'll basically be starting again from square one in the Japanese market. Our current Xbox console didn't have enough software for Japanese consumers. This time, we're teaming up with powerful Japanese game makers, including Square Enix, the maker of Final Fantasy. As for Microsoft's overall game division, we plan to get out of red ink by June 2007.

Ken Kutaragi, Sony Computer Entertainment president--

AS: What do you think of the competitors' machines? Will Sony continue to dominate the gaming market?

Ken Kutaragi: Microsoft is trailing behind us, but they are not a threat. They are good at improving [on products], but we will be advancing to the next level with revolutionary technology. Beating us for a short moment is like accidentally winning a point from a Shihan (Karate master), and Microsoft is still not a black belt. Just like with their operating systems, they might come out with something good around the third generation of their release.

It isn't a bad thing to have a high price. When we released the original PlayStation at 39,800 yen ($368), Nintendo's Super Famicom was in the 10,000 yen range ($100 range). Still, everyone went for the PlayStation. This time, ours [the PS3] will be like a BMW that's equipped with a Ferrari engine. Nintendo's [Revolution] will be something like a new model of a family car. Some people might want it, but if it was me, I'd want to advance to the next level.

AS: Why is Sony's next-generation console adopting a next-generation disc format?

KK: The current DVD [format] had a slow growth during its first three years of release, but it dramatically penetrated [through the market] after the release of the PS2, and its software prices had gone down. By using Blue-ray in the PS3, we hope to boost the amount of available [Blu-ray] software and sales of high-definition TV sets. With enough product [in the market], the Blu-ray will be one step closer to becoming the standard [next-generation] format.

Satoru Iwata, Nintendo president--

AS: What do you think of the competitors' machines? Will Sony continue to dominate the gaming market?

Satoru Iwata: It's questionable what the "horsepower" of the two other companies' consoles will be used for, such as fast calculations and high-definition resolution. Creating game software in high definition will require everything from the [graphic's] models to the background to be redone, and it will bloat up development costs. And yet, it has no use for people that aren't playing with a high-definition TV set. Game consoles are not an essential product in life, so we want to make ours as compact, thin, and as inexpensive as we can so that it won't be viewed with hostility by family members.

AS: What has Nintendo learned from its previous game machine release?

SI: We launched the Nintendo DS last year, and the release of our Nintendogs, which came out this April, is being called the second launch [of the DS, since Nintendogs massively boosted sales of the handheld in Japan]. We want to push the DS's sales with the release of game software during the first year. There's a big gap between people that enjoy games that take time and playing skills, and people that don't. I'm feeling a real sense of danger about the decline in the Japanese gaming population. Patting a dog and telling it to stay [in Nintendogs] is something that anyone can enjoy. We're aiming to increase the population of game players with these new kinds of games.

AS: Sony's PS3 is adopting the Blu-ray next-generation disc format. What about the Revolution?

SI: It will be more beneficial to the consumer if we took the money for [adopting the use of] a next-generation disc format and used it somewhere else where we can present more new fun. Nintendo is a company that likes to see smiles on the faces of people that love entertainment. We're not about selling new kinds of TVs or taking control of the living room.

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