If we're being honest, I get it. Really. I do.
You had a lot of cool ideas for the Xbone, and I actually like most of them.
Being able to play games without a disc, being able to switch between games instantly to play multiplayer, being able to share games and subscriptions with family, guaranteeing Kinect support and improving it so that developers would actually use it, cloud processing... these are all pretty worthwhile ideas.
However, as soon as you decided you wanted to do these cool new things, you immediately went into panic mode.
"If we let them play without discs, how will we stop them from installing rented games? Or borrowed games? How will we stop them from just logging into friends' consoles and installing all of their purchases for them to play when they're not around? How do we prevent people from not using the Kinect?"
From a business standpoint, these questions make sense, and so you set out to address all of them. The console has to be online often enough that it might as well always be online, we have to go through Microsoft to buy or sell used games or rent them, the console needs Kinect to function, and we are limited in how many accounts we can share with. This easily prevents people from taking advantage of you in pretty much any conceivable way.
One might argue that this approach makes sense, but no one on your team apparently wondered if maybe it was a good attitude to find ways to "stop" your customers from using your console.
Sony, on the other hand, has rarely had this attitude. Honestly, you should have known they wouldn't play your game, even if it might have been in their best interest to do so. And I'm not saying this just because of the sassy remarks made during the PS4 conference, I'm saying it because of their past record with the PS3 digital downloads.
The PS3 tried very hard to get people more interested in digital downloads. Sure, they weren't the only one, but you guys made it very difficult comparatively. Purchases made for one Xbox 360 couldn't be downloaded on a different console -- or even on a different hard drive for the same console -- without remaining perpetually connected to Xbox Live. What's more, the Xbox had very few full games available for download, and most of them were indie titles or DLC packs.
So when I got a PS3, I expected a similar experience. I bought a couple digital games and thought that was that. Then a friend of mine got a PS3 and just for fun, I logged in with my PSN account and checked to see if I could download some of the games I purchased and install them on my friends' console so we could play them together. Much to my surprise, I could. Every game or DLC pack I had ever purchased was available to download and install. I figured that they would probably only be accessible if I was logged in, but no, even logged in as my friend, even offline, they could play those installed games that I had purchased on a different console. I figured there had to be some catch somewhere, but no. The games had been installed on both consoles, seemingly unrestricted. I researched it and apparently there was some kind of five-console restriction and supposedly it was eventually reduced to two, but I'm fairly certain that's not the case, at least not for me. I've played games I've purchased on multiple friends' PS3's to this day and I've never run into any kind of restriction even though I'm pretty sure I would have by now considering how many friends' consoles I've played my downloadable games on. Maybe it's because my account is old or because those games have been subsequently uninstalled from my friends' consoles, but in my experience, I've never once had difficulty playing a purchased game on a friends' console using their PSN account after the initial download and installation, and I was very happy with this.
I'm not sure if this was Sony's intention or not, but honestly, I think that this was an excellent policy. If it weren't for this policy, I probably wouldn't have purchased PSN games unless I had no alternative, much like I did with the Xbox 360. Because of this policy, I can play games I've purchased at any friend's house so long as they have a PS3 and a decent Internet connection (at least for a few hours for the download). It makes digital games more convenient than physical copies of games, at least in some respects. It encourages people to try it out in spite of the overwhelming time it takes to download and install, not to mention the amount of HDD space it can take up. The advantages are just too tantalizing.
Going away from video games for a minute, let's take a brief look at a different industry that was similarly consumed by the digital revolution: music.
Because of the earlier limitations of Internet connection speed and HDD space, music was pretty much the only form of media that was easy to download and enjoy digitally back in the day. Napster pretty much revolutionized the way we enjoy music.
Then the music industry freaked out and killed Napster. Then a bunch of other services popped up in its place and so the industry targeted the users themselves, trying to scare them out of it. This just made things worse. Then iTunes came along, gave people the option to buy their music digitally, and voila, problem solved. Then they started implementing DRM to restrict where you could download your purchases and how many computers you could have your account active on, and forcing you to play the music within iTunes or else, but since then, they've eased up a bit with the implementation of iCloud and DRM-free music that can be played elsewhere. Even so, it's difficult to share music with friends in a digital format, which is why some people still prefer to just buy the CD. The CD has no restrictions. You can rip it using a multitude of software as many times as you like and listen to the digital versions anywhere. You can give it to friends and let them rip it, even if it is technically illegal to do so.
That's not to say that the music industry was thrilled by this prospect. They tried to restrict CDs with DRM that prevented them from being ripped or by bundling it with software that spied on the user's computer to see if they had "pirated music", but these attempts just exploded in more bad PR and you basically don't see anyone try to pull this stuff anymore. They realized that making it illegal was good enough. So long as this was something people did and felt slightly bad about, it would be enough to keep it from being widespread.
Now the music industry has basically levelled out. The digital market has proven profitable, its restrictions are reasonable, and most people don't pirate music anymore just because they don't want to.
The film industry is slowly going through the same transition, though they're throwing a bit of a hissy-fit too. But with Netflix and other streaming services, they've made legally acquiring digital TV and movies more convenient than pirating them, so that's what most people do. They still want to cling onto their old model, but eventually they'll get over it, one way or another, or they'll suffer the consequences.
And that brings us back to you, Microsoft.
Like I said, Microsoft, I get it. You want to offer all of this cool stuff, but you don't know how to do it without either restricting the consumer or opening yourself up to abuse.
But the only way you can make this move towards digital work is if you embrace the parts that make digital convenient. If digital is restricted to a certain number of machines under certain conditions, then it might as well be a physical copy, and if your physical copy is similarly restricted, then there's no point in having a physical copy in the first place. You're shooting yourself in both feet here. If the only other option is to open yourself up to abuse from your customers, you probably should pick that option instead, because at least then you'll have customers.
Gaming is a social experience, and it's not limited to the kind of social experience you can have online. People still have real-life friends that they see in person and like to play games with. By trying to make online experiences more versatile, you are hamstringing peoples' capabilities of sharing games with people in a physical reality.
Here's your problem.
You tell people that they have to be online to play their games. They get upset, and then you tell them that it's because you decided to let them install their games on the HDDs and this was the only way you could offer them this feature. They tell you that they didn't ask for that and you have a pissed off customer.
But let's imagine a different universe. Imagine if you went out and said that gamers would be allowed to install their games on their console. That they could switch between games midstream. That their friends could install their games too. Then imagine peoples' surprise when they ask what the catch is and you say that Microsoft will not be implementing any restrictions outside of the obvious factor that you have to be logged into your Xbox Live account during the download and installation. To keep developers happy, you say that individual developers can implement DRM if they see fit, but by default, the Xbone would not inherently limit software installations.
Would this new system be abused? Almost certainly. But more importantly, this system would be used. Even people without friends would buy digital copies, just so they could share it with friends if they wanted to. Just so they could know that they wouldn't have to waste shelf space on a game.
The key to winning over customers is to make them feel like they are in control, and even better, by making them feel like they are smart. I don't mean you have to stroke their ego, I mean you have to let them think they're smarter than you. People would go in, feeling like they're about to get one over on you guys by buying games and sharing them with their friends, but before you know it, those people have bought waaaay more games than they would have otherwise, all because they think they can beat the system.
I mean, just look at Steam. Steam has a lot of restrictions. You have to login before you can play offline. You can't login on more than one PC at a time. But they currently have the biggest market share in software sales because they regularly make their customers believe that they are getting a major deal. Every Summer, gamers buy truck loads of games they'd never have bought otherwise, simply because of how cheap they are. I recently bought the "Alan Wake" series on Steam. I have no interest in playing it. But I bought it anyway because maybe one day I will and it was only $5.
It's not about tricking people. The Steam Sales don't have some kind of catch. You buy the game, you own the game. Simple. There's no dark secret about them. But gamers make all kinds of stupid purchases just because they like to take advantage of great deals and opportunities, just like anyone else. This isn't rocket science. Retailers have known this shit for years.
The Xbone's new features don't feel like great deals or opportunities. They feel like windows in a jail cell. You have to let gamers think they're the smart ones. That they can take advantage of you if they play their cards right. That they can game the system. But instead, you basically look at every possible way a gamer could take advantage of your new services and find ways to block them. And in so doing, you made a console that just can't help but piss people off at every turn.
"I can install all of my games on the HDD and the cloud? Cool! That means I can play my entire library anywhere!"
"Anywhere with a stable Internet connection."
"Oh... well, at least I'll be able to install rental games."
"No you won't."
"Oh... well, at least there will be no difference between new and used games since they install no matter what."
"OK, then at least I'll be able to install the game and then give the disc to a friend."
"But I can share my games with family members right? So if I buy a game, we can play it together without them having to buy it."
"Nope. Only one person on your family list can play from your library at a time."
"Then why the fuck would I want to install games on my Xbox?"
"So you can switch between two games to play online matches with friends!"
"Yeah! Isn't that great?"
You've basically implemented cool new technology and then found ways to impose the same limitations that would exist without the technology, and then made the technology mandatory.
Your games look fine, but they're not all that different from what we have right now. I was paying attention 7 years ago. I remember how big of a leap it was from the Xbox/PS2/Gamecube generation to the present one. It was major. The difference was staggering. But what I saw today was not different enough to sell an entire console, and you know it. You've tried to distract people, but it just makes you seem even more deceptive. And as nice as some of your new features are, every single one comes at the price of convenience and trust.
And speaking of price, $499 is ridiculous. You know who knows that? Sony.
They launched their lowest-end PS3 at $499 back in the day and even though their system was technically far better than yours, even though it offered the same features at a lower cost (free PSN, rechargeable controllers, built-in WiFi, high-def video disc player), and even though it had the biggest following from the previous generation, Sony still got their butts kicked by you and Nintendo almost entirely because the system was too damned expensive. How can you not remember this?
What's even more baffling to me is that you're throwing out this price point even though your new software restrictions would basically guarantee a huge boost in revenue by maiming the used game and rental markets. Even though you have a massively successful subscription service. Even though you are fucking Microsoft and have the best connections in the industry and could easily afford to take a hit on console price even if you didn't. Even though you had no substantial pressure to release a new console this year and could have taken the time to reduce production costs before announcing a price. You decided to act like this was the best you could do.
Guys, your two competitors are selling at $349 and $399. That's it. Game over. They win. Even if average consumers can tell that the Wii U is technically inferior to the PS4 and the Xbone, they will probably not be able to discern a major difference between the PS4 and the Xbone and will probably just buy the cheaper one.
But I know what you're probably thinking. Xbox has brand recognition. Average parents shopping for Christmas don't pay attention to things like DRM or sharing restrictions. They just want to get the newest Xbox for their kids. And that may be true, but if you think they won't notice these restrictions, just you wait. I can imagine the Christmas morning now...
"Yay! The new Xbox! Thanks, Dad! Can I set it up now?"
"Sure! Go right ahead!"
*An hour passes*
"Yay! Let's play the new 'Kinect Sports'!"
*Puts disc in*
"Dad, why isn't it playing yet? What does 'installing' mean?"
"Oh, the lady at the store said that you have to install the game on the Xbox now."
"She said it will let you play the game without the disc."
"Oh, cool! That's great!"
*Plays "Kinect Sports Rivals"*
"That was fun! Hey, can I play some 'Viva Pinata'?"
"Sure! Go right ahead."
*Puts disc in*
"Hey, it's not working."
"Oh, I'm sorry. I forgot. They said it won't play Xbox 360 games."
"Oh. OK, I guess that's... whatever."
*Turns off Xbone and plugs back in the old Xbox 360 to play games.*
*A few hours pass.*
"Hey, we're going to go to your uncle's house. You want to bring the new Xbox to play with your cousins?"
"But there's only the one game. Can we buy some more on the way?"
"I'm sorry, but 'Kinect Sports' was the only one that seemed appropriate for you."
"Oh well. I guess that'll be fun enough."
*They pack up the Xbone and go visit their relatives and start setting it up on the TV in the basement. Her cousin arrives.*
"Hey Alice. You got a new Xbox too?"
"Yeah, though I only got the one game for it."
"Oh, well my mom got me 'Killer Instinct'. I brought it with me. You wanna play it?"
"Sure! Just don't tell my dad."
*Turns on Xbone, but it throws back an error*
"Hey, it won't start."
"You didn't plug in the Kinect."
"But we're playing 'Killer Instinct'. It doesn't need Kinect."
"The console won't start without it."
*Plugs in Kinect. A different error pops up.*
"Oh, it has to be online, too. Go ask Uncle Bob what his WiFi password is."
*Bob comes down*
"Oh, I don't have a wireless router. But I can run a cable down from the living room for you."
*Finds a massive ethernet cable and runs it down to the basement for the kids to play with the new Xbox*
"OK, let's play."
*Puts in "Killer Instinct" and installs it. They start playing. A few minutes later, someone trips on the ethernet cable and Bob unplugs it since the kids aren't playing online. One hour passes.*
"Hey! It stopped working! It says connection lost or something! But we weren't even online!"
"This sucks. I'm tired of this. Hey, I think Carl set up his PS4 upstairs. Want to play that instead?"
This might seem like a relatively contrived dramatization, but it's really not. I remember what it was like to be a kid with a new console or a friend of a kid with a new console. Gamer kids love to show off their shiny new toys and share them with friends and family, and the holidays are a great time for people to get together and do just that. But if you bring along your new toys and they don't work or they require a massive amount of work to get working properly, not only does it give you instant buyers remorse, it pretty much tells everyone else at the get-together how incredibly lame that new toy is.
You know why the Wii did better than the Wii U? Both consoles had about the same level of software support. Both consoles were roughly within the same price bracket. But the difference was that the Wii was a bigger novelty. People who brought the Wii to their holiday gatherings became the talk of the evening. Everyone played Wii Sports and everyone had fun. So everyone wanted one of their own. But the Wii U just didn't have that wow factor, so after the holiday boom, sales plummeted.
A console's best possible advertising is word of mouth, and if you can't get people excited about your console without giving them a list of rules and requirements, that word of mouth is going to be mumbled at best.
And that's not even considering the fact that a lot of parents are terrified about their children playing games online. A lot of them just leave the system disconnected because they can't be bothered to figure out your asinine parental controls. But now they won't be able to, and that alone might be enough to make them change their minds about which console to get.
Frat boys who love playing Halo and CoD will probably throw a hissy fit when they realize they won't be able to bring their Xbone into the lounge (a lot of college dorms don't have free WiFi in the common areas).
You may think that you can get away with pissing off gamers, but gamers aren't the only ones who care about being able to play games the way they like to play them. This trait is pretty much universal. Even if you're just targeting parents and frat boys, you'll still find ways to piss them off, and they'll probably be even angrier since they probably won't see it coming.
Microsoft, I'm not saying your new restrictions are unreasonable. Well, actually, I take that back. They are completely unreasonable, but I can understand why you made them. Each and every decision has a thread of logic behind it that I can follow and comprehend. I can see why someone in a board room thought this was the best way to move forward.
I don't believe you've lost your minds, but you have definitely lost sight of the bigger picture. You are about to release the most expensive console on the market, you've pissed off the core gaming market, and you will make casual consumers go completely insane with frustration on launch day. Early adopters will be disappointed, their friends and families will have been given a terrible first impression of the new device, and your competitors will be laughing their way to the bank while the pissed off gamers drink your salty tears.
Even if some people do enjoy your console in your pre-determined, overly-calculated, incredibly limiting environment, that's not what you want. You want people playing Xbone everywhere. You want them bringing it to every party, sharing games with every friend, bringing it along on long road trips. You want your product to be ubiquitous, you don't want it exiled to one room in one house. You might think that if people can't move their Xbone, they'll just buy another one, but you're wrong. People who want to play Xbone at a friend's house won't buy their friend an Xbone. They'll return their Xbone, buy a PS4, use the leftover money to buy another game or two, and bring THAT to their friend's house instead.
So I'm sorry, but you've fucked up. You've fucked up big time.
Don't worry, I'm not going to dance on your grave, because if we're being totally honest, I actually love some of your ideas. I'm actually a little disappointed that the PS4 doesn't really seem to be doing much that's really all that innovative. I really like the potential and the technology of the new Kinect and I know the PS4's new Eye won't be able to come close to matching it. I like the idea of being able to install games directly on the HDD from the disc since the 10GB download through PSN can be arduous. I like the idea of sharing games with a short list of family members on different consoles. I like SmartGlass, though it needs a lot of improvement. I like your app variety (I watched the PS4 keynote through your GameTrailers app since the PS3 just directed me to their crappy built-in browser). I even liked that IllumiRoom thing from a while back, even though it is apparently nowhere to be found in the new console (work on that).
I'm a technophile and I want to favor innovation. I genuinely feel bad that I can't support the most innovative console of this generation. But you've set the cost too high. And I'm not just talking about the cost of the console, I'm talking about the cost imposed on all of your customers. You're asking them to give up things that they've come to expect and that never goes well unless you offer a better alternative.
Along with many other gamers, I have already made my decision. I'm sorry, but I've pre-ordered the PS4. I'm typically the sort of gamer that likes to wait and see how things play out, but there seems little point this time around.
Still, I'm open to reconsidering. If you drop these restrictions without also dropping the features, I'll probably change my mind. I'll cancel my pre-order and change my allegiances. I've changed sides in a console war before and I gave up brand loyalty long ago.
But I think we both know how likely that is. Ever since Windows 8, you've proven to have no real comprehension for what your customers want. You believe you have the power to dictate the rules we play by, but forget that we always have the option to simply refuse to buy your shit. I honestly wonder if you'll learn your lesson before the Xbone fails miserably.
I've been a gamer all my life and I've witnessed every console war since SNES vs. Genesis. In those days, it was frenetic gameplay and third-party support vs. beloved mascots and familiar pixels. It was blast processing vs. mode 7. Then Sony got in the game a generation later and it was 32-bit vs. 64-bit. Disc vs. cartridge. Cost vs. power. Then you guys came along and it was fighting games and FPS's vs. Everything Else. Then a generation later it was cost vs. power again. Online play vs. console versatility. No matter the generation, there was always an argument to be made for either side. There was never a clear winner until the market had spoken.
But this time? Well, this is the first time I've seen a community so universally in favor of one console over the other. On every blog post talking about the PS4 announcement from last night, I see no arguments over which console is better because there's really no argument to be had. Unless you really like Twitch, Halo, or Fantasy Football, I'm having a hard time figuring out how someone could favor the Xbone at this point. It's more expensive, more restrictive, more unwieldy, more pompous, and offered a very narrow view of what kinds of gaming experiences we can expect. The system specs are practically identical and yet the Xbone costs more, probably because of the required Kinect that most people (myself not included) want nothing to do with.
Though I'm not just getting the PS4 because it's better than the Xbone. I'm not just settling for it. I'm getting it because during that press conference, it was the first time I felt excited during E3 since I was a kid. I felt like Sony was listening to me. Like they cared about more than just my money. Besides which, the PS3 has been a really satisfying product and I feel like Sony trusts the gaming community. As much as I want to reward the Xbone's new ideas, I don't want to reward the way you treat your customers, and I'd much rather reward a company that at least tries to treat its customers with some amount of respect.
I'm sorry Microsoft, but you've been having a pretty lousy year. Your Windows Phone OS continues to fail to get a market share that can even be considered moderately competitive with iOS or Android. Windows 8 has gone over like a lead balloon and anyone who has upgraded to it who isn't using a tablet thinks it is terrible. Most people who buy tablets still get iPads. The desktop PC market continues to stagnate (though it certainly isn't dying). Your new server OS is equally ridiculous and annoying, implementing the same ridiculous UI even though no admin in their right mind would use a touch screen for a server. And now that you've also screwed up your gaming division, I think you've only got darker times ahead.
I don't think there's anything left for you to break.