Sci-Fi no more

Now that the three “next generation” video game consoles have been released, played, criticized and praised, it’s a good time to evaluate them and what they hint at for the near future.

For those living under a massive rock and have peeked out from underneath just long enough to read today’s newspaper, those consoles are Microsoft’s Xbox 360, Sony’s PlayStation 3 and Nintendo’s Wii. The most exciting and innovative changes come courtesy of Nintendo, which we’ll cover last.

Video games are big business these days – in fact, it’s a $50 billion market.

Even with all that cash to go around, however, it isn’t always profitable.

Take the Xbox 360 for instance. The next generation console from Microsoft was expected to sell 12 million units by June, 2007. A big number, for sure, but that projected sales figure is actually down from the earlier estimate of 13-15 million.

Microsoft also announced late last week that the company’s Entertainment and Devices group reported a $289 million loss this quarter. Keep in mind that big division doesn’t only include the Xbox 360, it includes many, many other devices, including the Windows Mobile and Zune.

The point being, you can sell 12 million units and still lose money in that division. Yet the name of game is to get the consoles out there and make money off the games.

Here’s where the future of gaming steps in.

Being released by Microsoft, it’s fitting that the Xbox 360’s strength and vision is in its Internet roots.

Microsoft has built an extensive and impressive online community, and the company has opened its “Marketplace” where gamers can buy and download video games. The most popular Marketplace feature is its arcade, where old school arcade games are sold for about $5 a pop.

It won’t be long before you start to see “bonus” levels to popular games, such as the Halo brand or Rainbow Six Vegas, sold in its online store. The next step would be the total elimination of the middleman, by selling complete games online or selling games level by level.

Some people have gone so far as to predict that games will be sold in “basic packages” and gamers will have to pay to upgrade weapons, unlock armor, etc.

For the next hint to the future, let’s turn to the PlayStation 3. The main selling feature of Sony’s new console is its massive hardware – which translates into very fast loading times, (for the most part) lag-free online play and amazingly crisp, detailed graphics.

If Microsoft’s strength is in its online play, Sony’s power comes from turning a video game system into a complete home entertainment package. PS3 includes the ability to upload and view photos, as well as download and play music and full movies from the hard drive. Users can plug in a keyboard and mouse and then surf the Internet. It also has a Blu-ray drive – which is predicted to become the next generation DVD.

And, like Microsoft, PlayStation has an online store where music is sold.

Where PCs were once the flexible machine that allowed people to work and play, the PS3 signals that gaming consoles are about to become just as flexible as a desktop computer.

PlayStation 3, however, has also had a rough ride in the bazaar. While the system was selling on eBay for three or four times the retail price after its release, the media is now starting to report that sales are slow.

Bucking that trend is Nintendo. The company that (excuse the gaming term) pwed the market in the early 1980s has as of late been labeled a producer of “kiddie consoles” and has been dismissed with a proverbial flick of the wrist by many older gamers, who have gravitated toward the graphic first-person shooters offered by Microsoft and Sony.

That “flick of the wrist”, however, has returned Nintendo to the cutting-edge with the most pioneering system of the bunch, the Wii.

Nintendo’s profit was up by about $1.4 billion – or 43 per cent – this fiscal, ending on Dec. 31, thanks to the Wii and the portable Nintendo DS.

Stores continue to sell out of the Wii within hours of getting new shipments.

Nintendo has offered gamers something different than its competitors: the chance to actually be part of the game with its motion sensor controllers. Who doesn’t want to control a character’s sword by actually slicing with their arm, or serve in a game of tennis by actually going through the motion?

Nintendo has begun to foreshadow what gamers have been dreaming about for years – virtual reality gaming. And the company, which has been tossed to the fringes in recent past, has been rewarded richly for it.

If these three consoles are any indication, the next generation of console will combine a massive, flexible online community, with an all-in-one home entertainment gaming system where players are actually “in the game”.

Ideas that were once relegated to science fiction are about to become real. And the future of gaming looks bright.