Booze, Baseball, and another "B"

Sunday, December 18, 2005

High-End Videogame Console Feature, Part II: Consumer Demand....

In the last part of this feature, when I examined High-End console history, I asked the question of whether or not there is support for High-End consoles in the US. I am very much in support of the idea of releasing high-end consoles myself, but that doesn't mean that everyone else is. When Sony first announced the PSX, right away I decided that I'd spring for one if they brought it out in the US. Luckily for my wallet, Sony decided to keep their PS2 compatible-TiVo only in Japan. I can't imagine that Sony found a lot of people lining up (with money) to buy one.

After looking at the history of existing high-end consoles, it makes sense to ask "is there demand for these things in the USA?" If there is demand, there is some possibility we might get these sort of systems here. I thought about how to best approach this question, and my idea was to simply ask people the question "would you buy a high-end game console?"

Of course, I don't think the number of people who responded to my question is probably a large enough sample size, but in this case, there isn't much that I can do about it. Responses were pretty much what I expected. The majority of people think that consoles are expensive enough as is, and don't want to be paying more for them.

Here are my results:
  • 38.5% - No, consoles are expensive enough/too expensive as is
  • 28.8% - Yes, I would buy a high-end console
  • 21.2 - No, consoles are good enough as is
  • 11.5% - Not sure
Responses from different places all garnered approximately the same percentages for each response, which I thought was interesting, but did not surprise me. Before you ask, no I do not have demographic representations for the people in this sample, which means the margin of error present is probably fairly high if you wanted to use these numbers to represent the American gamer. I'd say at least +/- 5%, probably more. Looking at the fact that very few high-end consoles have been released here in the US, one can reasonably extrapolate that the game companies have done similar research and probably came up with similar results; there are some people who would buy them, but most people don't want to be paying more money for videogame consoles.

Of course one rebuttal of this information, and the idea that people don't want to spend more money to own a high-end console, is the Xbox 360 (which I stated last time could arguably be called a High-End console). Of everyone I have asked, not one person said they would buy the "core" system; everyone wanted the high-end premium bundle, with many people going as far as calling the purchase of a core system "stupid." In fact, 100% of Xbox 360 owners I know own the premium package. This flies in the face of the logic that people are content to spend less on consoles, which I think means this debate is not closed yet. Another example would be the Game Boy Advance SP. When Nintendo addressed people's complaints that the GBA wasn't easy enough to view, people came running to buy the SP. With its built-in battery pack, cool fold out design, and built-in light, the SP was an instant hit, and another example of a successful high-end console (however it wasn't inordinately expensive).

It will be interesting to see what Sony and Nintendo do when they announce their system configurations next year. Most people, including Wall Street analysts, think that Microsoft's idea to have two differing hardware configurations was a terrible idea. Will Sony or Nintendo try to mimic MS, and make sure they have a configuration available only so as to enable them to say they hit a specific price point? Only time will tell.

For the final part of this feature I was hoping for comments from the game companies, but none of them got back to me, so part III is no more. As I mentioned above, if one looks at historical examples, game companies are not high on the idea of releasing high-end versions of consoles in the US.

Sega had the CDX come out, and it was too expensive to do well. When did you hear of the LaserActive? Fairly recently? Sega also had the Nomad, which people liked but it didn't have enough R&D to make it really viable (compatibility with Sega's add-on systems wasn't there, and battery life was terrible). On top of that, it was also expensive when it came out (as High-End consoles are). Panasonic decided NOT to release the Q here, the same decision Sony ended up making with the PSX, as I noted at the beginning of this article.

High-end usually means more expensive (often a LOT more expensive), and in the past the console manufacturers just have not shown a willingness to put out much more expensive systems in the USA. Price probably has a lot to do with that decision. The premium Xbox 360 is 33% higher in price than the core system, but a Panasonic Q was 2 - 3 times as expensive as a regular GameCube. The PSX was 5 times the price of the PS2.

It would seem that it's unlikely we'll see much in the way of High-End consoles here in the US, but systems such as the Xbox 360 (via the premium package) may change that. It's possible that the paradigm may now shift, since there are more older gamers than at any time in history, and game companies will want to capitalize on these older gamers' having more money to drop on systems than when they were kids. There's even a market for aftermarket versions of high-end consoles.

Never say never!


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