Industrial Gaming 11 | Third Generation Blues

When Nintendo launched the NES during the early-to-mid 1980's the Japanese stalwart went on to break all sales records for a video games platform; in total over 60 Million systems were sold worldwide. Amid stiffer competition from SEGA they then launched the Super NES and while sales couldn't quite match that of the NES, Nintendo remained the clear market leader with 49 Million units. Things all went a touch pear shaped in their own personal third generation, with dodgy business practice and arrogance leading to what many regard as the first failed Nintendo console, sales hit an all new low of 33 Million.

The damage by this point was nearly terminal, moving into a fourth generation and not being king pin left Nintendo panicked. In a last ditch attempt to tackle Sony's Playstation brand the weary producer made a half-assed effort to ride the Game Boy Advance' popularity; hence the birth of the GameCube name, connectivity and dodgy purple-plastic casing. As we all know by now the outcome was equal to the effort - 21 Million units worldwide, June '06 - but thankfully a combination of a clinical business model and handheld console success left Nintendo licking wounds as opposed to shutting up shop. Indeed things are looking somewhat promising under the new regime, more on that later...

When SEGA moved into the console manufacturing business they faced a much harder challenge. The SEGA Master System launched as a direct competitor to the NES and despite being home to some cracking games it only sold through 16 Million units. When SEGA made the technological leap ahead of Nintendo and launched the SEGA Mega Drive (Genesis for our American readers), it looked like Nintendo had a serious competitor, 35 Million units were lapped up throughout the world. However the third generation blues struck once more when SEGA launched the Saturn, the system was rushed to market to battle Sony without the content to back things up; 10 Million was the best it could aspire to. History sadly paints a different tale for SEGA going out for a fourth time, with the brilliantly misunderstood Dreamcast putting in a repeat performance and spelling the end of SEGA branded consoles.

Even Sony, nearing the end of a very successful second cycle, shipping 106.23 Million systems in only six years and three months, appear to be suffering this phenomenon. The latest news of the European launch delay is but a single drop in the 'PR-Nightmare Ocean' for the market leader as it prepares a third generation home console. No matter how big the company, immense the market share or popular the brand, the task of going through an easy third generation appears to be mission impossible.

Could this all be just one huge coincidence though? Frankly Satoru Iwata's insistence that the third Game Boy, the Nintendo DS, was not a Game Boy and instead was ironically a "third pillar" raises an eyebrow. It was obvious in the face of PSP that if Nintendo made all the same mistakes of their past, the Game Boy brand would become second fiddle to the new and funky system available for consumers. The answer was ingenious in its simplicity; throw out the old name, come up with new ideas, a new business direction and philosophy, and bang the PR drum as loudly as is humanly possible. Leaving arrogance at the door and replacing it with honest confidence is another lesson some people should learn, looking at no certain Japanese electronics firm in particular...

Finally we have the new kid on the console block, Microsoft. Past console trends point towards tough times ahead for the Redmond based corporation, but things don't always work as simply as they appear. Microsoft are selling a lifestyle with the XBOX brand, online communities with a home base and a solid infrastructure could be one final solution to any possible problem. This final point actually goes some way to concluding the theory; and Sony plays an integral part at every step of the evidence trail. From being the company that forced SEGA's hand with the Saturn, thus halting a strong tackle on the Nintendo Empire, to being the company that made the profitable and good-enough selling N64 look like a failure. They even played a part with the Nintendo DS and apparent death of the Game Boy brand; it's all down to Sony.

Even today the magnitude of bad PR being directed toward them is only exacerbated by the aforementioned XBOX Live friendly Internet, just check any online community moments after another "Sony moment" and Photoshop is the program of satirical choice. Yes, mistakes are being made, but there's a legion of Live users sitting ready to exploit them in every possible manner and turn a few body blows into one massive KO, the truth as I discussed last week is much more complex. In conclusion the third generation blues is an interesting idea, with some fantastic coincidences, but coincidence is probably all it is. Time as they say, will tell us everything...

Barry Lewis is Cubed3's top industry analyst and his feature, Industrial Gaming, is published every fortnight.