After moving down to Houston, TX, this past Fall, I have already bought a bad ass pair of cowboy boots, and even witnessed (no, experienced) my first rodeo, to include an entertaining round of Mutton Bustin‘. I also managed to somehow survive the epic Houston DMV (that’s what we Illinoisans call it); let’s just say that if moving to Houston was a video game, the DMV would be the final boss. No joke. What I have yet to experience however is a massive event that takes place just two and a half hours to my west in Austin, TX, otherwise known as SXSW, or South by Southwest for my acronym haters out there. Originally starting as a ginormous music festival, SXSW has now morphed into something bigger with film, gaming, and technology industries setting up shop. The festival almost always produces a good time, whether you’re lucky enough to attend in person (they do serve beer there), or virtually through the via this fine tool we call the Interweb. The festivities also produce headlines, as gaming companies and tech startups like to either announce new shit, or simply stir the proverbial pot. Enter Michael Pachter, who works as a research analyst at Wedbush Securities, who just recently dropped a price point nuclear bomb that has reverberated off the gaming industry’s online message boards like a pin ball.
“Next-Gen Games will Likely Cost $70″
Yup, $70 for next generations games; at least, that’s what Mr. Pachter is predicting, and in my opinion it wouldn’t surprise me if that’s how the prices shake out. Spare me the Master of the Obvious comments, but the Internet has been a game changer. Every newspaper and magazine has induced significant layoffs over the years, and in many cases has had to move to online pay walls simply to pay the bills and keep their papers/mags alive. Have you seen what Amazon has done/is doing to the likes of Best Buy? Although Best Buy is still a huge cash cow, Amazon and their online business model is slowly putting the electronics brick and mortar world out of business. Why? Amazon doesn’t need rental space for store fronts, nor does it need sales reps in blue polos walking up and down the PS3 aisles asking if you need any help. Now they do need massive distribution centers and lots of employees, but compared to Best Buy’s model it is much more sleek. The gaming industry is no different. Hardware is expensive to make, and it’s even tougher to perfect from a quality control perspective. Over the last ten years we’ve seen a number of platforms begin their shift to digital downloads; most recently we saw the news break that Sony’s library will likely be almost entirely online for digital access. Steam wasn’t necessarily the first company to offer this gaming route, but they have arguably been the most successful. Why pay a middle man manufacturing company a big percentage of your potential profit margin when you can offer up the game as a proverbial .zip file online for your fans to download? That’s where we’re headed.
Valve Betting on their Boxes (Not Microsoft’s)
Valve has been betting on the digital download future of gaming for quite a while now with Steam, and we’ve even known about their foray into the console/hardware market for some time. Just recently however have we begun to witness progress, with hardware manufacturer Xi3 unveiling their Steam Box imitation known as the “Piston”. While the Piston will sit on shelves with a $1,000 price tag (and will likely stay on shelves), and the fact that Valve is shunning it as an imitation, it is noticeable progress for where the industry is moving. Soon official Steam Boxes from Valve will be hitting shelves, and then the real questions will be answered. My biggest question however is likely shared by millions: will Half-Life 3 be a launch title?
More to follow!