Monday May 18, 2009 – Shelby Cunningham
Video game system (VGS) providers put their money on transforming their consoles into living-room media centers by building systems with internet connections and video optical disc drives in their latest devices. So far, so good. A percentage of gamers have embraced the online services, and DVD and Blu-ray Disc (BD) movies get played in the consoles.
The best strategy for a successful home media center is still being formulated, however. VGS makers will soon be giving us a glimpse of the next step in the media-hub strategy. Will they get it right?
All three console makers, with Xbox leading the pack, have had enough success with online services that offer games and video streams/downloads, that it’s certain that they will beef up these online offerings. So now that people have shown they want to sit on the couch and download games and media straight into their living room, will the next generation of consoles rely 100% on downloads and built-in memory and nix the optical disc drive all together? If rumors are correct, the first purely download-reliant VGS is right around the corner. The new PlayStation Portable (PSP) that many believe will be announced at E3 in early June will supposedly be sans optical disc drive and will rely on delivering all games digitally. Considering the unspectacular sales of UMD movie discs, this move isn’t surprising.
But let’s not stick a fork in the disc drive yet.
How will consumers react to not being able to play their last generation games on their new VGS if there is no receptacle for packaged media? Will they grudgingly accept that they will have to re-purchase the games as downloads? Or will Sony give PSP buyers a break and offer some free downloads with purchase? As for now, consumers aren’t ready to throw out their physical media. According to recent estimates from NPD, only 3% of home entertainment spending in March 2009 was on web-based downloads and online streaming. It also found that only 5% of consumers downloaded movies onto their video game consoles. Considering the relatively small uptake of game and movie downloads, console makers who choose to remove the disk drive altogether will have to risk alienating gamer enthusiasts.
