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Analysis – Microsoft Is Making The Right Moves For The Holiday

by Mike Futter on Oct 27, 2014 at 05:58 AM

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I’ve previously acknowledged that the resolution of games is an important topic for some people. Until there isn’t a discrepancy between the Xbox One and PlayStation 4 versions on the visual front, that conversation will continue to emerge. But for everyone else, there are other factors to consider.

While resolution is a primary motivator for some consumers, it's equally important to acknowledge that for a portion of the community there are other factors given more weight. Today, Microsoft fired two canon shots intended to make up lost ground in the current generation by capitalizing on the all-important holiday season.

Games Matter, Especially Exclusives
Before we get into the nitty gritty of the Xbox One and PlayStation 4, we must acknowledge that Nintendo is making big moves. Bayonetta 2, Super Smash Bros. for Wii U, Captain Toad: Treasure Tracker, Hyrule Warriors, and the continued strong performance of Mario Kart 8 set Nintendo up well for the holiday season. 

As we start to talk about exclusives, Nintendo differentiates itself well. The only problem though, is that Nintendo doesn’t have the third-party and multiplatform support to back up it’s strong in-house lineup. For some, Nintendo’s first-party is enough, and it’s important to recognize the company has assembled as strong a fall lineup as it could reasonably manage.

For those looking for core titles on console from Ubisoft, Activision, and EA though, the Xbox One and PlayStation 4 are where you’ll be looking. In fact, third-party publishers dominate the fall, with very few exclusives from either platform holder differentiating things.

From Sony, we’re waiting on LittleBigPlanet 3. Driveclub, Sony’s social driving game originally intended as a PS4 launch title, has been suffering from significant server issues since its October 7 launch. It’s not at 100 percent yet, as Sony and Evolution Studios are still repairing the damage.

Microsoft has a successful exclusive in Forza Horizon 2 under its belt, leading off a trio of titles exclusive to Xbox consoles. The publisher is set to release Sunset Overdrive tomorrow, which we liked a lot (our review). And the chances of Halo: The Master Chief Collection flopping are slim.

On top of those, Microsoft is once again turning to Harmonix to single-handedly sell the Kinect. Between Dance Central Spotlight and Disney Fantasia, those who enjoy motion controlled games aren’t left in the cold.

These still aren’t the strongest first-party lineups we’ve seen, which is why exclusives alone aren’t going to sell systems. There’s another important factor in play.

Price Matters, Especially Around The Holiday
You can say that Microsoft was stung by its over-reliance on Kinect at the start of the cycle. You can argue that the company’s stance on online connectivity scared away many loyal fans. You can even posit that resolution discrepancies have weakened the Xbox One’s position amongst videophiles. 

You wouldn’t be wrong. But that’s not what hurt Microsoft the most out of the gate.

The Xbox One was $100 more expensive than the PlayStation 4 at launch. That 25 percent overage, in combination with Sony’s then on-paper and now in-practice power advantage drove people away.

Microsoft is making some smart moves in that department. First, new head of Xbox Phil Spencer led the charge to cut the Kinect’s cord. It effectively downgraded the device from an integral part of the system to novelty peripheral, but it also brought parity at the register.

Then, Microsoft bundled up some of this fall’s heavy hitters. Sunset Overdrive is getting a bundle (now made more appealing by critical response). Assassin’s Creed Unity is getting a package with two games included at the same base price (three if you get the version with Kinect). 

Microsoft is also the first of the two competitors to include the much-needed larger hard drive, and it’s wisely doing it in conjunction with a game that’s been crucial to its holiday strategy for years. Microsoft has built a big user base on the back of Call of Duty DLC timed exclusivity. That deal is still in place for this year, and Microsoft needs to hold onto that community.

That’s why today’s move to chop $50 off the price of every Xbox One console and bundle in the United States is so crucial. This prices the Xbox One under the PS4 (at least for the holiday season) for most consoles. The Call of Duty bundle is still more expensive by $50, but that gets you the game and twice as much hard drive space. For people already considering Call of Duty, it’s a strong lure. 

Whether Microsoft’s gambit pays off won’t be entirely clear until the beginning of next year. I expect the sell-in numbers will start to narrow as we enter the second year of the console cycle. 

Regardless of your personal preference though, Microsoft’s moves are good thing (as is Nintendo’s push for a strong first-party lineup). More competition nets rewards for customers. More consoles in the market mean developers and publishers have a larger potential audience for their wares. After an extended period of contraction, the growth that will likely result from price and feature “wars” is something we should all be happy about.