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Gaikai, a video game streaming service, said that the company expects one of the current game console platform holders to withdraw from hardware business at the E3 trade-show in mid-2012. Given that Nintendo has already unveiled its next-gen Wii U, only Microsoft and Sony may break the news at the forthcoming show.

"Not all of the current console makers will have one more generation. That will be the big news at E3," said Nanea Reeves, chief product officer for Gaikai, reports IndustryGamers web-site.

Development and ramp up of new hardware for game consoles is a lengthy and expensive process that takes several years and hundreds of millions of dollars. In many cases platform holders have to sell consoles at a loss hoping to earn money on video game sales, which takes time and requires a lot of financial power.

Nintendo will clearly release its Wii U video game console this year, hence, it is not withdrawing. Sony has publicly confirmed development of PlayStation 4 and rumours are circulating about hardware for Xbox Loop (Xbox Next), therefore, the company may also be planning a new piece of hardware.

Selling video games and accessories for particular proprietary platform is a natural way for companies like Microsoft, Nintendo or Sony to earn their profits. Without proprietary games and hardware those profits and revenues will quickly erode making it hard for those companies to earn. As a result, it hardly makes sense for those three platform holders to sign a deal with game streaming service just now. Still, it is not completely impossible that such a deal will not be signed in the future.

Neither Microsoft, nor Nintendo, nor Sony commented on the news-story.

Tags: Microsoft, Nintendo, Sony, Wii, Wii U, Xbox, Xbox Next, Xbox Loop, Playstation

Discussion

Comments currently: 15
Discussion started: 01/12/12 08:57:02 AM
Latest comment: 01/13/12 11:41:37 AM
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1. 
Keeping in mind the cost and the low margins from hardware in consoles (because after the 3-4 first months they drop the hardware price so low, that they even have losses which they expect to cover with licensing games for the console) it is not unlikely for that to happen.

Even if Nintendo haven't the Wii U on track, it could be unlikely to abandon the race. Mostly because is the only out of 3 companies which is completely console and game maker, and they can put all the budget (and they have a big one as far as I know) on this race.

Sony on the other hand is strangling lately with many problems.
The PSN hack, strangling of innovation in other devisions, the Vaio's are going lower and lower in quality and sales, in general they have a lot of problems which can jump in and interrupt the PSX line, if the shareholders and the board of directors decide that their money can be used elsewhere.

Keeping in mind the resent change in CEO however who is saying that he believes that the playstation brand can bring back in line the whole company and also keeping in mind the brand new PSVita, it seems unlikely for the Sony to pull up at the moment.


Now thinking about MS...
If you ask me they are the most likely company to leave the console race, even if the Xbox is maybe their only really successful device they ever shipped (I mean as MS and not devices in co-op with other manufacturers), they still make their major revenue from the software in computers.
Windows and Office suite are their thing, they keep the company high for decades now.

MS is saying for years now how much they support the PC gaming and they even got the Xbox's no 1 peripheral, kinnect out for the PCs.

They have more to win if they focus their powers to support the PC gaming which is a strong aspect of their main market of Windows OS.
Like for example by releasing a new lightweight version of windows, gaming centric which boost gaming performance etc.
They can focus in software side while the PC hardware manufacturers are doing the hard job, by creating hardware (and software, drivers etc) for them.
Also they move all of their successful game franchises at the PC platform and even sign deals with makers like alienware to make something like "Windows Gaming Systems".

On the other hand, this is just what I think. We will better wait and see.
0 0 [Posted by: nitro912gr  | Date: 01/12/12 08:57:02 AM]
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2. 
The rumor sounds ridiculous.

Nintendo just sold 90 million Wiis so I doubt they are going to be quitting before giving Wii U at least a shot, especially after being so far into development. And as Nitro said, that is really their main business.

MS basically made no $ with original Xbox to create mind-share and but after they have done really well after with Xbox360. And over the last 2-3 years they have been revamping the Xbox Live interface, etc. etc. It seems unlikely that they too would pull out since they are currently #2 in the console race and prob. hope to improve in the next round.

Given that Nintendo already has the Wii U exposed and flashing its goods to the general public, and Microsoft's leaked roadmap clearly shows another Windows 8-related Xbox in the works, that leaves Sony as the only obvious one to leave the race.

The only one that really took a tumble in this generation is Sony. Sony went from dominating with PS2 to being dead last. However, selling > 60 million PS3s is still great. I really don't see Sony abandoning the console race unless the company has little $ to invest into it as a result of all the other struggling businesses it has (TVs, cameras, laptops, etc.). Ironically, the best thing Sony has going for them at the moment is the PS3 (and perhaps micro-4/3rd cameras).

Still, I just don't believe that someone would pull out in this upcoming generation. Perhaps, if PS4 sells really poorly in the next one, then I could see them pulling out in 2020 and beyond. Vita has seen very slow adoption rate, so it's very possible Sony is struggling as a firm.

Sony stock has collapsed in the last 2 years to 2008-2009 financial crisis lows:

http://www.google.com/finance?q=NYSE:SNE#
1 0 [Posted by: BestJinjo  | Date: 01/12/12 08:58:52 AM]
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3. 
Given how popular the Xbox has gotten i don't see MS pulling out, they have the money and resoruces to keep on going for years. Sony on the other hand is a diff story altogether. So i wouldn't be surprised if Sony cancels plans on the PS4 platform.
2 0 [Posted by: SteelCity1981  | Date: 01/12/12 11:52:49 AM]
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I do

I see Microsoft returning to the licencing of software

They will start giving away Windows 8 XBOX edition software to open market manufacturers

Just like Android is for phones.

Microsoft will focus on maintaining the software and Live infrastructure. The games will all be delivered by Live in competition to steam.

The biggest problem that has always faced consoles longevity and static nature of the hardware going obsolete
0 1 [Posted by: carl0ski  | Date: 01/13/12 03:58:50 AM]
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4. 
The Maker is Microsoft . Xbox will be a service gaming system , in Windows - PC, tablets, mobile telephone - , and streaming . There are a lot of evidences about it , for example the comments of Raul Shood in twitter - XBOX XBOX XBOX but working in some big thing to PC - or the last comments of Balmer about the focusing of the company in windows . And the rumour about "Xbox 360 games in PC and Xbox Live in PC .

2 3 [Posted by: jonelo  | Date: 01/12/12 01:11:43 PM]
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5. 
It will definitely be Microsoft. They have been developing technology to make the Kinect and their games compatible with PC's, so I see them returning to the more lucrative PC gaming market. Especially given that in the worldwide console market the Xbox is running third behind Nintendo and Sony, and Microsoft is the only one of the three with the option to expand into the PC market which is growing once again.
2 1 [Posted by: Clarrisani  | Date: 01/12/12 04:44:27 PM]
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Worldwide, including the lucrative US market, Xbox360 sold more than PS3. So your logic is MS should pull out because it sold 4 million units less in Europe?

http://www.vgchartz.com/#Global Totals
0 0 [Posted by: BestJinjo  | Date: 01/13/12 11:39:50 AM]
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Microsoft can easily release the next Xbox and still focus on PC gaming. The 2 markets are independent.
0 0 [Posted by: BestJinjo  | Date: 01/13/12 11:41:37 AM]
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6. 
Sony has stated they won't be displaying any next gen console at E3 2012. While Nintendo and Microsoft so far have plans to show their next gen console at E3 2012. So that may give you a clue to who is pulling out of the Console business. Microsoft has gained ground in 10 short years on Nintendo and Sony and the Xbox's popularity continues to grow. Microsoft made a killing this past black friday with Xbox 360 sales. So Microsoft has the most going for them right now out of any console maker heading into the next gen console.
0 0 [Posted by: SteelCity1981  | Date: 01/12/12 07:03:21 PM]
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7. 
i don't think so,
if you see bing you will know it isn't MS and Halo 3's (i think) development cost MS ~60M$ and got it in the first week ~300M$

Sony's PS3 isn't really successful but i think Sony will give it another chance

when i read the news i thought it was nintendo but i think we'll know more at E3
0 0 [Posted by: madooo12  | Date: 01/13/12 12:19:00 AM]
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Well Sony themselves said they had no plans debuting the PS4 at E3 2012. So something is def off.
0 0 [Posted by: SteelCity1981  | Date: 01/13/12 12:31:37 AM]
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maybe later i guess
0 0 [Posted by: madooo12  | Date: 01/13/12 06:49:38 AM]
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8. 
I can't really take the predictions of some random game streaming service company seriously.

I don't see any basis for the "prediction" given, therefore I would call this baseless.
1 0 [Posted by: Astral Abyss  | Date: 01/13/12 07:35:06 AM]
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9. 
I have not made ??a prediction of future streaming service only. Perhaps it is a problem of my poor English language. It will be a digital service like Steam or Xbox Live and will also offer streaming in some way, like las Google offering with Onlive. Whether from PC to a console or to a media center. But there will no a traditional console, but a service linked to one way or another with Windows or the OS of Microsoft .

Microsoft still has not amortized all the money invested in the XBOX. Another console perphas does not make sense and less when its main business is threatened as never was in these last 15 years. And really the target of Xbox, original target , was strengthen the main product of MS, Windows with the expansion of Direct X in the gaming space .

The PC concept and hardware is moving toward a terrain which Microsoft is not dominant, such as tablets and phones. And the weight of the web is huge now. Those two are areas that Microsoft does not dominate. Even the gaming is moving to these spaces .

Even in the business arena Microsoft is having the first competitor. The most important bank of my country-100.000 Workers - has just abandon Microsoft Office and starting working with Google Aps .
0 1 [Posted by: jonelo  | Date: 01/13/12 11:04:34 AM]
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