AAA Games versus Smart TV

Apple

The current Apple TV is merely an outpost for Apple, a foothold in an emerging space. Apple considers user experience to be paramount, and they haven’t yet conquered the design clusterfuck described before. That’s why you don’t have an App Store on Apple TV yet. Have no doubt that Apple is trying. Apps sell devices.

There is a chance that the iPhone or iPad could succeed as the couch controller (there are loads of apps aiming to do just that, including Apple’s own), but if you are looking at the big screen, you need operate the controller by feel. The iDevices have no tactile input.

Apple clearly has the design skill to create a proper controller, but they might see such an endeavor as lowering themselves. Designing down to the requirements of games? Gasp! Buttons? Gag!

This has to be said again because so many people think that touchscreens are the future of everything: If you are not looking at the thing you are touching, you need to operate it by feel (tactile input/feedback). An effective controller will need to click, point, or gesture. Ideally, it will have all three. Slinging some content from your touchscreen to the TV is a cool gimmick, but it’s not an effective way to operate your TV screen. If you want to select that thing on the left of your TV screen, you should probably be looking at your screen while you do it.

Apple also needs to evolve beyond iTunes for video content. It is archaic and a hassle. It’s lovely to never need to plug my iPhone into iTunes to get apps. Reportedly Apple tried to put together a $30/month subscription option for live TV, but the TV networks wouldn’t play ball.

Apple is the front-runner to win even with these challenges. Apple TV already has Netflix, and if anyone can negotiate with the big TV content owners to get new TV onto their box, it’s Apple.

Apple's Grades

Microsoft

The 360 controller is great for the hardcore. Kinect had a very good launch. Microsoft has the controller angle covered (their best bet might actually be just the voice control component of Kinect paired with a pointing remote with buttons).

Yet, when it comes to open market apps, Microsoft has a poor track record. On the 360, they have nearly asphyxiated the only open marketplace – Xbox Live Indie Games. They clearly consider it a red-headed-stepchild and will never put it front and center like Apple does with the App Store.

In their defense, their strategy is great for the present. It allows them to continue to attract hardcore gamers while remaining in control of the whole user experience with tight certification. Remember that design clusterfuck? They get to avoid it. The rumor is that they will roll out a subscription TV service to go along with their movie rentals and Netflix access – a step in the right direction. Yet, In the long term, they will be disrupted by an open app store.

Microsoft needs a new box. No matter how many Kinects they sell, they will never be able to make the 360 the affordable, accessible device that is needed to attract non-gamers. Those folks won’t buy anything with the name “Xbox.” It has hardcore gamer stink all over it. They will need something small and simple that the Xbox 720 can extend. Maybe: “Kinect TV.”

Microsoft's Grades

Sony

Sony’s strategy is to create a hydra with a hundred tiny heads, none of which have enough bite. They have Bravia TVs that feature GoogleTV. They are putting out a PSP phone and a PSP2. They have a tiny bit of Steamworks coming to the PS3, and they are probably working on a 3D Bluray player that doubles as a fancy hat. All of these things are Sony cool.

It appears Sony is too distributed to create the far-reaching service that will be required to win the living room. Software and services are catastrophic weaknesses for them.

Sony is good at hardware, Google is good at software. . . A “Homestation” GoogleTV device that uses a next-gen Move as a controller could be incredible. A step in this direction would be offering Google TV on the PS3. Would Sony do that if it meant free Google App Store games alongside the Playstation Store? Probably not.

On the positive side, the Playstation brand is very strong and Sony owns spectacular game developers with great franchises. Sony appears well prepared to build a $900 PS4. They could position themselves so distantly into the realm of the AAAA that they remain untouched by the raging battles around Smart TV, but that would be a colossally expensive bet.

Sony's Grades

Nintendo

Nintendo doesn’t give a crap. The DS and Wii can print money, remember?

They don’t need to own the living room and they don’t want to. They are happy to keep their box as an add-on toy. I think they look at the iPhone vs DS situation (both are healthy), and they’re not too worried about the living room.

But, I’m not so sure they shouldn’t be. Whatever magic controller wins this war might be better than the Wii-mote or whatever Nintendo is cooking up for the Wii HD. The accessible style of games that Apple will bring could steal the kids from the Wii. If the Wii discovered blue ocean, my illustration at the beginning is about as red-ocean as it gets. The Wii gameplan won’t work a second time and it’s not clear if Nintendo has another waggle up its sleeve.

Apple TV can’t have an app store without a Wii-like controller – it just wont work. Apple and Google need the controller to make an impact at all, forget about games. But, once they have the controller and the UX, games are enabled with great potential, just like iOS and Facebook enabled games. Nintendo had better watch out.

Next Page: Conclusion

9 Responses

  1. Nice article.

    I think three things:

    1. There’s no incentive for the content people to make this happen. I used to work for BSkyB on the interactive TV games as a producer, and for decades the various interactive teams inside Sky have been agitating for up to date technology, but companies like Sky won’t bite. Their reasoning, which is hard to argue with, is that they need to get cheap boxes into people’s homes that can carry digital signals, and once they’re in they have no incentive to go around replacing millions of boxes with technology that allows viewers to do things other than watch TV.

    All the cable and satellite companies have the same problem, and they’ve spent a long time figuring out how to deliver VOD etc onto their existing technology as a result, and that’s not going to change. So that means that any extra Google or Apple box has to be in addition to the cable box, and not free. That’s a bit of a problem.

    2. They may always end up falling between two stools. It’s hard to say what problem these devices actually solve. With VOD, DVR and hundreds of channels the average consumer arguably has far more video content than they actually need, so yet another source seems a bit frivolous. With game consoles that use dedicated (therefore better) controllers, the play experiences are very likely to be better and so the enhanced App Box’s versions might seem quite lightweight by comparison.

    I think nobody has solved that question yet. Without a compelling problem to solve (and I’m not sure box reduction is that compelling) it has to be sold as an nice-to-have, which instantly reduces the market ubiquity.

    3. Perhaps the solution is to go upwards. It doesn’t apply so much to Google, but what strikes me as odd is that Apple doesn’t have a gaming machine. They have all the components in place, from a development platform, to a commercial platform, an approvals department to a great reputation for designing awesome hardware. So isn’t the answer (for Apple at least) to do a PS1-era Sony and create a game console?

    Overwhelmingy, I think yes. What they could do is create a console that is wholly iTunes based, uses the App Store etc, but sells big games as opposed to just Angry Birds. Of course it could do Angry Birds as well, but – notionally at least – they could take a huge wedge out of the business model of the disc-based platforms that exist today. That to me is the missing link in the chain, because it gets the Apple tv into the homes through replacement rather than as an additive box.

    Summary:
    All in all though, I think there will not be one mega-convergent box. The economics just don’t stack up and there’s too many power players on the content side who really don’t want that to happen. There’s nothing stopping a whole lot of disruption happening on the console side though.

    February 2, 2011 at 3:35 pm

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  3. Lucas

    Tadhg,

    Thanks so much for the reply. Looking at this from the perspective of the TV world is the best way, and it’s the arena that I have the least experience in, so your comments mean a lot. The big media conglomerates will undoubtedly act as a massive drag on this transition. As you point out, they may prevent it from happening at all. After reading your reply and doing some more research, I can readily see how big of an obstacle it is that they represent.

    However, with so many companies like Hulu and Netflix working on services that can offer these companies more revenue, not less, I think that angle can be solved. There are many incentives for MS, Sony, Apple and Google to bring a iOS-like experience to the living room (as described in the article). That pressure, and the competition between these companies has the potential to sidestep whatever challenges Sky, Time Warner, Comcast, and their ilk represent.

    -Lucas

    February 7, 2011 at 2:37 pm

  4. Pete Morrish

    Another website, another disagreement with Tadhg.

    (We’re mates, by they way, and have worked together in the past; whilst he was producing at BSkyB, I was producing at one of their developers. Part of my current day job involves working in the next-gen connected TV space.)

    Just a couple of thoughts from me.

    1) I don’t think that the connected-TV games market will start with trying to appeal to gamers that are already out there (i.e. your Xbox gamers, PS3 gamers, etc). So I *do* disagree with the idea of Apple bringing out a dedicated games console. From my point of view, games consoles already exist to meet the needs of dedicated gamers; they ain’t going anywhere just yet. Such a device – with App Store – would be a great step, and would shake up the established industry players, but it wouldn’t be disruptive from the consumer’s point of view.

    2) I think the unmet consumer need will distil out of the mass of non-gamers who want quick, convenient distractions. People that are scared of traditional game controllers (the iPhone has shown that good content fits new non-scary controllers, so a traditional-style controller is by no means a pre-requisite for connected-TV gaming to properly take off), and that can’t be bothered turning on another box, waiting for it to boot up, then navigating menus until they finally get to the content they want.

    Instead, here’s a thing (and I’m thinking on the fly here; I’ve not heard anyone posit anything similar to this before): games as channels.

    The ideal setup for the traditional use case of the TV-watching experience, and for the traditional UX of the those slumped in front of the telly, is to have games ‘always on’. I’m thinking that (e.g.) Angry Birds is on channel 626. Flick to channel 626, and *there’s* Angry Birds, exactly where you left it. No loading time, no extra set-up, no nothing. It’s just another TV channel from the user’s point of view.

    From a tech viewpoint, it’s similar to the iOS implementation of multitasking, I guess. It would be the ultimate in convenience, and would leverage pre-existing mental models of both TV channels and the TV-content consumption experience (meaning that there’s no learning going on; the entire experience is self-evident from start to finish).

    As far as I know, none of the current or over-the-horizon boxes work in this kind of way. It’d make for a nigh-on perfect user experience, though, and could well be the blue touch paper that the space needs.

    February 10, 2011 at 9:48 am

  5. Lucas

    Pete,

    Great comment. The Wii calls their games “channels,” but you don’t flip between them, you still have a loading screen. It’s essentially the same as the iOS home screen of apps.

    I think a lot of modern TV users are used to a guide screen – one that lets them watch while they browse for something else to check out. That’s also similar to a home screen of apps, but with multitasking (as you point out). There’s definitely a great benefit in multitasking – flip to Angry Birds while your show is in commercials, or watch/play split screen.

    However, managing all of that is just another layer of complexity that requires finesse and a sublime input method.

    There is no doubt that any one of the four major companies I profile could make huge UX improvements over the status quo.

    February 10, 2011 at 11:19 am

  6. Dani

    So what’s your view on this and Nintendo after the announcement of the Wii U?

    September 1, 2011 at 8:00 am

  7. Lucas

    If I were to rewrite this now, I’d put Nintendo just under Microsoft, but above Sony.

    The capability to play a game on the small screen while the big screen is occupied is a really slick innovation. Nintendo continues to dabble in using it’s innovative controllers for more than just games. Netflix on the Wii is a huge hit. The Wii U controller will let you surf the web. It could potentially combine the browse-and-sling navigation of an iPad with the tactile surfing of a remote (using the game buttons).

    Yet, I don’t think there’s any indication that Nintendo will want to tackle the UX problem of managing TV and Movies with its controllers. Nintendo has typically strayed from providing live services, and I don’t think they have the experience or back-end services/infrastructure capability to pull it off right now. As long as they are relegating their offerings to the 3rd party Netflix/Amazon VOD realm, they will never have direct control over UX and will be limiting the potential of those offerings.

    Let us also remember the 3DS and Virtua Boy and that not all of Nintendo’s innovative controllers have legs. The Wii U is more of a hardcore machine than the Wii – it sort of splits the difference between a Wii and a PS3. Who knows if there is actually a market there?

    September 1, 2011 at 9:08 am

  8. Lucas

    Another interesting development is Google buying Motorola. They are now a hardware company and can potentially begin to offer a great UX that integrates software with a controller.

    September 1, 2011 at 9:12 am

  9. Dani

    Thanks for your insights! Good stuff!

    September 1, 2011 at 9:53 am

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