The Gaming Industry Needs To Take The Google Console Seriously

According to the Wall Street Journal, there's big news coming to gaming. Google is building a console, possibly as early as the fall, and it's going to run Android. Together with Apple 's recent announcement that iDevices will start to support dedicated game controllers, this paints a clear picture. Like Microsoft in 2001, the great tech giants of today are rumbling towards gaming.

Right now, neither the Xbox One nor the PS4 have much to fear. Smaller shops, however, like Ouya, Gamestick, and Gamepop, have plenty to fear. Google and Apple will approach gaming from their current expertise -- small titles that look like current mobile titles. The conventional wisdom, articulated by Paul Tassi, is that mobile games and AAA console titles can safely occupy different spheres, never impinging on the other's core demographics. Right now, this is true. Candy Crush does not cut into sales for Call of Duty, and neither Google nor Apple will make much of a mark on the launch year for next-gen. That's right now.

This technology is changing quickly, both for local devices and their ability to stream massive amounts of information from server farms. At the same time, games are improving -- we just saw XCom: Enemy Unknown, a hardcore favorite if there ever was one, released on iOS. Square Enix is releasing the follow up to critically acclaimed Deus Ex: Human Revolution as a mobile game. There will always be a place for simple physics puzzlers and match-three games, but the landscape of mobile games is maturing, offering more choices to more people. Once controllers become commonplace and these devices can easily stream to a TV, they will be harder to put into a "casual" box.

This is all still in its infancy. While the true AAA audience that eats up games like Bioshock: Infinite and The Last of Us isn't going anywhere, next-gen games don't just need that gamer core. Increasing development costs require mass-market audiences. If more peripheral customers can get good, solid gaming experiences just short of what the Xbox One and PS4 can offer, I imagine a lot of them will forego the sizable investment. Eventually, we're also going to see more of those fancy games released on non-traditional consoles -- the conventional PC architecture of both the Xbox One and the PS4 will make that much cheaper for developers. At that point, the notion of the gaming console gets muddy.

That's the beginning, when new console sales start to erode from the edges. After that, there could come a time when local and cloud technology for these theoretical consoles evolves to the point where Activision can release a full version of Call of Duty on a mobile device. When that happens, the current conception of the games console will collapse.

So I don't expect much besides status quo and great relief when Microsoft and Sony release their new consoles. There will be rejoicing, and first person shooters, for the gaming industry in the fall.  But I also see a storm of new technology and evolving tastes on the horizon, and  wonder what the long tail for these consoles, and the AAA gaming industry in turn, is going to look like. All the lines are blurring right now. The distinctions between console, PC, phone, tablet and watch are approaching academic. This makes for a cloudy future for anything with a more narrow focus.

In the worst case scenario, Microsoft will have to seriously reimagine its Xbox. Sony, which is rebuilding its corporate identity with Playstation at the center, could have a lot more problems. In the best case scenario, we sail into the future with more viable gaming options for ever before. For that to happen, the AAA industry needs to recognize that the landscape is changing. Let's hope they do.