Console war
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In the video game industry, a console war describes the competition between two or more video game console manufacturers in trying to achieve better consumer sales through more advanced console technology, an improved selection of video games, and general marketing around their consoles. While console manufacturers are generally always trying to out-perform other manufacturers in sales, these console wars engage in more direct tactics to compare their offerings directly against their competitors or to disparage the competition in contrast to their own, and thus the marketing efforts have tended to escalate in back-and-forth pushes.
While there have been many console wars to date, the term became popular between Sega and Nintendo during the late 1980s and early 1990s as Sega attempted to break into the United States video game market with its Sega Genesis console. Through a novel marketing approach and improved hardware, Sega had been able to gain a majority of the video game console market by 1991, three years after the Genesis’ launch. This caused back and forth competition between the two companies throughout the early 1990s. However, Nintendo eventually regained its market share and Sega stopped making home console hardware by 2001.[1]
Background and etymology
The video game console market started in 1972 with the release of the first home console, the Magnavox Odyssey. As more manufacturers entered the market and technology improved, the market began to coalesce around the concept of console generations, groupings of consoles with similar technical specifications that vied in the consumer marketplace. Since 1972, there have been nine such console generations, with two to three dominant manufacturers controlling the marketplace as an oligopoly.[2]
As with most industries without a single dominant leader, console manufacturers have marketed their products in a manner to highlight them in a more favorable manner compared to their competitors', or to focus on features that their competitors may lack, often in aggressive manners. For example, console manufacturers in the 1980s and 1990s heavily relied on the word size of the
Sega versus Nintendo
While not the only console war, the rivalry between Sega and Nintendo for dominance of the North American video game market in the late 1980s and early 1990s is generally the most visible example of a console war. It established the use of aggressive marketing and advertising tactics by each company to try to gain control of the marketplace, and ended around 1995 when a new player,
Background
The United States video game industry suffered a severe
In Japan,
At the same time, Sega was looking to get into the video game console industry as well, having been a successful arcade game manufacturer, but due to the downturn in arcade game business, looked to use that expertise for the home market.[13] They released the SG-1000 console in Japan the same day as the Famicom in 1983, but sold only 160,000 units of the SG-1000 in its first year.[14]
Sega redesigned the SG-1000 twice to try to build a system to challenge Nintendo's dominance; the SG-1000 Mark II remained compatible with the SG-1000 but failed to gain any further sales.
Entering the United States' market
The
NEC was another competitor to Sega and Nintendo.
As with the Master System, Sega also planned for a major push of the Mega Drive into the United States to challenge Nintendo's dominance among other markets, with the unit rebranded as the Sega Genesis. Sega was dissatisfied with Tonka's handling of the Master System and so sought a new partner through the Atari Corporation led by Jack Tramiel. Tramiel was bullish on the Genesis due to its cost, and turned down the offer, instead focusing more on the company's computer offerings.[23] Sega instead used its dormant Sega of America branch to run a limited launch of the console in August 1989 in test markets of New York City and Los Angeles, with its launch system being bundled with the port of the arcade game Altered Beast.[23]
In October 1989, the company named former Atari Entertainment Electronics Division president Michael Katz as CEO of Sega of America to implement a marketing strategy for a nation-wide push of the Genesis with a target of one million consoles. Katz used a two-prong strategy to challenge Nintendo. The first was to stress the arcade-like capabilities of the Genesis with the capabilities of games like Altered Beast compared to the simpler 8-bit graphics of the NES, and devising slogans such as "Genesis does what Nintendon't."
Most of these games were developed by Sega's Japanese programmers, though notably, Joe Montana Football had originally been developed by Mediagenic, the new name for Activision after it had become more involved in publishing and business application development alongside games. Mediagenic had started a football game which Katz wanted to brand under
The second push in 1991
The Genesis still struggled in the United States against Nintendo, and only sold about 500,000 units by mid-1990. Nintendo had released Super Mario Bros. 3 in February 1990 which further drove sales away from Sega's system. Nintendo themselves did not seem to be affected by either Sega's or NEC's entry into the console market.[23] Sega's president Hayao Nakayama wanted the company to develop an iconic mascot character and build a game around it as one means to challenge Nintendo's own Mario mascot.[24] Company artist Naoto Ohshima came up with the concept of Sonic the Hedgehog, a fast anthropomorphic character with an "attitude" that would appeal to teenagers and incorporating the blue color of Sega's logo, and Yuji Naka helped to develop the game Sonic the Hedgehog to showcase the character as well as the graphics and processing speed of the Genesis.[25] The game was ready by early 1991 and launched in North America in June 1991.
Separately, Sega fired Katz and replaced him with Tom Kalinske as Sega of America's new CEO in mid-1990.[26] Kalinske had been president of Mattel and did not have much experience in video games but recognized the razor and blades model, and developed a new strategy for Sega's push to challenge Nintendo's dominance in America with four key decisions, which included cutting the price of the Genesis from $189 to $149, and continue the same aggressive marketing campaigns to make the Genesis look "cool" over the NES and of Nintendo's upcoming Super Nintendo Entertainment System (SNES).[26] Further, Kalinske pushed hard for American developers like Electronic Arts to create games on the Genesis that would better fit American preferences, particularly sports simulation games which the console had gained a reputation for. Finally, Kalinske insisted on making Sonic the Hedgehog the bundled game on the system following its release in June 1991, replacing Altered Beast and even offering those that had purchased a Genesis with Altered Beast a trade-in replacement for Sonic.[26]
Under Kalinske, Sega also revamped their advertising approach, aiming for more of a young adult audience, as Nintendo still was positioning the SNES as a child-friendly console. Advertising focused on Sonic, the edgier games in the Genesis library, and its larger library of sports games which appealed to this group. Television ads for the Genesis and its games ended with the "Sega Scream" – a character shouting the name "Sega" to the camera in the final shot – which also caught on quickly.[26]
These changes, all predating the SNES's planned North American release in September 1991, gave Sega its first gain on Nintendo in the U.S. market. Further, the price cut to $149 made the Genesis a cheaper option than the planned $199 price for the SNES led many families to purchase the Genesis instead of waiting for the SNES. The Genesis had a larger library of games for the U.S. with over 150 titles by the time the SNES launched alongside eight games, and Sega continued to push out titles that drew continuous press throughout the year, whereas with the SNES, its game library was generally held up by flagship Mario and Zelda games that only came at out once a year, along with less which further made the Genesis a more desirable option.[26]
For Nintendo, up until 1991, they had been passive towards Sega's approach in North America, but as the SNES launch approach, the company recognized that they were losing ground. The company shifted their advertising in North America to focus on more of the advanced features of the SNES that were not present in the Genesis, such as its Mode 7 to create simulated 3D perspective effects.[27] When the SNES launched, this would be most prominently seen with the release of F-Zero (video game), where the 3D made the game look more complex, compared to earlier 3rd person racing games on home consoles. Pilotwings used Mode 7 to better simulate the landings that would happen, after players completed the other objectives in the level. The initial shipment of one million SNES units sold out quickly and a total of 3.4 million SNES were sold by the end of 1991, a record for a new console launch, but the Genesis maintained strong sales against the SNES.[26] The Genesis's resilience against the SNES led several of Nintendo's third-party developers to break their exclusive development agreements with Nintendo and seek out licenses to also develop for Genesis. These developers included Acclaim, Konami, Tecmo, Taito, and Capcom, the latter of which arranged to have a special licensing mechanism with Sega that allowed them to publish select titles exclusively for the Genesis.[28]
During this period, the push for marketing by both Nintendo and Sega led to the growth of
The war escalates in 1992 and 1993
Nintendo publicly acknowledged that it knew it was no longer in the dominant position in the console market by 1992.
The success of Street Fighter II both as an arcade game and as a home console title led to the growth of the fighting game genre, and numerous variations from other developers followed. Of significant interest was Midway's Mortal Kombat, released to arcades in 1992.[33] Compared to most other fighting games at the time, Mortal Kombat was much more violent. The game showed combatants’ blood splatter during combat and allowed players to end matches in graphically intense "fatalities.” Because of its controversial style and gameplay, the game proved extremely popular in arcades.[30]
By 1993, Both Nintendo and Sega recognized the need to have Mortal Kombat on their consoles. However, Nintendo, fearing issues with the game’s violence, licensed a “clean” version of the game from Acclaim for the SNES. Which included replacing the blood splatter with sweat and removing the aforementioned fatalities. Sega also licensed a censored version of the game for the Genesis. However, players could enter a
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C-SPAN footage of the first congressional hearing on December 9, 1993. |
The popularity of the home console version of Mortal Kombat, coupled with other moral panics in the early 1990s, led to concerns from parents, activists and lawmakers in the United States, leading up to the
By the time of the second hearing in March 1994, the industry had come together to form the
The arrival of Sony and the end of the war
In 1994 and 1995, there was a contraction in the video game industry, with
At the same time, a new competitor in the console marketplace emerged,
Both Sega and Sony turned to move these units to the North American market. With the formation of the ISDA, a new North American tradeshow, the
In the case of Nintendo, they bypassed the 32-bit CPU and instead their next offering was the
By this point, the console war between Nintendo and Sega had evaporated, with both companies now facing Sony as their rival. Sega made one more console, the Dreamcast, which had a number of innovative features including a built-in modem for online connectivity, but the console's lifespan was short-lived in part due to the success of Sony's next product, the PlayStation 2, currently being the best-selling home console of all time.[43] Sega left the home console hardware business in 2001 to focus on software development and licensing.[42] Nintendo remains a key player in the home console business, but more recently has taken a "blue ocean strategy" approach to avoid competing directly with Sony or Microsoft on a feature-for-feature basis with consoles like the Wii, Nintendo DS, and Nintendo Switch.[44]
Legacy
The Sega/Nintendo console war is the subject of the non-fiction novel Console Wars by Blake Harris in 2014,[45] as well as a film adaption/documentary of the book in 2020.[46]
Sega and Nintendo have since collaborated on various software titles. Sega has developed a biennial Mario & Sonic at the Olympics series of sports games based on the Summer and Winter Olympics since 2008 featuring characters from both the Super Mario and Sonic series,[47] while Nintendo has developed the Super Smash Bros. crossover fighter series for numerous Nintendo properties that has included Sonic as a playable character along with other Sonic characters in supporting roles since Super Smash Bros. Brawl.[48]
Sony versus Microsoft
Background
Since the sixth generation, both Sony and Microsoft have been direct competitors for home consoles. Since 2000, both companies have released a new console model within a year of each other with roughly comparable specifications. Because the console hardware does not have distinct technical advantages, the two companies compete more by creating a unique console environment through online services and offering console-exclusive games from their first-party and third-party studios.[2] While Nintendo also has remained a significant competitor to both companies, its development and marketing strategy using the "blue ocean" approach is considered fundamentally different from Sony or Microsoft that it is usually not regarded as major participant in the console war.[49] Today, it is the most evident ongoing console war, with both Sony and Microsoft controlling 72% of the gaming console market share.[50]
Initial Challenge From Microsoft
Microsoft specifically entered the console market with the Xbox console in 2001 as it saw Sony's PlayStation 2 as a potential competitor to the home computer as a ubiquitous device in the living room. Whereas the PlayStation 2 was developed from mostly custom components, Microsoft approached the Xbox as a highly refined personal computer based on Microsoft Windows and DirectX technology. The original Xbox did not compete well against the PlayStation 2, selling only about 24 million units worldwide against the PlayStation 2's 155 million, with Microsoft reportedly failing to profit on the console hardware. Nonetheless, Microsoft, satisfied with the Xbox's overall performance, reaffirmed its commitment to the console marketplace with the reveal of the Xbox 360 in 2005.[51]
Xbox 360 vs PlayStation 3
Microsoft was able to take lessons learned from the first Xbox to its second model, the
Both consoles were challenged by Nintendo's
Xbox One vs PlayStation 4
Sony and Microsoft both released their next consoles, the PlayStation 4 and the Xbox One, in 2013. Sony considered the difficulties developers had with using the custom instruction set for the Cell processor on the PlayStation 3 and restructured the PlayStation 4 to use more the standard x86 instruction set used by most personal computers helping to bring development in convergence with computer systems.[60] Sony also invested heavily into its first-party studios, organizing them under the PlayStation Studios branding, and focusing their products as key exclusives for PlayStation.[61] Microsoft initially wanted to drive the Xbox One as a replacement for a cable box in the living room as a single source for entertainment with features aimed around television viewing in addition to gaming. To achieve this, the Xbox One was to be shipped with Kinect and was to use an always-on Internet connection to enable numerous features, such as the ability to share games with other family members. However, when these features were first promoted, there was a heavy backlash from journalists and consumers, considering these unnecessary, privacy-invading features. Microsoft had to pull many of these features from the Xbox One before launch, such as eliminating the always-connected requirement and the need to use Kinect.[56] Sony took the opportunity in their PlayStation 4 marketing to play off Microsoft's missteps, such as demonstrating the simplicity of game sharing by simply passing along the physical media to another person, as well as its lower price point.[62] While Microsoft was able to course-correct the Xbox One after launch, Sony had gained enough ground with the capabilities of the PlayStation 4 along with a strong library of console-exclusive titles, and the PlayStation 4 outsold the Xbox One, 117 million units[63] to 52 million units.[64][65]
In 2013, South Park lampooned and satirized the eighth-gen console war between the Xbox One and PlayStation 4 in the episode "Black Friday Trilogy".[66]
The Xbox One was ultimately the more expensive of the two,[67] however, both console prices were high when compared to the historical console market,[68] setting a trend for ever more expensive consoles.
Xbox Series X|S vs PlayStation 5
Both companies released their next consoles in 2020, the
Furthermore, there have been rumors of both companies launching further consoles in the future, with a Sony executive claiming that further consoles will come out in a six to seven-year cycle.[72] Microsoft going one step further claiming it has consoles which "will not come to light for many years."[73]
With Microsoft's acquisition of
Other console wars
1990s handheld consoles
A number of major handheld consoles were released on the market within about a year of each other: Nintendo's
In video games
The Hyperdimension Neptunia series of video games started as a parody of the console wars, incorporating personified consoles, developers, consumers, and other such figures within the gaming industry.
See also
References
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