The Video Game The Video Game IndustryIndustry

The Players, Strategy, and The Players, Strategy, and FutureFuture

By: Kristian Peterson, Chris Orme, Gary Tonlinson, and Gwendolyn Rex

The PlayersThe Players

Microsoft XboxMicrosoft Xbox

Sony Play Station IISony Play Station II

Nintendo Game Nintendo Game CubeCube

MicrosoftMicrosoft

Strategy:

Internet gaming

Integrated home entertainment & computing

Technology leader

AdvantagesAdvantages

Technological experience & reputationTechnological experience & reputation Plentiful financial resourcesPlentiful financial resources Use of new and current technologyUse of new and current technology

• Internet game capabilityInternet game capability• nForce graphics cardnForce graphics card• 10-gigabyte hard drive10-gigabyte hard drive

• Pentium III processorPentium III processor • DVD playerDVD player

Ability to wait out product growthAbility to wait out product growth

BarriersBarriers

Internet connectivity problemsInternet connectivity problems No experience or reputation in the No experience or reputation in the

video game industryvideo game industry Small game selectionSmall game selection No established popular games or No established popular games or

characterscharacters Introduced after the other consoles Introduced after the other consoles

were already in the homes of were already in the homes of consumersconsumers

SonySony

Strategy:

Maintain market share leadership

Have the best game selection

Provide leading technology capability

AdvantagesAdvantages

Console introduced earlier than the Console introduced earlier than the competitioncompetition

Plays games from Play Station IPlays games from Play Station I Variety and popularity of gamesVariety and popularity of games Up to date technologyUp to date technology

• DVD play capabilityDVD play capability• Internet connectionInternet connection

ReputationReputation

BarriersBarriers

Keeping up with the high technology Keeping up with the high technology of Microsoftof Microsoft

NintendoNintendo

Strategy:

Dominate the younger audience

Strive to keep loyalty as buyers grow

Draw buyers through popular game characters and cheaper console

AdvantagesAdvantages

A console that is $100 cheaper than A console that is $100 cheaper than the competitionthe competition

Popular game charactersPopular game characters More wholesome games (less More wholesome games (less

violence)violence) Console mobility and simplicityConsole mobility and simplicity ExperienceExperience

BarriersBarriers

A console that lacks the technology A console that lacks the technology of the competitionof the competition

Later introduction than SonyLater introduction than Sony Viewed more for a younger audienceViewed more for a younger audience Not backward compatible with Not backward compatible with

Nintendo 64 gamesNintendo 64 games

The video game industry will continue The video game industry will continue to grow and diversify in its audience. to grow and diversify in its audience. We forecast a split in the market. We forecast a split in the market. One part will be more focused on the One part will be more focused on the family and younger audience. The family and younger audience. The other part will be larger and draw other part will be larger and draw those who are more technical and those who are more technical and seeking the latest and greatest.seeking the latest and greatest.

Sony will continue to keep up with Sony will continue to keep up with Microsoft in technology. In the long run, Microsoft in technology. In the long run, they may loose majority status, but their they may loose majority status, but their game selection will keep them the game selection will keep them the leader for some time.leader for some time.

Nintendo will dominate the younger Nintendo will dominate the younger audience and will try to make audience and will try to make improvements to keep loyalty as their improvements to keep loyalty as their customers grow.customers grow.

Microsoft will continue to be a leader and Microsoft will continue to be a leader and trendsetter technologically. Sony will be trendsetter technologically. Sony will be their major competition, but Microsoft will their major competition, but Microsoft will establish a large market share.establish a large market share.