Nintendo, Sony, Video Game case free essay sample

The video game industry has gone through six generations of consoles, and the seventh is now underway with new consoles from Nintendo, Sony, and Microsoft. Atari led the first generation of the video game industry. They were able to create the first home video game Pong in 1972, and they were the first to develop the interchangeable cartridge and the joystick. The creation of the interchangeable cartridges allowed for third party independent video game developers to enter the market. Atari failed to develop a system that controlled who could develop games for Atari consoles, so the company eventually failed when low quality games created by independent developers flooded the market and caused prices to plunge. Nintendo was able to become the leader of the video game industry in the next generation by entering licensing agreements with third-party game developers and by instituting a â€Å"Seal of Quality† policy where no game could be published without Nintendo’s approval. We will write a custom essay sample on Nintendo, Sony, Video Game case or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page Nintendo’s success with developing popular in-house games like Super Mario Brothers also contributed to their success in the second generation. However, Nintendo let Sega enter into market and take over as the next leader in the industry when Nintendo mistakenly delayed the release of their 16-bit console to avoid cannibalizing sales of the 8-bit console. Sega took advantage of Nintendo’s mistake by offering lower prices for their new console and games. Sony took control from Sega as the leader in the video game industry from 1988-2005 by targeting more mature audiences for their video games and being the first to install DVD-playing capability and Internet connectivity in the consoles. However, Nintendo was able to take over the lead in the most recent generation from â€Å"forward looking† Microsoft and Sony by being able to attract demand from younger and older audiences. This has caused Sony to reevaluate their strategy for the upcoming new generation of video game consoles. Sony’s target market has traditionally been core gamers, Males aged 14-34. The Wii, while popular with a wide audience, was unpopular with this core demographic because it did not feature the games core gamers loved like Grand Theft Auto and Halo. The Playstation brand is strong because it’s the most powerful system available with the best graphics and games that core gamers love. The poor sales of the PS3 thus far are attributable to Microsoft’s first mover advantage and release delays, similar to Nintendo’s problems in the 16-bit generation. Now that the PS3 has been released, Sony can make its push towards industry leadership by focusing on this core demographic, offering exclusive games, and using its superior graphics and system power as a competitive advantage over Microsoft. While games for more mature audiences should be Sony’s focus, they cannot ignore the expansion of the video game industry into new demographics. However, marketing the PS3 too heavily to these new audiences could dilute the PS3’s cool factor to core gamers by casting it as something their grandparents can play. The Wii has already captured the cool factor for non-typical gaming demographics, and pushing the PS3 in this direction would alienate its core users. Instead, Sony should allow third-party developers to create games for younger audiences so that the younger siblings and kids of core gamers will not be left out on the PS3, but avoid focusing marketing campaigns for the PS3 on these new demographics. This would make the console inclusive for new demographics, but avoid alienating core users while pushing for dominance in the core gaming market. Sony should also continue to move the PS3 towards being a digital living room hub. The Xbox 360 is marketed as an all-encompassing living room experience that replaces the need for movie and music players, and sometimes PCs. Not recognizing this shift in how consoles are used in the home would be harmful to the PS3, and they could lose buyers based not on their video game experience but because it is lacking digital hub features that are becoming basic. Sony should expand their living room experience by allowing third party downloadable apps that add on to the digital hub, and take advantage of Blu-Ray’s industry victory by packaging the system with movie discs. Sony can regain its industry lead by becoming the go-to console for core gamers and pushing for games that are inclusive of all demographics. This can be accomplished by heavily marketing the system as the most powerful system on the market while offering an extensive catalog of games, especially their exclusive game catalog.