A recent interview with Micheal Pachter made me think about what he’s been saying for the most part over the last few years. One thing he’s been touting over and over was this idea that console devices will fall out of favor with consumers and that, when gamers can play Call of Duty on a smartphone, they would all shift away from dedicated gaming machines. However, this reveals more about how little Micheal Pachter understands the gaming community and their spending habits.
Sure, mobile gaming has skyrocketed to become the dominant driver for revenue to companies, mostly Chinese. However, this only proves that gaming has become mainstream enough for the average consumer to get into it. Think of mobile gaming as a gateway drug towards the gaming market for many who traditionally wouldn’t have entered it in the first place. These consumers, once they grow tired of the mindless single-purpose experiences mobile offers, might look into consoles or PC games to gain access to more thought-provoking narratives. The number one reason most gamers get into gaming is because of realism in graphics and mobile, as fast as it moves is still limited to the size of the device and the power it consumes.
One could see this in action as to how popular the PlayStation 4 console has become in recent memory. It is currently on track to beat the PlayStation 2 in sales, making it the most popular gaming console Sony has ever manufactured. Tie this into the popularity of the Nintendo Switch, which shows you that it doesn’t really matter whether or not the consumer could play games on PC—of which everyone has one—it means that it gives them an easy way in.
With streaming services being thought of as the future of gaming, more so by Micheal Pachter, the issue here is that dedicated gaming still offers consumers the benefit of not having to be connected when playing games. The Nintendo Switch is popular regardless of its lack of online capabilities found on the standard smartphone. Consumers want ease of access, and being able to download a game to your hard disk, and being able to play it regardless of how good your internet connection is, or if Sony’s PlayStation Now is able to stay online for five minutes out of the year, makes streaming services a very difficult sell.
Microsoft has seen this trend towards gamers not willing to spend the same amount on AAA games each year. Having these games becoming increasingly expensive to build just makes the case for where Microsoft can offer these games at a subscription after the initial retail sales period (much like the movie industry), giving companies a recurring revenue stream without downgrading the experience with archaic streaming experiences. Even with fiber, the entire world will not be able to stream Call of Duty latency free via PlayStation Now servers, not unless some revolutionary new technology comes along.
Microsoft and Sony have been evolving the console market, and the latest mid-generation refresh proves that both these companies have realized that making consumers and developers toil away on outdated hardware for decades on end isn’t practical anymore. Consumer technology moves fast and if consoles can’t keep on giving consumers the latest technology, they will die, as consumers move on to greener pastures. Powerful hardware will remain a cornerstone of the gaming community, and pretending that this will not be the case when streaming becomes popular means not only will powerful smartphones become obsolete since you can “stream your apps”, but so will the entire PC hardware space suffer because of it.
Console hardware isn’t dying. Maybe in some far flung future where everyone is perpetually connected to a high-speed zero-latency neural network, it might work, but with today’s physical limitations it’s just not happening. Micheal Pachter should rebrand himself as a futurist, not an analyst.
Dreyer was a regular ICXM contributor between 2016–2017, publishing 139 articles across opinion pieces, game reviews, Windows and PC, and Xbox news. Their work focused on hands-on reviews, platform commentary, and breaking-news reporting during the Xbox One X launch year and Microsoft’s wider Play Anywhere / UWP gaming initiative. They post on X as @dreyer_smit.