There are not 3 consoles today. THere are DOZENS. The ‘premium’ consoles (360, ps3, wii), the budget/price-waterfalled consoles (AFAIK, you can still publish a PS2 game), there are budget/dedicated consoles (like the retro-atari ones that come with 20 games built-in), there are kids consoles (leapfrog and one or two other companies make them – same razor/blade biz model), and there are console biz models on multifunction devices like set top boxes.

The bigger the market grows, the more opp’ty that a niche segment can sustain a console targeted/dedicated to just that niche.

Jaffe’s comment is pretty naive if taken at face value. If he’s really saying ‘there will be one winner in the premium/high-end space, and others won’t have the capital to invest and keep up/catch up’, then it’s plausible. I disagree, but it’s a plausible theory.

Did you see this article about the potential XM/Sirius merger?

Hadn’t seen it — thanks for the link!

I don’t know as much about satellite radio as I probably should. That said: I believe these companies have been (and are predicted to continue) losing money hand over fist. The market’s ability to sustain two companies is an important consideration. Also, a question: are these companies Pepsi and Coke, or are they both Pepsi wanna-be (battling traditional radio, which would be Coke?) Anyway, that’s enough from me since I know almost nothing about the satellite radio market. ;-)

I wonder what your thoughts are on potential mergers in the space as it exists now

I think you’re more likely to see an outside juggernaut try to buy Nintendo (or, to a lesser extent, Sony) than you are to see a merger of existing console manufacturers.

Can you see a scenario where we’d see one less player in the space due to a merger or buyout?

One less player is possible, though the cause may not be merger or buyout. Hard to say anything more than that (outside the realm of very wild speculation.)

Did you see this article about the potential XM/Sirius merger (http://www.engadget.com/2007/02/21/sirius-and-xms-merger-presentation-revealed/)?

I agree that a unified box isn’t likely (particularily given the fact that we are seeing greater and greater diversity in what people want from their gaming boxes. Mobile, portable, casual, online, etc) but I wonder what your thoughts are on potential mergers in the space as it exists now (or in the next few years).

Can you see a scenario where we’d see one less player in the space due to a merger or buyout? If so, who?

-Ben

What do you think of Costikyan\’s argument that first-party gatekeepers to digital distribution means (i.e. XBLA, Wii Store, PS Network) attain a new hegemony by displacing third party publishers from the equation?

Fundamentally untrue. You can’t “displace” third party publishers — not unless you’re feeling suicidal from a business perspective. What do you think would happen if Xbox told publishers, “Hey, we’re cutting you out of the whole digital distribution thing! Nyah nyah!” I’ll give you a hint: something very, very bad would happen to our overall content pipeline.

XBLA has a dedicated “third party publishing process” that is designed precisely to keep publishers happy (and keep their valuable content flowing into XBLA.)

I should dig up my analysis of the industry I did in B-school last year that showed there would continue to be multiple consoles and see if it still holds true. Honestly, I think that we’ll continue to have consoles — and multiple consoles — until such time as the structure of the industry changes (or, what you called the redefinition of “console”).

Although I can see how one console would help developers, since they’d only need to make games for one platform, I can’t imagine that publishers (or developers!) would be happy having to deal with a single market-controlling monolithic entity.

Given that technological change would still occur and require a new system every few years, I don’t see any real benefit to consumers. As difficult as they can be, market forces are good for some things.

And one last nitpicky practicality point: if you have this standards commission, what happens when a player wants to leave or enter the market? Does SEGA still get a say in consoles after they become a software house? Does Microsoft get a seat before they have a product on the shelves? What about things like the Phantom? What about the handheld market? Games on cable boxes? Yikes, what a can o’ worms!