playstation versus windows 16 november, 2002 by johnmichael patrick monty monteith

As most of the visitors of this site already know, Microsoft takes a loss on every Xbox sold. Estimates are Microsoft is currently losing about fifty percent on their game hardware. There are precious few companies in the world that could afford to lose billions on a hardware device. So, why would Microsoft throw away a ridiculous sum of money on a machine that has a fraction of the sales of Sony’s Playstation, and even is falling behind Nintendo’s GameCube? Many think it is to try to make big bucks selling cutting-edge games to the masses. It isn’t. The real reason Microsoft is willing to give away billions on a game machine that will never compete with the Playstation is that Bill is scared of losing his Windows monopoly to Sony.

If we look back on Microsoft’s history we know that Bill & Co have no problem giving away products to hold on to their operating system monopoly. Microsoft has a history of including software in their operating system to kill off competition. Whether it is DriveSpace, Internet Explorer, Java VirtualMachine, or MSN Messenger, we all know that Microsoft will do anything legal (or illegal) to stop someone from encroaching on the Bill Gates Windows monopoly.

Is it purely coincidence that the gap between ‘game machine’ and ‘home computer’ has been narrowing rapidly in the past few years? Do you suppose it caught Redmond’s attention when Sony’s Playstation 2 has USB and Firewire ports as well as an expansion port for hard drives and Ethernet connections? Redmond is probably not concerned at all that Sony has a large hardware wing known for developing cutting edge hardware and software. No worries about the fact that the Playstation 2 runs Linux very nicely on its fast processor and video system. And surely Microsoft would not give a thought to the fact that Sony is one of the few companies that could compete with Microsoft in a financial OS war.

When we look to the next version of the PlayStation there are some features that most people feel are likely: USB2 ports, Firewire, large hard drive, fast processing power, built in Ethernet, wireless capability, powerful OS running it all. And how difficult would it be for the next PlayStation to browse the Internet, download email, do digital video and audio editing, and run a Microsoft Office compatible suite of applications? All this without running a single piece of Microsoft programming.

If you think this is far fetched, look no further than the Japanese market where the number one DVD player in use is none other than that Playstation 2. If Sony can capture the DVD market, is it far-fetched that they might gain a percentage of the home computer market? How many cutting-edge gaming computers have not been sold because people have bought a Playstation instead? Which would a home computer user be more likely to pick for their digital camera picture editing: their Playstation hooked to their living room TV, or a Microsoft Windows powered computer? The fact we have to even think for a second about that question gives Microsoft the willies.

While there is no confirmation that Sony is going to release a version of the Playstation that will compete directly with Windows home sales, there is no question that Sony is giving it thought. They have already proven that they can take over the gaming and DVD markets. They already have formidable home computer products (Vaio, Clie, digital still and video cameras) that are moving up or leading their respective markets. The execs at Sony must be eyeing the cash cow that Redmond currently owns and licking their collective chops.

Think about the possible coup two years from now: Sony releases Playstation 3, a new game console that penetrates the market as quickly and effectively as the two devices before it. With the purchase of a separate keyboard, you can hook your Playstation 3 up to your broadband connection for email and web access. With the purchase of the seventy-dollar Sony Office CD, you are compatible with Microsoft Word and Excel documents. You can hook up any Sony video / audio device to the Playstation 3 and edit movies, pictures, and audio with a few clicks of the oh-so-easy-to-use Sony OS. Why would Joe Consumer need a Windows home PC?

This is why Microsoft created the Xbox. This is why Microsoft wants desperately to steal away the computer gaming market from Sony. By starting the war now, Microsoft has a shot at saturating the gaming market just enough to keep Sony from being able to reach a critical mass to complete with Windows. Fortunately for consumers, Microsoft is losing the battle. The only question remains: Will Sony decide to take a piece of the Redmond cashcow?