PS3 console will probably win this generation

[edepot]

It seems that the PS3 is going to win this generation. And the reason is because of a circumstance that is quite unique in the console world. That reason is because the PS3 is the only console that has not been hacked yet, which sort of influences software house's decisions on producing games for it. In the previous generation, it was a level playing field whereby anyone could buy cheap disc copies (xbox, gamecube, and ps2), so there was always a percentage of games that were pirated. The software houses had no choice, so they picked the console that sold the most (PS2) and was fairly powerful. This generation, it seems the PS3 is hack proof, as the disc backup copies on the internet won't work on retail PS3s. So 100% of the profits are recovered (well, almost 100% if you take into account second hand used copy sales) from disc sales. Previously, in an odd way, a console that was hacked actually helped it generate console sales, as people found out that you could download or buy cheap game copies, they invested in the console. If it was not hacked, knowing that the games costs a lot, they would not invest in the console. The XBox360 and Wii is starting to sell a lot because of this predicament (especially now that the consoles are even cheaper nowadays). You can download and burn cheap copies of Wii and XBox360 games. But the thing with this generation is that software houses have access to very powerful hardware which can do surprisingly good games that many people will actually want to to try out because they can't have the experience elsewhere (like PCs). As more and more software houses start investing in creating games that cost a lot, they are shifting resources to the PS3 because of the hack proofness of the machine. Microsoft, who this generation doesn't care about profit in consoles as long as they destroy PS3 and Wii as competitors to Windows, will probably sustain a loss on their console throughout its lifetime (similar to XBox). They will throw billions more this generation and another generation until they have control of the consoles because they sit on a huge pile of cash. Software houses are not benefiting much from the XBox360 versions of games because the number of pirate copies are growing in number such that legitimate sales from PS3 versions are letting them generate more profit even though the PS3 has a smaller user base. Wii, because the hardware is sold as a profit, is less of a worry for a poorer Nintendo, as they can sell them without worry that software houses don't make a profit, or users don't purchase inhouse games. They can simply just make money from people who buy their consoles. The piracy loss affecting third-party software houses not making games for the Wii won't affect Nintendo that much because Nintendo basically tries to sell their own software, and most of their own games includes hardware peripherals that you can't copy. So the major loss is third-party houses that make games on the Wii if piracy persists.

So what is this leading to? As software houses start making less and less money because of the more and more piracy, they will find that they make more profit with PS3 versions of the games. Soon they will switch over to making games for the PS3 primarly because that console has no piracy. Similarly, making games for the Wii is not beneficial because most gamers on Wii only buy first party games (those that include hardware peripherals), and the Wii has been hacked with all games available on the internet (same as XBox360 games). These situations will end up forcing new games to be only on the PS3, which will in the end let PS3 sell more hardware. The tipping point is just around the corner, when all new third-party games will start showing up on the PS3 first.

In the mean time, Microsoft will continue their path of destruction of throwing billions and billions selling their console at huge losses, with a strategy of saturating the market with XBox360s so Wii and PS3 don't get enough market-share to attract software houses creating new games on those machines first. Originally they thought maybe they can recoup some of the losses on Gold XBox Live accounts, but with Wii and Sony both having free online multi-player Microsoft will probably scrap the monthly fees soon to follow their lead. They will also throw money buying exclusives and new content. But the problem with this strategy this generation around is that oddly PS3 is not hacked, so the incentive to create software for the PS3 is very high, which may end up being a major driving force for the PS3 to win this generation.

So what is the conclusion? The PS3 is going to win the software houses because it is not hackable, and this will be the stimulus for propelling the machine past Wii and XBox360 when the new games show up on it. But if the PS3 is hacked once the new games have shown up, it may help boost the sales of the PS3, as there is a segment of society that will probably not purchase a PS3 because of the high cost of games, but will invest in a console when they can get an alternative way to get copies of the games. So Sony may benefit from this if they get their PS3 console hardware profitable like the Wii, instead of a loss (a huge loss like on the XBox360).