Two weeks ago, rumours were running wild that Valve would jump into the console fray. The rumours were quickly squashed by Gabe Newell, but it didn’t stop some from dreaming. Maxator summed up the hopes of many gamers on his blog.

I think the stage is set for a new console player. If The Valve rumors are true, they choose their hardware well, throw in a slick interface, and court software partners, even those with competing online distribution systems, they will have a winner on their hands. So if Gabe Newell and company announce hardware at E3, I’ll be first in line to preorder a SteamBox. Who’s with me?

We weren’t with Maxator, because the notion of a Steambox doesn’t make sense. Maxator compared the state of today’s console gaming industry with the industry 12 years ago when Microsoft entered the fray, and similarities aside, it’s still comparing apples and oranges.

First and foremost, Steam is a Windows-based product, and a distribution method for Windows-based games. Microsoft was able to leverage their operating system (OS) expertise and enable developers to quickly port PC titles to a watered-down version of Windows still utilizing Direct-X. Valve doesn’t control an OS however, so they make for a poor parallel to Microsoft. More succintly put, Valve’s experience is with writing software for another company’s OS. For Valve to ship a Steambox, they’d need to license Windows, a cost Microsoft never had to endure.

If Valve didn’t license Windows, they’d need to delve into an area foreign to them: OS design. And if they did that, the ease of porting titles thanks to relying on Windows APIs and Direct-X is no longer possible, and that’s the biggest draw to a proposed Steambox.¹

Another important consideration is that PC gaming is very different from console gaming, and not just in genres and gameplay, but in the types of gamers themselves. Microsoft realized that their plan to rely on PC-based hardware wasn’t sustainable long-term, and that customized hardware needed to be developed for the XBox 360. That’s because PC games are designed to run on current-generation hardware, and PC games tend to push the envelope in regards to what that hardware can do. What we see is PC gamers who are constantly in an upgrade frenzy, swapping out video cards or more major components on a fairly routine basis, with developers generally supporting the latest hardware, rather than sticking to what’s been around. These types of upgrades aren’t possible with consoles, which is why custom hardware ensures that a console is relevent for a longer period of time.

The point here is that even if Valve found a way to license a Windows-based OS for use in a console and still pull a profit, and support PC control schemes that the target audience would want, it’s unlikely that PC gamers would care; since Steam is already available on PCs, and gamers want the flexibility to upgrade hardware as it comes out, why would they ever choose to buy a Steambox?

It comes down to a misunderstanding of what PC gamers and console gamers want. Just as you can’t lure a PC gamer over to a console full-time, you can’t get console gamers to buy into PC gaming, even if you ported select PC games to a console. It’s not about casual vs hardcore, either.

Ten years ago, Microsoft took advantage of Nintendo moving to casual gamers and Sony focusing more on Japanese gamers than profitable Western audiences. De Ja Vu? Now it is Microsoft shifting to casual gaming and social computing and Sony is still focused on the Pacific rim. Core gamers are hungry, advantage Valve.

What Maxator identifies as “core gamers” are a minority. Those who crave PC gaming titles game on the PC. The movement towards casual titles on consoles is driven by the market, because your average console gamer is now from the broader population, whereas PC gamers are still primarily younger, tech-savvy males. In every market that this demographic broadens, we see a move to more casual gameplay, which we can easily see in the evolution of games like World of Warcraft.

The bottom line is that if you want to play PC games and love Steam, get a PC and use Steam. Valve would be stupid to compete in the console wars offering the same old product wrapped up in a non-upgradeable package that gamers connect to their TVs. A much more innovative solution would be to leverage technologies that bypass the rapid upgrade cycle that defines PC gaming, and that’s where services like OnLive have come in and found success. For a Steambox to succeed, it has to offer everything Steam does today, and more. Simply dumping Steam onto a console isn’t going to do that.

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Since 2007′s release of the iPhone, Nintendo has adamantly opposed the device in favor of its own mobile consoles, much as they’ve done with every competitor’s hardware in the past. And Nintendo has a legacy to stand on, with the NES and SNES and even the N64. But things kind of break down after that, as competitors moved to optical media and basically left Nintendo in the dust. With the Gamecube, Nintendo attempted to get back in the game, but it wasn’t until the Wii that they were finally back in the good graces of the gaming populace. But even that momentary lack of judgement on our part has faded, as Nintendo’s ability to capitalize on the Wii’s innovations leave us with a few nice gimmicks, but ultimately little staying power.

The argument for Nintendo has been two-fold:

1. Nintendo will use the momentum of the Wii to finally offer competitive hardware in their next console.
2. Nintendo still has the mobile gaming market locked down.

Early reports of the Wii successor leave little to drool over, and the mobile market has slowly been pushed into iPhone territory, even though Nintendo ironically called it a novelty. It’s one thing for Nintendo to have dismissed the iPhone in 2007, but year after year is no longer excusable, especially when their countermeasures are a poorly performing 3D Gameboy. Nintendo’s now no longer leading much of anything, other than a steady march to the grave, much as SEGA did when they fell over thanks to the Dreamcast flopping.

There are investor calls for Nintendo to develop for iOS, but we’re still seeing push-back. It’s the same stubborn push-back that Nintendo of America has been cooing for the last couple years, and now it’s coming straight from Japan. “No, we want our software to run on our hardware.” Nintendo must be quoting a long-lost SEGA exec. The problem is that Nintendo’s hardware is, in a nutshell, crap.

Nintendo does one thing well: it makes great games. Old ports would be wonderfully on the iPhone, let alone new games using Nintendo IP. It’s a no-brainer to bring these titles over, and if Nintendo really wanted to brand some hardware to go along with it, we’d gladly support an iPhone sleeve with hardware bluetooth controls to go along with it.¹

If Nintendo doesn’t wake up soon, they’ll be forced to go this route anyway. Why not capitalize on the transition early instead of blowing more capital on failed hardware projects?

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We’ve been somewhat critical of the Apple TV as a gaming console, and when we last wrote about the subject, we proferred that the key to Apple’s gaming platform success was already achieved in Apple’s mobile devices:

Technologies like AirPlay, or even video-out adapters, may well serve gamers to stream iPhone and iPad gaming to the big-screen, and this is where we expect to see additional innovation. Why tack on additional costs to the Apple TV by offering new controllers, or muse about potential storage solutions, when we already have capable storage on existing iOS devices?

John Gruber linked a comment from Phil Harrison, who was involved in the original Sony Playstation launch. The future of Apple, Harrison contends, is also the future of gaming. And Gruber responds by noting that the Apple TV doesn’t even support apps yet, as though to point out how the Apple TV will be another salvo aimed at the console industry. But as we pointed out back in April when we talked about the Apple TV as a console, the changes Apple would need to make to the platform to complete against the traditional console market is unecessarily complex, and the more likely scenario Apple will pursue is much easier to envision:

The Apple TV doesn’t need gaming apps, it simply needs to present the apps already on our iOS devices to the big-screen. Everyone thinks the Apple TV could be another platform for Apple to push, but its true strength is in acting as a bridge between our existing Apple devices and the television. Just as it already streams music, photos, and video from our devices, the Apple TV could be leveraged to present a gaming experience served up from these same devices. The issue then is not adding controllers and storage to the Apple TV, but adding an Apple TV to our iPhones, iPads, and Macs.

Or more simply put, mobile Apple devices shouldn’t be seen as accessories to the Apple TV; the Apple TV should be considered an accessory to mobile Apple devices. We can take this further to say that the Apple TV will never be a gaming console, but it will be the accessory that brings the console experience to the home, thanks to bridging audio and video from iPads and iPhones to the family TV. The proof-of-concept was playing iPad games on TVs thanks to a wired adapter, but the release version of this technology is AirPlay, which already works fairly well for conventional media. With iOS 5, AirPlay will work for streaming audio/video from games to the TV as well, and as Real Racing 2 for the iPad illustrates, the technology will allow mobile devices to display additional information, while the main visual output will show up on the TV.¹

There’s still the small issue of storage, because 64GB max on the iPad means that only a handful of truly deep games can sit in one’s future Apple console library at a time, but that storage limitation will slowly disappear. Plus, the reality is that many gamers are content playing games that don’t require massive storage requirements for graphics files and video, so just how serious this storage problem will be is questionable over the course of the next couple years.

We fully expect gaming developers to implement AirPlay functionality in future titles, to at least supplement the gaming experience There’s no need for Apple to compete for shelf-space in Gamestop, because beyond their digital distribution of games thanks to the AppStore, Apple’s console is already being shipped in several form factors thanks to the iPhone, iPod Touch, and iPad. The Apple TV is just icing on the cake.

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Over the past couple days, we’ve seen considerable speculation about Apple’s involvement in television manufacturing; some wish to believe that Apple will delve into the TV production business, while others are critical in this regard. Others still are taking this opportunity to point out that doubting Apple’s entry in a given market has a poor track record, what with Apple having releasing the iPod, iPhone, iPod Touch, and Apple TV not long after pundits proclaimed these endeavors too risky, or too unlike Apple.

What’s certain, at least, is that Apple doubled down on their “hobby,” the Apple TV, when they released an iOS-based version costing just under a hundred bucks. The device is plug-and-play, easy-to-use, and is already offering alluring new features thanks to fancy licensing deals with Netflix, Major League Baseball, the NBA, et al. Indeed, the Apple TV is being positioned as an alternative to cable television, offering a consistent experience across markets that do not share the same cable provider. More importantly, the a la carte television and movie programming has gotten substantially better over time (addressing a chief complaint we’ve had with the Apple TV for years).

So Apple TV’s getting better, and that means Apple has an excellent weapon they can use to continue infiltrating an otherwise chaotic industry, offering a clean, consistent experience that potentially rivals the experience cable operators offer. Lessien believes that Apple can leverage apps, iAds, and subscriptions to even further promote the Apple TV, where apps pay homage to the living room gamer.

Apps, in particular games, give Apple an opportunity to extend their hugely successful mobile development platform into the living room. Low-priced apps, immediately downloadable, connected via GameCenter, controllable with iOS handheld devices just make sense. Nintendo, Sony and Microsoft should be nervous.

There’s still a question as to how apps will work on the Apple TV, because to date, third-party Apple TV apps have been part of official iOS updates, not voluntary installs from an Apple TV AppStore. And then, of course, are the issues with transforming the Apple TV into a console replacement.

What of the controller?

The Apple TV comes with a lone remote. It’s a nice, simplistic remote, and in no way capable of working as a good console controller. The notion of using iOS devices as controllers is a worthy one, with such functionality easily worked into Apple’s Remote app. But whether it can technically be done or not is hardly the issue. Rather, if Apple planned to situate the Apple TV as a console replacement, it wouldn’t drastically increase the adopter fee by requiring a controller purchase several times more than the cost of the Apple TV itself. While many people already have iOS devices they can use for this purpose, Apple won’t make that a requirement any more than they made having an iPhone a prerequisite for iPad cellular data service¹.

The alternative to buying up older, second-hand iPhones and iPod Touches is simply buying a new iController that only runs the Apple Remote app, or perhaps runs a specific iController app that allows developers to create skin-able controller layouts for various games. The controller wouldn’t need an A5 processor, much storage, or RAM, and could rely purely on bluetooth for connectivity. With a gyroscope for added functionality, this iController could probably come in at a reasonable price-point, so families could pick up an Apple TV, two iControllers, and a multi-iController charging dock for under 200 bucks.

Such an iController would clearly be wireless, and would have a sufficient battery life for prolonged gaming sessions. But, without tactile feedback, and being limited to virtual buttons on the device face, there’s an obvious question of how capable the device would be compared to the multi-button monstrosities that modern gaming controllers have become. That’s not to say that a simpler, more polished interface isn’t an attractive proposal, but this could be considered a major flaw when compared to consoles whose controllers offer a button for every conceivable action in a given game; Apple TV games may inherently need to be simpler.

The only other option is let the Apple TV interface with bluetooth-enabled gaming controllers of a more conventional form, but this then becomes a contrary force to the multitouch philosophy that Apple has pushed for iOS. In order for Apple to remain consistent in this regard, we see it challenging devices like the Wii, but not button-heavy consoles like the XBox 360 and Playstation 3. Ultimately, if the Apple TV is to compete in the console wars, it needs to find a way to offer the same titles that other consoles do, and that means offering a controller scheme that’s not weaker in comparison.

What of the storage?

The Apple TV doesn’t have a lot of storage. In fact, it’s designed to stream content, not download it. So when we talk of games, anything substantial is no longer a possibility. Yes, Apple could allow the attachment of an external hard-drive, but now we’re again pumping up the cost of the device and making it less accessible. If Apple decided to increase the Apple TV’s storage, we could get away with simpler, casual games, but to truly compete with the big boys, we’d see games many gigs in size. That’s not to say that Apple couldn’t position the Apple TV as a casual-friendly console and compete exclusively with the Wii in this regard, but why limit market penetration to such a niche role?

The only other option is to stream video, and here, Apple may have a sound strategy. That is to say, Apple has already proven it can get content owners on board with its platform, as seen with record labels, movie studios, and TV broadcasters. So, if Apple decided to take on OnLive, and use the Apple TV to stream gaming video feeds, then storage isn’t an issue. However, this seems contrary to the AppStore ecosystem Apple has established to date, and makes rolling out a nation-wide, consistent experience difficult. That’s not to say such a move isn’t plausible, merely unlikely.

What of established iOS gaming?

With no clear solution to the problems of offering low-cost controllers and storage for the Apple TV, there’s nothing Microsoft and Sony need to worry about just yet². Apple would likely do a much better job than OnLive for getting a streaming library of games available to a wide audience, but the technology here is still too young for widespread adoption. Apple is better off focusing on how they can situate the Apple TV as an every-man device, and look to entering the set-top console fray at a later date.

Where traditional gaming companies need to watch out is Apple’s continued domination of the mobile space. Technologies like AirPlay, or even video-out adapters, may well serve gamers to stream iPhone and iPad gaming to the big-screen, and this is where we expect to see additional innovation. Why tack on additional costs to the Apple TV by offering new controllers, or muse about potential storage solutions, when we already have capable storage on existing iOS devices?

The Apple TV doesn’t need gaming apps, it simply needs to present the apps already on our iOS devices to the big-screen. Everyone thinks the Apple TV could be another platform for Apple to push, but its true strength is in acting as a bridge between our existing Apple devices and the television. Just as it already streams music, photos, and video from our devices, the Apple TV could be leveraged to present a gaming experience served up from these same devices. The issue then is not adding controllers and storage to the Apple TV, but adding an Apple TV to our iPhones, iPads, and Macs.

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World of Goo is an impressive indie title, which appeared on the iPad not long ago, though it’s been available on other platforms for quite some time now. Developer 2D Boy comments on World of Goo’s iPad success:

In the first month of sales on the iPad App Store, World of Goo sold 125K copies (thanks to being prominently featured by Apple). In comparison, World of Goo’s best 31 day period on WiiWare was 68K copies (thanks to a mass mailing by Nintendo), and on Steam it was 97K copies (thanks to two promotions at discounted prices). So far, the iPad version is by far the fastest selling version of the game, both in terms of number of units sold and in revenue generated.

John Gruber correctly points out that, “This is what makes iOS different than Android.” But more importantly, this is why companies like Nintendo should be fearing Apple right now, instead of ignoring Apple’s success in the gaming sphere. Even if you dismiss iOS as a platform that “hardcore” games can be greatly successful on (which we’d argue), you can’t deny that volume sales of low-cost games are breathing new life into the indy game scene, and forcing larger publishers to rethink how they market future titles.

One has to wonder what Square’s thinking is when publishing a $15 title on the AppStore, when the top grossing games are sold for significantly less. There’s this odd mental block that some traditional developers just can’t seem to get over, in which they believe they are devaluing their work by selling it for cheap, even if the total profit in the end would be greater. We liken this in some ways to the print industry, who is still failing to adopt to today’s new media en masse.

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Twenty-one months ago, we expressed skepticism over OnLive, the gaming service offering streaming video games over the internet. In that time, OnLive has left beta, and recently offered it’s “microconsole” for $100. Still, OnLive’s growth has been slow, to say the least.

After our article went live, it didn’t take long for someone (Darq) at onlivefans.com to respond.

On the topic of OnLive struggling to have an attractive library, they already have some of the leading names in the gaming industry partnered up with them… I think right now is a poor time to judge the game library. I imagine that there are many skeptics out there that will decide to partner with OnLive and offer their games after the beta this summer.

Twenty-one months later and OnLive has 38 games available (we’re not counting expansions). And if we discount sports titles with “2010″ subtitles that now have 2011 releases, the already-abysmal library is even smaller. That’s today. Is now the right time to judge OnLive’s game library? The sad thing is, how many games were available 21 months ago? Is OnLive even meeting the goal of one new release per month?

Maybe it’s a testament to the service that OnLive was able to bring games like Borderlands and Batman: Arkham Asylum to the table, but these titles do not make up for the many other big-name games that are available for the XBox 360 and the PS3, which are simply missing from OnLive’s library. And, even these former big-name titles are yesterday’s news in the console world, where pre-used prices are less than OnLive’s pricing.

Yes, OnLive is cheaper than a console because there’s no necessary hardware cost if you already own a computer and a controller, but the lack of titles is a serious matter; even the Wii has a more enticing library for hardcore gamers than OnLive does. Maybe with OnLive, you have a few more dollars to spend on games, but since there’s a real limit on how many games you can feasibly buy (never mind how many games you’d actually want to buy from that limited selection), the price savings for OnLive may very well be irrelevant.

One of OnLive’s more promising offerings is the idea of streaming MMOs, since this is a gaming niche that many console gamers simply can’t participate in. Yet, OnLive has nothing to show in this area, either.

I believe you’re exagerating OnLive’s inability to cater to the add-on/modding or customization community. OnLive already has started promoting their SDK, and with their push on a community driven player experience I see them have a large focus on being able to mod for games that wish to support it.

Why still no MMOs On OnLive (a gaming niche that PC gaming is known for)? Not only has OnLive not addressed whether they can realistically support client addons for MMOs, but they don’t even have a single MMO announcement yet. There’s no point in us even addressing addons/mods for other games, since these are clearly a pipedream at this stage in the game.

Does OnLive have potential? Certainly. But given its performance on our home FiOS connection, and the absolute lack of games, the service doesn’t seem to be doing well for itself. If subscription numbers are going up at all, it’s certainly not because of the gaming library, and we can’t imagine people sticking around for more than a couple months if things don’t change for the better soon.

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That iOS games are threatening the traditional mobile gaming market is no longer a surprise. Today, TiPb declared that iPhone games may very well be the platform’s “killer app.” And maybe there’s some truth to this, but let’s be honest: iOS games won’t stand ground with console giants for a couple simple reasons.

The hardware: it’s fragmented.

As much as we like to dismiss the Android platform realized (versus the platform in theory) because of how fragmented the operating system is, all mobile devices in this market are inherently fragmented on the hardware side. That’s because the big push is to drop a new, upgraded model into consumer’s hands every year, and that doesn’t work well for mobile gaming devices.

Consider that Nintendo’s Game Boy was on the market for 10 years before the Game Boy Color was released. It would be another three years before the Game Boy Advance, and three more before the Nintendo DS. When the Nintendo 3DS hits shelves, the DS will have been around for six years.

The other major mobile offering, Sony’s PSP, was released in 2004, and the PSP2 isn’t scheduled for release until Q4 2011 at the earliest. So despite minor hardware improvements, the platform itself will have been around for seven years.

Now look at iOS devices. Come next summer, we’ll be on the fifth-generation iPhone, with each year seeing speed improvements. It’s one thing for Apple to stop supporting the 2G iPhone three years after its release, but we’ve also seen Apple drop iOS features in the iPhone 3G a mere two years after its release. There are even games in the AppStore that recommend an iPhone 4 for maximizing one’s gaming experience.

In this respect, Apple’s iOS devices are more like PCs in the gaming front, with newer games making use of better and newer hardware. The console market, in the meantime, is all about maximizing the capabilities of older hardware, such that newer hardware could be pushed off for years to come. The mobile space, as much as we want to compare it to consoles, is really only a console in terms of usability, not hardware stability over time.

Granted, things may shift just as they have for the PC market, in which hardware growth has slowed tremendously. If Apple is really making more money long-term on the AppStore and iTunes than they are on hardware improvements, then they could afford not to refresh their hardware every year. But that means Android phones, and devices from other competitors, would similarly need to slow down their hardware rat-race.

The storage: it’s lacking.

Still related to hardware, iOS device storage isn’t great. For most apps, or even multimedia in general, the current storage offerings are sufficient. But when the typical FPS comes in at several GB, iOS users will be expected to have 4+ GB of storage space per blockbuster title, and that means space quickly begins to come at a premium unless users decide to only keep one or two games on their devices at a time.

That’s why games like the revered Infinity Blade and Rage 3D are on rails. Not giving players the ability to roam around freely means developers can put less “stuff” in each title, and that means less textures, levels, animations, et al. And sadly, that sucks, because it means that while the hardware can otherwise support pretty cutting edge graphics, the lack of storage is keeping the mobile gaming market from pushing ahead. If storage weren’t an issue, then we daresay that iOS gaming could challenge any current-gen console, even if the graphics aren’t quite up to snuff (see: Wii).

One interesting outcome of this limitation is that iOS may become the de facto standard for rail-based gaming. Perhaps for non-technical reasons, console-based RPGs became a genre very different from PC RPGs, and a similar genre-generating phenomenon may be forming around iOS right now.

The control scheme: it’s… different.

Touch-based gaming is great for a variety of titles, but it’s not always ideal compared to the haptic feedback one gets from a physical interface. While a degree of control-scheme complexity is possible with iOS, one has to wonder where the limits are. An MMO like World of Warcraft (WoW), for example, would be nigh impossible to emulate on the iPhone control-wise. And that means there will be major concessions in terms of genres of games that iOS will sport. Yes, there may still be hardcore games on iOS, but the platform is clearly better at fostering more casual games with less input requirements.

What can be done?

One of the simplest things developers can do is not push cutting edge graphics, so as not to limit their games to customers who have devices more than a year or two old. Look at WoW, a game released in 2004 that, even then, didn’t push the limits of cutting edge hardware, which can arguably be considered a major boon to its success. (Blizzard has done similar with its previous games, like Diablo 2.) This is in stark contrast to MMOs like Everquest 2 who were more graphics-intensive, thereby not selling as many titles to customers with older hardware.

Games like Minecraft are further examples of unique, expansive titles working well despite not having great graphics. (Intentionally retro stylings are hot right now, bdesides.) And really, while eye-candy is nice to impress, an Infinity Blade-like game with free-roaming controls is arguably more attractive with graphics not as sharp, than the game in its current iteration, which is almost more a proof-of-concept than anything else.

Yes, we know that recent iOS devices have the hardware capable to make audiences gawk at the graphics potential of iOS games, but maybe that’s not where developers should be focusing their efforts for now. Whether rail-based games are fun is not the issue: let’s not pigeon-hole games on iOS to such rigid confinements, even if such rigid confinements make for better eye candy.

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It’s hard to believe that we’re nearing the end of the life cycle for the 7th generation of video game consoles. With speculation growing about what the 8th console generation will bring, Maxator threw his thoughts into the mix.

This generation was extended by the horrific economy and the late addition of motion sensing hardware by Microsoft/Sony and improvement of the Wiimotes with the Motion Plus dongle. That said, the Wii, PS3, and Xbox 360 have all exceeded the previous standard of four or so years between console generations…

It does seem like the current console generation has lasted awhile, but per Wikipedia, that’s not entirely true. It turns out that gauging generation length isn’t straightforward.

One way to determine the duration of a generation is to look at the length of sales for a given technology (e.g. 8-bit). The problem here is that sales length doesn’t account for technology availability causing generational overlap. For example, Playstation sales continued even after the Playstation 2 was launched, and new titles still continued to appear on the Playstation. Disregarding availability of newer technology means that the duration of older generations appear longer. (This would mean that the 3rd console generation lasted a solid 12 years.)

A second method for determining generation length is to consider a generation over once newer technology is available for sale. In other words, rather than factoring in the Playstation’s full sale’s life, we can consider it dead as soon as newer technology (e.g. the Playstation 2) became available. Under this method, the 4th generation has lasted the longest, with a record nine years.

Still, this means the current console generation has already lasted six years, and puts it in a position to last another year or two depending on how quickly the Big Three can bring a new console to market.

Nintendo, the old stand-by.

Compared to its competitors, Nintendo made waves with the Wii by introducing comparatively weak hardware, but at a cheaper price point and with an innovative control system. Maxator believes the “Wii HD” will be revealed at E3 in June.

I expect more of an iterative approach, then an all out new console, similar to Nintendo’s market strategy with the DS. I see a vastly improved processor with the same architecture allowing backwards compatibility with older Wii games. HDMI output for HD resolution is a no brainer and I don’t see a change in the controller…

Backwards compatibility is a must for the Wii, but a small, iterative approach won’t do. Considering that most Wii gamers are casual and/or younger, buyers will be more likely to ask what the huge differences are to justify a hardware swap-out. Merely adding a small speed bump and 1080p resolution isn’t enough, and we wouldn’t gamble against Nintendo finally jumping back into the competitive fray and offering a true graphics-monster. Hardware isn’t taking huge leaps like it did several years ago, which means incorporating cutting-edge graphics into a next-gen console isn’t as costly as it once was.

Of course, Wiimotes will likely stick around, and they may see small, iterative improvements. Nintendo will either continue playing up their ground-breaking motion controllers and keep them primary to the experience (unlike add-ons like Move and Kinect), else reveal an even more innovative control scheme (which is unlikely).

Lastly, for licensing and cost reasons alone, DVD is much more likely than BluRay… Look for a $250-300 price tag.

We’re rather inclined to suggest that Nintendo might forego optical media entirely and just push on with digital distribution. The Wii has been a successful platform for this already, and the technology is no longer proof-of-concept, with XBox Arcade having solidified the concept in gamer’s minds. If a new Nintendo console doesn’t compete graphically with other 8th-gen consoles, then digital distribution is even more likely, since it’s graphics that primarily increase file size. Either way, Nintendo will likely try to come in at the same price-point the Wii did, managing to beat the competition by at least $50 at the register.

Sony, the other Japanese Empire.

The biggest problem Sony had is fragmented, inconsistent hardware. Early PS3s sported on-chip backwards compatibility and a slew of USB ports, while later versions had software-based backwards compatibility that was later phased out. Unlike other consoles, the PS3 has lost more features than it’s gained, and that phenomenon has put many would-be owners off.

Given their entirely unimaginative and conservative hardware philosophy, I see a faster processor, same “gnome hands only” blocky controller, and of course included BluRay and hard drives. Boring but powerful and probably at a significantly lower price point than the PS3 started at, likely $350-400.

Sony has indeed played it safe, focusing its energies on what’s worked in the past, and the next-gen Sony console likely won’t be any different. Cutting edge hardware, a similar controller scheme, and a high price tag are to be expected, being traditional Sony fare. Even Nintendo and Sega played more loosey-goosey with hardware reveals in the past, whereas Sony is sticking to an old formula that may not play out well in the long-run. We’ve argued in the past that Sony’s largest benefactor is its reputation, but with poor moves like removing features over time, that reputation isn’t as strong as it used to be. If Sony doesn’t do more than react to its competitors (e.g. Move), then its 8th generation console will be like the Nintendo 64.

Microsoft, the Evil One.

Microsoft has been reactive to its competition as well, but they’ve taken better notes than Sony. While everyone expected a Wiimote copy-cat accessory, Microsoft responded with Kinect, and they’ve refined their UI and online offerings well. (The 360 UI still sucks, but it’s gotten better.) The big question will be how well Kinect does, and whether a more powerful Kinect accessory will be standard-fare in Microsoft’s next-gen entry.

I still see the “Xbox Next” being drive-free with an optional BluRay drive, ala their approach to the failed HD DVD.

It’s doubtful that Microsoft would suddenly jump on the BluRay bandwagon; they’ve actually signed onto a multi-company agreement not to adopt BluRay, along with such faux allies as Apple. Few companies are hedging their bets on BluRay anymore, and it’s arguably the last optical media format anyway. Just as the Wii has proven to have a good online marketplace, XBox Arcade has proven itself quite successful, offering many indy and older titles. Chances are, the next-gen Microsoft console will keep Arcade alive, and offer bigger, more spectacular games.

Of course, by offering digital downloads for blockbuster titles, Microsoft’s next console will absolutely need a larger hard drive, and for this they may take Apple’s cue and consider going with more reliable SSDs. The only obstacle here is cost, but with a Microsoft 8th generation console release in 2012, that may not be a huge issue, especially if they can skirt optical media and take a larger cut of indy sales.

Apple, the unlikely player.

It shouldn’t be a huge surprise that iOS has become a huge platform for mobile gaming, and with iOS now entering the living room thanks to the new Apple TV, it’s not a huge stretch to assume that Apple may use this as a springboard for home video gaming. We agree with Maxator, however, that full-on support of this isn’t going to happen anytime soon.

Don’t expect Apple to join the console wars anytime soon. Jobs has never made an effort to support gaming and with the entry costs of the console market being so high, I can’t see him hurting his stock price on a longterm risky investment. Plus, they are already happily making 20% on every repackaged Atari game on the iPad/Phone.

While Jobs has spoken to Apple gaming in the past, each Apple gaming headline has stood alone, with no real followup from Apple. With one failed console already on their books, Apple’s only now getting real gaming press because of how successful iOS has become. Apple’s 30% cut on all iOS apps is definitely helping the company out, and the large number of iOS gamers is notable by Apple using games in first-party advertising. But, most huge iOS gaming titles are casual games, and while deeper games on iOS do exist, they’re only now starting to really take off (e.g. id’s Rage).

Any Apple entry into the console wars will be natural, built on developer desire rather than Apple outright declaring a gaming console. Whereas most console companies have positioned their devices as gaming devices first and media devices second, Apple will work the other way around if they do eventually want to offer big-screen gaming. This means that any Apple console effort will remain dependent on the success of the Apple TV, which could easily evolve to support a solid gaming platform built on existing hardware. (Imagine multi-touch, mostly buttonless controllers that look like a handheld Magic Trackpad, complete with gyroscope.)

Dreams aside, Apple is already doing what many thought impossible: challenging Nintendo on the mobile gaming front. Apple doesn’t need to position their devices as gaming devices, because developers have already embraced them as such, even though they’re not really considered gaming devices as far as their primary functionality goes. Still, expect better games on iOS devices as the 8th generation console wars rage, but don’t expect to Apple to take this market on head-to-head just yet.

OnLive, the underdog hero.

While OnLive may not be able to compete in the motion-control arena, it’s a notable platform that deserves mention, even if it wasn’t on Maxator’s list. OnLive is a platform that bridges the gap between PC games and console games, and with it’s “console” client being offered for a mere $100, it already competes with the Big Three on graphical terms. They key to OnLive will be leveraging the success of big-name MMOs, which console gamers might want access to, but may not have the PC desktop power to play well. Since OnLive should be able to scale to play these titles as well as its current library (which is more console-centric), OnLive immediately establishes a niche market that’s still unrealized. The big question here is how fast OnLive can offer blockbuster titles compared to the Big Three, and how fast they can grow their infrastructure. Potentially, however, OnLive can challenge any of the Big Three as far as traditional console gaming goes, and could make hardware upgrades for PC gaming a thing of the past, too.

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If it’s one thing nerds love, it’s pirates ninjas Warcraft zombies. There are zombie movies, board games, games where zombies fight plants, and naturally, an upcoming massively multiplayer online game (MMOG) made for the console crowd.

After scavenging resources, you’ll need to pool some ideas and blueprints together to retrofit the settlement with defenses. The game’s dynamic and malleable physics engine lets you design obstacles, cattle paths and all manner of cruel and ingenious traps to stem the flow of sudden zombie strikes… Banish the memories you have of the PC MMO paradigm for combat, and start thinking AAA console action game.

The post-Apocalyptic, yet-unnamed zombie title, sounds like a hybrid between a first-person shooter and a tower defense game, with maybe a helping of Minecraft thrown in for good measure. And while that may sound strange, our second thought is, simply, “Awesome.”

Or at least, “Potentially awesome.” This is the type of project that sounds fantastic on paper, but ultimately, it will all be about the implementation. And there are already things that sound questionable, like whether this really will be an MMOG, rather than merely servers with procedurally-generated worlds that host 64 or 128 players. But let’s say that there really will be just one big server, and players begin scattered across the landscape almost at random, with perhaps some method to control a spawn point nearby friends (perhaps with a temporary “spawn code” limited to, say, six people.

The idea of running around solo without anyone immediately by your side, with zombies approaching in the distance, requiring you to find some method to defend yourself, is zombie-cliche at its finest. But once you do manage to meet up with your friends, knowing that larger zombie hordes are on the horizon, certainly makes for a good cooperative team-play. This is especially true when you’re fending off waves of zombies with the ability to manipulate in-game obstacles in order to channel approaching zombies into a kill-space, or enforce the walls of a make-shift shelter. But with resources limited (food and water to keep health up, ammunition for ranged weapons, perhaps even fuel for long-distance transportation), your zombie-killing crew can’t stay in one place for too long, and that’s where things could get interesting. Not only will you have to stray from your shelter to find resources, but you’ll ultimately have to return to defend yourself (think night-time mode in Minecraft), where simply being out-and-about isn’t enough defense to evade the zombie army.

Ultimately, you’d see makeshift settlements popping up across the landscape, all player-run, with some defenders staying behind, and other players running “missions” to acquire resources to keep the settlement running. That could be bringing back jugs of water, cans of fuel, gathered food, or found livestock. And bringing those things back could allow you to empower yourself and friends with “research.”

In quieter moments you’ll be able to build out the settlements, even plant and grow gardens within.

Undead Labs seem to be talking growing food, not flowers. Established settlements could provide bonuses to food grown over a longer period of time, just as other player-built structures could provide similar benefits, such as meat grown from livestock, sanitized water, refined oil, et al. Ultimately, we have a reason maintain settlements instead of just using them as short-term defensive hold-outs. And there’d be a reason to defend these settlements not just from the zombies, but from other human survivors.

Think Mad Max and typical post-Apocalyptic fighting, with different in-game guilds vying for raw resources out and about in the world, and raids happening on other human settlements to steal weapons and refined resources. Maybe even outright destroying rival settlements under the the right circumstances.

Okay, so we’re excited at the prospect of this untitled game, and it being more of an action title as far as combat goes means we really wouldn’t need to rely on a keyboard to make this work. Indeed, forcing players to rely on a headset to communicate would be a fun limitation, and a game like this running on OnLive would simply be a dream-come-true.

Of course, we may be jumping ahead of ourselves here, but we can easily see Undead Labs spinning gold thread here, surpassing the Left 4 Dead series as far as zombie games go, and truly pushing the envelope when it comes to MMO player cooperation. It may not be a carebear title, but nothing about zombies should be.

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We haven’t weighed in on Microsoft’s Kinect (formerly “Project Natal”) because we haven’t seen anything exciting about it yet. Maybe it’s better than Sony’s Move, and advancing what the Wii provided from a technological perspective. But let’s step back for a moment and look at where this all began, with Nintendo’s current console offering.

We picked up a Wii on release. We waited in line overnight, for crying out loud. And we did thoroughly enjoy the initial titles we played, but let’s be clear: they weren’t groundbreaking titles. Good titles with motion control, yes, but not groundbreaking titles in and of themselves. Maybe motion control is what made the Wii unique, and sold casual gaming to the masses, and maybe even pushed consoles into family entertainment centers where parents were previously skeptical of consoles as family-friendly entertainment. But as far as titles go, there’s no single Nintendo Wii game that’s more fun to play than any great title on any other console lacking motion control. (For example, the original Mario Kart was no less fun than the current Mario Kart is today.)

Yes, we’ll make a small exception for workout titles; EA Sports is a fantastic at-home workout for those without a gym who want to get into better cardiovascular shape, and traditional control schemes obviously wouldn’t work in this regard. But EA Sports, and games of this ilk, are not exactly fun gaming titles in the traditional sense.

So now with Kinect set to release late this year, we have another motion control scheme, albeit without a physical controller necessary. And this may work well for casual games, and probably pretty good for workout titles also (there will, after all, be an EA Sports title for Kinect). But for other gaming? If anything, Microsoft is looking to grab more Wii users and capitalize on the fact that a good chunk of gamers own both a Wii, and an XBox/PS3. Capturing the “casual” gaming crowd is an expected move for Microsoft, who has already moved in that direction during the XBox dashboard re-do (avatars, et al).

We’re highly skeptical that Kinect will bring anything worthwhile to the table if one already has a Wii sitting next to their XBox; Kinect is the Wii peripheral for the XBox. It’s a cool idea, but nothing more than a novelty, which conveniently comes out mid-way through the XBox 360 lifecycle. If anything, it combats Nintendo’s move of potentially releasing an HD Wii, forcing Nintendo to up their ante and delay a new product release more in line with Microsoft and Sony’s next generation, else simply throw in the towel like Sega did after the Dreamcast.

Either way, the Kinect alone won’t win Microsoft the battle here; the Kinect is a reactive move by Microsoft. Not in the way that the Move is Sony’s reaction to the Wii (which is playing catch-up more than anything else), but in the sense of allowing the XBox to be a competitor to the Wii on all angles – not just meeting the Wii’s capabilities, but arguably exceeding them without adding cumbersome, physical controllers. This move will likely pay off in keeping the 360 situated as the premiere US console, but probably won’t force Nintendo out of the console business entirely, unless Microsoft is able to capture some choice IP for Kinect-based games.

We just don’t see the Kinect doing much to sway the console wars one way or the other at this point. The Wii has already been widely adopted, and so the potential installation-base in Wii-less households appears very small. Unless there are some killer titles out there that make having Kinect outrageously desireable (and we haven’t seen any yet), why drop the money on Kinect?

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