Gamer Tick: Will There Be An Xbox 720?

In this installment of Gamer Tick, Jim investigates the future of Microsoft's console franchise.

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If there was one major disappointment of the past console cycle - that of the Xbox and PlayStation 2 - it was that it was over so quickly. If you a look at the games that were released in the PS2's final 18 months (if we look at a year before and six months after the PlayStation 3 turned up) it looks very much as if developers were just getting into their stride with Sony's machine. Likewise with the Xbox - that was barely given a chance to get good. If God of War 2 was such a leap forward from the original game, what could have similar studios done with another two years of development on the last generation platforms? Arguably, the latest two platforms, the PS3 and the Xbox 360, came about too quickly.

All of which leads to me admitting my bias in this analysis: I really hope there isn't another console cycle for a very long time. 2010 would be far too early. Let's let developers get really, really good with the machines we have now. Everyone will benefit.

Regardless, the clues for the next cycle of the Xbox are already being spotted by the unblinking eye of the internet. This job advert from Microsoft does seem to suggest they've moving into a future-planning phase already: "Microsoft's new Halo Studio team is looking for a technical and highly talented program manager to work with an engineering team to help define the next generation of gaming software technology." The page-hungry bloggers are quick to call it the footstone for next-gen hardware, or even next-gen blockbuster games, but of course it could just the next installment of Direct X, the software that runs games on PC and Xbox.

Nevertheless there are some more concrete clues, such as Microsoft's President of Entertainment and Devices Division saying this in June: "We started thinking about the next generation before we shipped the Xbox 360. It doesn't start with a date. It starts way upstream with silicon development. From that comes a series of data points. You start making early technology choices. It's an evolving thing."

Experts have already been having their say on the when exactly that machine might show itself. Pacific Crest Securities analyst Evan Wilson told Gamespot that "we believe that peak industry sales will occur in 2010, given that Microsoft will likely introduce its next console that year." If that's true, the 360 will have lost the most recent console war, and been pushed into obsolescence before its rival has even begun to hits its global peak. Microsoft would have to have to invest billions on launching a new system from scratch, which - although it will be technically superior - will have to take on a cheaper PS3, and the already vast resources of Sony's developer network to actually make the games people want to play.

And does Microsoft have the development clout long-term? Looking at the future line-up of PS3 games, and the potential for titles like LittleBigPlanet to go into supernova, you'd have to say no. Then there's the unexpected closure of Ensemble Studios. This is one of the legends of the game development world, the producers of the Age Of Empires series. They're finished once Halo Wars has finished up its development cycle. Why would Microsoft be closing such a significant studio? And are there other closures and sell-offs to come? The rumor mill is quietly nodding.

In fact, if you look a little closer at the NPD figures over the past year, it begins to look as if Microsoft is to be the third horse in the console race. While some months have seen the 360 out in front for software sales, and occasionally holding the No. 2 spot behind the Wii on hardware, it seems clear that the 360 will not come out on top in this latest cycle. Despite the 10 million unit user-base in the U.S., the 360 cannot match the long-term growth of its Japanese rivals.

So what of the Xbox 720? Can it, should it exist? Despite its vast cash reserves and commitment to a "20 year" game console project, is it really worth Microsoft coming back for another round? Some commentators, such as WildTangent CEO Alex St. John, are already saying no, and arguing that this, in fact, is the last generation of consoles: "The era of consoles defined by graphics and high-production values is over," said St. John at this summer's Casual Connect conference. "Sony and Microsoft took the bet that prettier graphics would be the huge differentiating feature for their consoles. They were wrong. Everybody expects things to look good, so making it look 10 percent better doesn't have a big impact on its value. Since that's changed, we now live in an era where community defines the value of a game, not production values. So the community dynamics of an MMO are more valuable to a user than how good the graphics look."

It's possible that there's some truth here. There might be 10 million 360s in the U.S., but there are also 10 million World Of Warcraft subscribers - a single game - and countless millions of PCs coming online across Asia and China. That, you might argue, is the real market for gaming - not these fancy boxes Sony and Microsoft want to sell us. So perhaps St. John is right, and we'll end up with something that's just a PC with a fancy interface, rather than a single box owned and manufactured by Microsoft. Perhaps the Xbox 720 will be built by Dell and Gateway ...

Or perhaps Microsoft's commitment extends further than that. After all, when asked what Microsoft would do if the 360 failed, Bill Gates replied, "We'll play again."

Jim Rossignol, author of the recent gamer-culture book This Gaming Life and editor at RockPaperShotgun.com, has been writing about videogames for the past decade. His work has been published by Wired, The BBC, The London Times, PC Gamer, The Escapist, Edge magazine, Gamasutra.com and many others.

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