Analysis & Opinion

Microsoft’s bid to dominate the future entertainment stack with the Xbox One

Paul Jackson, principal analyst at Informa Telecoms & Media

Paul Jackson, principal analyst at Informa Telecoms & Media

Microsoft’s reveal of the Xbox One yesterday evening in Redmond signaled the culmination of its ambitions to be at the centre of the future living room entertainment landscape.

While the console’s gaming credentials point to advances in graphics and gameplay combined with more ‘social’ and connected experiences (much like Sony is promising with the PlayStation 4), it’s the non-gaming services that are the most interesting – they are aiming to displace many of the boxes under your TV (apart from the DVR / STB – yet!).

For today’s consumers, particularly those with a more technology-centric view or the media addicts, the options for consuming media, communications services, etc. are near-limitless.

The problem is that different devices, such as Smart TVs, STBs, DVD players and streaming devices, all have different connections and (usually awful) UIs. If Xbox One can unify some of this, and also add in voice control and facial recognition for personalisation, then it can earn its place under the TV – even in non-gamer households.

We are still at least six months from release of the Xbox One or PlayStation 4, and, as usual, we’re still missing vital pieces of the puzzle, like price and region availability.

But the direction Microsoft is taking with the Xbox One clearly points to an aggressive approach – maybe with a matching low price – to quickly build a user base of Xbox One households.

Naturally, given the console’s heritage, the US will lead this charge, but other markets like the UK won’t be far behind, especially since Microsoft has already built many content and service relationships (with the likes of Netflix, BskyB, etc.) for its existing Xbox Live services on Xbox 360.

Gone are the days when home consoles are automatically guaranteed a place in gamers’ hearts (just look at the failure of the Wii U), but the Xbox One looks like a strong contender – not just as a winning next-generation console, but as the hub of many households’ entertainment world.

This article was originally posted on the Informa Telecoms & Media analyst blog here.

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