Problems With An “Always-On” Next Xbox? #dealwithit

Problems With An “Always-On” Next Xbox? #dealwithit

There has been a lot of speculation about the next generation of Xbox. The rumored methods that the next Xbox will apply to used games must have Gamestop feeling a bit like Damocles, and has many consumers who are unable (or unwilling) to pay full retail price for games in a state of disappointment and despair. This, while anti-consumer and very frustrating, is at the very least not preventing the console from playing retail purchased content. Now, the all but confirmed mandatory Internet connection for basic console operation? That’s a bit of a different story. The current rumor is that the next Xbox will not launch any applications or games without an active Internet connection, and that if the connection is interrupted during operation, it will only continue to operate for a scant three minutes before suspending operation and launching the network troubleshooter.

The problem with an “always-on” requirement is in the assumption that every consumer capable of purchasing (and willing to purchase) will also be capable of affording a consistent and stable Internet connection. Click here, and a new tab will open with a screenshot taken from the National Broadband Map showing the availability of all broadband technology short of wireless (and by wireless, I don’t mean your home wi-fi router). There is hardly any coverage to speak over over most of the western half of the country, but this can be explained by the incredibly sparse population centers across this region. This lack of population density has resulted in a lack of investment interest on the part of major broadband providers, which leaves any gamer consumers with a passion for Xbox in the lurch once the next generation hits. The same can be said for the large swaths of broadband unavailability in the incredibly densely populated eastern half of the country, however.

According to the FCC (as of August 2012), approximately 19 million Americans lack access to fixed broadband service. This is not an economic determination, but a simple statement of availability. The number of Americans with access to broadband service, but without the ability to afford broadband service is surely more considerable. Affordability isn’t always as simple as a monthly fee, either. With broadband providers placing increased emphasis on transfer caps, and streaming services becoming more and more prevalent on consoles, an additional factor of charging for overuse comes into play. So, what would a reasonable response to the concept of an “always-on” next generation Xbox be?

How about telling these millions of consumers to “get with the times” and “deal with it?”

This is apparently how Adam Orth, the Creative Director at Microsoft Studios, chooses to respond on his personal Twitter account.

The sheer arrogance and disconnectedness of such a response is staggering, especially from someone so critical to Microsoft’s game development operation. As you can see, he chooses to support his defense of the “always-on” argument against such claims of availability and (more importantly) stability by presenting straw man fallacies, likening the game console’s rumored connected requirement to the functionality of a mobile phone or a vacuum cleaner. He has a point in that a vacuum cleaner can not function without electricity, and a mobile phone can not perform its most basic function without a stable cellular network. His argument falls apart, however, when you realize that a majority of games do not require an Internet connection to play. If you want to play the multi-player portion of a game, or if you want to play a MOBA/MMO, then you absolutely do need an Internet connection. But tell me, how many MOBA/MMOs exist on consoles? How many games are released only as multi-player titles? And how do the answers to both of those questions compare to the number of games that are capable of being played without the requirement of an Internet connection?

In this case, it’s not only the shortsightedness of an “always-on” console that troubles me; it’s Adam Orth’s arrogance and his lack of respect for consumers that I find distasteful and foolish. Adam, I have a question for you: How many people do you anticipate will choose to “deal with it” by purchasing a PlayStation 4 instead, since it is confirmed that it will not come with an always-on requirement?

On a lighter note, enjoy the almost immediate birth of a new meme: the Always Online Adam Orth (AOAO).

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  • SpaceGhost2K

    According to the FCC (as of August 2012),
    approximately 19 million Americans lack access to fixed broadband
    service. This is not an economic determination, but a simple statement
    of availability. The number of Americans with access to broadband service, but without the ability to afford
    broadband service is surely more considerable. Affordability isn’t
    always as simple as a monthly fee, either. With broadband providers
    placing increased emphasis on transfer caps, and streaming services
    becoming more and more prevalent on consoles, an additional factor of
    charging for overuse comes into play. So, what would a reasonable
    response to the concept of an “always-on” next generation Xbox be?

    • SpaceGhost2K

      Bah, I didn’t get to add my input before that posted. OK, first point: There are almost 400 million people in the US. If 19 million lack access to fixed broadband, that’s 5%. Even if 5% of current gen users couldn’t participate in next gen, that 5% probably only makes up about 1% of all sales since they can’t use multiplayer maps or buy XBLA games. Fair enough? Can a company accept the losses of 1% of their income from these customers, if they double their total income by requiring new game purchases? I’d say yes.

      Now, about the ones that can’t afford broadband – can they afford a next gen console? Can they afford new games? If those people only have used consoles and used games because of the cost of entry into the gen and they don’t buy downloadable content because of no online connection, it won’t matter if the console companies have them for customers next gen or not because they’re not their customers NOW. They haven’t made a penny from them. If they lost them, what do they lose? Nothing, really.

      So everyone pays $59.99 for a new game where the publishers get part vs. a world where half the people pay $54.99 but the publisher gets none of it. All that means is that half the people have to pay five bucks more, but the developers double the amount of money they make on a game.

      Ask yourselves, how many studios like THQ and LucasArts and all the others could you have back if they’d made twice the money from their games? How may people would still be working at Square Enix tonight instead of looking for a job?

      • Chris

        I almost deleted the first one as a spam comment. Glad to see it was just a posting bug.

        19 million Americans may lack access, but as I said, a higher percentage may not be able to afford *stable* access. The key word is stability, due to the rumored three minute killswitch. As for affordability of the console and games, a console is (ideally) a one time purchase, not requiring a long-term budget investment like Internet service. There are many reasons that a household would have a console without being able to afford a stable Internet connection: gifts, long-term saving, etc.

        Used games, while an issue, are not *the* issue of the “always-on” problem. That being said, every used game is not priced at $54.99. Used games can range from that price down to just a few dollars, depending on the game and the location of purchase. THQ would most likely still be gone, because of their awful money management. LucasArts would most likely still be gone, because they haven’t put out a good game since 2010 (if you count TFUII), or 2008 (if you hated TFUII but liked TFU), or 2005 (if you feel like Battlefront II was the last real game they put out). Square Enix also suffers from poor money management and product planning; imagine how many layoffs could have been avoided with the revenue that HD remasters of FFVII, VIII, and IX could have provided alongside the upcoming X/X-2.

        Thanks for commenting! Regardless of different opinions, I do appreciate the conversation and interaction.

        • ShadowOfTheVoid

          The broadband situation is indeed worse than it seems. According to the International Telecommunications Union and the World Bank, there are roughly 28 fixed broadband internet subscriptions per 100 people in the United States. That amounts to around 86 or 87 million subscriptions. There are around 120 million households in America. Therefore, nearly a third of all Americans lack broadband internet.

          Incidentally, these numbers are similar among Xbox 360 owners. According to sales figures Microsoft revealed at CES last year, there were about 40 million Xbox Live subscribers but 66 million 360s sold at that point, meaning that over a third of all 360 owners don’t have XBL (either Gold or free) for whatever reason. That number may be even higher, as I’d imagine a great many 360s have multiple accounts on them.

          An always-online Xbox would shut out literally tens of millions of potential customers, including many current 360 owners.

          • He110Ne0

            Even wealthy areas like Bergen County, New Jersey have internet issues. There are still areas here that are unable to get FIOS – I live in one, It is a wealthy town RIGHT NEXT TO other towns that HAVE FIOS. Sure I have Cable, so I have a fast connection – but it’s a fast connection that REGULARLY likes to dip and disconnect and take its sweet time coming back on up especially during peak usage hours (and yes, our account is password protected, that’s just the nature of the beast.) If Microsoft hasn’t learned from the consumer backlash on things like SimCity or Ubisoft’s obnoxious need to constantly “verify” your disc on PC games than this is going to hurt them badly.

            Hopefully they are seeing this feedback and will adjust their ACTUAL announcement accordingly. The point about affordability is a big one – consoles ARE the solution for people who want to game who have less income. They are cheaper than buying a PC, you don’t have to continuously upgrade video cards, or worry about software compatibility issues, or have much technical knowledge at all.

            Lastly – ALL money aside, I worked at EB Games/ Gamestop for years. Parents buying their children their first 360 always got the speech from me about Gold and the accessibility their kids would have to interactions with strangers. Many parents would call me later and confirm there was a way to disconnect their system from the internet to keep their 10-12 y/o from accessing online features (a. to not spend points/money on their credit card and b. safety).

            Online connection is great – but the Gold wall is ridiculous and already hurting the 360 audience by pissing them off (some demos are gold only. REALLY??). I like a system that maintains itself, sure, but this gets into the issue of ownership. If I bought a game, I bought the game. I shouldn’t have to prove that continuously through play and every time I start it up. Not only does that seem a grossly inefficient use of hardware and server power, it makes me question Microsoft’s grasp on financial realities in the world.

  • SpaceGhost2K

    According to the FCC (as of August 2012),
    approximately 19 million Americans lack access to fixed broadband
    service. This is not an economic determination, but a simple statement
    of availability. The number of Americans with access to broadband service, but without the ability to afford
    broadband service is surely more considerable. Affordability isn’t
    always as simple as a monthly fee, either. With broadband providers
    placing increased emphasis on transfer caps, and streaming services
    becoming more and more prevalent on consoles, an additional factor of
    charging for overuse comes into play. So, what would a reasonable
    response to the concept of an “always-on” next generation Xbox be?

    • SpaceGhost2K

      Bah, I didn’t get to add my input before that posted. OK, first point: There are almost 400 million people in the US. If 19 million lack access to fixed broadband, that’s 5%. Even if 5% of current gen users couldn’t participate in next gen, that 5% probably only makes up about 1% of all sales since they can’t use multiplayer maps or buy XBLA games. Fair enough? Can a company accept the losses of 1% of their income from these customers, if they double their total income by requiring new game purchases? I’d say yes.

      Now, about the ones that can’t afford broadband – can they afford a next gen console? Can they afford new games? If those people only have used consoles and used games because of the cost of entry into the gen and they don’t buy downloadable content because of no online connection, it won’t matter if the console companies have them for customers next gen or not because they’re not their customers NOW. They haven’t made a penny from them. If they lost them, what do they lose? Nothing, really.

      So everyone pays $59.99 for a new game where the publishers get part vs. a world where half the people pay $54.99 but the publisher gets none of it. All that means is that half the people have to pay five bucks more, but the developers double the amount of money they make on a game.

      Ask yourselves, how many studios like THQ and LucasArts and all the others could you have back if they’d made twice the money from their games? How may people would still be working at Square Enix tonight instead of looking for a job?

      • http://twitter.com/twotwotala Chris

        I almost deleted the first one as a spam comment. Glad to see it was just a posting bug.

        19 million Americans may lack access, but as I said, a higher percentage may not be able to afford *stable* access. The key word is stability, due to the rumored three minute killswitch. As for affordability of the console and games, a console is (ideally) a one time purchase, not requiring a long-term budget investment like Internet service. There are many reasons that a household would have a console without being able to afford a stable Internet connection: gifts, long-term saving, etc.

        Used games, while an issue, are not *the* issue of the “always-on” problem. That being said, every used game is not priced at $54.99. Used games can range from that price down to just a few dollars, depending on the game and the location of purchase. THQ would most likely still be gone, because of their awful money management. LucasArts would most likely still be gone, because they haven’t put out a good game since 2010 (if you count TFUII), or 2008 (if you hated TFUII but liked TFU), or 2005 (if you feel like Battlefront II was the last real game they put out). Square Enix also suffers from poor money management and product planning; imagine how many layoffs could have been avoided with the revenue that HD remasters of FFVII, VIII, and IX could have provided alongside the upcoming X/X-2.

        Thanks for commenting! Regardless of different opinions, I do appreciate the conversation and interaction.

        • ShadowOfTheVoid

          The broadband situation is indeed worse than it seems. According to the International Telecommunications Union and the World Bank, there are roughly 28 fixed broadband internet subscriptions per 100 people in the United States. That amounts to around 86 or 87 million subscriptions. There are around 120 million households in America. Therefore, nearly a third of all Americans lack broadband internet.

          Incidentally, these numbers are similar among Xbox 360 owners. According to sales figures Microsoft revealed at CES last year, there were about 40 million Xbox Live subscribers but 66 million 360s sold at that point, meaning that over a third of all 360 owners don’t have XBL (either Gold or free) for whatever reason. That number may be even higher, as I’d imagine a great many 360s have multiple accounts on them.

          An always-online Xbox would shut out literally tens of millions of potential customers, including many current 360 owners.

          • He110Ne0

            Even wealthy areas like Bergen County, New Jersey have internet issues. There are still areas here that are unable to get FIOS – I live in one, It is a wealthy town RIGHT NEXT TO other towns that HAVE FIOS. Sure I have Cable, so I have a fast connection – but it’s a fast connection that REGULARLY likes to dip and disconnect and take its sweet time coming back on up especially during peak usage hours (and yes, our account is password protected, that’s just the nature of the beast.) If Microsoft hasn’t learned from the consumer backlash on things like SimCity or Ubisoft’s obnoxious need to constantly “verify” your disc on PC games than this is going to hurt them badly.

            Hopefully they are seeing this feedback and will adjust their ACTUAL announcement accordingly. The point about affordability is a big one – consoles ARE the solution for people who want to game who have less income. They are cheaper than buying a PC, you don’t have to continuously upgrade video cards, or worry about software compatibility issues, or have much technical knowledge at all.

            Lastly – ALL money aside, I worked at EB Games/ Gamestop for years. Parents buying their children their first 360 always got the speech from me about Gold and the accessibility their kids would have to interactions with strangers. Many parents would call me later and confirm there was a way to disconnect their system from the internet to keep their 10-12 y/o from accessing online features (a. to not spend points/money on their credit card and b. safety).

            Online connection is great – but the Gold wall is ridiculous and already hurting the 360 audience by pissing them off (some demos are gold only. REALLY??). I like a system that maintains itself, sure, but this gets into the issue of ownership. If I bought a game, I bought the game. I shouldn’t have to prove that continuously through play and every time I start it up. Not only does that seem a grossly inefficient use of hardware and server power, it makes me question Microsoft’s grasp on financial realities in the world.

  • Samuel H.

    I’m pretty much DONE with Xbox.

    • Chris

      I’m very tempted to say (and feel) the same, but I’m waiting to see what the official announcements will be, since absolutely none have been made yet. Hopefully, the reactions to the rumors will help set Microsoft straight (if they are indeed off kilter here). If the rumors prove true, however, I may end up feeling the same. The Xbox 360 pulled me away from PlayStation. The next Xbox may very well push me back to it.

      • Samuel H.

        I don’t know. I’m not liking this new “media centric” direction they are taking with making the 360 an all-in-one entertainment system. I kind of miss the days when gaming systems were just about gaming. Plus, I absolutely HATE how much of the Xbox’s features are locked away unless you go Gold. This has actually been one of the main reasons I’ve stopped using the 360 for things. I’ve actually shifted more towards PC And PS3 now.

        • Chris

          I like the multi-functionality of the device, but I dislike how the primary purpose (gaming) has been pushed so far to the side. The Gold Wall is also frustrating. Netflix and Hulu, for example, shouldn’t be blocked. They’re subscription services that are freely available and accessible on every other connected device except the 360. With the way things are currently going, I can see the primary system in our house being the PS4 instead of the next Xbox.

          • Samuel H.

            I mainly keep a 360 around now so my kid can play all the old games I have for it. I hate the Gold Wall and it honestly has kept me from purchasing new games. Most new games I’ve bought have been on STEAM or PS3.

          • Chris

            I tend to stock up on subscriptions when they’re cheap on Amazon, so the Gold Wall isn’t as present of a frustration for me. To be honest, the only reason I continue to purchase multi-plat titles on the 360 is because I’ve become accustomed to the controller, I’ve invested so much time in my Gamerscore, and because development for the PS3 is inconsistent. With the new architecture of the PS4, I have a feeling that the issues the PS3 had with game quality and consistency will disappear. Match that with the seeming openness of the PS4, and the consumer friendly nature it’s presenting, and I think it will own the next generation.

  • http://twitter.com/samversionone Samuel H.

    I’m pretty much DONE with Xbox.

    • http://twitter.com/twotwotala Chris

      I’m very tempted to say (and feel) the same, but I’m waiting to see what the official announcements will be, since absolutely none have been made yet. Hopefully, the reactions to the rumors will help set Microsoft straight (if they are indeed off kilter here). If the rumors prove true, however, I may end up feeling the same. The Xbox 360 pulled me away from PlayStation. The next Xbox may very well push me back to it.

      • http://twitter.com/samversionone Samuel H.

        I don’t know. I’m not liking this new “media centric” direction they are taking with making the 360 an all-in-one entertainment system. I kind of miss the days when gaming systems were just about gaming. Plus, I absolutely HATE how much of the Xbox’s features are locked away unless you go Gold. This has actually been one of the main reasons I’ve stopped using the 360 for things. I’ve actually shifted more towards PC And PS3 now.

        • http://twitter.com/twotwotala Chris

          I like the multi-functionality of the device, but I dislike how the primary purpose (gaming) has been pushed so far to the side. The Gold Wall is also frustrating. Netflix and Hulu, for example, shouldn’t be blocked. They’re subscription services that are freely available and accessible on every other connected device except the 360. With the way things are currently going, I can see the primary system in our house being the PS4 instead of the next Xbox.

          • http://twitter.com/samversionone Samuel H.

            I mainly keep a 360 around now so my kid can play all the old games I have for it. I hate the Gold Wall and it honestly has kept me from purchasing new games. Most new games I’ve bought have been on STEAM or PS3.

          • http://twitter.com/twotwotala Chris

            I tend to stock up on subscriptions when they’re cheap on Amazon, so the Gold Wall isn’t as present of a frustration for me. To be honest, the only reason I continue to purchase multi-plat titles on the 360 is because I’ve become accustomed to the controller, I’ve invested so much time in my Gamerscore, and because development for the PS3 is inconsistent. With the new architecture of the PS4, I have a feeling that the issues the PS3 had with game quality and consistency will disappear. Match that with the seeming openness of the PS4, and the consumer friendly nature it’s presenting, and I think it will own the next generation.

  • He110Ne0

    One other point – I’ll be interested in what retailers will be carrying a system that is eliminating the portion of their business that makes them money. Gamestop’s preowned sales usually make up about 40% of their annual profits. Best Buy is already pushing their pre-owned selections, and other companies are following suit. The markup on games is very small, and the profit on a new system to a retailer is only at most a few dollars. Simply put – you cannot run a retail business on new sales alone. You need peripheral mark ups, and used game sales.

    If this is the tact Microsoft plans on taking, it’s going to need to open a dedicated store, like Apple, because no retailer will want to dedicate their man power and selling efforts to a product that is shooting themselves in the foot.

    I just can’t see this pitch going over well in business to business sales meetings.

  • He110Ne0

    One other point – I’ll be interested in what retailers will be carrying a system that is eliminating the portion of their business that makes them money. Gamestop’s preowned sales usually make up about 40% of their annual profits. Best Buy is already pushing their pre-owned selections, and other companies are following suit. The markup on games is very small, and the profit on a new system to a retailer is only at most a few dollars. Simply put – you cannot run a retail business on new sales alone. You need peripheral mark ups, and used game sales.

    If this is the tact Microsoft plans on taking, it’s going to need to open a dedicated store, like Apple, because no retailer will want to dedicate their man power and selling efforts to a product that is shooting themselves in the foot.

    I just can’t see this pitch going over well in business to business sales meetings.