PlayStation 5 vs Xbox Next

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A Preview of the Next Console Generation

The signs and portents are showing that a new console generation is heading towards us, sometime in the next year or so. Interestingly, we can already describe the new consoles pretty well, given what’s been going on in the last console generation. The exact details will remain a mystery until launch, but knowing the general outline of the new consoles can help everyone make their plans for the next two years, whether that’s for game development, marketing, or just purchasing a console for personal use.

When will these consoles launch? Probably in time for the 2020 holidays, perhaps even earlier. Look for more hints over the next year, but we probably won't see a complete official announcement until just a few months before a new console ships.

First off, the most clear picture will be for Microsoft and Sony, so I’ll deal with those in this essay. Nintendo and others (Google, Apple, Amazon, and maybe others) will be considered separately.

Let’s start with the features that we can be nearly certain these new consoles from Sony and Microsoft will have, along with the justification for believing in these features. Then we’ll move onto more uncertain features that these consoles may or may not have.

The PlayStation 5 and Xbox Next will be X86-based.

Likely AMD will be supplying customized CPU/GPU combinations to both Sony and Microsoft, which will probably have some technical differences that may or may not make much of a difference to users (though marketers will no doubt play them up). There’s no more custom CPUs for consoles, as game developers are much happier with the ease of supporting PC, PlayStation, and Xbox with essentially the same code base. Developing AAA games is difficult and expensive enough these days without adding in the need to work on a unique CPU. Sony and Microsoft have also saved money by not having to develop a completely new CPU and all the software tools that would go with it. These days, AMD and Nvidia have been pushing the state of the art for GPUs far beyond what Sony or Microsoft could afford to do – so they will stick with what worked for them on the current generation of consoles.

The PS5 and Xbox Next will be 100% backward compatible with their predecessors.

Given that the new consoles will use the same X86 CPU as the current generation, this one’s a no-brainer. Besides, this is of great value to current players – your software library will work just fine on new consoles, and possibly even better. This is important for game publishers, as they will be able to keep selling existing games even after new consoles arrive. Of course, there may be updates for older games to make them look even better on new hardware – an opportunity for game publishers to re-ignite interest in older titles and perhaps make some more money from them.

The PS5 and Xbox Next will be capable of 4K HDR display with 60 frames per second – or better.

The primary selling point of these new consoles will be to fully support the growing market of 4K HDR televisions, showing off the added resolution that people have available. Yes, the Xbox One X can sort of hit this mark, but not consistently. More horsepower is really necessary to take full advantage of what 4K HDR screens have to offer. Of course, it may not be all that much of a difference to the casual observer – but this capability will be heavily touted as an important reason to buy a new console. This is part of why the new console generation may not be a big sales winner, after the initial surge of early adopters – you really aren’t going to see much of a difference over what your old consoles could do.

The PS5 and Xbox Next may have more than one model apiece, with different price points, but regardless the most expensive model will not exceed $599 at retail.

Here we get into the realm of less certainty. Exactly how Sony and Microsoft deal with their current consoles when new ones come out, and whether they introduce more than one new model, is not clear. It’s likely that both companies would want to have hardware at both a lower and a higher price point, the way they do now – but they may see advantages in having three or even more different price points covered. Say, $199, $299, and $399. Maybe they’ll have cost-reduced versions of old consoles, or consoles with more limited storage capacity. This will be interesting to watch.

Game-streaming (inbound and outbound) will be an important part of both the PS5 and the Xbox Next, possibly with specific hardware features designed for that.

Having players stream their games to the world is going to be a more important part of consoles. Being able to take advantage of a streaming-game service, where you don’t even have to download a game, is also part of what console makers (and major game makers!) are dreaming of. The phrase “Netflix for games” makes them visualize large piles of recurring revenue. Now, there are plenty of technical hurdles to overcome, and reasons to be skeptical that game-streaming will finally become a major profit center (since it never has before). But game companies will keep trying, so expect to hear more about that.

What will be more powerful, PlayStation 5 or Xbox Next?

This is anyone’s guess. Really, both Sony and Microsoft can build hardware to any power level – the question is what profit margins will the company allow? Or will either company be willing to entertain a loss on the console hardware in order to gain market share? Either company could decide to sell $600 worth of game hardware for $499. That’s easier for Microsoft than it would be for Sony, since Microsoft has well over $100 billion of cash on hand, and Sony’s still trying to recover from its lean times of a few years ago. Who really, really wants to have the most consoles out there? It’s anyone’s guess. So it’s hard to say which hardware will really be more powerful – it’s not an engineering question, it’s a financial and business decision, in the end. The engineers will design to what the suits at the top decide.

Final Thoughts On Next-Gen Console Wars

Both Sony and Microsoft have done well with current console generation, though Sony clearly came out on top. Both companies will likely do well with new hardware, though it’s not at all clear that new consoles will sell anywhere near as well as the current generation has. Will Nintendo take away the best-seller crown? Or will Google or Apple manage to create something that actually competes?

Microsoft’s Bid for World Domination of Games

Microsoft is getting ready to expand Xbox Live, its gaming network/community, from Xboxes and Windows PCs to include Android, iOS, and Nintendo Switch. This will grow the potential market/community for Xbox live to over 2 billion devices. Notably, this includes pretty much every major gaming platform – except MacOS (the number of MacOS game players is minuscule) and (of course) Sony PlayStation and their network.

It’s a smart move. Once upon a time, the walled gardens of Xbox and PlayStation were enormous compared to any other game audience. Now, single games like Fortnite or League of Legends dwarf the size of those console audiences. Hardware generally is powerful enough to play most games pretty well, perhaps with some graphics compromises that really don’t matter to the majority of players. (Fortnite is doing extremely well on mobile, for instance, despite the differences in controllers and graphics with consoles or PCs.) The gameplaying audience is mostly not concerned with being fans of a particular hardware, as they often were in days gone by – now they want to play a game wherever they are, with whatever hardware is handy.

Microsoft is smart to recognize that, and to attempt to get out in front and be the gamer’s network across all platforms. It’s a smart competitive move, particularly because Microsoft’s rivals aren’t going to go there – can you see Nintendo doing something like that? Or Sony? Sony seems too satisfied with its market leadership, resisting all efforts to open up (Fortnite pried them open a crack, after weeks of fan pressure).

Microsoft wants to gain market leadership, or at least recurring subscription revenue and extensive virtual goods sales. Particularly as the next generation of consoles looms on the horizon. Though once again, it’s unclear whether there may be future console generations beyond this. The biggest games are growing well beyond the platforms they began on. As billions of people now have access to a gameplaying device, the biggest money lies in finding the best games to reach the widest number of people – and the best business models to monetize those people.

Microsoft sees connecting those game players together as a great way to make money by marketing games, virtual goods, and services to the widest possible audience. If they can get the details right, this looks like they are correct. Grand concepts are one thing, and implementation is another. I look forward to seeing how well Microsoft does at implementing this vision.