What A Kinect-Free Xbox One Means To Sony

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Microsoft stunned the gaming community today when they announced that starting June 9 a new Xbox One SKU would be available for $399 and that it would not include Kinect. Buried in the Press Release was also the minor bombshell that a large number of entertainment apps (including Netflix, ESPN, YouTube and more) would no longer be behind the Xbox Live Gold subscriber paywall, but we’ll get to that later.

Getting the price of the Xbox One in line with the PlayStation 4 is crucial to the health of the system, obviously more than any of us realized. Over the past year, Microsoft has been attempting to move the needle in terms of the home console experience. The focus on television and video services along with the inclusion of Kinect with every single console sold was a daring gamble. One that, so far anyway, has been an unmitigated disaster.

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A lot of the problems came from Microsoft bungling the message early on. From Always On requirements, the end of Used Games as we know it, a focus on the Set Top box functionality and a tightly integrated Kinect, it was a lot to take in. The biggest problem is that they weren’t prepared for the initial backlash and suffered through different executives giving mixed messages. We were also told that the Kinect was an integral part of the experience and couldn’t/wouldn’t be removed from the equation. Now, less than five months after launch, that has changed.

Sony’s runaway success with the PlayStation 4 has really forced Microsoft’s hand here. It appears likely that they were waiting to see if Titanfall could help reverse their fortunes or at the very least, stop the bleeding. It’s quite apparent at this point that Respawn’s exclusive Mech frenzy hasn’t lit the world on fire, otherwise Microsoft would be trumpeting its sales from the rooftops. So, when the numbers began to come in and nothing was changing they started talking about the unthinkable.

In a series of interviews over the last few hours, executives have mentioned that serious talk began back in April. Just talking about the ‘conscious uncoupling’ of the Xbox One and Kinect must have been agonizing for them. Remember that they built an entire strategy around the ‘magical experiences that come with Kinect‘ and even started out nearly a year ago with a line in the sand that the two were inseparable.

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I can hear the fanboys stirring outside my window so let me get this out: I don’t think this was necessarily a lie from Microsoft, just standard PR speak. They had a vision, albeit a poorly conceived and conveyed vision, and they tried their hardest to make it work. Remember that there was a massive Day One patch to disentangle the Kinect functionality from the Xbox One even just a little. This is something they never planned for or expected to do. So as far as Microsoft was concerned, their vision of what the Xbox One with Kinect would become over the lifespan of this console generation made the two really inseparable.

As Microsoft was savaged across the Internet, consumers spoke with their wallets. While both consoles are selling unprecedented numbers, Sony has more than doubled sales of the Xbox One to this point, with stronger numbers even in North America, where the Xbox 360 dominated the PS3 this previous generation. Microsoft had to do something to reverse the trend as they were quickly becoming an also-ran this generation. And where Sony spent most of the previous generation as the Internet’s favorite arrogant, out of touch whipping boy, Microsoft has quickly taken their place.

They’ve taken a some huge steps towards making the Xbox One relevant again and pulling the video services out of the Xbox Live Gold subscription is just as big and potentially game changing as the Kinect move. So, with an optional Kinect, price parity and now the liberated video services, where does that leave us? With two consoles that, to the average consumer anyway, look pretty much the same. The differentiators are going to come down to exclusives again. Yes, you can argue the architecture and raw power differences between the two for the next ten years, but to the everyday person, the one walking into a Best Buy or Target, they just want to know where the best value lies and what games they have.

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Yes, Microsoft still has the TV functionality and the HDMI pass through up their sleeves, but they’ll really need to find a compelling way to market that to the average consumer that still has trouble figuring out how to hook up a console in the first place.

This all but guarantees, in my mind anyway, that Grand Theft Auto V for Xbox One (and PlayStation 4 of course) will be announced on stage at E3 in a few weeks, probably with some exclusive or timed content. Expect some heavy hitters on stage as well including something new from Epic and at the very least a trailer and maybe some gameplay footage of the next Halo. Taking another page from Sony’s playbook, probably at the urging of former PlayStation Social Media Manager Jeff Rubenstein, Games With Gold hits the Xbox One in June with free games and discounts.

A number of Sony’s advantages (price, no apps behind a paywall) have been erased while others (PlayStation Plus free games and discounts) are quickly being eroded. Sony has to come out strong at E3 and really wow people with their exclusives. They need to expand the PlayStation Now Beta to everyone with PlayStation Plus and put a time frame on an eventual launch, even if it’s a vague as ‘This Fall’. They have amazing relationships with Indie Developers, gobs of untapped potential in the Vita and its connectivity with the PS4 and there’s still the unknown quantity of Project Morpheus. They need to push all of this and push it hard.

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So Sony has a number of ways to differentiate themselves but to do it they’ll need to excel in an area where they’ve been historically weak, marketing. Microsoft has quickly achieved parity of a sort and the gloves are off. You can bet they’ve got a full onslaught planned for E3 and after and they’ll be aiming to hit the PlayStation as hard as they can. Sony has to be ready for this and really start pushing consumer awareness of their strengths and the things that make them different from Microsoft.

Personally, I never thought Microsoft would take the Kinect out of the box. At first glance, the timing may seem odd but right now it’s all anyone is talking about leading into E3 and it has ramped up the excitement and expectations for each of the presentations.

Sony has an edge in that Microsoft’s Presser is in the morning while theirs is later that evening, giving them ample time to adjust their message and I can guarantee that they’ll need to. Either way, this E3 just went from ho-hum, no big deal to one of the most interesting and exciting in years. What do you guys make of all of this?

Written by Josh Langford

Josh Langford

Josh has been gaming since 1977 starting with the Atari 2600.
He currently owns 25 different consoles and 6 different handhelds (all hooked up and in working condition) including all consoles from the current generation – minus the Switch.

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  • Trioptical

    First off, a question: does the TV stuff still work without Kinect? My understanding was that the Kinect functioned as an IR blaster and that was how the XBOne controlled the other devices in the living room.

    • They confirmed that it will. Yusef Mehdi, Xbox’s Chief Marketing and Strategy Officer said in Forbes “You still get Xbox One as an input one device where you can still watch live TV, do two things at once, input switch.”

      • leeorv

        How do you input switch without voice commands though? is there a button for this?

        • With your controller.

  • John Montegudo

    Good Editorial piece. I think Xbox is definitely behind the ball here. I just hope Sony can push it’s advantage. They need to come out swinging with a new Uncharted and announce that Destiny will work with the Morpheus. If the Xbox slowness out of the gate proves anything it’s that Gamers want games. Not an interface that works with a cable box that they may not even be using. Lots of people are cutting the cord a la Torgo. The only reason I don’t is live sports and financial comfort. But Gamers want GAMES! And not just some Mech game that is only 6 vs 6. Sony needs to use it’s full force of PR people to get out there and push some innovative games. I agree that this will be the most epic E3 in a while. can’t wait to see what Microsoft does to bridge the gap and how Sony responds.

    • Yup and it makes sense for them to get this out there now. Get everyone talking and focus E3 entirely on games and features that match or exceed PS4.

  • Jason Honaker

    Great article. One other angle that I haven’t seen brought up is that at the same time Microsoft is taking their camera out of the box, due to weak demand, Sony can barely keep the PS4 camera on the shelves (at least as of a week or so ago). I think maybe even with this change, the problem might run much deeper than just the price alone.

  • leeorv

    Josh, I think you, as well as many others, are guilty of downplaying the hardware difference between the two consoles due to lack of interest in / lack of technical proficiency.

    The PS4’s graphical processor and hardware is literally 50% stronger than the Xbone. this is not a “marginal” difference, and is not going to go away or go unnoticed. As time passes, more and more developers will be able to utilize this difference in hardware potential to better optimize their games on PS4, and PS4 exclusives will likely show a significant graphical advantage over the XBone’s exclusives.

    The graphical processor difference is not the only difference actually, the speed of the memory modules used on the PS4 is significantly higher than the ones used on the XBone, to the extent of also being close to 50% faster. On top of all of that, the PS4 utilizes a “shared memory storage” architecture, which means that when utilized correctly, the Graphical processor can access data currently on the memory chips that’s meant for the Core processor and vice versa, whereas traditionally this data would have to be copied to a different part of the memory before it can be accessed.

    All of this is significant because no console generation has ever had two consoles that are nearly identical in architecture but one of which uses significantly stronger hardware than the other.

    At a 100$ difference in favor of the PS4, the PS4 was a steal, at price parity, is still is smaller, quieter, faster, stronger, better, and has (and will continue to have) more games and better versions of multiplatforms. The only advantage that Microsoft holds is the software feature set, which is admittedly substantially better for the time being.

    • But to the average consumer who doesn’t know or understand that, which I’d argue is a large number (see Wii sales), by far the most important factor is price. If the average consumer was well educated we wouldn’t still be hearing people talk about the Wii U as an add-on to the Wii.

  • ruefrak

    Obviously the real reason why Microsoft made this move is because they love SKUs and the XB1 simply didn’t have enough of them. They started off with the Day One Edition and the regular edition. This was followed up with the Titanfall bundle/Forza bundles, which were cute and all, but not “new SKU” enough. Now an XB1 without a Kinect? That’s a new SKU Microsoft can get behind.
    Meanwhile Sony is stuck with just one 🙁

    • ChazzH69

      Sony also had the brilliantly named ‘Player Edition’ which included the camera, an extra controller and Killzone; admittedly it never managed to hit the stores as it was sold out before they finished packaging them.

  • embelievable

    I think that Microsoft’s strategy going into the new console generation was to get this box into the homes of everyone, not just gamers. With the explosion, of the casual scene, they probably hoped to capitalize on and convert some “Candy Crushers” to “Xbox-ers” while maintaining the 360 fan base with the CODs and Halos. How do they do it? By creating a device that integrates cable, sports apps, and has something for everyone. Maybe the Kinect’s role was to get an Xbox One alongside every Wii in every convalescent home in the US. They probably hoped that the PS4 would be just for the “gamer’s” living room whilst the Xbone was for everyone’s. I think they underestimated the conviction of the hardcore!

    At any rate, I like the price drop and the Kinect exclusion. At the very least, it means that I’ll eventually get an Xbox One. They’re losing a bit of they’re credibility with this new round of policy reversals but, as Josh put it, the average consumer walking into the store probably doesn’t even know that it was, at one point, Microsoft’s plan to mandate Kinect, end used gaming, and require connectivity. Ultimately, I think this new SKU is a savvy business decision that will lessen the gap on Sony’s sales lead.

  • Dirkster_Dude

    Microsoft should have lowered the price, but kept KINECT in the box. If people wanted to hook it up great – if they didn’t it would always be an option for Microsoft’s future vision. It isn’t like with more than $235 billion in US dollars in reserve capital that Microsoft doesn’t have the money to eat the cost and start making money off the XB1 later than they intended.

  • Competition is good for consumers

  • Maverick

    I agree with you that MS was waiting to see the results of Titanfall. It most likey did not meet their sales expectations and that was the final straw. I’m an Xbox One owner. Titanfall is good, not great. It gets old quick and is a little bare bones. But, PS4 should look forward to the inevitable Titanfall 2, which I think could come fairly quickly. I think the current leadership over there now is doing there best to fix many of the mistakes of the past regime. I always thought that if they were 50% behind Sony is sales by E3 major changes would have to be made. The sales gap is only getting wider and I doubt the new territory launches in the fall would do anything more than slow that down without a price drop/kinect drop. Forcing kinect on people was a huge mistake. I have the whole tv/kinect voice command setup going and really its a novelty at best. I often just use the controller or standard cable box remote since the voice command are often hit or miss.

    I used the be a hardcore Xbox/Anti-Sony fan early last gen. But by the end of it I preferred PS3 and used the Xbox for exclusives and play with friends that had Xbox. Thats going to continue this gen. If you could only have one system, it should be the PS4. But if you can afford both, the One is definitely worth having. The future looks exciting for both sides.

  • Jan Compaf

    it means XBONE still SUCKS

  • NoNeedToArgue

    good read. now is where things get interesting.

  • Carlos Ortiz

    The two biggest ways PlayStation can offset M$’ recent changes, imo, are:

    1) Price cut PS4 by $100 at E3. This will definitely help to sell more systems (provided Sony can make them fast enough) and re-install the price disparity.

    2) Remove multiplayer on PS4 from behind their paywall, similar to how it is with the PS3.

    • John Montegudo

      But why would Sony lower the price when they can barely kep the PS4’s on the shelf?Considering the high end ram and all the stuff they squeezed in there I think its’ a good deal. I could see them doing a de-facto price drop by bundling the PS4 with a Vita and a kick ass cross save game for less than what each would cost individually. That would rock.

      • Carlos Ortiz

        I completely agree with you that the PS4 is a good deal. Thing is, gamers are expecting Sony to do something big to counter Microsoft’s mimicry of PlayStation price & policy. The items I listed would work sufficiently enough, I feel, to offset Microsoft’s recent alterations.

        I think bundling a Vita would be a great idea all-around; including a Vita in a separate SKU would likely increase Vita adoption if the price was right but I don’t know if Sony would be willing to take that much of a loss.

        One other option I just thought of, which I think is better than my $100 price cut idea, is for Sony to bundle in a PS4 camera with every PS4 sold, BUT keep the price at $400. This addresses MS’ most publicized change and strengthens Sony’s positive PR by ADDING value to their bundle rather than diminishing a product, like Microsoft. Sony’s PS4 camera is also valued at less than $100, so Sony would lose less money from this bundle idea than from my original idea of a $100 price cut.

        I think Sony’s two big guns for feature announcements at this year’s E3 should be the PS4 camera inclusion + removing online multiplayer from behind their PS+ paywall.

  • Eric Henderson

    no fan boy backlash im surprised!!!!!

  • Fredrik Gundmark

    I read that MS were talking to developers regarding freeing up some additional cpu space that now is used by the Kinect. Has anyone else read this?

    If they do this they’ll have some games that is unplayable while having a kinect connected. What’s your take on this?

    • They have been discussing this with developers, they’ve confirmed it, but they would never allow a game to be unplayable when Kinect is connected.

      What they’re most likely discussing is if they give developers that extra power, do they want it, provided that they can code in a second set of instructions to ‘dumb it down’ just a bit if Kinect is connected.

      It would absolutely come with a trade off requiring developers to do a little more work. The questions is, will it be worth it to them.