The games industry is slowly moving to next-gen consoles, and here’s how publishers are helping–and why they’re not ready to give up on current-gen hardware just yet.
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Publishers are starting to shift towards next-gen consoles in a very careful and calculated way. There’s multiple parts of this strategy that include:
- New $69.99 price hike
- Exclusive performance only available on next-gen consoles
- Features exclusive to PS5 and Xbox Series X/S
- Cross-gen releases
These parts are actually quite intertwined with one another. Exclusive performance and exclusive features are ways to help justify a price hike to $69.99, which represents the first frontline price jump in over a decade. The new price will help boost sales revenues, which will be re-invested into R&D advancements that in turn help power new optimizations and features that push each console even farther.
Publishers are indeed eager to move to a new generation, but this won’t happen quickly. The move to PS5 and Xbox Series X/S exclusivity will be a slow and gradual process. 2021 will be the second year in this cross-generation shift, and we’re starting to see key trends emerge that will frame the immediate and extended future of the console market.
Current-gen is Still Very Important
This year, both the PlayStation 4 and Xbox One will turn 8 years old. Throughout that time, both systems have amassed substantial install bases. The PS4 has shipped over 116.4 million units, and the Xbox One is believed to have sold over 45 million worldwide. With numbers like that, most big-name publishers like EA, Take-Two, Activision, Capcom, Bandai Namco, and Ubisoft aren’t ready to abandon those platforms.
Due to chip restrictions and high demand, the PlayStation 5 and Xbox Series X/S install bases have yet to mature. The PS5 has shipped 7.8 million units in its first year, a little over than the PS4s launch numbers. Abandoning current-gen is a bad business decision that would miss out on tons of sales.
Publishers have compromised by releasing their games across both generations. This dual-gen approach is a great way to maximize sales, eliminate gate-keeping, and also offer next-gen console owners an opportunity to flex their console hardware. Today’s biggest games typically release on both generations in an effort to bridge the sales gap and ease into the new generation. Some publishers like Capcom and Ubisoft have offered free next-gen upgrades.
While 8 years is a long time amass sales, it’s also a long time to be outpaced by major tech advancements. The PS4 and Xbox One are built on outdated Jaguar SoCs and slower, mechanical HDDs that can’t always meet the demands of today’s popular games without significant sacrifices. The lower-end chips lead to 1080p 30FPS (sometimes lower) in-game performance.
Game publishers have a plan to ease into the new console generation without abandoning the existing sizable PS4 and Xbox One market. It’s an approach that includes cross-gen releases, and two parts that emphasize next-gen consoles: exclusive performance and exclusive features.
Smooth Cross-gen Sales Transition
Cross-gen releases are important. Publishers don’t want to leave money on the table, and have embraced a technically difficult path to ensure higher sales potential.
This isn’t easy on developers, though, especially when they have to optimize their games for 8 consoles with varying performance targets: PS4, PS4 Pro, PS5, Xbox One, Xbox One S, Xbox One X, Xbox Series S, Xbox Series X.
Free next-gen upgrades are a big part of this transition. Most publishers have offered free upgrades of current-gen games, but this is starting to fade out.
EA, for example, is apparently ending its Dual Entitlement program that offered buyers of current-gen FIFA 21 and Madden 21 games a free copy of the next-gen versions. EA put out its Dual Entitlement program as an option to Microsoft’s Smart Delivery.
New EA games like Battlefield 2042 and Madden NFL 22 won’t get free next-gen upgrades. Both of these games cost $69.99 on next-gen and come with an expensive $99.99 cross-gen bundle.
EA doesn’t plan to use Dual Entitlement or Microsoft’s Smart Delivery system for these new games.
Read Also: PlayStation 5 Review: The golden era of console gaming
Justifying a New $69.99 Price Point
Exclusive performance and exclusive features are key parts of justifying a new $69.99 price point.
This new MSRP kicked off in 2020 with games like NBA 2K21, Demon’s Souls, and Call of Duty Black Ops Cold War, and is continuing in 2021 with Madden NFL 2K21, Battlefield 2042, Ratchet and Clank Rift Apart, and more.
While most publishers haven’t discussed the new $69.99 price point in length, Take-Two Interactive’s Strauss Zelnick defended the price jump in 2020:
“There hasn’t been a price increase for frontline titles for a really long time, despite the fact that it costs a great deal more to make those titles. And we think with the value we offer consumers…and the kind of experience you can really only have on these next-generation consoles, that the price is justified. But it’s easy to say that when you’re delivering extraordinary quality, and that’s what our company prides itself on doing.”
These comments have led me to predict a $69.99 baseline price point for Grand Theft Auto V’s re-release on PlayStation 5 and Xbox Series X.
These new price points put pressure on consumers to buy the top-tier versions of games and make the most out of their expensive new next-gen console purchase. Publishers will justify this increase with heightened experiences that are powered by new tech innovations. We’ll go over these below.
I’ve said in the past that next-gen consoles won’t offer exclusive games, but exclusive performance. So far this has been true.
Most games will run better on next-gen consoles by default, even if they’re not optimized. The Xbox Series X can natively boost certain games without optimizations, and games will load better on both systems by default thanks to their PCIe 4.0 SSDs (especially the PlayStation 5’s 5.5GB/sec SSD).
New games are optimized to leverage each console’s beefy 7nm SoCs to enable higher-end gameplay like 4K 60FPS, 1080p 60FPS with ray-tracing turned on, native 4K with 30FPS, and even 4K 120FPS in specific games. Titles are being made specifically to leverage the Zen 2 CPU, Navi GPU, and 16GB of GDDR6 RAM in these new consoles.
For example, Call of Duty Warzone now runs at 120FPS on PlayStaiton 5, and both Halo Infinite and Doom Eternal will be able to hit 120FPS on Xbox Series X/S consoles. Ratchet and Clank Rift Apart can hit 60FPS with raytracing turned on, which is no small feat.
Games will play better, look better, and overall perform better on next-gen consoles in ways that aren’t possible on the PS4 and Xbox One.
Read Also: Xbox Series X Review: Dream Machine
This is a newer concept that’s starting to take shape in more meaningful ways. Publishers like EA are starting to roll out certain features and game modes that are exclusive to next-gen consoles.
For example, Battlefield 2042’s 128-player multiplayer is exclusive to the PlayStation 5 and Xbox Series X and won’t be offered on PS4 or Xbox One. Those platforms are locked to 32v32 for a total of 64 players.
Madden NFL 22 also has features that are only available to next-gen hardware.
EA is introducing something it calls Dynamic Gameplay for Madden NFL 22 on PS5 and Xbox Series X/S. This is a net-all term that emphasizes key tech improvements from its R&D division, namely with AI. This is a clear proof-of-concept of EA’s new technologies that’ve been in development for years that are only now made possible by next-gen console tech.
Madden NFL 22’s Dynamic Gameplay offers three main improvements:
- Gameday Atmosphere – Connects players to their NFL fandom through the crowds, environments, and presentation elements that enhance and impact every game.
- Gameday Momentum – – Performance-based mechanics, including Home Field Advantage which provides a unique game condition tailored to each NFL team’s stadium atmosphere, swing momentum, bringing the tangible influence of momentum to life on the field.
- Star-Driven AI – Powered by real-world player data that will evolve throughout the season, changes AI behavior and team tendencies to make NFL superstars and the personality of each team more true-to-life.
This is just the beginning. These games are powered by DICE’s new next-gen Frostbite engine, which has been optimized specifically for next-gen consoles. Most of EA’s internal studios use Frostbite, and these technologies will weave their way into future games including Dragon Age 4 and the next Mass Effect game.
“We’re only at the beginning of the groundbreaking experiences and immersive fun that we’re going to be able to create for players on the new consoles using more AI, machine learning, adding social layers to make connection and communication seamless and more. Where we’re going will be truly transformative,” EA CEO Andrew Wilson said in 2020.
Battlefield 2042’s huge 128-player maps and crazy next-gen physics systems are a testament to these new breakthroughs.
EA has its experimental SEED division which has been researching and developing new game technologies based on AI, machine learning, streaming, and other infrastructures for years now.
Microsoft has developed tremendously powerful and flexible DirectX 12 APIs and toolsets to help developers optimize their games for Xbox Series X/S, and Sony’s internal AI division is working with first-party developers on new machine-learning and algorithmic technologies.
Ubisoft also has its own R&D department called the Strategic Innovation Lab that has helped manifest next-level AI tech in games like Watch Dogs Legion. Ubisoft also recently appointed a machine learning expert to lead its product technology team.
Publishers will be more likely to shift away from current-gen hardware as the next-gen install base matures, and as these advancements continue outperforming the PS4 and Xbox One’s capabilities.
Right now the major next-gen exclusive features have been marginally small, but when combined with next-gen exclusive performance, these are powerful motivators to upgrade to next-gen hardware and pay the new $69.99 MSRP.
We should see bigger advancements start rolling out in 2022-2023 game releases as these R&D divisions break new ground and implement the tech inside of game engines. That means significant upgrades for engines like Ubisoft Massive’s Snowdrop, DICE’s Frostbite, and even Bethesda’s own Creation Engine 2.
2021 is a pivotal year for the next-gen console transition. Publishers will continue slowly pushing ahead and incentivizing next-gen purchases while also supporting current-gen hardware like the PS4 and Xbox One in a sales capacity.
Sony, in particular, will support the PlayStation 4 until at least 2023 and expects the PS4 to make 70% of revenues in 2022.
“Great new PS4 releases and an expansive catalog mean that we expect the PS4 to account for 70% of next year’s store spend despite the growing install base of the PS5,” Sony’s Jim Ryan said.
Microsoft, on the other hand, will start offering next-gen exclusive Xbox Series X/S experiences like Starfield in 2022. They aren’t leaving the Xbox One behind, though, and will instead offer Project xCloud game streaming as a way to access next-gen exclusives on current-gen hardware…which is a novel approach.
Third-party publishers will blaze new trails and help justify the $69.99 costs with hefty upgrades, enhancements, and exclusive features that leverage the power of next-gen hardware. We don’t expect next-gen sales to eclipse current-gen any time soon, but performance and feature sets are already doing so at a rapidly expanding pace.