Industry analyst Billy Pidgeon, of IDC fame, is predicting a shift in the way video game systems will be developed, and priced.

The huge losses that Microsoft and Sony have suffered in getting their consoles into the hands of gamers at a (sort of) affordable price are a sharp contrast to Nintendo’s huge success and profitability with the Wii. While the high-end consoles came at a high cost for both the system developers and consumers alike, Nintendo was able to out-sell the competition with a cheaper, albeit less powerful system.

“I think the results of this cycle will have a strong influence on the next cycle, in that cheaper consoles will be expected,” Pidgeon explains. The massive popularity of casual gaming on Nintendo’s console, as well as with simple games like Guitar Hero is already changing the way game developers approach the industry.

Pidgeon goes on to suppose that the entire industry may shift from hardware-focused consoles to lighter appliances that depend on the Internet. “The platforms of the next cycle may not be a console at all, but software distributed by network to convergent devices like PCs, set top boxes and smart phones,” he explains.

Pidgeon goes as far as to suppose that the Sony PlayStation 3 may be the last console to incorporate “cutting edge” hardware. It may be possible that the video game console will create a greater divide between casual gaming platforms and dedicated, technically superior platforms. If not, hardcore gamers may need to rely on their PC hardware to deliver more powerful games.

Tags: console wars, gaming industry, wii

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