Interview: Talking Xbox One, PlayStation 4 and next-generation gaming with Michael Pachter

[GZ]: It would be easy to ask you what you anticipate being Sony and Microsoft’s policy on used games for their next-gen consoles, but instead I want to ask you whether or not the industry as a whole would be better off without used games? Many note that PC gamers do not have used games and they’re doing just fine, and that consoles need to simply invest in Steam-like software that provides modest pricing. And when it comes down to it, Michael, are used games or poor publisher/developer decisions more to blame for the recent string of studio layoffs?

[Pachter]: No, the industry would not be better off without used games. There are a lot of people who cannot afford new games, and the used market provides access for those people; similarly, the used market provides currency for people who want to buy new games at full price, and I think that the “cost” to publishers and developers from used game sales is very low. Used games have nothing to do with studio layoffs; rather, poor decision-making is the reason. 

[GZ]: Microsoft was clear that the reveal was principally to showcase the Xbox One hardware, and that E3 would be their platform to highlight the games that’ll be on that hardware. Would you label Microsoft’s E3 presentation as “do or die” for the company in terms of those contemplating the Xbox One or PlayStation 4? And do you trust that their briefing will actually be “about the games?”

[Pachter]: The E3 presentation is certainly pretty important, since they only showed a handful of games at the Reveal event. Yes, I trust that E3 will be all about games, and I am looking forward to it.

[GZ]: Sony had the first word regarding their console announcement, and they will also have the last word at E3. It’s no secret that we will be seeing the PlayStation 4 for the first time there, but what else do you expect Sony to present during their briefing? 

[Pachter]: No clue what Sony will show, but I’m excited to hear a launch date and price, nonetheless.

E3 2013

Now to shake things up, we're going to turn to some quick-fire questions regarding next-generation and, particularly, the "console war."

[GZ]: Will Mirrors Edge 2 be announced at E3? As an Xbox One exclusive?

[Pachter]: Yes on Mirrors Edge 2. Unlikely it’s an exclusive.

[GZ]: Will there be a subscription-based Xbox One bundle at launch?

[Pachter]: Yes, there will be a subscription based bundle for Xbox One.

[GZ]: What will we be paying at launch for the Xbox One?

[Pachter]: $399

[GZ]: …And for the PlayStation 4?

[Pachter]: $349

[GZ]: Who will come out “on top” once E3 is gone and passed?

[Pachter]: I think both Sony and Microsoft will perform really well, and think that gamers come out on top, because they will have more choices than ever before.

[GZ]: …And will that be who’s more successful at launch?

[Pachter]: The boxes will both sell out at the above prices.

Xbox One PS4

And that wraps up our interview with Michael Pachter. We'd like to thank Michael for taking time out of his busy schedule to talk to us about the Xbox One and PlayStation 4. Did anything that Michael touched on resonate with you? Anything you disagree with? Let us know by commenting below, and stay tuned to GameZone for all your gaming needs.

It was just one week ago that the world was introduced to Microsoft's Xbox One. The unveil brought excitement, frustration and a significant amount of confusion, but it has officially ushered us into the next generation of gaming now that all of the "console war" participants are in line. Today, we are excited to be joined, once again, by Michael Pachter, Wedbush Securities' Managing Director who has been analyzing the gaming industry for years now. We're going to ask Michael several questions regarding the Xbox One, PlayStation 4 and the industry itself, so without further rambling, here's our exclusive interview with Michael Pachter. 

[GameZone]: What were your thoughts after watching Tuesday’s Xbox One event? Did you feel that Microsoft presented their console in the best way that they could, especially with E3 just weeks away?

[Michael Pachter]: I think Microsoft and Sony are each trying to offer a complete solution, with games and multimedia functionality. Sony led with games, Microsoft led with multimedia. We can evaluate how each presented after each has finished its presentation, which will be post-E3

Xbox One Reveal

[GZ]: Who did Microsoft believe they were marketing to with their Xbox Reveal? Rev3Games’ Adam Sessler noted that your average, “casual” consumer wasn’t tuning in on a weekday at 10 a.m. to watch the unveil, but in fact the “hardcore” individual. However, Microsoft seemed to be catering directly to the consumer that’s less interested in gaming and more in television and other media. Do believe they expected that a broad demographic was tuned in; so much so that they would go to such lengths to sell the Xbox One’s entertainment value, or are they in fact pushing for hardcore and casual parties alike to be “wowed” by what Xbox One can do from an entertainment perspective?

[Pachter]: Adam is a friend, very intelligent, but wrong on this one. Your average casual consumer doesn’t watch press conferences at all, and instead relies on the mainstream press for information. The mainstream press was at the event in force, and uniformly impressed; only the gaming press was underwhelmed. I don’t think that Microsoft is so naive as to think a broad demographic was tuned in, but they were sophisticated enough to know that they would be featured in the New York Times, on Bloomberg and CNBC, and on NPR and NBC, all of whom would say positive things. They’ll show games to the hardcore at E3.

[GZ]: A major announcement that was probably the least covered was the “new relationship” between EA and Microsoft. Do you anticipate that this new deal will bring major franchises and/or new IPs exclusively to Xbox One, or can gamers expect a less-than-impressive partnership that provides exclusive modes like that of FIFA 14 and its Ultimate Team mode? In layman’s terms, is this new relationship significant for Microsoft and their consumers?

[Pachter]: I am certain that there is an EA exclusive for Xbox; I don’t know what it is, but it’s likely a new IP. That could be from anyone, but the Respawn IP makes the most sense. The exclusive sports modes are a smart thing for both companies, costing little to provide and generating a lot of enthusiasm. Anything that is exclusive for any console is significant, as it makes that particular console more desirable. We’ll hear more from Sony and Nintendo later this year.

Console War

[GZ]: There was major confusion throughout the event regarding always-on, always-online and used games. Regarding always-online, do you believe Microsoft will in fact make that bold jump and require a constant Internet connection, and if so, how do they respond to the reality that there are those throughout the United States –throughout the world – without high-speed, robust Internet?

[Pachter]: I don’t think they will require always on or always online, but rather “always connected,” with a periodic online connection required (likely once a day, but we’ll see what they come up with). They have to validate that the same game isn’t copied onto several consoles in order to support used game sales and preclude piracy, and I’m sure people won’t complain if we can set the box to connect at 4 a.m. every day when we’re asleep. I am not sure how they are going to handle the broadband issue, as it is an impediment for a lot of people, and hurts some of the most faithful gamers who are in the military and stuck on aircraft carriers or in Afghanistan without a persistent Internet connection. I think Microsoft has a solution, but I don’t know what that is.