In an interview last Friday Microsoft Corporation (NASDAQ:MSFT) Corporate Communications Chief Frank Shaw told All Things Digital not to expect a new Xbox console any time soon. There has been speculation that the company would preview the hardware later this year. Rumors said the company would make an announcement at E3, gaming’s premiere industry event, later this year concerning work on a new console. Hopes for such a move have now been destroyed, leaving the release of such a console at least two years away it seems. Nintendo have preempted the release of a next generation console by either Microsoft or Sony. The company announced its next gen offering the Wii-U last year. Nintendo are seen as offering a different gaming experience more conducive to casual gaming than the “hardcore” consoles produced by Microsoft and Sony.
Game consoles until now had usually conformed to a five year rule concerning the length of a single generation of technology. The common knowledge was that after five years the graphical and other technological abilities of a console had been fully tapped and consumers would soon become bored of the platform. The big players in the market, most notably Sony and Microsoft have made attempts to extend this lifetime limit in recent years. The huge R&D costs associated with developing a new console and the level of hardware innovation required result in companies selling their consoles at a large loss initially hoping to make up the cost later through games sales. The console manufacturers receive a licensing fee to publish a game on their platform. This makes up a large part of the revenue available in the market.
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Despite the delay in the release of its next offering Microsoft still dominate the console market. The company’s Kinect system has been much more successful than the Playstation’s Move concept and the company’s sales continue to vastly outstrip its competitors. The Xbox sold over 400,000 units in February almost doubling it’s closest competitor the Wii’s sales. The unit’s price has been slashed in recent years down to a retail average of about $200 which is very competitive with he Wii at $150. In terms of gaming experience the Xbox offers more in terms of catalogue as well as boasting the most successful online platform, Xbox live. We’ll have to wait for real news of a new Xbox but until that happens the internet will provide plenty of easily digestible rumors.