What Microsoft did right in 2011

2011 will go down as one of the best years for the Xbox platform ever. Much like the PS2 in 2004, the Xbox 360 has hit that sweet spot where the system is selling itself without the need of great exclusives or much push form the company. It has really landed the network effect where Xbox 360's are selling just because the install base is big. People are buying Xbox 360's because their friends have them.

Microsoft has also done a good job of pushing multi-platform games as 'exclusives' basically grabbing the public and claiming "Yeah you can play this on the other boxes but it is best on Xbox." Whether or not that is true is totally immaterial, it works. I've talked to more than one person who thinks Skyrim is only on the Xbox 360. (not PS3 and not PC) While their advertisements are not as funny or cool as Sony's, Microsoft really nails the audience mind share. When you see a Kinect ad you know ti is a Kinect ad before the little camera shows up. This is important in growing their install base, at this point Microsoft is selling the sizzle not the steak but man that sizzle sells.

Microsoft has also done a good job keeping the Xbox 720 rumors under wraps and out of the mainstream media. The only think I see derailing Microsoft is if they unveil that new box. Microsoft needs to ride this wave until it land on the beach, announcing a new platform would be hilariously dumb.

What Microsoft did wrong in 2011

One word 'Coast.'

With the gutting of Microsoft Game studios Microsoft is taking a short term view of the business. They are riding the wave of popularity but they are not actively looking for the next big wave. Or at least they are not being open about looking. The view from the outside seems to be that they are going to ride this pony until it can't go further and then jump onto the next thing.

I'm not saying they shouldn't enjoy being on 'top' but they need to watch out because the PS3 is nipping at their heels. A high reliance on Kinect is hurting the hardcore market. Xbox rode big third party multi-platform games in 2011 and that isn't a good plan to maintain an audience of hardcore gamers. In 2011 all the reasons for hardcore gamers (except 1) to buy a new Xbox 360 were on the other consoles as well. That isn't good.

Wrapping it up and looking ahead

There are no big names coming out this spring, I'm not talking about no games being announced I'm talking about the fact that we are not even hearing murmurs of anything. Admittedly this is the time in a console's life cycle where you enjoy the investment but I'm afraid Xbox fans may spend next year in the same boat Nintendo fans are spending 2011 in.

I still think it is way to early for Microsoft to put out its next console in 2012, I think you'll see an announcement in 2013 and a release around holiday 2014. The quietness on the exclusive software line up is troubling because consoles need exclusives.

Also Microsoft needs to kick Live in the pants it they want it to stay relevant. At the moment people are signing in because that is where their friends are; but Sony is offering a similar service on the other console for free. The game quality on PSN is equal if not better than Live and PSN is slowly checking off the same boxes Live has. One day, maybe in the next console generation, it will come down to the only difference between PSN and Live being that Live costs more. When that day shows up Microsoft is in very hot water.

Unlike Nintendo's future Microsoft's is largely in their own hands. Sony spent 2011 doing everything they could to win the most customers, Nintendo spent the year doing everything it could to lose the mos customers and Microsoft spent 2011 just having the most customers.