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The Problem with Microsoft's Position Pt. 2: Effects on Gaming Centers

When Microsoft revealed the "details" on the Xbox One, it left many shrugging, angry, enraged, confused, and most importantly, looking towards Sony as an alternative. The perspective that many had while watching that press conference was one of "I want to see what Microsoft will be doing." However, as I watched the press conference, I had two separate perspectives, one of which is relatively unique that many people have never had cross their mind: as the manager of a network gaming center.

For those few who do know here at Giant Bomb (and the many that don't), I work at what many would call a "LAN center," but we call it a "network gaming center." What does this mean? A lot of our business is built around a simple idea: come in, sit down, play video games with friends/family/complete strangers. It's not just about gaming here, as the social aspect is what we want to create; in our town, there are not many places that young people under 18 can go to hang out and relax in a safe environment. While some people will say "why would people pay to go somewhere and play video games at $5.00/hour (cheaper with bulk time, any unused time is saved on your account until the next time you come in), I would ask "why would people pay bar prices for drinks when they could invite people over and drink at a cheaper rate?" We go as low as $2.00/hour in bulk rates.

We've found a moderate level of success in a business model where many only last about six months to a year.

This will be our ninth year of operation.

When we started, it was with much less equipment. We were a floor space of 3,000 square feet housing 20 PCs (eventually moving to 28 PCs) and 4 original Xbox stations on 70" projection screens. Within three years, we were moving into the location next door because we needed more space; we were filling up regularly on PC and Xbox alike. Within the confines of our 6,000 square feet, we house 40 PCs, 28 Xbox 360 stations, a pool table, an air hockey table, and a Rock Band station (complete with an Ion drum kit!). All of them are system linked as well as online-capable (all 28 Xbox stations have their own personal Xbox Live accounts if someone doesn't have their own).

Why did we choose Xbox and Xbox 360? The choice was actually very simple: multiplayer. At the time, Halo was wildly popular. Remember that fervor around the release of Halo 2? Imagine how many people wanted to come into our store and play on this massive projection screen covering an entire wall, each person getting their own 32" slice of the pie. Now imagine people wanting to link up all four of the consoles for a massive 16-player deathmatch. It was extreme amounts of fun. When Xbox 360 and PS3 were being shown off, the choice was very simple to make. Xbox 360 supported four controllers on a lot of games for local multiplayer, better system link options for local LAN play, more secure online capabilities with Xbox Live, and Halo 3. These were all things that we needed to have happen.

"Josh, why did you feel the need to info dump all that stuff? I thought this was about Microsoft's problem with the Xbox One."

It absolutely is about that. Look closer at all the details that I've laid out. We have 28 Xbox 360 stations, and in terms of game variety, we have over 100 different games for people to play on Xbox 360 and at least 40 on PCs. When you go out to buy the new Call of Duty, you have to buy one copy, maybe two (one for a friend or a second Xbox in the house or something)?

When we buy the new Call of Duty, we are most likely buying a minimum of ten copies. We'll also have 17 of our house XBL accounts going out, so we'll need to get our subscriptions updated on that. Let's do the math:

  • $600 x 10 = $600
  • $60 x 17 = $1,020
  • $1,020 + $600 = $1,620

When Call of Duty: Ghosts comes out, we will most likely be spending close to $1,700 on the game. It makes your $60 purchase seem a little piddly in comparison now, right?

In turn, it means this: if we can save a couple of bucks here or there in order to get copies of a game, then we'll do it. If we can get a copy on eBay for $50, a copy on Newegg for $48, or a used copy at Gamestop for $55 minus our $15 off coupon from the Rewards program because we spend a LOT of money at that place, we will do it.

Mind you, we do not get this many copies for every game. With the majority of our games, we get one copy. It's all we need. However, with Halo, Call of Duty, Gears of War, Battlefield, Borderlands...these are the games we get a larger quantity of copies for. Why? Shooters are popular and that's what people want to play.

If Microsoft plans on somehow restricting the use of used/borrowed games on their consoles, this is bad news for us. With ten copies of Call of Duty, we can at least switch them between the 28 consoles that we have. However, saying that we'll have to either get 28 copies (more if we decide to expand on the console area at all) because of a potentially restrictive used games policy?

When we look at the next generation of consoles, we are currently saying "which one is going to offer the best options overall at a cheaper overhead?" and the current answer is Sony. Why? Sony's online (as far as we know) has no cost attached, but it is looking to be as fully featured as Xbox Live is. The next generation is currently looking to have a more online-focused setup and stepping further away from the local multiplayer ideals. If that's the case, then it means some rearranging on our part, and the PlayStation 4 is the better option for that specific focus.

The issue here is that we'd be "changing horses midstream." We've used Microsoft consoles and operating systems since we opened, and it looks that in our tenth year of operation next year, we'll be switching to Sony if Microsoft doesn't get their shit together. We have customers that come in to play a game before they decide to buy it themselves, a form of rental if you will. We have customers that don't even own an Xbox 360 console, yet they have an Xbox Live account and purchase Microsoft Points regularly to spend on the games here. What about the people that come in and end up saying "I want to buy an Xbox 360?" This has worked great for Microsoft, and they do not even realize it. Hell, we're just 28 Xbox 360 stations. Look at Howie's Game Shack. They are franchised...and last I checked, they have at LEAST 50 stations in each of their locations! This is money in their pocket, and they are about to lose it all because of restrictive policies.

That's not even the worst part of it. Our customers who play Call of Duty generally like playing it on Xbox more than PlayStation. Our customers like playing Halo. They like the Xbox Live platform. What happens if we make the switch to Sony's PlayStation 4? Will it receive the same type of fanfare and support from OUR customer base?

As it stands, the next generation of consoles is a scary prospect for gaming centers all over America. Many of them are small businesses that were founded with the idea of providing a place of comfort for gamers while also making a little bit of money. These aren't get-rich-quick schemes. We're not rich folks. We're regular joes that like video games and want to offer a space for people to enjoy that hobby. What happens when restrictions might take away a part of that hobby?

This blog is meant to offer a different perspective to everyone, one that many would not even see or hear about unless they were made directly aware of it. It's meant as a way to say "we have thoroughly enjoyed Microsoft's console on a personal and commercial level, and it sucks to see the rumors and news that we're seeing."

I also understand that asking a game console manufacturer to keep something like gaming centers in mind as well when they are designed a console is general craziness. They are looking at the individuals at home, not the individuals at LAN spots.

The times, they are a-changin'...and we can only hope that it's for the better. We'll know more at E3, but until then, we're sweating bullets.

Thanks for reading. Appreciate your time.