Microsoft's big, data driven misstep

TV

If you missed it, that was a word that Microsoft used the most during its press conference in the reveal of its new console, the Xbox One.

Now make no mistake, television is a huge market, still the biggest entertainment market there is by volume around the world. And one Microsoft has been admittedly trying to crack for over a decade now. The design for the original Xbox was fought out with something like an IPTV service and being the central box of any television in mind.

So when it came time to design the Xbox One, Microsoft was no doubt ecstatic to find in its usage surveys of the 360, that half the time people were using their box for exactly what it had hoped for. Around half the time, if not more, people spent on a 360 was spent doing things other than playing games.

With the vision of a Microsoft box through which the whole television experience would feed still strong, and now data in hand to prove it could be done, the idea of building a box around this concept was surefire.

The only thing more surefire is how much this strategy has backfired so far. By and large the public reaction to the Xbox One's announcement has been indifferent to negative, with relatively little positivity compared to the other two camps to outweigh it. So what happened?

In one word: Competition. In the past less than a decade, a computer has become a device that's suddenly become useful to have hooked up to a television for various purposes. Netflix alone delivers the largest amount of bandwidth of any internet service going to US households, and to a growing and expanding list of other countries, every day. Being able to use it, or to stream other video content to your TV has become an everyday occurence for millions of people.

And the many millions of people that have adopted such services over the years have, conveniently enough, had some sort of computer already hooked up to their TV and ready to go for them. All in the form of the game console, quite probably a 360 (though more probably a A PS3 outside the US), that they'd already bought for other purposes. How useful, no need to buy anything new, no need to hook anything up, it was already done for you!

And now, 8 years after the launch of the 360, Microsoft is trying to sell these same consumers an expensive new box. That gets the same Netflix that their current 360 does. Or that a $50 Roku does, without any need for a monthly "subscription" to an extra service. Or a $100 Apple TV, a "hobby" for Apple that is raking in millions of sales.

But wait, says Microsoft, you can watch live TV on our new box too! Just like you already can if you have any other television service; but now you don't have to switch inputs if you want to go betweens games and TV! Yes, that really a selling point of their's, oh the horror of 3 or 4 button presses! But wait, there's more! Says Microsoft. Now, you can video chat, or stream music, and both at once! Just like you can already do with your PC, or your Tablet, or your Smartphone, all three of which you can (if it's a laptop) take around with you wherever you go, unlike the Xbox One.

So what exactly is the selling point of the Xbox One, what does it do that a conumer able to afford one can't do with something else they already likely have? Nothing, in so far as the Microsoft press conference was concerned for the most part. In fact, not only does it do nothing new, there are competing products that do the same things the Xbox One has been shown to do but better, and they're already available.

Fortunately most of this is just a question of marketing for Microsoft, something easily rectified. Or to put it another way: A $400 box that lets you watch TV, stream Netflix, and video chat on skype seems vastly overpriced. A $400 box that plays great games, and can also let you watch TV, video chat on skype, and stream Netflix if you want is pretty cool.