Somewhat articulate

Why this LG vs. Sony Case Sucks for Everyone

The business world is one of the most vicious, cut-throat, and competitive environments the world has ever seen.  It may even rival battles of ancient times between entire nations.  The difference these days is that while companies do not throw sticks and stones, storm castles, and stand in musket lines firing shots at one another, they do throw patent infringement cases around.

A few weeks ago, electronics manufacturer LG filed an injunction against Sony, stating that several Sony products violate patents held by LG.  Most of the products that supposedly violate the patents are several Sony Blu-Ray players, including the current generation models of PS3’s.  If LG wins the case, Sony will be forced to take the current configuration of PS3’s entirely off the market and pay LG hundreds of millions of dollars in damages.  Alarmingly, the injunction has been granted by the courts in Europe and several thousand PS3 consoles were confiscated by UK Customs officials yesterday.  The effects of this confiscation are supposedly not going to be felt for at least 2 to 3 weeks, since they anticipate they currently have a 2-3 week supply of PS3’s already in stock at retailers.

The title of my blog today is very deliberate.  It does suck.  It sucks for everyone in gaming.  If you peruse through online forums right now, you’ll find the comments of many people who are calling and hoping for the downfall of Sony through all of this.  The videogame console industry has very little competition right now.  It’s a restrictively expensive industry to enter and there are very few corporations that have the capital, reputation, and third-party backing necessary in order to introduce themselves as a new competitor.  It is not a small business-friendly environment.  Each console generation has had fewer and fewer companies with a console.  We saw Sega throw in the towel in the previous console generation with the Sega Dreamcast.  With the production costs in videogame development on the rise and the success of the original Xbox, the Game Cube, and the PS2, Sega simply could not keep the momentum going like they had previously done with the Sega Genesis and Sega Saturn. 

So let’s hypothetically assume the worst case (and highly unlikely) scenario.  Assume that out of all of this Sony vs LG drama that LG takes Sony’s lunch and they’re forced out of the videogame console industry entirely.  What are we left with?  Microsoft and Nintendo.  That’s it.  Nintendo is pretty much dominating the casual gaming market, with Xbox Kinect starting to nip at their heels a little bit.  However, let’s look at a little history here.  What happens when we have an industry where Microsoft dominates it and has no rival?  We all remember the drama from the last decade where Microsoft was accused of running a monopoly with Windows.  We had no alternative to Windows.  Microsoft had the operating system so thoroughly dominated that you couldn’t find very much software support for pretty much anything but the Windows operating system.  Because of that, Microsoft put out buggy operating systems, terrible support and the consumers suffered because Microsoft had no incentive or reason to innovate.

Currently, the videogame console industry is somewhat healthy because there is a steady stream of console innovation.  Without competition in this industry, all we’re going to see is the same game repeated over and over and over again (How many Call of Duty’s are there, again?).  So I repeat what I said.  This whole LG vs. Sony stuff needs to be over soon.  LG is not even a competitor in the videogames market.

If you peruse through online forums right now you’ll hear lots of angsty teenagers that are hoping for the downfall of Sony because they took out the “Other OS” feature on the console earlier this year.  Angst away if you must (yes I made it a verb), but keep in mind, there’s barely enough competition as it is.  And if we keep losing competitors like we have with every console generation, we’re going to be stuck playing Kinect Sports and never get cool new games like Killzone ever again.