Microsoft Just Made A Huge Mistake At E3

Posted: June 16, 2016 in Opinion Piece

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by Erik Kain via Forbes

Microsoft just made a huge mistake that the company can’t walk back from during its E3 2016 media briefing this weekend.

First, the company announced a brand new Xbox One: The Xbox One S. This is a slimmer, sleeker, and more powerful Xbox One than the big, clunky thing we have on our entertainment stands at the moment. It’s more attractive and, according to Microsoft, will even play games better thanks to its High Dynamic Range capabilities. It will also play 4K video.

A limited edition of the Xbox One S will launch in early August. It comes with a 2TB hard drive and costs $399. Two standard versions will be available soon after. The smallest and cheapest is a 500GB edition for $299, and one step up you can get the 1TB version for $349. (Limited is obviously the way to go given how fast modern games eat up hard drive space.)

This, in and of itself, would have been a really terrific announcement for Microsoft to make. It would have been a great console to sell this holiday season, both on its own and as part of various bundles.

Unfortunately, Microsoft then shot itself in the proverbial foot. They also announced the Xbox One “Scorpio,” an even more powerful console, with a release date in 2017.

The Scorpio is much faster and more powerful than vanilla Xbox One, from graphics oomph to memory bandwidth. Perhaps more importantly, the Scorpio is likely more powerful than its upcoming competition.

According to an analysis at Eurogamer’s Digital Foundry, the Scorpio is almost certainly faster than the upcoming PS4K Neo console as well—possibly as much as 40% faster. Read that analysis for all the juicy details. Suffice to say, Scorpio looks like it will be a beast—a huge upgrade from vanilla Xbox One in almost every sense.

That’s terrific! It’s almost like having a new console, and it transforms the way we think about upgrading consoles into something far more akin to upgrading mobile phones.

Microsoft’s mistake wasn’t to create the Scorpio, which could easily give them a new boost in the console race they’re currently losing to Sony. Their mistake was announcing it at the same time they announced the Xbox One S. The announcement turns many potential “S” buyers into potential “Scorpio” buyers. Most consumers won’t have cash on hand to upgrade vanilla to “S” and then “S” to “Scorpio” just a year later.

What Microsoft should have done was remain tight-lipped about Scorpio to give the Slim a chance to actually sell and flourish. They should have kept their plans under wraps until at least early 2017, if not E3 2017, where such an announcement would have made waves (especially with units to play on.)

This was a huge wasted opportunity for Microsoft, and could very easily result in lost sales of the new S this Fall and holiday season. On the other hand, it’s nice for budget conscious consumers. It gives them a clear roadmap so that they can easily decide whether to upgrade now or wait.

For that, at least, we can tip our hats to Microsoft. It’s always nice when to hold off on making large purchases, when something better is just around the corner.

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