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The Wait For Next-Gen Consoles Started Last Week

If you felt a barely perceptible rumble beneath the surface of this year’s E3, there’s a good reason for it: a new generation is on the way.

Less than a month ago, comments from Sony executives about the remaining life cycle of their phenomenally successful PlayStation 4 console sparked a host of speculation that the next generation of console hardware was still far off, with many outlets speculating that a new PlayStation could be “at least three years away.

That talk is nowhere to be seen now, as publisher Bethesda software revealed during its press conference that both its first new property as a studio in two decades, “Starfield,” and the highly anticipated sequel to 2011’s “The Elder Scrolls V: Skyrim” are being designed for next generation hardware.

That moment alone would be enough to signal that the successors to the PlayStation 4 and Microsoft’s Xbox One are coming, but taking a closer look, there are other major indications that a new console generation is probably set for 2020 – or, perhaps, even sooner.

The first indications of next generation hardware began at Microsoft’s E3 2018 Xbox Media Briefing the Sunday afternoon before E3 officially began, where Xbox head Phil Spencer took the stage to reassure an audience who had recently heard from Ubisoft head Yves Guillemot that he saw his company’s future in game streaming. “The same team that delivered unprecedented performance with Xbox One X is deep into architecting the next Xbox consoles, where we will once again deliver on our commitment to set the benchmark for console gaming,” Spencer said, confirming that the platform holder will launch new consoles in the future as traditionally understood by the gaming industry. This comment came without a specific timeline, but there were other clues, including the reveal of Halo: Infinite, a game with no release timeline and tech on display that appears well beyond the capabilities of the baseline Xbox One console.

Microsoft specifically committed to Halo: Infinite running on Xbox One consoles, but this doesn’t preclude the appearance of the game across multiple generations of hardware. “Crossgen” software – games with versions releasing on both older hardware and new platforms with improved visuals and features – is common when new consoles launch. It’s hard to look at “Halo: Infinite’s” visual quality and performance and view it as indicative of real-world performance on even Microsoft’s Xbox One X console.

By far E3’s most talked-about title, “Witcher 3”-developer CD Projekt Red’s “Cyberpunk 2077” was announced for Xbox One and PS4 as well as PC, but there are reasons to suspect there are other platforms in mind. The first is technical: CD Projekt Red was demonstrating the title live behind closed doors at E3 with 50 minute gameplay walkthroughs running in real-time on PCs running fairly high-end hardware, and despite this, the frame rate was shaky and seemed capped at 30. This is not a criticism of the title – it’s in development and very far from release. But the dividing line between high end PCs and the recent mid-generation console refreshes the PlayStation 4 Pro and Xbox One X is often frame rate: 30 on consoles, and 60 on high-end PCs.

Even ignoring the development build’s framerate on PC, there are red flags on display that signal a game that could struggle under the limitations of current generation of consoles. “The Witcher 3” suffered the most on PS4 and Xbox One in the same kinds of scenarios, particularly in large populated cities like Novograd, attributable to the comparatively weak CPUs in both consoles. These constraints are only lightly mitigated on the PS4 Pro and Xbox One X. Meanwhile, “Cyberpunk 2077’s” E3 demonstrations showed huge city areas full of NPCs and the kinds of effects that gave “The Witcher 3” on consoles problems.

The last clue from CD Projekt Red is one of timing; Cyberpunk creator Mike Pondsmith has suggested the game could be “years away” during interviews at E3.

At least we know that “Cyberpunk 2077” probably won’t arrive until 2020, along with “Starfield.” Another suggestion that the next generation of consoles is coming within the next two years is the relative unknown quantity of games releasing after 2019. Sony has typically announced projects at E3 years ahead of their release, but after the likely late-2019 release of “Ghost of Tsushima,” their calendar is uncharacteristically open, at least publicly. Ubisoft showed a graphically impressive technical demonstration of “Beyond Good & Evil 2” at this year’s show, one that seemed a leap beyond their current announced projects, and once again, there was no discussion of a release timeframe for it.

Rumors also recently surfaced of Sony’s development progress with GPU and CPU designer and manufacturer AMD on next generation graphics technology, an agreement that compromised AMD’s ability to ship a competitive PC component in a timely manner.

Even Microsoft’s big news at the show, the announcement of the founding or acquisition of five new development studios, was underlaid by a likely reality: that none of those new additions would yield new Xbox games until 2020 at the earliest. Coupled with the Halo: Infinite announcement’s absence of a release timeline, there was a real sense that Microsoft, and indeed Sony, and Bethesda, and others, are waiting for something. That something is new consoles, and all the signs seem to point to a likely 2020 debut for them.

It’s possible that developments could come even sooner, as the technology may be in place to launch new hardware in 2019. But 2019 would present other challenges to Sony and Microsoft. For Microsoft, their most passionate fans and early adopters likely just purchased a new Xbox One X, and releasing a newer, better console just two years later is a move that risks alienating that fanbase. For Sony, who is seeing unprecedented success with the PS4, this is their most profitable period with the hardware – the PS4 is cheaper to make than ever, software sales are higher than ever, and revenue from live services like PlayStation Network are higher than ever. Launching new hardware is typically a loss-leading proposition for platform holders, and disrupts software sales for both first and third parties.

Despite the high profits that come from a fully mature hardware platform and large install base, both companies seem to have committed to a new hardware generation, and there are good reasons for that. There have historically been indications that consumer engagement and excitement for platforms wane as those ecosystems mature. Put more simply, people aren’t excited by old consoles (unless the company selling them is Nintendo, that is). And the glut of available software for these systems leads to a player-base less willing to take risks with their purchases or time to try things they aren’t familiar with.

There’s also the risk that players will seek more expansive, sophisticated, advanced experiences elsewhere if consoles can no longer provide those things. The end of the last console generation saw a resurgence of the PC space and runaway success for PC-only titles like “Rust,” and the rise of PC multiplayer giants like “League of Legends” and “Dota 2.” It’s important for companies to get the best returns they can for as long as possible with consoles, but waiting too long can threaten the future of those platforms.

Time will tell how long Microsoft and Sony make the world wait for that new hardware. The only thing that is absolutely clear is that the waiting began last week.

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