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Harrison on Steambox, Shield – “entering the hardware business is a hard thing to do”

Thursday, 10th January 2013 17:37 GMT By Stephany Nunneley

Microsoft’s European VP Phil Harrison has offered his opinion on the Piston and Shield PC-consoles touted recently by Valve and Nvidia at CES 2013.

Speaking with MCV during a press junket this morning in London, Harrison said the firms may find the road ahead quite tough for new, mass-market consoles.

“CES is always very interesting. But entering the hardware business is a hard thing to do,” he said. “You need to have deep pockets. Hardware can be successful but it’s rare to get new hardware to scale. I’m talking tens or hundreds of millions.

“It’s about having a supply chain and a distribution model, it takes thousands of people to make a reality.”

Microsoft announced this morning its new London studio, Lift London, will focus on connected products instead of physical releases.

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16 Comments

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  1. Hirmetrium

    Yes, a console with an established catalogue of popular games using accounts that people have already filled with said games, because you know, Valve’s digital approach isn’t fucking retarded!

    And, one thing you can be sure of, is that Valve’s pockets are deeper than most.

    I think Phil is out of touch with what Valve are trying to achieve.

    That said, the man is a massive console veteran, for both Sony and MS. I could well eat my words.

    #1 2 years ago
  2. Phoenixblight

    @1

    Valve’s pockets are not deeper than Microsoft and the Steambox using Linux limits the machine. There are less than a hundred games and no triple A games besides Valve that support Linux. Sure you can get Windows on the machine but guess who will have to pay for that license.

    SO Valve does have quite a task to prove to the market.

    #2 2 years ago
  3. Dragon246

    ““You need to have deep pockets. Hardware can be successful but it’s rare to get new hardware to scale. I’m talking tens or hundreds of millions.”
    Exactly. Unfortunately many “gamers” blissfully ignore this.

    ““It’s about having a supply chain and a distribution model, it takes thousands of people to make a reality.””
    That is why they are persisting with gamestop and physical retail structure. A “console” without physical medium is a recipe for poor sales.

    Trivia- Since 2003, steam has 50million users. In that time, more than 300 MILLION consoles were sold.
    Its not easy and steam doesn’t have the deep pocket to pull this off.
    Although I am sure steam knows all this too. So we can only wait and see.

    #3 2 years ago
  4. Mike W

    I think someone said the same thing about MS when they entered the hardware market….oh the irony is too sweet. ;)

    #4 2 years ago
  5. Phoenixblight

    @4

    Not really as MS put in billion dollars to market their machine. Valve does not have that amount of money to play with.

    #5 2 years ago
  6. Dragon246

    @4,
    And MS lost billions with original xbox. Valve cant afford that, like PB said. MS probably lost the amount of money equal to total worth of valve at that time, so its indeed a very difficult game to play.
    Very ironic indeed.

    #6 2 years ago
  7. DSB

    @3 But how much money did those 300 million consoles make? Not a single dollar? Okay then, maybe it’s time for a new approach.

    I don’t really see any reason for the industry to applaud itself when it’s that bad at making money off of those sales. It’s obviously due for a rethink.

    #7 2 years ago
  8. Dragon246

    @7
    Why should I be worried about that? If they are selling me a hardware for less than the market price, then that’s a plus for me as a consumer. If valve wants to sell a console at a profit, I may as well buy a PC. It would be cheaper.
    If the “rethink” means a costlier “console”, then no thanks. Industry is fine as it is.

    #8 2 years ago
  9. DSB

    @8 That’s great if you just want to collect plastic boxes full of hardware, but actually it costs you a lot more because you have to buy the games that are supposed to make up for that loss.

    All that a disc license does is help to cover that loss, transferring an extra expense to the content manufacturer, who then, because this is capitalism, transfers that extra expense onto you.

    Whereas Steam actually puts 70% of the profits squarely in the content manufacturers pocket, you’re looking at maybe 30% on a brick and mortar console deal, if you’re lucky.

    Guess who’s going to be shelling out to cover the difference.

    #9 2 years ago
  10. Cobra951

    None of that justice will make a whit of difference to the mass market. All they’ll see is the prohibitive $1000 price tag on that miniature desktop named “Piston”, and they’ll move along. Only the fans and other diehards will bite. If it’s sold at a profit, it may even carve a modest niche for itself, but it sure won’t change the world.

    #10 2 years ago
  11. Phoenixblight

    @10

    Piston and the SteamBox are not one and the same in fact they are different devices.

    #11 2 years ago
  12. theevilaires

    Phil the act is up you did your job now its time to go back to SONY. We Won! :D

    #12 2 years ago
  13. DSB

    Really TEA? You actually want Phil “4D Graphics” Harrison back on your team? :P

    I would’ve thought it was laugh of the year for the Sony guys when he went over.

    #13 2 years ago
  14. Maximum Payne

    @10 Agree.
    And that’s without windows licence and probably also without i7 and top GPU model.

    #14 2 years ago
  15. theevilaires

    @ DSB It was all staged Phil Harrison still works for us…ermm I mean SONY. We *cough* I mean they set this all up so Phil could infiltrate Microsoft and leak several vital strategies. Our..*cough* I mean SONY’s plan is going according to schedule. :D

    #15 2 years ago
  16. Telepathic.Geometry

    Maybe I’m over-simplifying, but I think you can split core-gamers into 3 groups:

    A) PC gamers;
    B) Console gamers;
    C) Both.

    Right now I think that the number of gamers in group (B) who would like to move into group (C) is actually quite high, and Valve is just looking for a way to get them there.

    Obviously I don’t have a crystal ball, but I think that this means selling consoles at cost (not at a massive loss like MS did), not having to woo brick and mortar shops, and also not aiming for 100 million. Even if they could sell a few million, that’d be a nice new revenue stream for them, as I don’t think they would have many if any peeps coming over from group (A).

    #16 2 years ago