Thursday, July 15, 2010

How do the research budgets of Sony, Microsoft and Nintendo stack up?

There is a vast disparity between the research and development budgets for the three major console players.

According to statistics presented at the Microsoft Worldwide Partner conference 2010, Microsoft invested $US9.5 billion in research and development this yeat. This compares to $4.5 billion by Sony, and a relatively meagre $0.5 billion by Nintendo.

Speaking in a keynote, Microsoft COO, Kevin Turner, said the Xbox was one of the key products for the vendor, and that the Kinect add-on will be an important release in its retail strategy.

"Kinect is important because it will be the hottest retail item this year," he said. "It's an awesome experience that when you walk up to your TV it will recognise who you are. Gaming is just the start - the Xbox will be the hub of the living room."

Of course, those statistics are skewed a great deal - the Xbox platform itself wouldn't have recieved anywhere near the full $US9.5 billion investment - Microsoft has many other platforms and many other business interests. Sony, to a lesser extent is the same - the notebook, TV, music and phones business units would have been competing for that $4.5 billion in investment.

On the other hand, these kinds of investments don't exist in isolation. The overarching theme of the Microsoft Worldwide Partner Conference was the cloud - and investments that have gone into some of Microsoft's commercial research and development will have informed the Xbox development. It is Microsoft's great vision that everything in the household is connected, so the Xbox will transcend the mere playing of games.

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