Game console cycle

Maybe you scoff at the idea of someone playing a video game being called an athlete, but once upon a time many felt the same about people getting paid to throw a ball around. Like it or not, the esports movement is picking up steam. Granted, Corsair is a hardware company, and the sale of equipment can be a cyclical business model. However, the reason I'll be keeping an eye on this video game stock next year is the bottom line.

As it grows, Corsair is getting more efficient. This advancing bottom line could continue in the new year and beyond as gaming becomes an increasingly important part of the entertainment industry. Corsair is also building out a more durable business to complement its game-accessories business.

Game-streaming equipment is its highest growth segment, and it's complemented it with two recent acquisitions. One is an app that turns an iPhone or iPad into a webcam; the other is the world's largest esports coaching platform, Gamer Sensei. I'm intrigued. If you think video games and esports will continue to grow in popularity, Corsair Gaming is worth sticking on your watchlist.

The multi-year, console-refresh cycle strikes again. But Nintendo is missing from the guest list of this year's console party, so why am I recommending a company that seems to be out of step with the rest of the industry? The Japanese video gaming giant doesn't like to play by the same rules as everyone else.

Nintendo's semi-portable console has been the best-selling system on the market for 23 straight months. In November , the company sold a record 1. That impressive result was achieved in the face of both Microsoft and Sony pushing out new consoles in the first half of that month.

The existing Switch and Switch Lite systems are holding their own against fresh competition. Nintendo also released some of the biggest hits in recent months, including Animal Crossing: New Horizons in the spring of Rumor has it that Nintendo is putting together a new console for the holidays of , adding features such as 4K graphics and a beefier central processor to the basic Switch design.

That's a good idea even if Nintendo really doesn't have to upgrade its hardware anytime soon. The Switch lineup stands apart from the Xbox and PlayStation products by offering a radically different gaming experience. Sony and Microsoft's latest consoles weigh roughly 10 pounds each. You would need a backpack plus a portable electric generator in order to play them on the go.

Oh, and don't forget about their need for a TV screen. The complete Switch system weighs in below one pound, and includes two controller pads and an integrated screen. However, their foreign nature often presented developers with a steep learning curve. The aforementioned PS3 was, in many ways, a poster console for this issue.

Complexity in all the wrong places. With heavily customized hardware posing growing pains for developers, it made more sense for console manufacturers to move to a proven standard to ease development.

With the x86 being so capable and familiar to developers, both Sony and Microsoft decided to jump on that architectural bandwagon. This further lightened the resource load on game developers.

From their inception, these engines have been designed to run on the wide array of PCs out on the market, which makes them inherently scalable across hardware. As a matter of fact, many console game developers often had to spend far too many of their resources building their own game engines from scratch. This is what allows Project Scorpio to have beefier hardware yet be completely backward-compatible with the Xbox One without having to rely on software emulation or forcing game developers to recompile code.

This faster, new console cadence may cause some concern and give the impression that players must upgrade consoles every three to four years moving forward.

When I asked Sweeney what he thought about the faster console cadence, he was highly optimistic. That's incredibly valuable… By doing these incremental updates, the industry can move forward technologically at a much faster pace without those business challenges. I think it's really the ideal model: bringing the best upgradeability of the PC with the reliability of the console kept, so you're never going to have to deal with driver problems on a console, but you will get the newer hardware.

Even the Wii U is now selling at a loss. This generation is also likely to see fierce competition from smartphones and tablets running Android and iOS. Console revenues have already fallen behind Android and iOS gaming revenues. Many analysts predict that this may be the last generation of home gaming consoles. Also, PC graphics are expected to surpass console graphics.

See also Console Wars Heating Up. As of , data from Statista shows the PlayStation 4 dominating the market, outselling Xbox by more than three times the number of units. Sony was dominating the gaming console market with its PS2 but stumbled with the PS3, giving Nintendo and Microsoft a greater foothold in the market. It seems to have gotten some of the market share back with the PS4, but only time will tell how newer technology and changing consumer habits will affect the console-gaming industry.

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