Today marks the close of the Electronic Entertainment Expo, or E3, a mammoth annual conference in which the world's best and brightest tech companies show off the latest in video game technology.
Giant #3 Nintendo Co. Ltd. (NYSE ADR: NTDOY) opted to sit this one out, having just released its newest console, the Wii U, late last year.
I've been using my *ahem* embarrassingly extensive nerd powers to troll forums and get an idea of how Microsoft's Xbox One and Sony's PS4 stack up in the eyes of the gaming community.
Unfortunately, most consumers are disappointed because the two companies ended up with virtually the same tech.
The consoles look nearly identical, have similar camera systems, blu-ray players, and cloud capabilities. CNET's Scott Stein quips, "[T]he two consoles feel like debutantes who showed up for prom in the same dress."
Both consoles strive toward becoming the multimedia center in every living room; an all-in-one home entertainment system that can replace your cable box, stereo, and DVR.
Price points are also similar: PS4 costs $399, Xbox One is $499.
Ultimately Sony seems to have slightly more support coming out of E3, due to the PS4's marginal edge on graphics, frame rates, and price.
But for an event famous for innovation, such lack of diversity between console tech definitely made this E3 fall flat.
They say where one door closes, another opens:
The giants' failings may have opened up a rare market for smaller indie gaming companies to step into the market.
For instance, keep an eye on Ouya, Inc.
Founded in 2012 by Julie Urhman, a game industry veteran, the company's self-titled "Ouya" console is scheduled to hit the shelves on June 25th.
Uhrman used Kickstarter to fund the project, and ended up raising $8.5 million – Kickstarter's 2nd-highest earning project to-date.
And there is good reason Ouya fared well on Kickstarter:
The Ouya offers something different.
First of all, it competes at a totally different price range – each unit costs only $99.
Second, every game will have a free demo experience.
Third, the games are cheaper and entirely downloadable.
Finally, the Ouya actually operates on a modified version of Google Inc.'s (Nasdaq: GOOG) smartphone Android system.
This means the Ouya can naturally house phone apps, among other things.
With less focus on graphics, game play experience is the mission here. Look for some intriguing plots and different styles than mainstream Halo-type games.
The idea has attracted some interesting indie and big name game developers, including the likes of Square Enix (TYO:9684). In fact, there are currently over 450 games being developed for the Ouya.
With giants like Sony and Microsoft failing to differentiate themselves with innovation, the gaming world just got a whole lot more open-minded.
Investors should stay on the lookout for new gaming companies on the horizon.The Ouya probably isn't alone.
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$100 gaming console coming soon