Graphical upgrades between console generations used to be jaw dropping. The difference between an 8-bit NES game and a 16-bit Super NES game was enormous, as was the difference between a Super NES game and an N64 or Sony (NYSE:SNE) PlayStation title.
Yet ever since the sixth generation of consoles, which included Microsoft's (NASDAQ:MSFT) Xbox, Sony's PS2, and Nintendo's (NASDAQOTH:NTDOY) GameCube, the improvements have become increasingly incremental for many gamers.
While the seventh generation Xbox 360, PS3, and Wii were notably flashier than their sixth generation counterparts, the "wow" factor had diminished substantially. Sure, there were still impressive graphical beasts such as Ubisoft's (NASDAQOTH:UBSFF) Assassin's Creed and Sony's Uncharted, but as video games became more expensive to produce, gamers became harder and harder to please.
When the Xbox One and PS4 arrived last November, the initial differences were even less substantial.
Although both machines packed considerable graphical processing horsepower, some cross-generation titles that have been released so far -- Activision Blizzard's (NASDAQ: ATVI) Call of Duty: Ghosts, Ubisoft's Assassin's Creed: Black Flag, and Electronic Arts' (NASDAQ: EA) Battlefield 4 -- simply lack the graphical punch that makes gamers want to abandon their well-worn seventh generation consoles.
Meanwhile, Take-Two's (NASDAQ:TTWO) GTA V, which was released for the PS3 and Xbox 360, was a gorgeous demonstration of how much untapped potential remained in both consoles.
So that leads me to my main question for this article -- have we reached the point where graphics no longer matter for home consoles?
Does graphical horsepower still matter at all?
Nintendo's Shigeru Miyamoto, the man who created Mario, once famously stated, "Too many powerful consoles can't coexist. It's like having only ferocious dinosaurs. They might fight and hasten their own extinction."
Miyamoto made that statement before Nintendo released the Wii, a console much less powerful than either Sony's PS3 or Microsoft's Xbox 360, but still outsold both consoles by 18.5 million and 19.8 million units, respectively.
The Wii U, however, has only sold 5.7 million units since November 2012. By comparison, Sony's PS4 and Microsoft's Xbox One have respectively sold 5.3 million and 3.5 million units since November 2013. That has caused some critics to claim that Nintendo doomed itself with weaker hardware, which has made its games less graphically appealing than comparable PS4 or Xbox One titles.
Yet that statement is completely off base. As I mentioned in a previous article, Nintendo's Wii U ran into serious problems due to three other factors -- poor marketing, poor name choice, and a confusing form factor that caused some customers to think that the Wii U was a tablet peripheral instead of a new console. It had nothing to do with the Wii U's graphical capabilities.
Here come the texture by texture comparisons...
The differences between same-generation home consoles have also narrowed since the fifth generation.
Many games have been released on Sony, Microsoft, and Nintendo consoles and mostly look and play the same. There are plenty of articles that compare exact side-by-side screenshots and videos, but to many casual gamers, the games look roughly the same.
For example, here is a comparison of Eidos' TimeSplitters: Future Perfect (2005) on the original Xbox and the GameCube:
Now, jumping ahead to the eighth generation, here's IGN's comparison of Assassin's Creed IV: Black Flag on the PS3, Xbox 360, Wii U, and PS4.
While some gamers, who obsessively notice every last drop of rain or bead of sweat, might spot the differences, they aren't that obvious to average gamers. While the differences might be a bit easier to spot on large HDTVs, the basic gaming experience between these cross-platform titles is roughly the same.
There are also new comparisons between the Xbox One and PS4 versions of Konami's (NYSE: KNM) Metal Gear Solid V: Ground Zeroes that some sites claim prove the PS4's graphical superiority. Yet again, to most gamers, those differences simply aren't that apparent.
Sensory overload and the imminent death of triple A games
Movie fans probably remember the first time they saw CGI dinosaurs in the original Jurassic Park (1993) They probably also remember the two-and-a-half hour long explosion known as Transformers: Dark of the Moon (2011). The first Jurassic Park only cost $63 million to make, while the third Transformers film cost $195 million. Yet the former title has arguably aged much better than the latter.
That's exactly the problem facing the video game industry today -- triple A games are getting ridiculously expensive to make, and it's getting increasingly difficult to recoup production costs. Gamers are demanding Hollywood-like special effects, and games have reached a tipping point of sensory overload more akin to Dark of the Moon than Jurassic Park.
In an August 2012 interview for Edge Online, Assassin's Creed 3 creative director Alex Hutchinson called triple A titles the "last of the dinosaurs," which could buckle under the weight of their Hollywood-like production budgets. GTA V, for example, cost a whopping $266 million to make -- higher than the $220 production of Disney's (NYSE: DIS) The Avengers.
The greatest games don't need the greatest graphics
Yet when we look at the top five best selling games of all time -- Wii Sports (2006, 81.9 million units), Super Mario Bros. (1985, 40.2 million units), Mario Kart Wii (2008, 34.3 million units), Wii Sports Resort (2009, 32.2 million units), and Pokemon Red/Blue/Green (1996, 31.4 million units) -- none of them were big budget graphical spectacles. Instead, they were simply fun games that appealed to gamers of all ages.
More importantly, they were all made by Nintendo, which makes the lowest priced and lowest powered eighth generation console, the Wii U. This means that there is still an untapped market for fun games with less emphasis on photorealistic graphics. In addition, the latest trailer for Nintendo/Monolith Soft's upcoming Wii U title X demonstrates that its graphics can still hold its own against the PS4 and the Xbox 360:
The bottom line
I may sound old fashioned when I say this, but beautiful graphics simply aren't required for a great game. Simply take a look at Minecraft, a title with 1990s graphics that has nonetheless charmed gamers and sold over 35 million copies worldwide.
It will be interesting to see where home gaming consoles will be headed after the eighth generation -- just how much better can video game graphics get, and how much higher will their production budgets rise?
What do you think, fellow gamers? Has the industry become so obsessed over graphics that it has lost sight of how to make fun, compelling games? Let me know your thoughts in the comments section below!
Leo Sun has no position in any stocks mentioned. The Motley Fool recommends Activision Blizzard and Take-Two Interactive. The Motley Fool owns shares of Activision Blizzard and Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.