Although Microsoft's (NASDAQ:MSFT) Xbox One had a terrific launch, sales of the console seem to have slowed to a crawl, with retailers going so far as to offer promotions to move inventory. Sony's (NYSE:SONY) PlayStation 4, meanwhile, outsold Microsoft's console 2-to-1 in the U.S. last month and remains difficult, if not impossible, to find. This is hardly surprising, as for dedicated gamers, Sony's console is simply a better deal -- it costs $100 less and is capable of (slightly) better graphics.
Yet Microsoft's Xbox One offers something Sony's PlayStation 4 can never match -- the ability to work as a set-top box. If the Xbox One is going to be a success, it will have to be on the strength of its TV capabilities. A new accessory unveiled last week could go far in making that case.
Microsoft announces the Xbox One remote
On Thursday, Microsoft unveiled the Xbox One remote -- a $25 universal remote capable of controlling the Xbox One, as well as the owner's TV and audio receiver. Although the lack of number buttons stands out as a poor design choice, $25 for a universal remote isn't a bad deal (Logitech charges $80-350 for its Harmony line).
Yet, the announcement has largely been met with derision. Business Insider's Kristen Acuna called it "pointless," questioning why anyone would ever purchase it -- after all, can't you just use your normal Xbox One controller to accomplish the same tasks?
While that's true, it's completely missing the point -- the remote is intended for people who aren't comfortable handling a video game controller. A gamer may be comfortable navigating the Xbox One with a controller, but what about that gamer's visiting grandmother?
This goes back to the original point behind the Xbox One -- the "one" device needed to control your TV. When Sony unveiled the PlayStation 4 last year, it focused entirely on games -- showing footage of games, games, and more games, without even revealing how the PlayStation 4 would look.
In contrast, when Microsoft unveiled its console last year, it glazed over its video gaming capabilities almost entirely, instead focusing on the Xbox One's ability to control the owner's entertainment center.
"Here at Xbox, we love gaming ... you're gonna see that ... a lot more at E3," Microsoft's Yusuf Mehdi told the audience when he revealed the Xbox One last year. "For now ... I want to show you how we'll take that passion for gaming, and apply it to your entire TV experience." The focus on TV-related features was so encompassing that it spawned parody videos, as dedicated gamers seemed uninterested in the Xbox One's TV capabilities.
More complicated than Xbox vs. PlayStation
Truth be told, the "Xbox vs. PlayStation" meme is largely irrelevant, as the consoles seem to be aiming at completely different targets. Right now, it's the easiest comparison to make, but over the long haul, Microsoft's true competitors could be Google, Apple, and Amazon.com (all of which are widely rumored to be working on set-top box solutions of their own) as well as the cable companies like Comcast -- not Sony.
Of course, establishing the Xbox One as a device for everyone (not just gamers) will require much more work on Microsoft's part. Five hundred dollars for a set-top box is a great deal of money -- just ask TiVo, a company that, for most of its history, was unprofitable, as it tried to persuade consumers to purchase its aftermarket set-top boxes.
Moreover, the Xbox One's voice commands are finicky and need further improvement, and additional integration with online streaming services is badly needed (the lack of HBO Go stands out). Paying $60 per year to access these services is another barrier, but that problem could be circumvented if Microsoft offers enough quality original programming.
In the end, the success of the Xbox One will come down to whether Microsoft can persuade people who don't play video games to buy one. The remote is a small step in the right direction.