Nintendo and Microsoft wake up to families

After years of allowing children (let's be honest: allowing boys) to blow up spaceships, steal cars, and basically shoot anything that moves, the good folks at Microsoft who make the Xbox 360 video-game console have decided to go after a new market: moms.

That's right. Media reports last week said Microsoft plans to create a whole new set of games that will appeal to families. In addition, the company wants to make the family games that it already offers easier to find, placing them on prime retail space in place of war or sci-fi-type games. (Don't worry, boys, you'll still be able to get "Gears of War," Microsoft's best-selling game at the moment.) Microsoft may even cut the price on its game console before the holidays. Such a move is hard to even think about in June, but that's how marketing folks see the calendar.

Why the shift? Because nothing focuses the mind of a business executive like the success of a rival – in this case, Nintendo. But it's not just the wireless Wii that has vaulted Nintendo to the top of the gaming world. It's the decision that Nintendo president Satoru Iwata made about going after new markets.

Sooner or later, the supply of testosterone-driven males between the ages of 15 and 29 dries up. Nintendo decided to appeal to what are known as "casual gamers" – basically, everyone who is not a young male. Relying on the ease of use of the Wii as its hook, the company went after younger kids, women, and even seniors, creating games that cut down on destruction and emphasized fun.

Nintendo has been particularly successful with its sports-oriented games such as Tiger Woods Pro Golf. The wireless Wii remote has enabled family members – who might not have the thumb speed of younger family members – to hold their own. (The classic example was when late-night TV host Conan O'Brien defeated one of the Williams sisters playing Nintendo tennis with a Wii.)

The result: Wii outsells both Xbox 360 and Sony's PlayStation 3 by large margins. Experts project Nintendo will sell about 16 million Wii units this year, about 60 percent more than either of its rivals.

I've attended enough technology conferences to know what market experts say: In a competitive market, sooner or later a winner will emerge with a clear player in second, someone never quite as successful as the leader. The company that finds itself in third may be bounced out of the market entirely, or marginalized. (Think of operating systems for desktop computers: Windows is the leader, Apple is No. 2, and a lot of much smaller players scuffle at the bottom.)

Often, the difference has little to do with quality. Years ago, VHS beat Beta as a video format, although Betamax was far better. Mac users are more than happy to tell you why Apple is much better than Windows, but Windows has 90 percent of the market. Nintendo beats Sony and Microsoft, although the latter two game consoles are widely seen as better and more powerful machines.

Pricing and approach often make the difference. In each case above, the devices that won or now lead their markets offered a product that was cheaper and easier to use than its rivals. Nintendo's game console doesn't have the computing power of the Sony or Microsoft products, but it does have a pricing advantage – it costs $100 to $200 less. When you add Wii's ease of use and games that appeal to more than a narrow male demographic, you have a situation where marketing adroitness and innovation beat muscle and power.

This approach hurts Sony in particular. After a long ride at the top with the popular PlayStation 2 (the game console in my house), industry experts expected PlayStation 3 to continue its domination of the market. Instead, it has sputtered and stalled (its high price hasn't helped much), and Sony has experienced a meteoric drop from it long-held top spot in the gaming world. Steve Smith, writing at the Monsters and Critics website, says that if Sony doesn't shake this "loser" image, it could carry over to the next iteration, PS4. That would be a real problem for the company.

As a parent, I cheer Microsoft's effort to create games for the entire family. If you care about the games your children play, you probably want them to do more than just blow stuff up. It also has been a real chore for parents to find games that they think are suitable and that children won't view as boring or "uncool."

Indeed, I always find it puzzling why businesses other than Nintendo don't realize that parents are constantly searching for appropriate games, music, clothing, etc. Hollywood has finally started to realize that, "Hey – families go to movies, so maybe we should give them a few movies to go and see." If the success of the Wii means that other video-game console makers decide to include families in their business plans, that's fine by me.

In an article last week in Bloomberg News, Albert Penello, director of Xbox global platform marketing, said he realizes his company needs to start reaching out to this demographic or risk being "pigeonholed as a hard-core machine." If fear of being pigeonholed means my family can get more use out of an Xbox than our PlayStation 2, I will be more than happy to switch.