Segmented Markets

Another one of those topics hot on the mumblevine these days is the pros and cons of Microsoft's decision to offer two 360 models. The Technology Suits offer this perspective on it (thanks GameDev.Net) which isn't particularly earth-shattering but manages to ask some interesting questions:

In the end, the feature race between Sony and Microsoft will have pushed the price of the “full package” next-gen console (whether all-included or base with accessories) beyond the price of all but the hardcore gamers or those with ample disposable income.

The important thing to remember is that the industry needs to pay attention to the casual gamer if it wants to substantially grow fixed game sales. By segmenting the consoles, Microsoft has begun to do this. The “full package” will still be available to for the typical gamer, but a cheaper version that meets the needs of the casual gamer will also be available.

-- Should Console Manufacturers Segment Consoles

There does seem to be an interesting paradox. The price of the coming console generation doesn't really seemed aimed at the casual gamer, but the casual gamer is apparently the NASCAR dad of the gaming industry these days.

If that's the case ... that the casual gamer is the coming cash cow ... wouldn't it make more sense to develop a cheaper, less able, more user friendly console rather than a more expensive, powerful, decked out one? Is this Nintendo's strategy after all?