Gaming Giants Go Soft -- Karaoke Anyone?

Move over guns and grenades. Make room for karaoke microphones and Frisbees.

The gaming world is going soft.

Having been the home of fairly violent games like the Xbox 360's "Halo 3" and PlayStation 3's "Resistance: Fall of Man," the video game industry is looking to grab more of the mass market consumer.

Microsoft A screen shot of "Lips," a new karaoke game for the Xbox 360.

Given the considerable success of the Nintendo Wii, which already attracts a diverse group of gamers, and social games like "Guitar Hero" and "Rock Band," the two other consoles, Microsoft's Xbox 360 and Sony's PlayStation 3, are adding more family-friendly video games to their libraries and offering movie and TV show downloads on their consoles.

"The mainstream audience is defining video game play again," said Nolan Bushnell, the former CEO of Atari, founder of video game classic Pong and current CEO of uWink, a chain of social gaming restaurants in California.

Microsoft’s Xbox 360, for example, announced an exclusive deal with Netflix at the E3 Media and Business Summit going on in Los Angeles this week, which allows the DVD movie rental service’s eight million subscribers to download and watch movies instantly on the Xbox 360, for no extra cost.

The deal, experts said, has the ability to make the console the centerpiece of the living room, long the Holy Grail of the gaming industry.

"Microsoft wants Xbox to be the one set-up box that you have hooked up to your entertainment system," said Peer Schneider the publisher and senior vice president of content at IGN Entertainment, a network of video-game related Web sites that are a unit of News Corporation's Fox Interactive Media.

Besides the Netflix deal, Microsoft is trying to attract a traditional non-gaming audience by adding a new interface this fall that allows users to create avatars in social environments, similar to the Wii's popular Mii avatars.

Nintendo "Wii Sports Resort," to be released next spring, features beach sports.

Also coming this fall are lighter games like the card game "Uno," and a karaoke game called "Lips."

"Everybody can come together and play in the living room," said Microsoft's Senior Director of Product Management David Hufford of the new games.

Because the Xbox 360 had tremendous success attracting hardcore gamers with titles like "Halo" and "Gears of War," the more family-friendly titles "feels like a mismatch," said Schneider, who is quick to note that the move to attract a mainstream audience reflects the video game industry’s long-running strategy: first hardcore, then mainstream.

Much of the push for mainstream has to do with the mass appeal of the Nintendo Wii and its easy operation.

The Wii, said David Riley, director of market research firm NPD Group, "has attracted so many traditional non-gamers into the gaming market that it has helped a lot to move this industry forward."

The simple controller "opened the door for many who were controller phobic," said Bushnell, and got them to start playing.

"Games that are making the biggest impact are the simplest," said Bushnell referring to the game "Wii Sports," which lets users play tennis, bowling or baseball by waving the motion sensor controllers.

Nintendo is releasing an accessory that plugs into the base of the Wii remote for more intuitive controls. They can be bought separately or comes packaged with "Wii Sports Resort," set for release in Spring 2009, which features beach sports like Frisbee and jet skiing.

Microsoft The Netflix queue on Microsoft's Xbox 360.

Like Microsoft, Sony will also begin to offer downloads or rentals of movies and TV episodes from most of the major studios, ranging from $1.99 to $14.99.

The PlayStation 3's content downloading service might be more attractive to those who want their movies and TV shows on the go; Sony's handheld device PSP can connect to the PS3 and transfer the downloads.

The PlayStation 3 has a built in Blu-ray DVD player, which already gives costumes an incentive to buy the console.

In the gaming front, Sony will be releasing a social gaming title called “LittleBigPlanet” this fall.

The move to add more content, whether it be video games or movie downloads, has been well received by analysts.

“Finally, the manufacturers are giving them a reason to pick these consoles up,” added Riley.

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