How Sony Stole From Apple, and Other Big Stories From E3


Editor's Note: A previous version of this article stated that Take-Two Interactive was at E3 and argued the company had made a mistake by not launching Grand Theft Auto V during the upcoming holiday season and on the Xbox One and PS4. It also stated that Xbox One prevents sharing and would ban sales of used games to GameStop. These statements and arguments were incorrect. The Motley Fool regrets and apologizes for this error.

Each E3 gives gamers plenty to chew on, and this year was no exception as publishers added sequels, up-and-comers introduced new titles, and a cold console war grew hot again.

Big publishers captured most of the headlines, as Time Warner touted Arkham Origins, Activision Blizzard showed Call of Duty: Ghosts, and Electronic Arts previewed Titanfall for the Xbox One and teased Star Wars: Battlefront, the first of what could be many genre games under a broad-based license with Walt Disney.

A pilot and a titan in EA's Titanfall. Source: Electronic Arts.

But no one at E3 made bigger news than Microsoft , and for all the wrong reasons.

Still tone-deaf after all these years...
You know it's bad when Microsoft denies there's a problem in the first place. (Cough, Vista, cough). But that's what we had from Mr. Softy at E3 last week: no response to gamers who hatehow the forthcoming Xbox One console will require them to log in via the Internet once a day to check for rights violations.

Limited sharing of games and cloudy policies surrounding the exact mechanics of used games sales have also added heat to the launch.

You can almost picture CEO Steve Ballmer speaking from the pulpit. "Gaming is a privilege, not a right," he'd say in defense of the Xbox's daily spying as gamers riot in the streets below. Or not. The picture is what matters here: Mr. Softy casting a pall over a graying, Orwellian crowd of former Xbox enthusiasts.

A perfect setup for Sony , which responded with an overhand smash of an ad:

Sony skewers Microsoft's DRM policy. Sources: Sony, YouTube.

Microsoft hasn't suffered a takedown like this since Justin Long and John Hodgman dismantled Vista in Apple's now-infamous "I'm a Mac" ads. How ironic that Sony threw the punch, since it was the iPod that killed the Walkman. A rumored TV could do even more damage to the Japanese consumer-electronics giant.

For now, it's the PS4 threatening the Xbox One. And, for that matter, the entire Xbox line.

Not that Mr. Softy is without allies. Notably, EA. Microsoft touted Titanfall at its E3 press event. More will board the bandwagon as publishers come to realize the Xbox One's log-on requirement could lead to more direct relationships with players, less piracy, and more upselling of options and upgrades.

Presuming, of course, that gamers don't abandon the Xbox for the PS4 first. Both consoles will go on sale in time for the holiday shopping season.

Will gamers buy? No doubt. Flubs -- even big ones -- won't keep them from selling both in substantial quantities. But here, "substantial" may not be enough to create the sort of profit growth Microsoft investors are seeking.

What surprised you at E3? Are you more or less interested in Microsoft stock at current prices? Let us know what you think using the comments box below.

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Fool contributor Tim Beyers is a member of the Motley Fool Rule Breakers stock-picking team and the Motley Fool Supernova Odyssey I mission. He owned shares of Apple, Walt Disney, and Time Warner at the time of publication. Check out Tim's Web home and portfolio holdings, or connect with him on Google+, Tumblr, or Twitter, where he goes by @milehighfool. You can also get his insights delivered directly to your RSS reader.The Motley Fool recommends Activision Blizzard, Apple, Take-Two Interactive, and Walt Disney and owns shares of Activision Blizzard, Apple, GameStop, Microsoft, and Walt Disney. Try any of our Foolish newsletter services free for 30 days. We Fools don't 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.

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