As most of you probably know, Microsoft’s next-generation gaming system, the Xbox 360, debuted last week. While the Xbox 360 will undoubtedly be the “gotta have it” gift this Christmas, exactly how successful the Xbox 360 will be for Microsoft will not really be known for a few years. The Xbox 360’s competition, the Sony’s PlayStation 3 and Nintendo Revolution, will be hitting the market within a year or so and the gaming masses will soon get to choose which of the three gaming franchises they want to buy into. For the past few years, most gamers have been choosing Sony’s PlayStation 2. Sony enjoys approximately 60% of the console market. Microsoft has around 20% and rising. Some analysts call 20% a success because Microsoft, in its first attempt, was able to take the 2nd place spot from Nintendo. Others say that given the investment Microsoft has made into the Xbox franchise, they could have done better. For the Xbox 360 to be labelled a success, how much of an increase in market share does Microsoft need to achieve? I personally think a number like 35% would be a great accomplishment. Such a 15% increase would likely come directly out of Sony’s market share, putting Sony and Microsoft almost neck-and-neck.

Ultimately though, no matter how great a gaming console is developed or marketed, success hinges primarily on the quality of the games that are developed for that console. Console manufacturers know this: they sell the consoles at a loss. Profits rely on license royalties from games sold for the console.

With a couple exceptions such as Halo, quality of games is where Sony and Nintendo dominate Microsoft. Will this change with the Xbox 360? I visited Fry’s over the weekend and got a look at some of the launch games for the Xbox 360. Two of the more anticipated launch titles, Call of Duty 2 and Project Gotham Racing 3, were on demo. Nearly every shopper that walked by turned their head and stared at the beautiful HD graphics offered by both games. Even with these first generation of titles, clearly the developers are utilizing the newfound horsepower in the Xbox 360 to make some awesome eye candy. Is killer graphics enough?

Let’s take a look at IGN’s list of the top 10 video games of all time:

#10 Super Metroid/SNES/1994
#9 Star Wars TIE Fighter/PC/1995
#8 Street Fighter II/[Many]/1991
#7 StarCraft/PC/1997
#6 Sid Meier’s Pirates/PC/1987
#5 Super Mario 64/N64/1996
#4 Sid Meier’s Civilization II/PC/1996
#3 Tetris/[Many]/1986
#2 Zelda: Ocarina of Time/N64/1998
#1 Super Mario Bros./NES/1985

What do you notice about this list? Well for starters, the newest game on that list is seven years old. Moreover, none of these top 10 games are for the current generation gaming consoles. The newest of the games on that list are for the now two-generation old Nintendo64. The PC games on that list are just simple, good ol’ 2D games. Digging deeper, if you look at IGN’s reasoning behind choosing each of these games, there is little mention of graphics. Instead, in nearly every case, what was mentioned was great storylines, innovative and depth of gameplay, and intuitive controls.

For me, the two innovative trends in gaming are:

Game Interaction
Dance Dance Revolution isn’t wildly successful because of the graphics. It’s been successful because you get to be in the game. Dancing on the DDR mat is far more visceral than pushing buttons on a controller. A few months ago I bought the Logitech force feedback wheel and pedals for use when playing Gran Turismo. I had been playing the Gran Turismo series for several years with the regular controller and it’s always been a game I enjoyed. With the Logitech wheel/pedals, the fun I have has really gone to the next level. I can honestly say I’m having more fun playing GT4 than I’ve had playing any other game on any console. When will I be able to play a fighting game and actually play by doing the fighting motions? Or play a golf game by actually swinging a club?

Online Gameplay
Definitely the biggest movement in gameplay has been in enabling multiplayer activity through the Internet. No more playing against lame, predictable AI opponents. Online gameplay clearly takes competition to the next level whether the game is sports, first-person shooter or MMORPG. But I think the really cool applications of online play is those that form community gaming experiences out of individual gaming experiences. Games like The Sims or Nintendogs. Remember how big those Tamagotchi virtual pets were? In Nintendogs, you have a virtual pet, but the pet lives in a virtual world thats shared on millions of devices.

Unfortunately, instead of innovating, most game developers are just taking the easy road by re-releasing the same games with better graphics and a couple new elements. What’s next…Tetris 360?