Why Microsoft is finally pushing for cross-platform online gaming

With this year's Game Developer's Conference barely started, Microsoft has already rolled out a major announcement that has the potential to significantly change the console gaming landscape. By allowing for cross-network play on Xbox Live, Microsoft has signaled it's willing to open the doors to one of gaming's most frustrating walled gardens and help restore the platform-agnostic promise of the early Internet.

The question is, why now? Microsoft has been running Xbox Live since 2002, and it's been nearly a decade since the similar PlayStation Network launched on Sony's PlayStation 3 (not to mention PC-based networks like Steam). Why hasn't Microsoft made public overtures to connect these disparate networks before now?

Part of it might be technical, on all sides. After all, it's easier to develop a new, private gaming network with tens of millions of users if you are in total control of all the hardware that will be connecting together. The Xbox 360 and PS3's vastly different system architectures may have made true online agnosticism difficult on console developers in the last generation as well.

But a large part of it was surely business-related, at least for Microsoft. The lock-in effects of closed gaming networks means console gamers have long had to effectively coordinate their system purchases to line up with those of their online gaming friends.

Ten years ago, when the Xbox 360 was launching, this was a key advantage for Microsoft's new system. Back then, Microsoft had years of experience running Xbox Live (compared to Sony's standing start with the PlayStation Network), a one-year head start in reaching market with the Xbox 360, and online-centric exclusives like Halo and Gears of War in the pipe to drive multiplayer-focused gamers to its console ecosystem.

The momentum driven by that Xbox Live lock-in among console gaming's online early adopters was no doubt a large part of why the Xbox 360 was able to find relative market success—especially in the West—following Sony's market-dominating PlayStation 2 (though it surely wasn't the only reason).

Today, the console market looks quite different from Microsoft's point of view. Worldwide, the PS4 is now in close to twice as many homes as the Xbox One. Even in the usually Microsoft-friendly American market, Microsoft only rarely beats Sony in raw monthly console sales numbers these days.

That means, all things being equal, this console generation is much more likely to see a critical mass of your friends playing on Sony's PlayStation Network rather than on Microsoft's Xbox Live. If both online ecosystems are closed off from each other, more new console buyers are going to follow those friends to Sony's console if they want to play online. But in the world of cross-platform play Microsoft is proposing, the Xbox One might suddenly get a second look—especially since the system will give you access to a new Halo in addition to letting you play Call of Duty and Madden with all your PS4-owning friends.

Microsoft has said it doesn't care overly much about the size of its user base relative to Sony's. Still, the same network effects that drove the Xbox 360's sales could now be a headwind against the Xbox One gaining more momentum among prospective buyers—especially among the online gamers that tend to be console gaming's biggest spenders. That means today's announcement from Microsoft can be seen both as an olive branch of consumer-friendly cross-platform cooperation and as a white flag of surrender in the battle to drive the console market.

And it's a flag that Sony doesn't have to accept. By offering "an open invitation for other networks [read: Sony] to participate as well," though, Microsoft is very publicly pressuring Sony to follow the same course. Otherwise, Sony will likely take a significant PR hit for trying to hold on to its own relative walled-garden advantage at the expense of player convenience. (Developers will also have to play along, but the notion of having a single, unified base of players across two major consoles will probably win out over any technical growing pains in connecting the two similar consoles).

Sony hasn't given much indication how it will respond to Microsoft's very open invitation/dare, but it would be in everyone's best interests if they could bury the hatchet. Business concerns aside, there's no longer much reason to force developers and players to a limited base of competitors with the exact same hardware if they don't want to. Hopefully, Sony won't let its current market dominance prevent a chance to finally unify a hopelessly divided online gaming landscape.