The Cutting Edge: COMPUTING / TECHNOLOGY / INNOVATION : A Potential Goliath? : PCs Join Pursuit of Video Game Buyers and Bigger Share of $6-Billion Industry

While video game kingpins Nintendo Co. and Sega Enterprises Ltd. and newcomer Sony Corp. fight it out for the hearts and minds of ever-fickle video game buyers, a new and potentially overpowering new combatant has tiptoed into the fray: the personal computer.

The PC has always been used for video games, but it never offered the lightning-fast action and graphics performance that dedicated game machines provided. Now, though, with the launch of Microsoft’s Windows 95 software and the tremendous power of the latest microprocessors, PCs are emerging as an important force in the $6-billion-a-year game industry.

“Ultimately the PC is going to be the dominant machine for games,” declared Fredric Paul, editor of Electronic Entertainment. “From a parent’s point of view, it’s a much better investment to spend $2,000 on a PC than $400 on one of the advanced video game players. The PC lets you do a lot of different things. The PC is good for you. The game players just let you play games.”

Video game companies contend, not surprisingly, that their machines are still the best for playing fast-action games. The latest generation of machines is powered by 32-bit microprocessors that offer the computing power of an engineering workstation. That translates into speed: lifelike Ninja warriors flying across the screen with reckless abandon and controls that let the player respond in an instant.

Sega, Sony and licensees of start-up 3DO Co. are all selling 32-bit game players. But despite the positive buzz around the Sony machine in particular, many in the industry say sales have been sluggish. Last year, before the newest machines were introduced, sales of game hardware had fallen by 40%, according to market researcher Dataquest Inc. of San Jose.

Sales of PCs, meanwhile, have been booming, and they’re much better equipped for games than before. Most new PCs come with CD-ROM players, which offer the massive storage capacity needed for video and sound. (The 32-bit game players also use CD-ROMs rather than game cartridges.)

And Windows 95 has given the PC a much friendlier face. Microsoft Corp. and Intel Corp., which makes the industry standard PC microprocessors, have insisted that software developers and peripherals makers adhere to strict standards so that PCs would be “plug and play.” In other words, when a new piece of equipment--such as a CD-ROM player, a printer or a software package--is added to a PC, Windows 95 will automatically recognize it.

That should help counteract the reluctance of some consumers to venture into the PC world. And it should prevent embarrassing situations such as that which occurred last Christmas when “The Lion King,” a popular CD-ROM game based on the Walt Disney Co. animated movie, failed to run properly on PCs, leaving children disappointed and parents angry.

“It used to be that you had to be a fairly sophisticated computer user to be able to get a game to run on your PC,” acknowledged Microsoft product manager Bill Koszewski. “Windows 95 should be a great platform for games.”

Microsoft is now aggressively wooing software developers to write games for Windows PCs. It’s also spending heavily to develop its own games, and has formed a joint venture with upstart Hollywood studio DreamWorks SKG that will focus heavily on games.

“Things have changed dramatically,” said Steve Weinstein, vice president of development for Alameda-based Spectrum Holobyte, which makes a popular Star Trek game for Windows PCs. “Microsoft used to ignore the game developers.”

Game designers also note that the PC offers a clear target, unlike the increasingly fragmented market for stand-alone game systems. Whereas a game created for the Sony PlayStation will not run on a Sega or a Nintendo machine, a CD-ROM designed for a Windows PC will run on machines manufactured by dozens of different companies. Even Sega and Sony are designing PC games: Sony has been at it for a couple of years, and Sega opened a PC games division in July with plans to introduce 30 titles in 1996.

Ironically, some of the software developers who were creating PC games early on may miss out on this latest turn of the market.

“Our founding mission was to make software that made a PC worth owning,” said Bing Gordon, a senior vice president at San Mateo, Calif.-based Electronic Arts. The company earned accolades for innovative PC games such as “Chuck Yeager’s Advanced Flight Trainer” and “Patton Versus Rommel” and by the late ‘80s was the leading maker of computer entertainment products.

But sales of computer games were about 10% of those for video games played on Nintendo. Although it never completely abandoned the PC, Electronic Arts directed its money and talent to creating games for Nintendo and Sega.

Now Electronic Arts finds itself playing catch-up in a market it once dominated.

“When we started going after the dedicated [video game] market, our share of PCs went down,” Gordon conceded. “We’ve been trying to make a comeback.”

It’s unlikely the PC versus video game battle will be decided any time soon. For one thing, Nintendo has yet to make its entry into the advanced game business, but it is making big promises for its new machine, to be released next year.

Sega’s Saturn and Sony’s PlayStation may also do better when the price falls below the current $300. “That price point is out of the comfort zone for many,” Dataquest analyst Bruce Ryon said.

But some in the game industry insist that it isn’t price that counts, but something else: “It’s all about the gestalt: how people want to be entertained and where they’re entertained,” said Trip Hawkins, chief executive of 3DO. “I don’t think people are going to leave their couches to go to their desk to play video games.”