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Seventh generation of video game consoles

The seventh generation of home video game consoles began on November 22, 2005, with the release of Microsoft's Xbox 360 home console. This was followed by the release of Sony's PlayStation 3 on November 17, 2006, and Nintendo's Wii on November 19, 2006. Each new console introduced new technologies. The Xbox 360 offered games rendered natively at high-definition video (HD) resolutions, the PlayStation 3 offered HD movie playback via a built-in 3D Blu-ray Disc player, and the Wii focused on integrating controllers with movement sensors as well as joysticks. Some Wii controllers could be moved about to control in-game actions, which enabled players to simulate real-world actions through movement during gameplay. By this generation, video game consoles had become an important part of the global IT infrastructure; it is estimated that video game consoles represented 25% of the world's general-purpose computational power in 2007.

Joining Nintendo in releasing motion devices and software, Sony Computer Entertainment released the PlayStation Move in September 2010, which featured motion-sensing gaming similar to that of the Wii. In November 2010, Microsoft released Kinect for use with the Xbox 360. Kinect did not use controllers, instead using cameras to capture the player's body motion and using that to direct gameplay, effectively making the players act as the "controllers". Having sold eight million units in its first 60 days on the market, Kinect claimed the Guinness World Record of being the "fastest selling consumer electronics device".

Among handheld consoles, the seventh generation began somewhat earlier than the home consoles. November 2004 saw the introduction of the Nintendo DS, and the PlayStation Portable (PSP) came out in December. The DS features a touch screen and built-in microphone, and supports wireless standards. The PSP became the first handheld video game console to use an optical disc format as its primary storage media. Sony also gave the PSP multimedia capability; connectivity with the PlayStation 3, PlayStation 2, other PSPs; as well as Internet connectivity. Despite high sales numbers for both consoles, PSP sales consistently lagged behind those of the DS.

A crowdfunded console, the Ouya, received $8.5 million in preorders before launching in 2013. Post-launch sales were poor, and the device was a commercial failure. Additionally, microconsoles like the Nvidia Shield TV, Amazon Fire TV, Mojo, Razer Switchblade, GamePop, GameStick, and more powerful PC-based Steam Machine consoles have attempted to compete in the video game console market; however they are seldom classified as "seventh-generation" consoles.

The seventh generation slowly began to wind down when Nintendo began cutting back on Wii production in the early 2010s. In 2014, Sony announced they were discontinuing the production of the PSP worldwide, and the release of new games for the DS eventually ceased later that year with the last third-party titles. Microsoft announced in that same year that they would discontinue the Xbox 360. The following year, Sony announced that it would soon discontinue the PlayStation 3. Around that time, the remaining Wii consoles were discontinued, ending the generation as all hardware was discontinued. The final Xbox 360 physical games were released in 2018, as FIFA 19 and Just Dance 2019. Despite this, several more Wii games were released, including a few more annual Just Dance sequels, as well as a limited 3,000-copy print run of a physical release of Retro City Rampage DX. The eighth generation had already begun in early 2011, with the release of the Nintendo 3DS.

The Xbox 360 gained an early lead in terms of market share, largely due to its established Xbox Live online gaming system, and its early launch date, which was one year before its rivals. Sales in North America and Europe continued to be strong, even after the release of the Wii and PlayStation 3. Like its predecessor, the Xbox 360 received a muted reception in Japan, attributed to the lack of content aimed at Japanese gamers, which was a key reason why its predecessor underperformed in that country. Despite its early launch date, the Xbox 360 finished in 3rd place behind its competitors.

This early launch did come with some trouble, as technical problems appeared in a portion of Xbox 360 units sold. The most well-known problem is the "red ring of death" and Error E74, which received a great deal of attention due to some users having to replace their consoles multiple times. Microsoft attempted to address this by offering a three-year warranty on all affected consoles and repairing them free of charge. It also retroactively reimbursed owners of affected systems who paid for repairs, and ultimately made several adjustments to the console's design to improve reliability, consulting with "an established ASIC vendor".

As they share many cross-platform games and competed for the same audience as their predecessors, frequent comparisons are made between the Xbox 360 and PlayStation 3. The PS3 uses the Blu-ray format, while the Xbox 360 uses a standard DVD9. The Xbox 360 was less expensive to produce and broke even on manufacturing costs earlier than the PS3, while industry consensus was that the Xbox 360's conventional architecture is easier to develop for.

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