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PlayStation 4 vs. Xbox One: Who will survive the video game wars?

PlayStation 4 is winning the latest battle over Xbox One in the video game wars, beating Xbox for the fourth-consecutive month in the latest tally for the console wars, but it remains to be seen who will win the war.

"The game is just getting started," says Blake Harris, author of Console Wars: Sega, Nintendo, and the Battle that Defined a Generation.

Since Sony's (SNE) PlayStation 4 was released in November, more than seven million units have been sold worldwide compared to about five million Xbox one units from Microsoft (MSFT), according to sales figures from NPD Group.

Related: Sony stumbles: So why should Apple be worried?

Harris says the competition between Microsoft and Sony goes beyond games. The companies are waging a battle for the soul of your living room. The the Xbox One in particular was designed to be a hub controller for all of  the user’s media, including acting as a substitute for their existing cable boxes. The result was a somewhat clunky interface that has yet to capture mindshare with the gaming public.

The game is increasingly about networks as well. Both Sony and Microsoft are driving users to sign up for their own free standing networks. Once there users can stream videos, use Netflix (NFLX) and other streaming services and download games.

On Monday Sony CEO Kazuo Harai emphasized the importance of the Sony network as a way to keep his company afloat. “We have to rigorously pursue install base numbers” Harai told reporters. “The biggest driver for our network will be the PlayStation 4.” Sony’s network currently has more than 52-million users, most of whom own either a PlayStation 3 or 4. Microsoft’s Xbox Live has 48 million users.

But Harris says both companies may be focusing on the living room so much that they’re missing the importance of what they’ve got in the palm of their hand. He suggests those keeping score look beyond the traditional video game consoles to where the next big battle will be waged: the portable market.

"Nintendo is doing great in the portable space," says Harris, adding that the "handheld market alone can become more significant as it becomes a big jumble in the console market." Included in that big jumble: more virtual reality games, says Harris. And he suggests that those keeping score not ignore the Oculus Rift, which Facebook (FB) bought two months ago for $2 billion, but has yet to hit the market for the masses.

"Maybe there isn't another level of graphic superiority for the next generation console... and it is virtual reality... and playing these incredible games," says Harris.

In the meanwhile, gamers can enjoy the "incredible graphics" on PS4 and Xbox One, including the most popular "Titanfall," offered exclusively on Xbox One.

And Sony and Microsoft will continue to compete for market share. Sony just announced plans for a joint venture with state-run Shanghai Oriental Pearl Group to re-enter China's market for game consoles. Last month Microsoft announced it would start selling its Xbox in China.

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