Nintendo and Microsoft are making the right moves to cut into Sony's lead in video games

Being the underdog counts for a lot in the video game industry. Both Nintendo and Microsoft are making smart moves against Sony's dominant position.

Beware Sony, the competition is closing in.

At E3, the annual video game trade show that's taking place in Los Angeles this week, the big three console makers — Microsoft, Nintendo and Sony — each touted their visions for the near-future of video games. After all three had wrapped up their press briefings, it was clear that while Sony may have a sales lead now with its PlayStation 4, its rivals are making smart moves that could help them cut into that lead.

null  (Christian Petersen/Getty Images)

Of course, the competition has a lot of ground to make up. Sony has sold more than 60 million PlayStation 4 consoles, which is more than double the number of Xbox One machines Microsoft has sold.

Sony has also left Nintendo in the dust. Though it's off to a good start, Nintendo's new Switch console has only been available for a few months, and its previous game machine, the Wii U, was a bust.

And Sony's also having a lot of success getting PlayStation 4 owners to buy other things. Nearly 30 million of them are paying for PlayStation Plus, Sony's online service.

Still, things can change quickly in the games business — something Microsoft and Nintendo are counting on.

Microsoft continues to push a narrative of Xbox as a platform, regardless of hardware.

Microsoft continues to push a narrative of Xbox as a platform, regardless of hardware.  (YouTube/Xbox)

The headline news at Microsoft's E3 event on Sunday was the unveiling of its powerful new console, the Xbox One X, which is aimed at Sony's high-end PlayStation 4 Pro.

But the company made another important announcement that was easy to overlook.

Microsoft company announced it's adding backwards compatibility with the original Xbox. Soon, you'll be able to play games designed for the first Xbox on the Xbox One.

It's admittedly a small addition to the Xbox One. Owners of the console could already play Xbox 360 games on the machine.

But the move is a big step toward allowing Xbox customers to build a library of games that don't disappear each time they buy a new console.

That's something smartphone owners and people who use services like Steam have come to expect. Their digital libraries generally exist in perpetuity and are typically available on all devices that run on the same platform, be it Apple's iOS, Android or Steam. But on gaming consoles, digital libraries are a relatively new concept, and Microsoft is leading the way.

Steam  (YouTube/Xbox)

Microsoft's support for backwards compatibility stands in stark contrast to Sony. In a recent interview with Time Magazine, Jim Ryan, Sony's head of global sales and marketing, said:

"When we've dabbled with backwards compatibility, I can say it is one of those features that is much requested, but not actually used much. That, and I was at a 'Gran Turismo' event recently where they had PS1, PS2, PS3 and PS4 games, and the PS1 and the PS2 games, they looked ancient, like why would anybody play this?"

But backwards compatibility isn't the only step Microsoft is taking to combat Sony. It has a bunch of new games coming — "Metro: Exodus" looks great! — and plenty of them are exclusive.

And then there's the Xbox One X, which will play games in ultra high-definition 4K.

The new box, which costs $500, won't replace the Xbox One. Instead, Microsoft will sell it — and the Xbox One S — alongside and as an upgraded model of the older console.

All three boxes will play Xbox One games. If you want to play games in HDR, you can get an S model. If you want games in HDR and 4K resolution, you can get an X model.

And going along with Microsoft's theme of allowing users to create a digital library they can take everywhere, you can also play Xbox games on your PC. Microsoft has made all its first-party Xbox games available on Windows 10.

So Microsoft has a flashy new console. But more importantly, it has a vision.

Nintendo delivered on promises and is listening to fans!

Nintendo delivered on promises and is listening to fans!  (Nintendo)

Nintendo came out swinging in a major way, building on the already intense hype around its new hybrid game console, the Switch.

At its presentation on Tuesday, the company promised fans they'd see a steady cadence of major game releases for the new game machine.

Perhaps the most anticipated of those will be "Super Mario Odyssey." Nintendo plans to release the ambitious game on October 26, just in time for the holiday season.

But by the time "Odyssey" launches, there'll be a half dozen major first-party Switch games that make it all the more appealing as a gift. Among them are "Splatoon 2," due out on July 31, and "Arms," which will hit store shelves on June 16.

Nintendo Switch  (Nintendo)

There's more coming. Nintendo teased a handful of new games that are on the horizon— the kinds of games that Nintendo fans are clamoring for. In the works are a new "Metroid Prime" game, games that will include major characters like Yoshi and Kirby, and a new entry from the "Fire Emblem" series.

And get ready for "Pokémon" on the Switch; a major version of the game is on the way.

Overall, Nintendo convincingly showed how its intending to make the Switch a real contender.

Sony brought updates to games you've already heard of, many of which are coming out next year.

Admittedly, "God of War" looks excellent.  (Sony)

Unlike its rivals, Sony seemed to be spinning its wheels, focusing on next year and hoping to coast past this year's show.

Sony's presentation — which was essentially an hour-long video of trailers, punctuated with a few remarks from PlayStation head Shawn Layden — lacked any message beyond, "There are games coming!" That's a good message for a video game company, and I don't mean to sell it short. But when you compare it to the visions that Microsoft and Nintendo are showcasing here at E3 2017 — the biggest game show of the year — it comes up lacking.

Most of the games Sony showed won't be ready until next year. It didn't make any tentpole announcements, or show any meme-worthy videos poking fun at the competition. And it didn't announce any new features for the PlayStation 4 or PlayStation Plus.

It sounds silly, but this stuff matters in the overall narrative coming out of E3. The perception companies create at the conference can affect holiday sales season and the overall momentum of their game systems.

To be sure, Sony did offer fans some things to look forward to, showcasing a wide variety of gorgeous-looking, unique games, some of which are exclusive to the PlayStation 4. Among the highlights:

-The new "God of War" looks like it will be excellent, with compelling graphics, storyline and gameplay.

-"Days Gone" appears to be coming along nicely. A tactical open-world apocalypse survival game? Sure!

-A re-re-make of "Shadow of the Colossus," which was already terrific and looks especially cool in its latest incarnation.

-More "Horizon Zero Dawn," arguably the best game of 2017 so far! Who could say no?

-Whoa "Spider-Man"! That dude sure is limber!

Unfortunately, with the exception of the "Horizon Zero Dawn" expansion, everything I mentioned above is slated for 2018 or very late this year ("Days Gone" is planned for Dec. 29).