Analyst: Wii Shortages until 2009; Mass market not ready for High-def gaming

[Natoma]

http://www.dailytech.com/article.aspx?newsid=7065

Considering the DS is supply constrained even today with Nintendo cranking out 2 million of those babies a month, this actually isn't surprising.

On the flip side, the take on mass market high def gaming is one I've been saying for months. There's no real desire in the mass market to buy a $400+ console, particularly when less than 10% of the mass market has a HDTV in their home.

I think HDTV will be ready for prime time in the PS4/720/WiiHD timeframe, i.e. 2010+.

 

[Tap In]

I agree that the mass market is not ready for hiDef gaming (or movies). that's why I believe a Core 360 (and eventually Premium) can compete with Wii in 2008 and beyond since it will be a similar (mass market) price but even on an SDTV will be offering an exemplary experience with regard to quality and quantity of games and their online play.

Wii probably wins this generation WW outright though.

 

[DeadlyNinja]

I know I sure as hell can't afford to pay 400 - 600 bucks for a game system and another 1000 for a new HDTV to take advantage of it.

 

[Nesh]

I dont think HD is relevant

People may not be ready for HD but they are always ready for better visuals. And better visuals arent necessarilly provided with high definition.

Gears of War and other games look superb enough in SD. The majority of people who bought a PS3 or a 360 didnt buy them because these consoles can output in HD. The trend is always the same. Wait for the next gen console to get something better. SDTVs can offer that better they always got with each next gen console. HDTV offers only the little more better.

If the masses were ready for HD I dont think PS3 and 360 sales would have increased that much.
Unless people have the impression that you NEED a HDTV to be able to play these consoles. Probably Wii sales might have decreased if they were ready because they might have been too used to better resolutions but even this is questioned.

There are other factors PS3 and 360 sales are (RELATIVELY!) less:

1) Relative cost (unless you can say that cost increased due to HD output but that should be only partially. Most likely that could be said about PS3 only, for its BR movie functionality which increased cost. But perhaps SOny mighty have implemented it anyways as a bigger storage).

In the case of the 360 that should be comparative cost next to Wii.

360 has a normal pricing. It follows a similar pricing route as the consoles that came before it and offers the expected graphical evolution even if you dont have a HD TV. And its sales are either great or normal. It doesnt sell any lower than expected based on historical sales.

Wii is so cheap though that it is easier for everyone to buy. And its a great thing when you can buy something new cheaply.

2) diversified product. Wii on top of the low price provides a very diversified epxerience. Its different. Everyone would love to try something different. I mean...even if you have a 360 or a PS3 you would still want to get a Wii. Even if developers offer old gen graphics or sometimes worse graphics.

Its not that 360 for example doesnt sell a lot. Its just that Wii sells too much and it has nothing to do with HDTV. If Wii offered the same controls under the same pricing and the same hardware it wouldnt have sold as much if at all.

 

[NERO]

Dear Nintendo and shareholders,

Build new f*&king fabs!
Seriously, has there been any news in this regard?

BTW, I agree that the HD era will be in full swing by the next gen, but the reason it will accelerate will be because of this gen.

 

[Fu3lFr3nzy]

I know I sure as hell can't afford to pay 400 - 600 bucks for a game system and another 1000 for a new HDTV to take advantage of it.

Im somewhat annoyed when I read comments like this. You dont have to spend 1 grand to take advantage of the HD experience that X360/PS3 provides. In X360's case, you can use your current LCD monitor(which is @ mainstream prices nowadays) and get similar results with that of a HDTV.

Besides, most people I know are buying a console not because of "omgwtfbbqhd", but because the games in that particular console tickle their fancy. I have a couple of friends who own X360's and not one of them owns an HDTV and plays the console on SDTV's and I havent heard a single complaint from them.

Once X360 gets priced competitively with the Wii, then we'll see whether Nintendo's money maker can keep its momentum.

 

[Bigus Dickus]

I don't think HD is terribly significant right now, but it will be within the lifespan on this generation. HD displays are just this past year really making progress towards being mass affordable, and certainly within the next three or so I expect HDTV's to finally take the place of virtually all SDTV's sitting on shelves at Sears, Target, Best Buy, Rex, Fry's, etc. (and there are a shitload of SDTV's still on shelves). I think SDTV will only remain at the uber-cheap and smallish end of the scale - i.e. people wanting a TV for $100. When there is a large variety of sizes available in the $200-$500 range, sales will pick up a lot of steam, especially since more and more content will transition to HD over the next couple of years.

Thus, halfway through the Wii/PS3/360 lifespan, HD will be a much more important factor. And that's why the PS3 and 360 will still have some legs to them, while Wii will be running out of steam. It's a console designed for a 3 year lifespan, and I don't see how that will work for Nintendo in the long run.

 

[phat]

In hindsight, marketing the Xbox360 and the PS3 as HD game consoles has probably backfired since 90% of the population would feel that the extra they'd be paying for these consoles would go to waste with their current TVs. I can see a lot of parents thinking, we'll get Johnny a Wii/PS2 now, and a PS3/360 later when we have an HD television.

Another way of putting it is, if you have a family budget to stick to, aren't a hardcore gamer, and don't have an HD TV set yet, would you rather spend $600 on a PS3, or put that $600 toward your HD set?

Phat

 

[-tkf-]

So is this analyst telling me that the Wii provides the same graphics and "wow" factor as the 360 and PS3 does in SD?

The only thing i can agree to is the perception that you need a HDTV if you buy a 360 and a PS3. Of course it´s wrong but it´s what MS and Sony keep saying "HD era" and "FULL HD". Even the analyst got this wrong i guess

 

[DuckThor Evil]

There's no real desire in the mass market to buy a $400+ console, particularly when less than 10% of the mass market has a HDTV in their home.

I think HDTV will be ready for prime time in the PS4/720/WiiHD timeframe, i.e. 2010+.

I think you are being a bit conservative on that 10% figure, I believe it's more and rising as we speak, even in Europe the stores are basically sellling HDTVs only at this point and I expect the situation to be quite similar in the US. I also believe that there is lot's of overlapping happening between console and HDTV owners, because it makes sense to have HD signal on your HDTV. I do understand that a high reason for people buying these TVs is the looks, but it's not the only reason.

10% of the mass market in US is already quite many homes, PS2 sold what about 40 million units in NA? and we know that this 10% figure is rising very rapidly if it hasn't already. Not everyone is going to buy the HD-console today, the sales happen throughout the console's lifetime and I have seen little evidence that the adoption rate of the HDTVs is limiting the sales of the HD consoles. The price tag is. That will change soon enough. A more valid concern would be that, can Nintendo sustain the interest of gamers during the rapid increase of the HDTV market?

 

[tongue_of_colicab]

Thus, halfway through the Wii/PS3/360 lifespan, HD will be a much more important factor. And that's why the PS3 and 360 will still have some legs to them, while Wii will be running out of steam. It's a console designed for a 3 year lifespan, and I don't see how that will work for Nintendo in the long run.

In 3 years time marketshare will already be settled. If the wii has by far the biggest marketshare it wont matter x360 and ps3 will offer better gfx (x30 and ps3 wont be that great 3 years from now anyway compared to what we can do by then) because Wii is were the money is. Besides that the Wii offers something ps3 and x360 cant offer so even if everybody has the need for HD gfx there will still be a market for Wii.

 

[PatrickL]

In Europe what stores advertise are HD ready (720p) TV not really the Full HD as it still costs twice as much for the lower ones.

 

[archangelmorph]

In 3 years time marketshare will already be settled. If the wii has by far the biggest marketshare it wont matter x360 and ps3 will offer better gfx (x30 and ps3 wont be that great 3 years from now anyway compared to what we can do by then) because Wii is were the money is. Besides that the Wii offers something ps3 and x360 cant offer so even if everybody has the need for HD gfx there will still be a market for Wii.

Just because it would have a huge market share doesn't particularly mean software would sell better on the system than it would on any other..

Currently the PS2 has the biggest market share by a significant market but unless your God of War or a new FF game then your not going to get significantly hot software sales considering the platform is winding down in favour of newer, more novel ones..

By that time regardless of how large the Wii market is developers and publishers will still be spending big bucks on HD game content for PS3 and Xbox360 because the installed bases will be comfortably sustainable..

In fact I suspect that the diversity of platforms will create alot of specialisation in terms of platforms catering to specific tastes. Therefore if a AAA title like gears of war can sell over 3 million (and counting) copies in a seemingly limited 360 userbase then how much more will the sales potential of such titles be when the installed bases of the HD consoles reach critical mass..?

In terms of profitability of a platform (in comparison to last gen) I really don't think its as easy as saying "the platform with the largest market share will remain the primary focus of software providers" because I (and both the platform holders for tha matter) don't consider MS or Sony to be fighting over the same pie as Nintendo..
I think its a rather safe assumption to say that consumer uptake of the Wii is having (and is going to have) considerably little to no impact on consumer uptake of the Xbox360 and the PS3 and the only thing holding the two platforms back from reaching critical mass will be sales. Eventuallty they'll come down and both platforms will stand to represent a separate playing field to the one that Wii has and one that's equally as lucrative..

I suspect by that point publishers will be quite happy to spend big budgets on the "hollywood production level" HD games with massive selling potential (upwards of 2-5 million units for the best of them) and considerably (because they don't need to) to churn out AAA Wii games (with possibly equal to or less selling potential per title which would be offset by the publishers ability to spend more, to release more titles within a shorter time frame and keep the cash flows high)..

All in all I don't see this generation being as focused as the industry has ever been before with content creators spreading more of their resources across the three primary platforms (and across the two handhelds) in order to grow more than they've ever been able to do before..

What a sunny outlook..

 

[tongue_of_colicab]

Just because it would have a huge market share doesn't particularly mean software would sell better on the system than it would on any other..

Currently the PS2 has the biggest market share by a significant market but unless your God of War or a new FF game then your not going to get significantly hot software sales considering the platform is winding down in favour of newer, more novel ones..

But you can assume that a/the big(gest) platform will get its fair share of AAA games because of the large userbase. And like you said, the ps2 is winding down in favour of new platforms so you cant compare sells of ps2 with the new consoles.

 

[archangelmorph]

But you can assume that a/the big(gest) platform will get its fair share of AAA games because of the large userbase.

Read the rest of my post, I didn't dispute that fact..

And like you said, the ps2 is winding down in favour of new platforms so you cant compare sells of ps2 with the new consoles.

Yes I can compare it considering in your initial statement you referred to the state of the market in three years time and not now..

Do you believe that, with the rate of HDTV uptake as it is currently and considering the limited hardware capabilities, the Wii won't be winding down (in terms of sales and overall momentum) by that time?

 

[tongue_of_colicab]

No. Atleast not because of HDtv's. First off all the Wii isnt a console you buy because your #1 priority is gfx. Also by the time HD is in the far majority of homes x360 and ps3 gfx wont be anything special anymore either. If people based their choice of console on HD output nobody would buy Wii. Even on a SDtv ps3 and x360 gfx are alot better so if they cared so much about gfx would buy a Wii in the first place?

 

[archangelmorph]

No. Atleast not because of HDtv's. First off all the Wii isnt a console you buy because your #1 priority is gfx.

Fair point..

Also by the time HD is in the far majority of homes x360 and ps3 gfx wont be anything special anymore either.

I'm quite sure they will be and i'm sure you already know this so I don't know why your making such a statement.. It's common knowledge that as console developers get to grips with the hardware of the systems they quality of the software will begin to shine later on in the console life cycle and unless your speaking relative to the PC market (which in that respect it would still be not to far off) the HD console software will have evolve visually far beyond what would be present on the Wii (with the added visual bonus of a much higher resolution standard)

If people based their choice of console on HD output nobody would buy Wii.

This is true but since the vast majority of consumers don't own a HD output then then how do you know this isn't/couldn't be the case in 3 years time when HDTV has become standard.. (it's like an SDTV owner walking into a store and thinking about buying either a PS2 with it's SD res output, or a PsOne which only supported black and white but had VR gloves as standard..) Once the quality standard of HD sets in it will be very difficult for consumers to go back to SD and therefore the Wii will suffer due to this in terms of losing significant momentum.. How much is a question still up in the air but there's no doubt this will occur..

Even on a SDtv ps3 and x360 gfx are alot better so if they cared so much about gfx would buy a Wii in the first place?

It's not just about graphics but about the evolution of the medium.. You can't deny that even beyond rendering the PS3 and Xbox360 have the capacity to take gameplay far beyond what was previously capable and the Wii offers the same capacity but down a different path..

Plus I would imagine that in 3 years time Nintendo would be in a safe position to announce and start the hype machine for their next gen Wii which would evolve the input paradigm further and present significant improvements in hardware capability.. This will be the biggest reason the Wii would begin to slow down and would be a good move on nintendo's part to keep consumer focus on their side for a long time or at least until the PS4, Xbox3 begin to loom..

 

[tongue_of_colicab]

I'm quite sure they will be and i'm sure you already know this so I don't know why your making such a statement.. It's common knowledge that as console developers get to grips with the hardware of the systems they quality of the software will begin to shine later on in the console life cycle and unless your speaking relative to the PC market (which in that respect it would still be not to far off) the HD console software will have evolve visually far beyond what would be present on the Wii (with the added visual bonus of a much higher resolution standard)

Yes I was talking about relative to the pc market. If I look at ps3/x360 gfx now, I dont think it looks that much better than hl2 and fc wich I could play on my pc 3 years ago. Atleast, not what I'd expect from a 3 year gap. Sure, x360 and ps3 gfx will become alot better (how much of that will actually be seen by the user is something i'm not sure of, at some point more detail will go unnoticed alot faster) but those consoles alread have better gfx than wii. Why would people suddenly care about the wii gfx 3 years from now (assuming that the majority of the market owns HDtv's by then) when x360/ps3 gfx aint uber anymore compared to pc and Wii already had the ''crap'' gfx from the start?

Once the quality standard of HD sets in it will be very difficult for consumers to go back to SD and therefore the Wii will suffer due to this in terms of losing significant momentum.. How much is a question still up in the air but there's no doubt this will occur..

Again, that is only if consumers really did have gfx as their #1 priority. I was at the store 3 week ago to buy a new tv for my bedroom. The store only had like 3 SDtv's left and the rest was HDtv's. But the image quality of those tv's (thanks to PAL) looks alot worse on those 1500+ euro HDtv's than it does on my 200euro SDtv. Now if people cared about image quality like you say, why to most people buy a HDtv as their new TV? it certainly isnt offering better image quality. Ofcourse the comparison between TV and games is crooked but I assume you get my point. But as I already said, Wii already has ''crap'' gfx, even on a SDtv so I cant see how getting a HDtv will suddenly make the ''crap'' gfx more important in your choice. Besides the fact that the Wii isnt made for people who want ubergfx.

Plus I would imagine that in 3 years time Nintendo would be in a safe position to announce and start the hype machine for their next gen Wii which would evolve the input paradigm further and present significant improvements in hardware capability.. This will be the biggest reason the Wii would begin to slow down and would be a good move on nintendo's part to keep consumer focus on their side for a long time or at least until the PS4, Xbox3 begin to loom..

I guess that depends on how well the Wii is doing. I dont really see a reason for nintendo to hype Wii2 if Wii is still doing well. Better get as much people as possible to buy your old machine before you start making them wait for your new machine to come out.

 

[archangelmorph]

Again, that is only if consumers really did have gfx as their #1 priority. I was at the store 3 week ago to buy a new tv for my bedroom. The store only had like 3 SDtv's left and the rest was HDtv's. But the image quality of those tv's (thanks to PAL) looks alot worse on those 1500+ euro HDtv's than it does on my 200euro SDtv. Now if people cared about image quality like you say, why to most people buy a HDtv as their new TV? it certainly isnt offering better image quality. Ofcourse the comparison between TV and games is crooked but I assume you get my point. But as I already said, Wii already has ''crap'' gfx, even on a SDtv so I cant see how getting a HDtv will suddenly make the ''crap'' gfx more important in your choice. Besides the fact that the Wii isnt made for people who want ubergfx.

PAL is an SD resolution and has no bearing in HD quality.. HD is standardised at 720i/p and True HD at 1080i/p and this is the same regardless of the region..

If you truely believe that their is no difference between IQ of an SD and HDTV set then you're speaking from a minority perspective my friend..

I don't know why people utter such arguements unless they really haven't seen a HDTV broadcasting HD quality footage at all..

The difference is astoundingly obvious unless your visually impaired..

 

[DeadlyNinja]

Just because it would have a huge market share doesn't particularly mean software would sell better on the system than it would on any other..

OK, then what do people do with the Wii they bought if they don't buy games? The Wii is made to do just that, play games and nothing else.