Business Approach Comparison Sony PS4 and Microsoft Xbox

[wco81]

Well Kinect may draw attention away from the fact that it's a bit weaker.

But Kinect is contributing to the higher price, without producing better-looking graphics.

The forums I've read, people think it's cool to tell the TV and other AV components to turn on or turn off and don't mind that they still have to use their DVR remotes.

However, it could be a nostalgic phase.

 

[wco81]

I've heard some people compare the coolness of Kinect to the first time they got their hands on the iPad.

If this was a widespread feeling, the sales would be much higher and we wouldn't be discussing a possible price cut.

 

[-tkf-]

sorry tkf. But what the hell kind of logic is that?? Lol.

not to mention, my x1 features are working pretty damned well and impresses everyone that tries it out.

repeating over and over that its a fail will. It make it true

What i meant was that if the feature set of the XB1 isn't "selling" now i don't see why those features should sell it better in the future, especially considering that the USA should be where those features are the strongest and work the best, while other markets are more in doubt.

But honestly, we don't know if the PS4 really is outselling the XB1 as we suspect.

 

[Tap In]

I've heard some people compare the coolness of Kinect to the first time they got their hands on the iPad.

If this was a widespread feeling, the sales would be much higher and we wouldn't be discussing a possible price cut.

only people hell bent on a price cut are those insisting that it will fail without one. I disagree because I use one and know it is worth the price. I will not be the only one. Lol

of course more people for whom budget is a big factor will choose ps4. Ms knows this and expects it too. But -plenty - of people will pay more for a more feature rich system. They don't need to outsell Sony . They will do well with services at a higher price, feature set. The will also do better with more cost conscious people a few years from now when price comes down


its a marathon not a sprint

 

[BRiT]

Those features may not work on the initial-purchaser market, but could work on the later era market. Typically the first 3-6 months to market is concentrated with the hardcore/initial purchasers. It's not until the product is out well beyond that time that you will see the impact other features have on the general consumers. These features may resonate better with the group that purchases later.

 

[wco81]

I think there's some expectations that software will improve the Kinect features over time.

So a lot of the good feelings about Kinect seem to be about the potential. Not so much for games or redefining how games are controlled but for media features.

 

[-tkf-]

Those features may not work on the initial-purchaser market, but could work on the later era market. Typically the first 3-6 months to market is concentrated with the hardcore/initial purchasers. It's not until the product is out well beyond that time that you will see the impact other features have on the general consumers. These features may resonate better with the group that purchases later.

Good point and i think you are right, and that the "Real" judgement isn't handed out yet. But unless everyone that buys the XB1 now is hardcore XBOX fans the features would still have to weigh in on at least some of those that purchase it now.

 

[Shortbread]

perhaps. But I think you are underestimating the power of Kinect at a higher price as people learn and see how cool the living room tech is.

plenty... Of people will pay a little more to get "more" features or something to play the more compelling services and games

*Had to drag this quote over - didn't want to get nicked for thread derailment *

Anyhow, you see value in Kinect, yet my brother-in-law doesn't, and myself, I can't comment since I don't own an XB1. So where is the middle ground (if, any) between those who love it and those who don't? Meaning; does MS keep pushing forwarded with Kinect with an uneven fanbase? Or do they create a second sku (kinect less sku), on allowing a potential buyer the option on choosing his/her preference?

Little of topic... maybe not.

I noticed women (not all, some), like my sisters don't quite like the idea of setting up (configuring / calibrating) anything that requires so much time. My oldest sister made a remark and stated "Umm, too much going on, not female friendly". This happened when she was attempting to calibrate and configure my brother-in-law's XB1 system for my nephew K2 based game. This was similar to a woman's comment I overheard in Target the other day. How long does it take to properly calibrate/configure the Kinect 2 to understand commands and varying motions?

 

[djskribbles]

I think people are overestimating the power of Kinect at a higher price and how most consumers see the value in it. I just don't see how things are going to change. It's not like MS's marketing has done nothing leading up to launch, and it's not like it's that hard to find an Xbox One now. Many people have reported seeing stacks of them in stores, and both Bestbuy and Amazon have them in stock online.

Kinect is obviously appealing to a lot of people... the launch sales reflect that. But how many people will be willing to pay $500 for it in the long run? We're already seeing sales fall off a bit whereas PS4's demand is still very high. The only possible reasoning for that is the price.

With that said, I think people are jumping the gun a bit here. I think the Xbox One will still sell fairly well. I don't think there's anyway MS will drop the price within a year. If anything, they'll release a core SKU without Kinect. And mark my words... if they do, watch the XB1 get a fairly big sales spike.

 

[wco81]

Most of the X1 ads I see don't feature Kinect. Now it's part of the Madden and FIFA commercials and the whole come on thing, with Gerard and the Ryse guy waving to the player to join them.

They did feature the "Xbox watch TV" on some of the TV shows they sponsored, like some Fox sitcoms, brought to you by Xbox and then had a frame around as the show started and said "watch TV" and the show would start.

BUt those commercials haven't been on regularly like the games-specific ones.

 

[Tap In]

tkf... thanks for the heads up

here is my original post in other thread

well $399 sells to a certain demographic and $499 with kinect to a different group

eventually the early adopters will give way to people looking more at the games and features and less so at price

first off, to assume the xbox one is not selling over some anecdotal evidence is a mistake, and secondly, even if it is selling below a box that is $100 cheaper, means nothing in judgment of how, if and or what the xbox will sell long term. Nor does it go to how Kinect is or will be received as people start to see a value.

far too soon for that. need to plow through the early adopters first , many of whom, I'd assume, skew younger and have less luxury income in general.


that said, based on price difference alone I would have to think that MS is expecting and planning for an install base of 75-80% of Sony by beginning of year three when price drops should kick in

so I already concede Sony will sell higher ww at least until price drops but NOT because kinect is a failure as some want to suggest. they will do well especially in US due to services and better ww as those services improve

 

[djskribbles]

t
first off, to assume the xbox one is not selling over some anecdotal evidence is a mistake, and secondly, even if it is selling below a box that is $100 cheaper, means nothing in judgment of how, if and or what the xbox will sell long term. Nor does it go to how Kinect is or will be received as people start to see a value.

far too soon for that. need to plow through the early adopters first , many of whom, I'd assume, skew younger and have less luxury income in general.

If that was directed to me, then I didn't say the Xbox One is not selling, I said it's selling at a slower rate and that the PS4's demand is much higher. And yes, it is based on anecdotal evidence, but anecdotal evidence is pretty telling. This is what I've noticed in the US/Canada:

-Many stores have at least a few Xbox Ones on shelves and it takes a while to sell them.
-Most online retailers have Xbox Ones in stock and have had them in stock for several days.
-on eBay, the PS4 sells for about the same price as the Xbox One (PS4 selling higher than retail, Xbox One selling at about cost after taxes)
-I've seen an eBay seller post similar bundles for sale (extra controller, game and $50 eBay giftcard) and the PS4 sold 152 units in less than a day, whereas the Xbox One is still in stock after more than 2 days and sold just 22 units.
http://www.ebay.ca/itm/Brand-New-Pl...s&hash=item4617c4575d&clk_rvr_id=565862114366
http://www.ebay.ca/itm/Brand-New-Pl...s&hash=item4618264145&clk_rvr_id=566352168957
http://www.ebay.ca/itm/301046228219?clk_rvr_id=565850784722
-When the PS4 is in stock, it sells out almost instantly
-On Amazon.com, the PS4 is currently the best selling console and it only has promised stock for January 5th, whereas the Xbox One is actually IN STOCK and ranked 10th. (edit: even the promised stock for January sold out already)
-GAF members have tracked the sales on Amazon.com when it was in stock and the PS4 sells at a significantly faster rate than Xbox One.
-Amazon.ca had a PS4 'new year's edition' for sale and even that sold out a few weeks ago. They now have a 'february edition' to be released on Feb. 28th and that's ranked 2nd in video games, behind the PS+ subscription that recently went on sale for 29.99 on boxing day.
-BF4/CoD stats show considerably more players online on PS4, even during peak hours in the US.

The thing that isn't clear is who will sell more units in the US for the month of December. The PS4 clearly sells faster and is far more supply constrained, but it's very possible that MS shipped a lot more units to the US.

The situation is probably much worse in Europe for MS.

And as for long term sales, it's obviously just a prediction on my part... it's no different than you predicting that people will eventually see the value in Kinect.

 

[BoardBonobo]

I don't think anybody believes that the kinnect is a failure. It's very good at what it does. IMO it's a mistake not a failure. MS obviously have faith in it, as shown by its second iteration, but I seriously suspect they were expecting to stride into this generation powered by the success of the 360 and be welcomed with open arms, and wallets. Because in their eyes they were the new Midas of gaming.

But they screwed the delivery, the message, and the price. And beyond that they seriously underestimated the competition and, more problematically, the desires of the gaming market and exactly how pernicious it can be to change. As a result they are floundering in the early sales and have device that is neither a console or a focused media box. Add to the fact that kinnect is still an outlier that only make sense if you use it first and it appeals to you. But it's not worth a 100 dollars to find that out when, if you are after gaming console, the opposition is cheaper and more gaming focused.

If they were going to sell the kinnect then that is what they should have focused on from the start with the actual console as just the enabler for the tech.

 

[Bigus Dickus]

Not worth the time for a point by point, but I disagree with essentially every statement/conjecture you made in that post.

 

[Rangers]

I've heard some people compare the coolness of Kinect to the first time they got their hands on the iPad.

If this was a widespread feeling, the sales would be much higher and we wouldn't be discussing a possible price cut.

Those features may not work on the initial-purchaser market, but could work on the later era market. Typically the first 3-6 months to market is concentrated with the hardcore/initial purchasers. It's not until the product is out well beyond that time that you will see the impact other features have on the general consumers. These features may resonate better with the group that purchases later.

I tend to feel like people either want a product or they dont. What console started slow, then became a juggernaut later? i cant really think of any. Maybe 3DS? And it would be arguable. For home consoles I dont think there are any.

Wii is what I keep coming back too, the epitome of the casual, mainstream oriented console right? But it sold gangbusters from the beginning. XB1 isn't doing that.

I don't think anybody believes that the kinnect is a failure. It's very good at what it does. IMO it's a mistake not a failure. MS obviously have faith in it, as shown by its second iteration, but I seriously suspect they were expecting to stride into this generation powered by the success of the 360 and be welcomed with open arms, and wallets. Because in their eyes they were the new Midas of gaming.

But they screwed the delivery, the message, and the price. And beyond that they seriously underestimated the competition and, more problematically, the desires of the gaming market and exactly how pernicious it can be to change. As a result they are floundering in the early sales and have device that is neither a console or a focused media box. Add to the fact that kinnect is still an outlier that only make sense if you use it first and it appeals to you. But it's not worth a 100 dollars to find that out when, if you are after gaming console, the opposition is cheaper and more gaming focused.

If they were going to sell the kinnect then that is what they should have focused on from the start with the actual console as just the enabler for the tech.

It's looking like MS made some miscalculations. The proposition they put out is "Kinect, plus $100". Early returns say that's not a proposition people want as much as PS4, which is the "powerful gaming box, $100 less" proposition.

The screwup they made that has the potential for long term damage, and it's something that is always underestimated as a factor imo, is power. I'm not saying XB1 is doomed because it's weaker, but I am saying it's future is a lot less certain because of that.

If they put out a $500 box, with Kinect, but it's 3.0 teraflops, they would quite simply be in a vastly better position. Kinetic might still be a bad idea, but having the more powerful hardware overcomes an enormous amount of flaws.

We could easily I think, see a January NPD that looks like PS4=500,000, XBO=100,000. At that point is where MS might realize they've got a problem. They'll probably win or at least do well in Dec NPD.

Would the XBO sell as well as PS4 if XBO was $399? IMO that's not even a given at all. PS4 still has the edge of being more powerful.

It all gets back to the fact imo it's debatable whether there's a market for consoles beyond core gamers. MS is always trying to chase that broader market, but who knows if it even exists. Part of the basis for a core console is that it must have excellent graphics. This makes a relatively high price, which retards broader adoption. Bit of a catch 22.

And if you're going to focus on just core gamers, then you're never going to take over the world or be vastly profitable with a console. It's really a market that's pretty arguable if there's any reason for these huge corps to be in. There's probably a reason Samsung, Apple, and Google dont do core consoles, in a way, they're after bigger fish. Sony will probably do consoles as a vanity project till the cows come home, but it's never going to make them a ton of money. All you need to do is realize that if you add up all the P&L's, even PS2 wasn't vastly profitable, and it's a best case scenario.

Doesn't mean there isn't profit to be made in the market, if you accept that it's not going to take over the world.

 

[djskribbles]

This may be the first time I agree with Rangers.

Seriously though, I think it's a reasonable post.

 

[BRiT]

What console started slow, then became a juggernaut later?

All of them including the PS3 and XB360 and Wii. At least that's what the numbers will show. However, that's only because of being supply limited.

 

[Shortbread]

I'm not going to paint MS in a doom and gloom corner, not yet anyhow. If MS is serious about giving the gamers what they want - then provide options, not lip service. Give me a core system, at a reasonable price, worthy of the hardware. The night before Christmas, I had an opportunity on purchasing the XB1 - but I had no reason on doing so. Nothing against XB1 software, I just don't like the fact I'm paying more for an add-on that I'm not going to use.

If MS can provide that experience I had with XB360, reasonable price for the hardware and only X-platform exclusives, then they have a returning customer.

 

[bkilian]

I'm not going to paint MS in a doom and gloom corner, not yet anyhow. If MS is serious about giving the gamers what they want - then provide options, not lip service. Give me a core system, at a reasonable price, worthy of the hardware. The night before Christmas, I had an opportunity on purchasing the XB1 - but I had no reason on doing so. Nothing against XB1 software, I just don't like the fact I'm paying more for an add-on that I'm not going to use.

If MS can provide that experience I had with XB360, reasonable price for the hardware and only X-platform exclusives, then they have a returning customer.

It's not an add on if every single box has it. It's a core feature. Your statement is more accurately "I don't like the fact I'm paying more for a core feature I think I won't use", or perhaps "I don't want to buy a device that doesn't cater to my every whim". Valid concerns, and that's why you have the power to choose where to spend your money.

 

[dobwal]

I'm not going to paint MS in a doom and gloom corner, not yet anyhow. If MS is serious about giving the gamers what they want - then provide options, not lip service. Give me a core system, at a reasonable price, worthy of the hardware. The night before Christmas, I had an opportunity on purchasing the XB1 - but I had no reason on doing so. Nothing against XB1 software, I just don't like the fact I'm paying more for an add-on that I'm not going to use.

If MS can provide that experience I had with XB360, reasonable price for the hardware and only X-platform exclusives, then they have a returning customer.

What was Sony doing last gen? It didn't stripped down the PS3 to provide a core system. Neither did it abandon or stop supporting its non gaming features to appease some who think a console should a one dimensional product.

The 360 and PS3 weren't considered failures simply because the Wii was selling like gang busters. And the PS3 fortunes didn't turn around simply on a price cut.

If MS is serious about gaming its going to have to heavily invest in software. Because games are the biggest factor that influence the success of your platform.