NPD August 2007

[Laa-Yosh]

Just remember, again, that Sony' doing about as well as Gamecube and Xbox were at this time at more than double the price.

They're doing a lot worse then the first Xbox in the US. Xbox sold 3 million units in the first 12 months, PS3 is at 1.8 million in 10 months and it's very unlikely that they can sell 600K in both september and october.

 

[scooby_dooby]

Great post Scoopy, however I wouldn't dismiss MS's lineup for the upcoming years. Granted not much have been announced, although games like Alan Wake and Fable 2 are probably going to be quite big hitters, not in a league as those two you mentioned but big anyways. Ninja Gaiden 2 is going to be big. and everybody knows Gears of War 2 is coming and in my book it's as big as anything, it's not announced, but it's coming. This year MS will have amazing lineup and I believe it can be repeated in the future, why wouldn't it?

Oh it's not bad by any means, they also have a little thing called the Mass Effect trilogy

I just don't think it's on the level of Sony's, they have great titles, but not the proven worldwide blockbuster's that Sony will be bringing.

 

[Zaphod]

I believe this is probably in prep for some sort of repackaging as the rumored Arcade sku, or something like that

Agreed. A wireless controller, a small bundled memory card and a couple of pack in arcade games will do wonders for perceived value without increasing BOM cost for MS much.

right now Core's seem pretty flimsy in presence.

My point is that I don't believe MS ever wanted it to sell many Cores up to this point in time. $299 and $399 (not to mention $279 and $349) mostly attract the same customers, thus you want them to buy the higher value & higher margin SKU. At some point, however, (say $219 and $299, I don't know exactly) you'd want to even out the value proposition as you're able to attract customers that simply aren't looking to buy at close to $300 and above. Regardless of what tech-forum participants might consider superior.

 

[Rangers]

I guess in Christmas 2008 MS wont have Halo. There you go, Sony.

It will have Gears 2, though.

Pachter weighs in some more. Halo 3 to sell 3m in 12 days, 399 PS3 possibly announced at TGS?

In his latest research note to investors, Wedbush Morgan's Pachter says, “The top September release is expected to be Microsoft’s Halo 3 (360), which we expect to sell over 3 million U.S. units in its first 12 days.

“We expect the game to be a driver of console sales, and believe that Microsoft’s unit sales for the 360 could exceed 400,000 in September, the highest figure for a non-holiday month since launch.â€￾

http://www.next-gen.biz/index.php?option=com_content&task=view&id=7167&Itemid=2

 

[liuelson]

Not to mention, if software sales on Wii continue to lag, devs/pubs will likely continue to take a cautious outlook and not invest too much in Wii titles and so the software circle of life will continue until someone takes a chance and makes a proper AAA 3rd party game and the result is a multimillion unit mover. That should help break the chain. Easiest way I can figure for these devs to accomplish the experiment would be to port (scale back) a few heavy hitters from the xb360/ps3 and see how they sell (obviously they would have to tweak the controls properly).

Smaller dev budget for Wii -> less risk, easier profit -> more resources to take bigger risks. But what kind of risk to take? Big-budget traditional FPS / RPG / Platformer / Sim games on the traditional HD console? Or innovating with new, more immersive entertainment experiences using something like Wii + 2nd life?

 

[iceberg187]

Top Selling Games By Platform For August 2007 (By Retail Sales $)

360 Title Publisher
1 MADDEN NFL 08 Electronic Arts
2 BIOSHOCK Take-Two Interactive
3 GUITAR HERO 2 W/ GUITAR Activision

PS2 Title Publisher
1 MADDEN NFL 08 Electronic Arts
2 GUITAR HERO 2 W/GUITAR Activision
3 GUITAR HERO ENCORE: ROCKS THE 8Activision

PS3 Title Publisher
1 MADDEN NFL 08 Electronic Arts
2 WARHAWK W/ HEADSET BUNDLE Sony
3 LAIR Sony

Wii Title Publisher
1 PLAY W/ REMOTE Nintendo
2 METROID PRIME 3: CORRUPTION Nintendo
3 MARIO STRIKERS: CHARGED Nintendo

Handhelds Title Publisher
NDS POKEMON DIAMOND VERSION Nintendo
PSP MADDEN NFL 08 Electronic Arts
NDS HIGH SCHOOL MUSICAL: MAKIN THE C Disney Interactive Studios

 

[DuckThor Evil]

Oh it's not bad by any means, they also have a little thing called the Mass Effect trilogy

Damn I forgot that also eventhough Halo 3 seems to be an end to Halo games as we know them, I would wager that Bungie crew won't stop making games in the future.

 

[Cheezdoodles]

Now, 360 looks like it's sitting pretty right now, but their lineup seems rather front-loaded, with not much coming in 2008 or 2009.

The reason most people have this impression is because unlike Sony, Microsoft has a lot of big hitters this year, and it would be the ultimate act of stupidity to market 2008 and 2009 titles over 2007 releases.

You want as much hype as possible on your closest to release titles. Any talk about future titles takes away hype from current coming titles.

The only reason Sony is not currently hyping many 2007 releases, is because it doesn't have any many titles to hype. So you gotta show them stuff in the future.

 

[Asher]

Great post Scoopy, however I wouldn't dismiss MS's lineup for the upcoming years. Granted not much have been announced, although games like Alan Wake and Fable 2 are probably going to be quite big hitters, not in a league as those two you mentioned but big anyways. Ninja Gaiden 2 is going to be big. and everybody knows Gears of War 2 is coming and in my book it's as big as anything, it's not announced, but it's coming. This year MS will have amazing lineup and I believe it can be repeated in the future, why wouldn't it?

People seem to forget that MS intentionally showcased 2007 games at E3. It's pretty silly to then think there's no big games coming in 2008, when the entire point at E3 was to focus on 2007.

 

[TheChefO]

This is one argument I've never bought. There's absolutely no historical evidence to suggest that 'having no competition' contributes to higher sales, in fact it could just as easily be a detriment in some cases, as consumers take a wait and see approach. It was always raised in arguments as a reason why Sony would overtake MS when PS3 launched, I never bought it then and I still don't.

Half of 360's lifespan it has been facing pretty stiff competition and sales have continued trucking along at 40k-50k/week.

I would bet that PS3 would sell more than 360 at comparable pricepoints, not only due to the brand name, but the BR players as well.

So that's how you might see the gap narrow, PS3 sells more at $400 than 360 did, and then sells more at $300 than 360 did, etc etc. 360 would maintain the lead until the pricepoints become closer together ($50 apart) and then Sony would begin to outsell them overall.

That's just one scenario I can see happen.

But I agree with you that time is running out, there's only so long you can go without gaining momentum until you do permanent damage. Which is why my pricing plan for what Sony should do is extremely aggressive, they need the kick in the ass within the next year or else...

Good point.

Facing a ghost with a reputation for kicking @ss and taking names is tough competition and I'm sure it stalled sales. But, I don't see how Ps3 at this point could track the same sales rate as xb360 did in the current environment.

Only way I could see that happen is if MS sits on their hands while Sony drops price. There are some good games coming (MGS4, GT, Drake(?), KZ2), but I'm not sure if it will be enough to overcome the sales momentum of this Christmas if Sony drops to $400 and MS reacts with $2-250 - $300. Sure Sony will sell more than they would have and see a spike, but the competition would be quite compelling at that point.

2008 will be interesting, but I firmly believe that when MS hits mainstream pricing($200), momentum will be decidedly one way.

2008 software lineup will be quite impressive for Sony, but MS does have a few up their sleeve as well that year. I think PS3 will do very well for themselves in 2008, but I still don't see them topping 60million this gen and firmly entrenched in 3rd place.

 

[scooby_dooby]

I'm not sure if it will be enough to overcome the sales momentum of this Christmas if Sony drops to $400 and MS reacts with $2-250 - $300.

Well I think Sony needs to be at $400 this Xmas, and $300 by early next year to stay 'in the fight'. I think a $300 PS3 could potentially sell nearly as much as a $200 premium 360....

If they don't then ya, I agree with you, it will be too little too late.

 

[Shifty Geezer]

Competitors price will always be lower.

- software diversity is getting better
So will competitors'.

That's questionable. Looking at what's coming out for PS3, it covers a wider range AFAICS than XB360 or Wii, in considerable part because Sony make differentiating titles. Which other platform boasts a protozoa simulator, a rail enthusiast game, a 'have a summer holiday' game, and a line-art-that's-lost-perspective game? The point Phil was making is that PS3 certainly won't be behind the others in terms of diversity, so library depth isn't a worry for PS3 as a games platform.

Most of them have gone multiplatform already.

Isn't that quite a sweeping generalization? Is FFXIII multiplatform? MGS4? GOW? Tekken? GT? Some of these might do, but it's too early now to say PS's major exclusive franchises have been lost. The biggest exclusivity loss is GTA, but at the same time the new franchise from R* now that they're finished with GTA (so no more of that franchise exclusive for XB360 either) has been announced as PS3 exclusive. NCSoft is PS3 exclusive at this point. For whatever reason, devs are making exclusive PS3 games, so it's not just an expensive platform for playing the same games as you can get on XB360.

Playstation brand image has already been seriously damaged - it's not THE console to have anymore.

There was a recent article, although I can't remember where, that offered the analogy of a Ford versus a Porsche. Which is THE car to have? The Porsche. Which is the one everyone buys? The Ford. If the Porsche dropped in price to be near to the Ford, which would everyone buy? (This analogy ignores fundamental difference of requirements of course! You don't get a 2 seater sports car if you have a family to taxi hither and thither!). The point is, you can't tell desirability from sales. A better gauge is what are uneducated adults referring to games machines as? Do they ask if little Jonny is playing on PlayStation or his Nintendo, without the slightest knowledge of the difference?

At this point I don't know if PS has lost much brand ground to Wii. It's probably lost some, which isn't hard because before Wii, Nintendo held no mindshare in console gaming! I don't have any anecdotal experience of people talking about one or other brand either. It's not a topic I've come across in the ordinary public. I don't think Wii has become synonymous with gaming though, and I think the PS brand is still very robust. Brand alone won't sell you consoles (something Sony should perhaps have thought a little more about before releasing PS3...), and you can't say lack of sales of a flagship model = weak brand identity, nor even success of another brand is damaging to yours. The PS3 brand can still stand for diverse, quality entertainment, and the Wii brand stands for fun, social gaming without affecting that PS brand image. The difference is what the market is buying at the moment.

 

[TheChefO]

Smaller dev budget for Wii -> less risk, easier profit -> more resources to take bigger risks. But what kind of risk to take? Big-budget traditional FPS / RPG / Platformer / Sim games on the traditional HD console? Or innovating with new, more immersive entertainment experiences using something like Wii + 2nd life?

I think Wii will be a console where experimentation is encouraged, but because of that, the budget will likely be lower than a typical AAA title on ps3 or xb360, thus, the production value lessened.

I hope I'm wrong and people start to really push the abilities of Wii, but I get the feeling devs aren't inspired to.

 

[Asher]

Shifty: I think that Ford/Porsche analogy is, at the very least, completely ridiculous. There's a massive difference in quality and technical specs between the two that simply does not exist in PS3 vs Xbox 360.

 

[TheChefO]

I think a $300 PS3 could potentially sell nearly as much as a $200 premium 360....

Months ago I would have agreed with you, but it seems momentum is a long lost friend to ps3.

The big hitters have been slow to arrive and when they have arrived, haven't been all that big.

I truly expected their AAA titles to be rakin in the cash and awards, but they've fallen short while xb360 has contued to push on with quality software that's selling by the boat load.

I'm sure 3rd party devs haven't been blind to this continuing trend.

 

[TheChefO]

Shifty: I think that Ford/Porsche analogy is, at the very least, completely ridiculous. There's a massive difference in quality and technical specs between the two that simply does not exist in PS3 vs Xbox 360.

Exactly.

The Porsche is in every way a better vehicle.
The same cannot be said for ps3 vs xb360.

In fact, looking at what software's available now and in the near future, one could easily say, the xb360 is the Porsche of this race and at a cheaper price to boot. Thus, double the sales this NPD.

I expected more from the Sony camp software wise at this point.

 

[dobwal]

I'll give you a few reasons:

- because many PS supporters (me included) haven't bought one yet

the same could be said during the early stages of the N64/PS1 generation. Yet the majority of SNES supporters moved to the PS1.

- because PS2 is still selling in very hot numbers - what will they buy?

You're talking about a bunch of buyers who include a large segment of gamers who waited 5+ years to buy a $149.00 console. Its hard to imagine a big majority of them being hardcore PS fans.

- price will come down eventually

thats a given. How fast is the most important and if the PS3 flounders too long, pricing won't matter. The GC's pricing advantage didn't help it outsell the PS2, as the PS2 popularity allowed it to sale more at higher price points. You can't expect that the PS2 popularity will carry over to the PS3 inevitably or under any circumstances.

- software diversity is getting better

Also, true for the 360 and the Wii.

- exclusives of well known franchises

Nintendo portfolio of first party exclusives going into and during the PS1/N64 generation was pretty good. If Zelda, Mario games, Golden Eye, Perfect Dark and Pokemon games couldn't overcome the PS2, the is no gaurantee that FF, MGS and GT will push the PS3 over the 360 or the Wii.

From these points, I think point 1. and 2. are the most important ones. How many PS2 has Sony sold *after* Wii and Xbox360 launched? Many. Of course, many of those PS2 owners could shift to the Xbox360 as well, but if Sony can get point 3., 4. and 5. sorted in time, they very well go for the next thing they know best: A PlayStation.

And there are over 100 million PS2 owners out there (how many of those 100 million are PS2 exclusive owners? 50+ million?). How many of them are really that interested in the Xbox software lineup? At this point, Xbox360 could have very well sold well predominently to its existing market of Xbox owners. We'll see how much more they sell once they hit the 25 million mark worldwide and start exceeding their Xbox1 userbase.

How many gamers were exclusive Xbox owners or GC owners? Even with demand higher for the Wii and 360 due to price, the PS3 should be able to out compete the Wii and 360 in sales if those exclusive PS2 owners were as brand loyal as you think they are. Your're talking 50 million versus a much smaller exclusive base for the xbox or GC.

 

[RobertR1]

One thing manufacturer should realize is that if you are going to launch late, you NEED to come out with guns blazing on the software side to draw attention.

The Wii actually did a good job of that with Zelda. Also, adding Wii sports to the package was simply brilliant.

 

[Acert93]

A silly question to those that think the PS3 won't finish last this gen... when do you think exactly it will take the #2 spot? I'm asking for a month and year here... 2008? 2009? I honestly can't see it, since it's been beaten every month non-stop since launch... and it's an uphill battle from here on in.

Does anyone dare to calculate how much time (month) it would take to Sony to match Ms user base in US? (smells like a dead horse... )

VGChartz.com has 7.03M Xbox 360's sold in NA and 2.01M PS3's sold in NA.

Lets assume the race goes until November 2011 (50 months), at which point new consoles should be out. To match lifetime North American sales by November 2011, Sony needs to outsell MS by an average of 100,000 units per month.

Sony's PS3 will never catch MS's Xbox 360 in North America.

They're VGChartz numbers, but that's all we can get. So how was Xbox 360 doing 1 year after release?

In its first week, Saints Row sold ~265K units and eventually went on to break a million worldwide. Dead Rising sold ~210K units its first week and has since gone platinum as well.

I wouldn't be worrying if I were Nintendo. MP3 will probably go platinum.

To play devil's advocate:

The fact we are even contemplatfing some sales relationship between MP3 sales to titles like Saint's Row and Dead Rising re-inforces the NPD numbers. The two 360 titles are above average titles, but definately not top 10 material whereas MP3 is the best Wii title to date.

If 1) an established Nintendo franchise with 2) a strong fanbase on a 3) platform with a lot of consumers looking for quality software snatch up MP3 at a rate similar to the 360's B-Team... ouch!

But I don't think that will be the case. I think (hope!) MP3 hits the 2M threshhold. It would be a shame if it didn't. And if it doesn't briskly break 1M I think it will send a very negative message to publishers: A B-team title on the 360 can outsell a killer app on the Wii.

Pesonally, I would find 1M sales for MP3 dissappointing considering the Wii install base, the quality of MP3, and the decided drought of AAA software on thew Wii. If Gears of War can sell over 4M in less than 6 months I don't see why we shouldn't expect the BEST Wii game to break 2M by the end of 2007.

The limited sales window for MP3, though, I think it skewing things. It will break 1M, but I don't have a guess how much more.

Out of curiosity: How many MP3 units should Nintendo have moved in NA for there not to be a problem?

Considering Bioshock has a 50% higher installed base to sell to and had 11 days of sales included in the numbers (vs. 5 for MP3) does that indicate that the Xbox 360 has a problem selling to the traditional gamer demographic too?

In the Bioshock thread there were plenty of people who voiced concern over Bioshock potential sales. It is creepy (to say the least), has no multiplayer (online or off), and is an unestablished IP released in summer right before the Halo 3 tidal wave.

It also has a lot more competition from back library titles as well as new competiting software. Nearly 900K 360 gamers picked up Madden in August.

I think you have a valid point about the 5 days.

But I don't think comparing MP3 to Bioshock is very relevant. MP3 to Halo 3 seems to be more level ground: 1st party titles, established IPs, successful IPs with a strong fanbase, a legacy of high quality releases, critically praised (assumed in Halo 3's part). Both are seen as "some of the best the platform has to offer" and a reason to own the console as it defines each companies' vision. MP3 with the Wiimote/Nintendo Brand, Halo 3 with HD gaming & Live/social elements.

Bioshock says something different about the 360 platform than MP3 does about the Wii and Halo 3 about the 360.

The fact MP3 didn't have a bazillion pre-orders or first day says doesn't concern me though. I don't think that is characteristic of the Wii fanbase (or the GCN ones for that matter). The diehard/hardcore gamers with large gaming budgets who neeeeed to get their gaming fix, those are the types that feel compelled to get the best gaming experience immediately.

Neither of those companies dropped out of the console business, and one of them even managed to not lose 4 billion dollars!

The price dynamic comes into play here/ Neither 2nd/3rd place console was significantly more expensive than the market leader.

3rd parties aren't jumping on Wii, and they're not going to. It's not that sales are low--there aren't any 3rd party games out in the last 3-4 months worth occupying the top 10 in the first place! I think it's pretty simple: Developing for the Wii is boring as hell. Coders. producers, and artists want to do something new...program new graphics effects, develop cool new models and levels that weren't possible before, and so on. They figure if they ignore the Wii for long enough, consumers will, too, and they're probably right. When they say "Wii is a fad," it's a self-fulfilling prophecy.

Uhhh who are you and what did you do with our pirate??!

I predicted the Wii would succeed (woohoo), but I didn't predict anything near what it has done (doh!). And while I have a lot of doubts (software sales, Nintendo's relationship with 3rd parties, how long will the insanse sales pace continue with the software lineup, how will the Wii be impacted by a $199 HD competitor, etc) I think at this point I am comfortable accepting the fact the Wii is going to be very strong for 12+ months. Even if (if!) MS is able to pull slightly ahead this holiday in sales, Nintendo will pass them by Spring.

Their install base will be impossible to ignore.
The cost of developing for the platform will be enticing.
The pool of talent who a) aren't cut for next gen or b) want something totally different will find a home on the Wii.
Publishers have already shifted resources to the Wii.

If Wii software sales lag it won't be from a lack of effort. The Wii launch behind(Nintendo politics and Wii skepticism pushed aside) there is a wealth of tools and products ready for the Wii treatment. A LOT of companies have GCN products (engines and assets as well as experienced staff) to push out high quality Wii titles. The question is will they find good uses of the Wiimote and how will consumers react to these products.

Even with great controls (MP3 or MoH like), do Wii owners really desire a slew of good shooters?

As an FPS gamer I can say that something like BF2 (destructible worlds), Frontlines (64 players online), Halo 3 (4 player coop and insane MP variety), and Call of Duty 4 (class/team play, RPG elements, intense SP) all tend to cater to the things FPS gamers want more of.

So I think publishers will try to get good Wii titles out... but a GCN+ effort (better graphics, more involved gameplay) with good Wiimote controls won't resonate IMO. I could be wrong.

But I think a lot of Wii owners are looking for something different. If they wanted FPS with better controls they could get a PC, and the titles being sold on the Wii don't indicate to me a dieing thirst for a hoard of FPS titles. The publisher who figures out WHAT Wii owners want will benefit greatly.

Until then I think it will be touch-and-go. This is the risk of totally departing the mainstream and going after new consumers. You have to figure out what they want and how they want to play it. Exciting--yes! But also scary from an investor perspective. 1 in hand versus two in the bush and all that jazz.

because many PS supporters (me included) haven't bought one yet

Consumers are fickle. Nintendo saw their marketshare tank quickly. As did Sega. As did Atari.

I think the hardcore PS3 supporters already spoke up. They were the ones who bought a $600 console with a limited library. From here on out software and accessibility will play a significant role.

How many PS2 has Sony sold *after* Wii and Xbox360 launched? Many.

Yep, far cheaper and a lot more game variety. Why by an average game at $60 when you have an entire library of AAA games on the PS2 for $20? A perfect cheap gift for a birthday or whatnot.

A PlayStation.

The PS3 will play 2nd fiddle to MS in NA and has lost Japan to Nintendo. This is really bad for Sony.

The Japanese developers appear to be quite in tune with DS and Wii development and philosophy. They are affordable (which allows high volume as well as risk taking) and reward ingenuity. Nintendo will own the lion's share of Japanese development efforts.

NA is a hugely lucrative market where big titles sell big numbers. Sony will never catch MS's install base in NA and MS's software sales are amazing. NA publishers will absolutely focus on MS in NA.

The PS2 was the lead SKU on about everything, had almost every important title and exclusive, had the widest and deepest software selection, and became very cheap over time. It dominated Japan, NA, and Europe.

The PS3 has none of this going for it.

It is a PlayStation in name only. Nothing more.

As asleto pointing out, every move Sony makes will be countered and check mated. A price drop? Sony hits $399, MS hits $299. Sony hits $299, MS hits $199. Sony gets a great new title, MS gets two.

It is the same boat MS was stuck in last time. The big differences, other than fans, is MS was at price parity and easier to develop for and had a solid, if not meager, NA install base (these points made porting worth the effort).

At this point, Xbox360 could have very well sold well predominently to its existing market of Xbox owners. We'll see how much more they sell once they hit the 25 million mark worldwide and start exceeding their Xbox1 userbase.

Ouch! Haha! Then again I think Sony would be happy retaining 50% of their PS2 customers, so I guess those barbs go both ways.

Pinch of salt and all, but according to MS there are millions of Halo gamers still playing on Xbox1 consoles. I do think the, "Only Xbox gamers are buying 360s" card will die sooner than later. Some misconceptions die hard.

I think another interesting question would be: how many are interested in the ps3 lineup?

As a consumer I think, looking at genres, the question really is: "If I want my RPG... Sports... Racing fix... what platform should I get?"

If I am a crazy insane sports nut, looking at a PS3, why wouldn't I look at the 360?

If I was into waving my arms and am looking at a PS3, why wouldn't I look at a Wii?

There will always be holdovers. Us Nintendo fans put the GCN (as well N64 to a degree) on our backs. PlaySation fans will support the PS3. But the PS has always been about mass market success and resonating with hardcore and casual gamers and becoming the default standard.

We once played video games.
We then played Nintendo.
We then played the Playstation.

Times change. Do we, "Play with our Wii" now?

Anyhow, I find it shocking that the PlayStation isn't the "home" to RPGs at this point. There aren't many genres where I would say the PS3 is a market leader.

If the 360's software isn't appealing to PS2 owners, I don't see how in general the PS3 is fairing any better. Sure, a few Sony exclusives will tickle the hardcore faithful. But I have already seen a couple hardcore PS2 fans tell me their are dead set on a 360 now.

Like I said: Gamers are fickle. Heck, why do you think I got off the Ninny bus after 4 generations??! I am fickle!

 

[TheChefO]

One thing manufacturer should realize is that if you are going to launch late, you NEED to come out with guns blazing on the software side to draw attention.

The Wii actually did a good job of that with Zelda. Also, adding Wii sports to the package was simply brilliant.

That's the biggest thing that surprises me at this point. Sony has a huge internal dev studio, yet their games library is ... well ... thin.

Not to mention their strong relationship with 3rd party devs over the years. I knew they would have a problem with their pricing model, but software wise I figured they would be hitting on all cylinders at this point.

I think they were really, honestly, truly not expecting the competition to be this tough and their own sales to be this low. At least it doesn't seem like they planned for this...