NPD December 2007

[....]

Those people who get a console at $200 will buy less and less games IMHO.
One of the reasons for the Wii's success is that it's already selling to that market, eating away future X360/PS3 sales.

Many people, who are real gamers, are likely waiting for at least 299 premium models. In my eyes, only hardcore gamers, or wealthy individuals would consider 400 and 500 premium models as acceptable.

As for wii eating 360 and ps3 future sales, I doubt it, there were significant software sales for the 120M ps2s, add to that xbox+gcn. If the wii doesn't get adequate third party support and adequate online, they'll be forced to get another console.

 

[Laa-Yosh]

Sony picked them when they were still small and grew they did. That's the point isn't it ? ;-)

I thought it was small teams experimenting with different concepts. NT has always wanted to make an AA game in a well known genre, at least I've got that impression

 

[Xalion]

For some reason, I seem to see these numbers differently from everyone else here. I know people always say the 3 consoles are competing, but I don't generally find that to be true. It is true that all 3 share some of the same target audience, but those segments tend to be small "overlap" segments, not entire target audiences.

In my mind, the Wii came out with the idea that they would not compete with the XBox and the PS3 this generation. Instead, it looked at ways it could expand the market. It is doing a phenominal job at that. Most of the people I know who have a Wii did not own a console last generation. Of those who did, amost all of them own at least one of the other 2 consoles as well. Many people look just at the number and say "The Wii is crushing the PS3 so the PS3 is in trouble!". I just don't see that. The people who are buying the Wii now are generally newcomers to the console market.

That is a GOOD thing for botht he XBox and the PS3. Last I heard, more than 50% of the US plays video games of some sort. The console to household ratio is much less than that. If the Wii gets a console in every home I'm all for it. I have had several friends purchase the Wii as a "healthy" console, realize that consoles aren't as bad as they thought, and go out and get one of the other two when the Wii couldn't really deliver the gaming experience they wanted. Don't read that last statement incorrectly btw, it does not say that the Wii is a substandard gaming console. People just look for different things in games. The Wii really can't deliver the same kind of experience for a game like Resistance or Halo that the other consoles can.

On the XBox360s side, they were trying to get into the market and get profitable. They have done that. If you look at it, they threw all of their eggs into one basket - the XBox360. I am glad they are doing well. Competition drives the market. While it does have some negative side effects (platform dependant games and studios having to choose who they program for), all in all I think it is a positive effect. Microsoft needed the 360 to do well to stay in the console business - far more than Nintendo or Sony needed their respective consoles to do. Lets face it, the DS prints money right now, and Sony has a 3 pronged product approach that is doing very well for them (PS2, PSP, and PS3).

Sony looked at trying to cement a different type of video game system. They tried to put out a multimedia center. Right now people may think that this was a bad idea. I don't think so. If Blu ray wins the format war, then the PS3 positions itself very well as a multi-purpose device. The addition of the PSN and interoperability of Sony's devices (remote play for instance) allows the PS3 to become a central feature to a homes entertainment system. With online content becoming more and more important, Sony is the only company with a system that will do it all. The 360 can do online media and games very well, but it cannot really address offline media needs. That is far more than an HD DVD addon drive by the way, it includes other things like the memory card reader, USB operability, music playback and streaming, ect. Nintendo has a decent game system, but really has no other purpose.

Sony's strategy is not short term in any sense of the word. They are trying to position the PS3 and PSP such that they are in place and ready when the market is ready for them. They are trying to continue their success with the PS2 for as long as possible to help offset their losses with the other two. I think they have done that.

So look at where all 3 companies want to be this season:
Microsoft - needed to firmly establish themselves in the console market. This meant being ahead of the PS3. Anything less would result in publishers losing interest like they did last generation.
Nintendo - needed to establish the wider market. Anyone want to argue that they have succeeded?
Sony - needed to establish a solid install base and move towards profitability. They have done exactly that in my opinion.

So I think the holiday season was successful for all 3. I certainly wouldn't go as far as to claim any of them were in trouble or had done poorly when I look at their long term goals and where they are now.

 

[Laa-Yosh]

That large user base means that the average attach rate for any given game has been well under 5% - which means that the PS2's market was very, very varied. It had hardcore action and fighting games, RPGs, dirving games, sports games, but also a lot of various casual games, kiddie games, and whatever. Basically, it has catered to all possible customers, especially because it has dropped to $200 very quickly.

Now the market is split up a lot more evenly, if you're a casual gamer or want something for your little children, you'll go for the Wii instead of the Playstation. By the time MS and Sony get there, that market will be under Nintendo's hold nad 3rd party developers will know it, too. The Wall-E game is coming for all platforms, I wouldn't be surprised to see it sell well on the Wii and underperform on PS3/X360 (Pixar licence games usually sell millions of units...)

 

[Laa-Yosh]

In my mind, the Wii came out with the idea that they would not compete with the XBox and the PS3 this generation. Instead, it looked at ways it could expand the market.

Again, I think Wii is selling to a large percentage of the PS2 user base, and most people did not realise that it existed. Casuals who don't buy GTA, GT, FF, GOW or MGS.

Sony looked at trying to cement a different type of video game system. They tried to put out a multimedia center. Right now people may think that this was a bad idea. I don't think so.

The problem is that noone really cares about these features...

 

[Scott_Arm]

I think the PS3 will be a successful product, but one that falls far short of their expectations. Sony really thought the PS3 would race to the lead like the PS2.

 

[Xalion]

Again, I think Wii is selling to a large percentage of the PS2 user base, and most people did not realise that it existed. Casuals who don't buy GTA, GT, FF, GOW or MGS.

This isn't really supported by software numbers (PS2 still moves large amounts of software), hardware numbers (PS2 still moves a lot of hardware), or ancedotal evidence that I have. Simply put, no one that I know who owned a PS2 bought a Wii.

Amost entirely the Wii was picked up by people who did not previously own a game console. The PS2 still has new titles being released, still has a huge software library, and is still a fairly well supported console. Most people I know of who I could describe as "casuals" have no reason to go out and buy a Wii. They are happy with their PS2s.

The problem is that noone really cares about these features...

This is just not true. This can be seen looking soley at sales ratios for Blu Ray vs. HD DVD. Apparently, people DO care about these features. More to the point, as more and more people buy HD Televisions, more and more people are going to care about these features. Especially when you look at the cost of uprading an entire home entertainment center.

Seriously, if you look at the market right now Sony is very well positioned for the "HD Revolution" that everyone is saying is going to happen. If that never happens then people might stop caring about those features. If it does, then in 5 years everyone will be talking about how brilliant Sony was. It is a risk, but no more of a risk than Nintendo took by releasing a Wii.

 

[DuckThor Evil]

Obviously. The Wii's average for sales in NA is actually 526k. It's only sold more than that amount 3 months out of 14 (dec06, nov07, dec07).

But it has still been in limited supply during all those months after its launch in NA, so it will be interesting to see the January numbers, its hard to predict what those numbers will be. The supply should catch the demand right about now...

 

[AlphaWolf]

But it has still been in limited supply during all those months after its launch in NA, so it will be interesting to see the January numbers, its hard to predict what those numbers will be. The supply should catch the demand right about now...

And I think most people who had $300 in December to spend on a Wii, either bought one, or they bought something else with the money. I'm sure they will beat last January's sales of 436k, but I doubt they will do much more than their monthly average to date. January is a traditionally stronger month for console sales than feb through july, but not by much.

 

[liolio]

France is a pro-SOny place, but anyway as stated by others the situation is different in UK.

More in Europe the Wii steal the show as it's already on top of the 360 and ps3.
My point is that the Wii steal some market share of both SOny and MS, people don't buy two system in one year.

But my feel is that french (and it seems others europeans people ) are pretty much concerned about 360 reliabilty the 33% fail rate is in every mind.
Ms has to come with something consistant in regard to Rrod marketing wise extended garanty don't make it we already have 2 year as a standart here.

 

[aselto]

The situation on the hardware side seems really stable now. Each platform has had very similar market share for months now... which is good.
The software market is much more interesting though. It seems that Halo 3 is having a long tale. Despite that Call of Duty franchise is almost as big at the moment, which is quite unexpected. Call of Duty 5 will be back to WW2 and made by Treyarch, so I'm very curious how it'll perform next year. Also another Activision's game Guitar Hero seems unstoppable now. I wonder if Rock Band with better critical acclaim and possibly word of mouth as well will endanger GH3's position in next months. Also great numbers from Mario Galaxy and Assassin's Creed. It's good to know that it's not only about shooters and rhytm games.

 

[scooby_dooby]

So I think the holiday season was successful for all 3. I certainly wouldn't go as far as to claim any of them were in trouble or had done poorly when I look at their long term goals and where they are now.

I agree, it was a success for all manufacturers in terms of hardware sales.

I advocated a PS3 cut to $399, and estimated Sony should be able to net ~1.5 over Nov/Dec keeping them competetive. They fell a little short of that, however MS also stmubled a little, so everythign being relative, you could say they both did well relative to eachother.

Had they not dropped price, as a few here argued, I think it would've been a completely different story.

As for Sony's longterm plan, it's true that they have a strong future system, but the problem with longterm plans in the console space, is that a console is still fundamentally a game playing device, and by having such a longterm plan, Sony jeopordizes it's 3rd party game library which ultimately may prove to much to overcome.

 

[Laa-Yosh]

Amost entirely the Wii was picked up by people who did not previously own a game console.

Several million customers of Super Mario Galaxy, Zelda and Metroid disagree. Those are games noone new to consoles would buy IMHO.

The PS2 still has new titles being released, still has a huge software library, and is still a fairly well supported console. Most people I know of who I could describe as "casuals" have no reason to go out and buy a Wii. They are happy with their PS2s.

Which is why the Wii is not at 30-40 million units now. But it is selling to the PS2 user base as well, you can be sure about that. 20 million people won't be converted to gaming within a year.
And PS2 makes less money from software revenue per month then the Xbox, which has less then fifth the user base!

This is just not true. This can be seen looking soley at sales ratios for Blu Ray vs. HD DVD.

There are - at least last time I've checked - less BR movies sold then the size of the PS3 user base. And for each AV enthusiast buying multiple movies, there are several times as many who have none, if you do the math.
For example, with the attach ratio around 1, for every user with 5 movies there are 5 users with no movies at all. And 5 Bluray discs aren't such a big collection...
People just don't care about BR, people can't download movies for the PS3, people don't buy the console in large crowds either. To me, that's "people don't care" in short. You can repeat Sony's PR here, but it still won't become true...

 

[Laa-Yosh]

a console is still fundamentally a game playing device, and by having such a longterm plan, Sony jeopordizes it's 3rd party game library which ultimately may prove to much to overcome.

Yeah, it's pretty evident if you look at the market share. Wii rules because of its price, but the X360 is strong as well, thanks to the plethora of games. And PS3, lacking any system sellers, is still just stumbling around.

It is about the games, and that's it.

 

[jb]

UT3 is not a new game. It can draw on existing mods that are familiar to old users.

Yes but most of those will be strictly PC users since that is where they first played the mods. Not saying all will... but go over and check beyondunreal and some of the other forums and the fans of the mods dont seem to have much interest in consoles at this point...

 

[Mboojigga]

I have to say I'm surprised at the Super Mario Galaxy sales. I really thought Mario would get passed over, because of the way the brand has tarnished in the years since Mario64. It really is a good title, so I'm happy it did well.

The userbase on the PS3 doesn't seem to be big enough or willing to buy so many titles. With Call of Duty 4, Assassin's Creed, Uncharted, Guitar Hero, Rock Band etc etc, it seems the sales are split for any one title to be a runaway success.

Everything is pretty much the same we've been seeing for the past year. These NPD threads are getting kind of boring.

I think that is what has been the issue all along. The PS3 has the exclusives right now and of course the "just wait until 08" stigma. Who bought the PS3 for what purpose? Who is actually gaming with this machine. Based on how the sales are for the games released on it makes you wonder how many are "gamers" vs "movie watchers"

 

[patsu]

The problem is that noone really cares about these features...

Intuitively, the need for better UI and media integration in the TV room seem to be there. But this has proved to be a tough nut to crack. Everyone is trying but by no means is PS3, 360, MPC or AppleTV there yet. So we are not seeing any huge numbers (so far).

The problem within our context here is it is orthogonal to game sale unless Sony can somehow integrate movies, TV and games together. I can recognize some early ideas in BD-Live's Java games, but that too is at least some months if not years away.


On a related note, I see PSP as the portable version of a media center. Hardware-wise, it's selling rather well because of these AV features.

I saw two 20-something women rushing to a Sony Style store to buy their PSPs yesterday (Yes, they were running to the PSP shelf ^_^ ). The gals needed to pick a game (for the bundle). Among savvy movie and music-related questions, It's quite amusing to listen to the gaming questions they asked themselves and the sales guy.

The bundled deal was very open (Any PSP game will do), but it was too hard for the casuals. The sales guy wasn't helpful. If these women picked a good game, there is still chance for them to buy a second one. I hope the store can do a better job next time (Locoroco or Lumines would have been a hit for them; or perhaps a signature PSP game -- like Wii Play -- needs to be marketed).

Yes but most of those will be strictly PC users since that is where they first played the mods. Not saying all will... but go over and check beyondunreal and some of the other forums and the fans of the mods dont seem to have much interest in consoles at this point...

Sure... but there will be some who don't mind playing the console version (or have shifted their gaming habit to consoles). It may not be a primary sales driver (compared to say mouse and keyboard), but it should not be an afterthought too (like the way Epic was handling it). To be frank, I didn't even bother to check out the mods once I learned the complicated process (I was pretty keen at first). I have "better things" to do.

 

[dobwal]

I think that is what has been the issue all along. The PS3 has the exclusives right now and of course the "just wait until 08" stigma. Who bought the PS3 for what purpose? Who is actually gaming with this machine. Based on how the sales are for the games released on it makes you wonder how many are "gamers" vs "movie watchers"

I agree. I don't believe its just the size of the PS3 userbase but also the makeup of that userbase. I believe Sony convinced hidef crowd better than it did the gaming crowd to buy a PS3 and the current enviroment is a negative side effect that Sony never intended to happen.

 

[Vic]

You never saw KZ2 in 2005.

You saw a CG movie contracted out by a 3rd party studio. It really should give you no indication of when the game wil lcome, or where it is in development.

I think KZ2 for 2007 was totally unrealistic, if they can get it released by 2008 I'll be impressed.

Well development would have started by 2005. And currently, it is scheduled for September. Considering GG have a 120-person team, I cant see why you would be impressed.

As far as the UK goes, 360 isnt that hot. Its install base has grown steadily, and now its being outsold by both its competitors. In the rest of Europe its a non-factor, so MS should be targeting more games at the EU just as Sony should at the US.

Also, as far as the US-Sony arguments go, surely the converse is true for the 360 in Japan? What incentive is there for Konami, Sega and Square to put their MGS4, Yakuza 3 and FF on 360 with such poor sales?

 

[Laa-Yosh]

Well development would have started by 2005.

Absolutely no proof for that; however we know that Guerilla has been working on the PSP Killzone at that time. All I can imagine is low profile R&D work for the PS3; but they probably haven't really started on the thing until 2006.