Tobold's Blog
Thursday, January 04, 2007
Too early to say who wins console wars

The Guardian has an article about the "lower than expected" sales of the PS3 in the USA. In November / December the PS3 sold only 750,000 units, compared with 1.8 million Wii and 2 million XBox 360. Typical example of how you can take correct data and end up with wrong conclusions. Microsoft did not win the console wars yet, with Sony coming last.

The correct answer to the question of how many Wii and PS3 units sold is "all of them". The numbers cited above are comparing the sales of the XBox 360 with the production numbers of the Wii and the PS3. It is impossible to say how many more Wii and PS3 units would have been sold if they had been available. And it is hard to say how many XBox 360 were sold for the simple reason that no other "next gen" console was available at that particular store. We'll have to wait for the christmas 2007 sales to get a first realistic glimpse on which console is coming out ahead. And then it will still take many years before a count of the lifetime sales of each console reveals a final judgement on this issue.

I would have bought a PS3, but over here in Europe they aren't even sold before March. Wiis were sold, but a friend of mine who got one for his kids had to ask in half a dozen shops before getting one. The only next gen console I saw available in the shops I visited was the XBox 360. Being actually for sale gives this console a big advantage in the number game up to now. It will be some time before you'll see all three of them standing on a shop's shelf. And even in 2007 the XBox will still have the advantage of having already over 100 games available for it, while the others are still catching up.

I'm not in a hurry to buy that PS3, although I still think that I eventually will. Besides having to wait for good games, I have two other issues with the PS3: High Definition, and the Blueray drive. I don't have a HDTV yet, and High Definition TV is slow in arriving. I'm sure that the next TV I buy will be High Definition. But right now I would only need it to see PS3 games in the best resolution, and that is a bit hard to justify. Makes you wonder if the famous guy who ruined his TV with a Wiimote was just looking for an excuse to buy a new HDTV. The Blueray drive is simply a gamble, nobody knows if Blueray will be the next VHS or the next Betamax. With Blueray players still more expensive as a PS3, this could either be a bargain, or an investment in the wrong technology.

While I'm not planning to buy one, I still think that the Wii will end up outselling both the XBox 360 and the PS3, because it is much cheaper than either, and more accessible to the non-hardcore gamer general public. Everybody "gets" Wii Sports after 3 seconds of explanation. You can't say that about the typical console games on the competitor's machines.
What's been interesting to me, Tobold, has been walking into stores like Circuit City and Best Buy that have started posting signs on the door that say which of the consoles they have available. Lately I've been seeing a lot of "Wii is temporarily sold out" and "PS3 is currently available" signs. The trend may be neither global nor long-term (although it's interesting that Kotaku noticed this same phenomenon in Japan), but it's definitely been consistent for the past few weekends in the southeast US.
Tobold you are of course correct in saying that the figures do not accurately show consumer demand, rather they show demand under constrained conditions of supply. That doesn't mean they are meaningless, however. The production efforts of the various companies are very important, particularly to developers of launch and early titles.

Take Capcom. In a recent interview, they stated that the development costs for their initial PS3 games were such that they need to sell 500k copies to break even. Now, if your total installed user base 1 month after launch is measured in the hundreds of thousands, then Capcom are almost certainly out of pocket on any titles they have released. This will have ramifications on their future development.

Essentially, a poor start makes developers cagey about platform exclusivity. They start hedging their bets. It's really about momentum. While of course it is far too premature to say that anyone has won or lost, such a slow start (even if it is due to supply rather than demand) WILL have a detrimental effect on the chances of the PS3. The question is, how big an effect?
Hey, just scanning around and came across your blog.

When I went home for Christmas to visit my parents I saw some things that were interesting at the local mall. You could not find a Wii anywhere. Xbox 360 was abundantly available - as to suspected since it has been out for over a year. However, to my surprise the Best Buy and Gamestop stores both had PS3s available. The Best Buy had a huge pyramid of them stacked in the middle of the store (there were at least 12). I think beyond the initial rush of the folks that really want a PS3 people are going to wait the PS3 out and see if it is worth the $600. The Wii nun chuck is innovative and the $250 pricetag is easier to stomach for alot of people. A buddy of mine got his hands on the Wii and I was able to try out the new Zelda and Wii sports -- they extremely entertaining. i though i would never say this but I think Nintendo may have the initial battle -- it remains to be seen if they can win the war.
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