Console vs Console - Facts & Figures!

[BinaryJack]

Found this very thought provoking piece this morning.
I dont have too much time to actually post my thoughts, and this piece had me thinking a lot!

I would like one and all to please respond to this piece with their thoughts.
Keep in mind, this piece is fact driven and not biased in any form or fashion.

It is a very long piece so I am not going to copy the entire piece in here, just read the link.
When I get home I will go through and copy some of of the more thought provoking pieces here.

http://www.edge-online.com/features/june-npd-in-depth?page=0,0

As promised, some cut 'n paste from the article:

MGS4:

The Sony Angle: Metal Gear? Metal Gear!

The PlayStation 3 exclusive, Metal Gear Solid 4, was the #1 selling game in June 2008 and Sony's first #1 title for its newest console. Combining bundled software with individual software sales, MGS4 moved nearly 1 million units in June. After less than a month in sales, here is how its stacks up with previous generations of Metal Gear Solid games, courtesy of the NPD Group:

Go to the site for the actual graph but it is something like this:

PS1 sales - close to 3 million
PS2/XBX/GC sales - over 4 million
PS3 sales - under 1 million

Most people following the market want to know: Did it help push sales of Sony's PlayStation 3? Here are the facts we have:


According to NPD Group figures, we know that as many as 220,000 of the 80GB PS3/MGS4 bundles were sold during June. That's around the same number of PS3 systems sold in May, the previous month.
In sum, the system sold around 406,000 systems or 81,000 systems per week, a 55% increase in sales from the previous month and the highest rate ever for the PS3 outside of November/December holiday periods.
Approximately 1 in every 4 sales of MGS4 was bundled with PS3 hardware.
Given these facts, it seems clear that the release of Metal Gear Solid 4 influenced PS3 sales.

However, we should note that this was not a perfect demonstration of the power of the Metal Gear Solid franchise. The MGS4 hardware bundle included an 80GB PS3, a model that not only has twice the hard drive space of the 40GB model but also includes some backward compatibility with PlayStation 2 software (a feature the 40GB model lacks completely). Given that this 80GB model has been difficult to find at retail for months, some pent-up demand for these features alone may have contributed to PS3 sales in June. Moreover, aggressive marketing of the PS3 – like the $100 gift-card offer from Wal-Mart – may have helped attract more consumers than Metal Gear Solid would have by itself.

With the recent announcement of a new 80GB PS3 model as the “mainstay of the company's hardware line-up”, Sony appears to be ending the multiple model strategy it has followed to date. The new configuration will also put Sony's system price firmly at $400 and end the inclusion of hardware-enabled PS2 compatibility. By announcing the system in July but not launching it until September, Sony may be making it more difficult to clear the remaining stock of 40GB PS3 systems, especially in the absence of some price cut.

As a result of all these factors – the Metal Gear Solid 4 launch, possible higher demand for 80GB systems, aggressive marketing, and an announced future price drop – Sony may see PS3 sales drop precipitously in July from the record high in June. Moreover, Sony probably still needs to get much closer to $300 and ultimately $200 before it can hope to achieve the 150 million system installed base that SCE president and CEO Kazuo Hirai has set as a goal for the PS3 lifetime. Sony continues to strongly signal that profitability, not marketshare, is its near term goal but at some point a larger installed base will be necessary to realize greater profits from the PS3 venture.

Well as we can see it seems that MGS4 did not actually spike the sales figures for the PS3 but more the discount voucher from wal-mart and the lack of the 80g model with ps2 backward capbaility.
I will amend my statement below.

MS is next, now people please note that these are facts and figures.
I did not make these up. My flamesuit is fastened though.

The Microsoft Angle: Profitable, with a Sony-Style Price Cut

Microsoft's Xbox 360 program is part of the company's Entertainment and Devices Division (EDD), and the company has reported a $426 million profit for that division for the fiscal year ending June 30, 2008. While other entertainment ventures are contained within the EDD, the Xbox 360 accounts for much of the division's $1.5 billion in revenue.

Were it not for the $1.1 billion cost to extend warranties on failing Xbox 360 hardware, the division would have recorded a modest loss last year.

A profitable year for the EDD is a step forward for Microsoft's gaming ambitions, but the current hardware sales situation requires attention.

According to NPD Group figures, the Xbox 360 weekly sales rate dropped for the fourth straight month in June 2008, and Microsoft responded in July by cutting the price of its 20GB Xbox 360 model by $50. Last year Microsoft was facing similar stagnation in hardware sales and responded then with a price cut. To get an idea of what happened then and what is happening this year, consider the following graph. It depicts Microsoft's weekly sales rate for January to August 2007 (in red) and January to June 2008 (in blue).

Plese see the site for the actual graph it is much more interesting than what I am trying to describe.

Jan to Agust comparison 2007 vs 2008.
Jan 2007 - weekly 360 sales just under 60 000 with a steady steady but rapid decline to 40 000 in March with a climb to 42000 +- in April decline to 40 000 in May and a very, very slight incline to July to about 42000 with a dramatic climb to 65000 units in August.
Jan2008 - weekly 360 sales sitting just under 60 000 with a clim tothe 62000 mark and then a sharp, steady decline to about 44000 units in April. It evens out in May and then June it ends at 42000.

So not much happening here really with the 360 sales.

Clearly the price cuts in August 2007 had an immediate and strong effect on Xbox 360 sales. However, those were permanent price cuts across the board to all models. Microsoft's cut this year is more akin to the price adjustments that Sony instituted a year ago (when it dropped the 60GB model to $500 and introduced an 80GB model at $600). To the potential Microsoft consumer, the Xbox 360 pricing structure will remain the same ($280 - $350 - $450) while the standard Xbox 360 model will have a better perceived value when its hard drive size increases to 60GB.
While it is not a perfect analogy, we can look to Sony's sales last year for how this kind of adjustment may play out in hardware sales. Here are the weekly rates for Sony's PlayStation 3 in 2007.

Once again, the graph is pretiier on the site but for those of you that have work filters blocking this:

Jan2007, sales are at 44000 units, steady, sharp decline to 28 000 in Feb, further decline to 20000 in April, stays pretty even until June with a MAJOR spike to 40 000 units in July, but this is severely compromised with a steep decline in sales to 22 000 units in September.

The Great Console Race

Nintendo definitively moved ahead of the Xbox 360 this month, with an installed base of 10.9 million Wii systems in the United States. Microsoft's Xbox 360 now stands at 10.5 million systems, more than twice the PlayStation 3 base of 4.9 million.

Ok, now this one I find fascinating:
Check the pretty graph on the site.

Nov 2005 until present.
360 starting below 500k, with an early start.
Ps3 starts with starting at 200k in october2006
wii starting at about the same time with slightly higher than 360 (about 600k)
By oct 06 360 is currently sitting at 4,2 million.

The growth for the 360 (almost 10 mil) is pretty much on par with the ps3 (almost 4 mil) by Jan with the wii taking off like a rocket, shooting to 10 million by April and the 360 at 11 mil and the ps3 at over 4 mil.

 

[doobiwan]

Interesting. Especially about MGS4 bundle being the only way to buy a "real" 80Gb PS3.

I totally agree that Microsoft need to cut prices and come out punching, but the problem is, last year they did it too early. This year, they seem to be trying to "big Bang" a lot later. I imagine there'll be a ton of stuff dropping, including the price and the new dash in one swoop. It might just be too late.

 

[Oculate]

Indeed,

M$ are still making money off Live!

I'd like to see the 'stats report' in November/December after GOW2 has been released

 

[doobiwan]

August itself is going to be very interesting, it's typically the month MS kick into gear and this year looks to be no different. Being the American console they like to "own" Madden, so that's typically their annual kick off point.

Look here:
http://xbox360.ign.com/index/release.html

From Madden, the releases go ballistic.

 

[BinaryJack]

Yes, this year is going to be a banger of a year for 360 , even more so than last year!

What I did not expect is the total install base of the 360 vs Ps3, I knew that it was big but I thought that the PS3 was closing that gap, seems not.

Sony needs some major titles and soon as it it is not looking too good at the moment.

 

[scotty777]

Yes, this year is going to be a banger of a year for 360 , even more so than last year!

What I did not expect is the total install base of the 360 vs Ps3, I knew that it was big but I thought that the PS3 was closing that gap, seems not.

Sony needs some major titles and soon as it it is not looking too good at the moment.

na, I think sony should just pull there head out there ars, and work! They really have to market better and must really start pushing the ps3 much more

 

[BinaryJack]

I agree Scotty - it is very easy for Sony to get up and running, just market the PS3 for what it is - a cheap multimedia device with BD that happens to play next-gen games.

 

[@udiS3]

Nintendo must be making a fortune...

Priced somewhat similar to the 360 but doesn't have the associated cost as it
is an inferior bit of hardware.

And then all the add on accessories...

 

[BinaryJack]

The Wii is a cashcow and they are standing with their buckets.

 

[doobiwan]

Nintendo must be making a fortune...

Priced somewhat similar to the 360 but doesn't have the associated cost as it
is an inferior bit of hardware.

And then all the add on accessories...

It's fundamentally an overclocked die shrunk gamecube with a few extra gizmo's. I almost bought a gamecube about a year before Wii came out and at that stage they were less than R1000 with bundled games!