No 360 price drop may see PS3 win this holiday season in the US.
High-profile gaming research analyst for Wedbush Securities, Michael Pachter, has told IndustryGamers that if Microsoft does not respond to recent price cuts "PS3 will outsell Xbox 360" in the US this holiday season.
The 360 has been outselling the PS3 on its US home turf during 2011 but, in a soon to be published "Pachter's Podium" Q&A, the analyst has reportedly called the holiday battle between the two consoles a "close call."
"If Microsoft does nothing, I think PS3 will outsell Xbox 360," Pachter told IndustryGamers. "However, my friends at Microsoft are extremely proud, and they absolutely refuse to tolerate the possibility that the PS3 will outsell the Xbox 360. I think they have the ads printed for the Xbox 360 price cut, and will drop them on us the instant they see PS3 sales greater than 360 sales."
On the back of a series of price cuts PS3 sales have significantly increased around the world, in one case by 400 per cent.
Microsoft, to date, has insisted there are no plans to reduce the price of the 360 in the near future.
If Microsoft doesn't decrease the price of the 360 they're pretty much done. The PS3 already outsells the 360 worldwide. If they outsell the 360 in the US as well, it's over. The 360 sells well here because everyone already has one here, which means all your friends play the 360. If you want to play online with your friends, you buy a 360. It's reversed in Europe. So everyone buys a PS3 in Europe. When the PS3 is $50 less than the 360 with more exclusives releasing at a steady rate, it'll just destroy the 360 in sales. Even in the US. Microsoft has to reduce the price of their console. Their main problem is the Arcade. They'd rather not reduce the arcade to the same price as the Wii. $150 for a 360 is kind of... bad.
I'm a PS3 fanboy only because there are more exclusives PS3 wise that I LOVE! XBox for me only has Halo, Left for Dead, Splinter Cell, and Alan Wake that would make me want an XBox. But, out of those 4 games, 3 of them are also on PC! So really. just wanting one game that the XBox has as an exclusive, does not make it worth wild to purchase an XBox for!
The worldwide sales have been three million units apart from each other, or should I say "shippings", correct?
Anyway, I want Heavy Rain, Uncharted trilogy, Demon's Soul, Katamari Forever, and a bunch of exclusive diversity for PS3. I don't have the PS3 yet, but I'm waiting for the model to have PS2 hardware chips, so I would play PS2 games. Meanwhile, I hope the PS2 comes down to $50 before its discontinuation, so I could get the slimmer model.
For XBOX 360, I want diversity and hardware stability. Beautiful Katamari, Tales of Vesperia, one of first-person shooters (maybe Halo?), and any other diversive exclusives would do justice.
I think that Microsoft needs to decrease the price of the Xbox as well, but I won't go so far to say that they are "Done if they Don't" - Microsoft still has the higest software attach rate of all 3 consoles. Significantly so in the US. - Systems don't generate revenue, the software does. Sony needs better penetration in the US market where it is getting its A** handed to them. It's a smart business move - Microsoft has revenue generating from their online service as well. $40.00 x 35 million/yr vs $0.00 x 70 million (Yes a few Playstation +, but I wager not many)
My prediction is within the next 60 days, Microsoft will drop the price, when it actually makes sense to do so (During the Holliday Season) We all know that their cost to manufacture is significantly less than Sony and if worse comes to worse, they could drop the price significantly and still make a profit.
What is even more surprising is that if you look at current console sales on Amazon. Sony is #12, but then Microsoft is #13 4GB #15 Kinect 4GB #18 Xbox 250MB.
I don't know people even bother buying a 4gb XBox! You know it's uninformed parents buying it for their kids as an entry point to HD after buying them the Wii earlier on in life. 4gb fills up fast! I even heard people who bought the last Halo game can not even handle the 4gb Xbox! Kinda lame!
You won't get a PS3 that can play PS2 games. Sony has already pretty much stated that it's not going to happen. If it was going to be a possibility at all we would've seen it with the Vita, but it didn't happen. The PS2 has a very different architecture and software emulation is decent at best. I'd just grab a PS3 if you want one. It'll probably drop to $199 before it phases out, but you'll be waiting a while.
A high software attach rate means people are buying more games and less consoles. It's usually a bad thing, not a good thing. When a console has a low tie/attach rate it means that the console is either mostly ignored by it's userbase or it's selling really well. Take the Wii for example. There's more Wii games sold than any other console and yet it has the lowest attach rate. High attach rate is often times bad, not good.
Likewise Microsoft needs better penetration in the rest of the world since Sony is destroying them in sales outside the US and has higher worldwide sales overall. If any console needed a price decrease it was the 360, not the PS3. The price decrease definitely won't hurt the PS3 at all, in fact it'll probably see sales increase considerably, but the 360 is sitting in a pretty bad position right now. The Wii isn't doing all that well either. Hopefully the Wii U can help them out there, because the price cut didn't do much for them.
35 million are the number of total xbox users with a xbox live account. That doesn't mean that there are 35 million gold accounts. Many of the accounts are likely inactive, quite a few probably don't have the money to justify spending on Live right now, others want to concentrate on school, work, etc. I know that XBox Live is a huge money maker for Microsoft. I'll say right now, I think charging for a service that should be free and doing everything in their power to market it up as the best thing that ever touched the internet is pretty... well... I wouldn't ever pay to play online. If I'm going to pay to play a game online I'll pay the people who actually run the servers, aka the developers. Why would you pay $50 a year to access EA servers that Microsoft doesn't even pay for? Anyway, it's an age old debate that won't be finished in this thread. Live does make a lot of money, but they don't have 35 million paying users. I've heard 19 million gold members, but I have no source for you and I really don't remember where I heard it. So that's just hearsay.
Sony's cost to manufacture is actually really low at this point. They bought out a cell processing plant and all they pay for now are the parts. Granted it's still more expensive than the 360, but they're still making a profit at $250. Their operating costs have gone down a ton.
What is more surprising is that the PS3 sells the worst in the US and it's still outselling the 360 and the Wii on Amazon. That means the PS3 is a pretty hot item right now. ;) I'm sure in Europe it's selling a whole lot better too.
You're XBox stops working, you buy a 4 GB, swap the hard drive, and you have a working XBox without buying a 250 GB one. There's a lot of warranties on older 360s that expired. On 360s that still suffer from the RROD. If Microsoft won't replace it for free... you buy a 4 GB. I'm not saying that's the only reason they're selling, but it does happen quite often. It's another thing you see all over the forums. Nobody buys a 250 GB 360 unless they're purchasing a 360 for the first time.
"A high software attach rate means people are buying more games and less consoles. It's usually a bad thing, not a good thing. When a console has a low tie/attach rate it means that the console is either mostly ignored by it's userbase or it's selling really well. Take the Wii for example. There's more Wii games sold than any other console and yet it has the lowest attach rate. High attach rate is often times bad, not good."
I don't think that is the case, because the Xbox has had the highest attach rate since launch. Given the fact that the big three talk about attach rate, I don't think its a bad thing. I think a large part of it is actually due to the fact that the gamers play online.
To simplify my statment, if you have two systems with relativly simmilar number of units out there (MS and SONY) and one has a higher attach rate than the other, that would be percieved as good. :)
Given the fact that the PS3 has had a significantly better software library this year, It should be blowing MS out of the water, but that is not the case, at least from what I have read.
Wii has a low attach rate, becuase most games suck (this is opinion and a joke) When you have a system who has a 30-40+ million lead, I would hope that they would sell more software. It's really a poor comparison to use.
As for your assumptions on Gold Membership at 19 million, I would wager even that is on the high side, but my point is that Live is a revenue stream that Sony does not have. A very significant one. As of 2010 they were losing money on the PSN. They need a larger user base and more software.
I think they misquoted MS I don't think that there is 23 million gold Subscribers as of last year.
I 100% agree that if MS doesn't lower its price it will loose its lead a lot faster. My point is that it has areas of revenue to make it a much more porfitable business model based on attach rate and Live Service.
If you check the numbers, the PS3 has always seemed to sell higher than the xbox most months on Amazon, but still falls well short in the US. Don't get me wrong, its a great price point, hell I even upgraded my old PS3 (gave my 60GB to my nephew), but I thought it would have been a lot higher than it is.
I have no real numbers to compare other than internet estimates, but between the UK / US its pretty much even between xbox and Sony. The big delta comes from the fact that MS has epic failed in Japan. While its impact on hardware numbers is huge, the software that consistantly sells in the top 10 in Japan almost never makes it to other markets, with the exception of a few.
They should just reduce the price of the 120 and 250 GB systems and discontinue the 4 GB. That seems like it would make the most sense to me. If they do that, they should remain competitive, especially if they offer quality Kinect bundles (which I don't personally care about, but which will make plenty of money).
Microsoft having a higher attach rate is a good thing for Microsoft. Of course their console has also been out on the market for an extra year so this isn't overly surprising since high console sales over a shorter period of time generally means a lower attach rate. If the PS3 had been on the market for as long as the 360 it's attach rate would probably be pretty similar. They really aren't that far off. Microsoft has 8.8 I think and Sony has 7.3? I haven't seen recent numbers so I have no idea what they are nowadays, but I'm guessing relatively close.
360 users are still buying games. PS3 users simply have more variety to choose from. PS3 users also tend to go for a lot more variety with their games anyway. On the 360 the only games that sell really well tend to be FPS, while on the PS3 there's a variety of games that sell pretty well. It's the difference between the US and Europe. We're stuck on FPS for some reason. It's one of the main reasons I'm glad I got the PS3. I can't stand FPS anymore. I played them to death 10 years ago. They really haven't changed much. I like variety.
I brought the Wii up to show that a lower attach rate can be a good thing, not a bad thing. There's other factors that you have to take into consideration before assuming that a high attach rate is a good thing. The 360 has had the slowest growth of the 3 consoles so it'll obviously have a higher attach rate.
XBox Live is a money maker. I also feel it's a rip off. I understand charging a fee for the service, but you pay $50 a year for a service that might cost them $5 per person. It's just a blatant overcharge on Microsoft's part. Especially since all of their games use peer to peer or private servers (first party studios always use peer to peer). That costs them nothing. Sony actually has private servers for most of their games that have online, and they still don't charge for the PSN. Adding insult to injury are the advertisements that have started to pop up on XBox Live. A big ad for a car company when you're on the Marketplace? Really? Either get money from showing ads or charge for the service. Doing both, especially when you're making a huge profit from Live in the first place, is just ridiculous. It's a slap in the face to people who are paying for the service. If you pay for something on the internet, it doesn't show ads. That's just common practice. Online gaming being free, except for MMOs, is also common practice, but there's no reason to keep talking about it I guess.
The UK is pretty much the only country in Europe that sees decent 360 sales. The rest of Europe sees worse than the US sale numbers for the PS3. Japan buys very few consoles. I realize that Japan's population is half of the US, but by it's console sales you wouldn't think so. It's really not a great market for anything but handhelds right now. It wasn't until 2010 that the PS3 passed 5 million sales in Japan. That was only about 15% of their userbase at the time. Since the US only sees about 30% of their userbase, at around 11 million in 2010. That leaves about 55% of the userbase in Europe, minus a few percent for the random other countries that see few sales like India and Korea. The PS3 is a huge thing in Europe. It's on scale with the 360 in the US.
The PS3 actually sees quite a few Japanese imports these days. Obviously not all of them, but I'm getting my fix of JRPGs lately. I'm happy.
In any case, the 360 definitely isn't going to stop being popular over a PS3 price decrease, but the Kinect craze isn't exactly in high gear these days after a year on year sales decrease from last year in July. The 360 needs a price decrease. Kinect only provided a temporary boost and there's simply not enough software to keep the hype levels high. The US is the only market that the 360 really shines. They need to keep it.
One thing to keep in mind about attach rates, is that is based on the number of systems currently sold. Xbox still maintains about a 3.25 million lead. Based on that fact if Xbox/PS3 have a game and each one sold 1 million copies, the PS3 would have a higher attach rate on that game based on the smaller user base. In that case for the Xbox to have a higher attach rate means it is selling more games. I know these are estimates, so take them for what thye are worth but a ~9 vs 7.5 attach rate is a significant amount of software and therfore a signifcant amount of dollars. As for your FPS theory, yes Xbox has more FPS because they sell better in general (Specifically in the US). Lifetime to date the best selling game for the PS3 is a FPS (Call of duty)
I still enjoy FPS, an apparently so does most of the world.
On the Wii, a lower attach rate is not a good thing. Its biggest challenge comes from lack of good software beyond 1st Party. Not sure what point you were tying to make with this.
My point on Xbox live was its tool as a revenue genrator for MS, not how you feel about it.
The PS3 is a huge thing in Europe. It's on scale with the 360 in the US. <--- That was the same point I was making, not sure why you are arguing it. 15% of million is about 7 million systems, which is not that small. As for percentage of games that Make it from Japan, besies a few JRPGs and few others, the number is really insigificant as far as software totals go. That was my point.
"In any case, the 360 definitely isn't going to stop being popular over a PS3 price decrease" (Agreed, that was my main point of the discussion)
"If Microsoft doesn't decrease the price of the 360 they're pretty much done." (This was my original arguement based on you comment above)
The price cut will help PS3 win world wide this year but it was going to do that anyways without a price cut. But the holiday in the USA should still see Microsoft winning. Holidays is all about family gathering for christmas and stuff and motion control always sell hot so there's no doubt that Kinect and Wii motion controll will be a hot seller again. Move is more or less motion control aim for the core gamers market than the casual. Add into the fact that Sony doesn't have a cheap 4GB model to compete with Xbox 4G model. Xbox is pretty much only selling big still because of the 4GB model. And I expect the 4GB model will sell huge during holiday.
Nevermind you're right, I was think tie ratio not attach rate. I know that Call of Duty is the best selling game for both the PS3 and the 360. It doesn't make FPS any more exhausting for gamers who have already been there and done that 15 years ago. Don't get me wrong I still do like an occasional FPS. Dead Space was a great game. As was Bioshock. It's just that most FPS are so cookie cutter it feels like I've already played the game 15 times. Halo is a great game as well, though I'm agreeing with Bungie that it's time to move on. Most FPS, like Call of Duty for example, just really don't have anything that sets them apart from other games. A historical war FPS? We haven't seen that 30 times in the past. FPS games have the potential to be great since nothing quite sets a mood like a FPS. Some games take advantage of it and create a very vivid experience like Dead Space. Others are just the same old game reincarnated like Call of Duty and Medal of Honor. Then again the same could be said for many genres I suppose. I'm just not a FPS junkie like most of the country.
The tie ratio of the PS3 and the 360 is relatively close, much closer than the attach rate. The attach rate obviously differs from one game to the next. EA flat out said that the PS3 was by far their main source of money last year. Things have obviously changed considerably from a few years ago. I don't doubt that 360 gamers buy more of many games on average, especially FPS. Then again RPGs tend to do better on the PS3. It's a give and take thing.
Again I was thinking tie ratio. Of course the Wii has a completely different software library than the Wii and PS3 so comparing attach rates isn't overly productive. Attach rate comparisons are relevant for multi platform titles. You can't really find anything overly meaningful from an attach rate of an exclusive.
I thought you were arguing that the PS3 was more of a Japan thing than a Europe thing. My bad.
LOL, I can see the conflict between the two statements. I wasn't implying that the 360 wouldn't still be a popular console. It was more of a statement implying that Microsoft is overconfident about their console's popularity in the US. Obviously people buy the consoles that their friend's have, but with all the exclusives coming out on the PS3 this year and the lower price point... Microsoft isn't really giving people who aren't interested in the Kinect much incentive to buy a 360 lately. If they don't change their mindset I'm thinking it's gonna turn around to bite them in the butt. Kinect is all and good, and I really wouldn't have a problem with it if it didn't seem to occupy all of their first party studios' time. They need to give their hardcore more than empty promises and press statements basically saying that hardcore gamers have nothing to be upset about. A price decrease would be nice for one, especially since people are still replacing their RROD models that are out of warranty. A few decent new IPs would be a nice present to the hardcore as well. Integrating Kinect into hardcore games isn't the way to make the hardcore happy. It's more likely to piss them off.
Anywho, XBox Live is really the one thing that's keeping the 360's hardcore user base with Microsoft. That'll work this gen, it won't work next gen and if you piss off too many of your hardcore you might find them on the other side of the fence come next gen.
I really don't see the Kinect selling well unless new titles start coming out. Not just new iterations of the old titles either, something new that actually shows that the Kinect is more than just a hands free Wii. Dance Central is really the only game that shines on the Kinect right now and most people don't want to spend $150 just to be able to play one game, not including the price of the game itself. It's a controller that Microsoft is trying to say will revolutionize gaming, and yet gaming really hasn't changed at all.
All the consoles will sell huge during the holidays. I'm guessing that the PS3 will see a huge increase in US sales due to the price decrease though. Probably not as well as the 360, but without a price decrease a lot of people who would've bought a 360 might buy a PS3 instead. They really should decrease the price. It's not like the 360 is overly expensive to produce anyway.
The Kinect hasn't really done much at all for me. I agree with that. What it has done, however, is give my niece and nephew something else to play with when they come over. I had a Wii, and though I love Nintendo first party games, I have to admit that I bought it in large part to give my sister in law's kids something to do when they come to my house. Had the Kinect been available then, I probably would've just picked it up for them rather than getting a Wii. That is still a big market. Don't forget that households often have more than one gamer. Sure, I'm a hardcore gamer. My wife is not. My nieces and nephews are not. If the 360 had more casual games available through the Kinect earlier, I probably would've bought it for them instead of a Wii. That is the future of gaming, I think. No console wants to be "the hardcore console" or "the casual console." As gaming gets to be a larger industry, the console that will win next gen is the console that can offer something to the whole family, which is likely to include hardcore and casual gamers.
Good for Sony, though they still won't catch Nintendo this generation. I will be curious to see how Sony and Microsoft attempt to go after the large 'casual' crowd Nintendo clearly made millions from. Microsoft despite coming in third should be rather proud. The ps2 sold 150 while the xbox 30 million, 5:1 ratio. The ratio this generation is closer to 1:1, Microsoft made up a lot of ground this generation. The real issue isn't who places second this generation, but rather will Microsoft continue to make up ground next generation. Microsoft proved themselves a legitimate threat this generation.
Except that Sony's stated many times that their main focus is on the core gamer and the new handheld they're releasing is obviously aimed at the hardcore gamer. What would a casual gamer need with a quad core CPU and GPU? The Move has gotten far more support for hardcore titles than casual titles. In fact the only casual title I can think of for the Move is Eyepet. Not to mention that the Wii and the Kinect are both not selling very well at all anymore. I'm not seeing where you get this huge casual market. The casual market is pretty much dried up right now. It may open up again later, but until we see the sales figures go back up it's not a very smart move to cater to the casual experience at the moment.
"In fact the only casual title I can think of for the Move is Eyepet."
Move Heroes, Zumba Fitness, etc. Look a bit harder.
"Not to mention that the Wii and the Kinect are both not selling very well at all anymore. "
Really? Odd, because last I checked the Wii in 2011 was the second best selling console and sold millions thus far. Honestly it isn't all that far behind the ps3 in total sales this year. It isn't selling as badly as you seem to think (more like hope). For having a 35 million lead and still only selling a couple million less than the ps3 and selling more than the 360... not too shabby for a 'dead' system.
At the end of the day Sony lost their crown. The psx dominated the Saturn and N64. The ps2 crushed the GC and xbox. This generation Nintendo destroyed the ps3 with the Wii and Microsoft was very competitive, very. It took the ps3 almost 5 years to outsell the 360, a console which only sells in 2 territories. Color me unimpressed. Especially considering both MS and Nintendo only dropped their console price by $100 since launch. Sony had to drop their price by $350. Sony is desperate. What other console dropped their price by 59% within 5 years? Maybe the Dreamcast?
"Not to mention that the Wii and the Kinect are both not selling very well at all anymore. "
Just looked up the data. The Wii in 2011 has sold 5.3 million, while the ps3 is at 6.1 million.... if the Wii isn't selling well anymore, I suppose the ps3 isn't either, considering the difference between the two is a mere 13%.