Microsoft Concedes Console War, Declares 2nd Place
by Blake Ellison, Sep 05, 2008 2:34pm PDTMicrosoft has finally fessed up--Nintendo's Wii has won this generational battle in the console wars.
In a reversal of its "we're winning if you don't count the Wii" policy, the company behind the Xbox 360 has acknowledged the success of Nintendo's sold-out, remote-waggling wonder box and instead declared victory over rival Sony and its PlayStation 3.
In his best PR voice, Microsoft VP Don Mattick told BusinessWeek, "I'm not at a point where I can say we're going to beat Nintendo ... [but] we will sell more consoles this generation than Sony."
As of March of this year, worldwide console sales are listed below. Since then, the Wii has come close to 30 million sold and the PS3 has topped 14 million, but Microsoft has not released numbers for the same period.
- Wii - 24.45 million units
- Xbox 360 - 19 million units
- PlayStation 3 - 12.85 million units
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Anyone have the monthly sales of worldwide console sale? I'll use the US sales: (taking the monthly rate from NPD at http://bits.blogs.nytimes.com/2008/09/03/xbox-360-lagging-in-sales-will-cost-less/?ref=technology and the current number of US console sales at vgchartz)
x360 at 12.32 million with a growth rate of 205,000/month.
PS3 at 5.77 million with a growth rate of 225,000/month
y = .205x + 12.32
z = .225x + 5.77
So at US current rate, it'll take 327.5 months for Sony to catch up to US X360 sales. They'll both have sales of 74.46 Million units sold.
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The 360 plays games and DVD's - the hardware is sold at a loss, but it's made up for in the very high attach rate + online digital distribution sales / subscriptions.
The PS3 plays games, DVD's, and Blu-ray discs - but has a relatively low attach rate given that the consoles could be purchased as a Blu-ray player only. Hardware is sold at a loss - and will be for quite some time.
The Wii plays games based on the last gen's technology + the Wiimote waggle. Hardware is sold for profit, but it has an attach rate that is perhaps equal or better than the PS3 (trying to find current numbers). Most hardcore owners of the Wii have subjected them to becoming dust gatherers or have traded their units in to the likes of EB/Gamestop to pickup the latest and greatest for their PS3's/360's.
I'd really like to know how many Wii's Gamestop has bought back.
All three of these cater to different groups and are incredibly successful in each of those groups...
This "war" is a waste of discussion space.
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I don't think MS, Sony, or Nintendo care about any of this, at the end of the day one thing matters: Profit. I think the game has changed largely with Nintendo going all Blue Ocean strategy on the industry, yet everyone still wants to talk about the game industry like its the 16bit era and everyone has the same strategy with different technology. Now we have 3 different strategies. At this point I think profit is the only thing that matters especially now that each company has a different approach to getting to that number (I mean do attach rates matter as much to a company who sells the console at a profit compared to the ones that sell it as a loss-leader?).
So at this point I'm sick of unit numbers. It's not a standard unit anymore. It's important to publishers, but not necessarily as a success indicator.
I think the far more interesting question was posed by another poster: Now that Nintendo has gone all blue ocean on everyone, how will their new market react to a new console? And is this strategy sustainable the way their hand held strategy has been? Likewise with Nintendo exposing whole new market segments - will Sony and Microsoft want to try and jump to them or expose their own ones?
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If I had to guess I'd say, by the time the next set of consoles hits.
North America: 360
Japan: PS3
Europe/Other: PS3.
Will that add up to Sony being in second or third place? Hard to say.
Also notice I am not counting the Wii, just HD consoles of this generation.
Of course, the RROD didn't help MSFT's rep any over there.
However, in the U.S., which is still by far the biggest gaming market, with the highest attachment rate per unit, MSFT is teh w1n, at least for now. It has a commanding lead, and its online presence is simply beyond anything Sony has been able to come up with (we'll see what happens when Home gets up and running for real).
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Content-wise, I think games matter far, far more than BluRay and it appears that the 360 will continue to have the stronger lineup with better exclusives (or at least timed exclusives) but that may not be enough to cripple the brand recognition and goodwill Sony built up during the PS2 era; though Sony has certainly squandered a good chunk of that goodwill with the PS3 and that is a mistake they cannot afford to repeat with the PS4.
Hardware-wise, the PS3 has a good rep while the red ring of death issue, even if it's fixed and all bad 360s are repaired for free, will continue to haunt Microsoft well into the Xbox720 era. They REALLY REALLY fucked up on that one. I'll bet heads rolled in Seattle when the magnitude of that screwup came to light.
Developer-wise, the 360 is clearly the lead development platform and this could be a dagger for Sony that really hurts them in the next generation. Unless Microsoft screws up like Sony did with Cell then the Xbox720 will probably be the defacto, lead development platform and everybody else will get ports and delayed releases.
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Even Mario Galaxy - easily the best game I've played on the system has a dozen or so collection mechanics to intentionally pad out the length. I love the presentation but come on man, last time I got a star for doing something good I was still shitting my pants.
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Shit.
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