NPD data (pictured above) released by Microsoft showcases the momentum of this generation of consoles versus previous ones. While the data was specifically released to highlight the growing success of the Xbox platform, it also highlights how much life is left in this generation of consoles.
As the graph illustrates, the previous two generations generally peaked by the fourth year, with sharp declines in sales afterwards. Even Sony's ten-year PS2 peaked in year 3. Based on the direction of the graph, both the Xbox 360 and PS3 have yet to peak in their sixth and fifth year, respectively. The Xbox 360, in particular, spiked sharply recently, likely reinvigorated by vigorous sales of the Kinect sensor. Microsoft PR unabashedly points out that the system is currently the "top selling console" in 2011, with a 29 percent year over year growth, "the largest growth of any console on the market."
While Xbox 360 and PS3 have yet to peak, the Wii has experienced sales not unlike the PS2's. It has been an undeniable success for Nintendo, but its downward momentum makes it obvious why Nintendo is announcing a new console well before its competitors: it needs to, as it hasn't followed the same extended "tail" that both Sony and Microsoft have offered.
"Xbox used to be solely in the games business, but the business is on a different trajectory now," Microsoft's press release adds. "What was launched as the ultimate gaming machine has quickly evolved to become an all-in-one entertainment device with something for every member of the household." That is a message that you'll be hearing much more frequently at E3, and for the rest of the year.