Well after a long delay (lack of internet connection, busy at work, plain forgetfulness) I bring you final part, this part is pretty subjective, seeing as I don’t actually have a crystal ball and cannot predict the future, however I can see trends and extrapolate, and the extra couple of months have been going pretty much as I expected.
My prediction of the winner is: Nintendo Wii
When I say winner I mean winner, we’re talking Sony PS2, Nintendo DS levels of success, not as some analysts predict a fairly even split with the Wii just in front, we’re talking donination (Nintendomination even), and how do I reach this conclusion, I’ll reveal that after the break.
Okay, so you want to know how I can possibly think the Wii is going to smash the opposition this time, simple mass appeal, Wii Sports is probably the biggest phenomenon in years, and like nintendo’s DS games Nintendogs and Brain Training it appeals to people who wouldn’t normally play games. To illustrate I’ll relate what happened to me today.
My housemates mum’s friend (How’s that for removed) who was visiting with my housemates mum started talking to me about the Wii and Wii Sports, I didn’t mention that I owned a Wii or Wii Sports, she actually recognised the console (even with the Wavebird adaptor plugged in and both top panels open) and asked me about it, and seemed genuinely interest in how it worked and played, she probably never even noticed the large guitar shaped controller sitting right next to it for Guitar Hero 2, the Wii has entered the conciousness of ordinary people, and is generating genuine interest and perhaps even enthusiasm.
Okay after that little side story back to the reasons:
- Cultural phenomenon – Wii Sports is probably going to go on to be the biggest selling single game ever, not as a series, but as a single game, in Japan where it’s not a pack-in it’s the biggest selling Wii game and sells to approximately 60% of all Wii purchasers every week, there hasn’t been a week since launch when Wii Sports hasn’t been in the top 10 sales in Japan. Even if Wii Sports was a stand alone in the US/Europe it would probably be selling at a similar rate. Even if we take just the Japanese figures into account, if the Wii does similar numbers to the PS2 in Japan (a real possibility) about 20 million, and Wii Sports continues in the same vein then we’re looking at 12Million in Japan alone, if Wii Sports remains a pack-in for the entire life of the Wii (unlikely) and the Wii sells similar to the PS2 worldwide (100Million) that would put Wii Sports at 92Million, however it’s likely that with the release of Super Mario Galaxy or Wii Fitness the Wii will be available with those instead of Wii Sports and they’ll probably remove the pack-in when they have their first price-drop, even with that if we take the 60% attach rate it has in Japan and extrapolate that it still equates to 60Million, I don’t think any game has ever come even close to those sort of sales. This helps the Wii since it’s only playable on the Wii, just like Nintendogs is only on the DS, you’ll buy the console for the game.
- Current sales trends – We all know that previous performance is no guarentee of future performance, however given that the Wii is still supply constrained 6 months after launch even with Nintendo producing about 1million a month (and having 1 million for launch) the current sales are at about 7 million and it’s still not readily available, with Super Mario Galaxy, Metroid Prime 3 and Super Smash Brothers Brawl still to come this year the demand doesn’t look like it’s about to fall off any time soon, and while the Xbox 360 is likely to see supply problems this Christmas (Halo3 and GTA4) the same is highly unlikely with the PS3 (hell it was readily available in the UK the day after launch), the Wii is going to be nigh on impossible to find this Christmas.
- Price – people are price sensitive and buy based not on low price, but on value for money, the Wii is perceived as value for money, the Xbox 360 and PS3 are not, part of that is based on some false assumptions (like requiring a HDTV to play, neither system does, they just benefit from a HD display) and the PS3s real problem is that Blu-Ray is an albatross, if you don’t own a HDTV then a HD movie player is a worthless investment, you’re paying a premium for something that you can’t use (why pay more for a movie on Blu-Ray when you get no benefit if you can’t enjoy the extra resolution), Microsoft’s external HD-DVD player gives you the option of having HD movie playback without forcing it on you, if won’t help HD-DVD win the format war (that looks a lost cause, but neither format is doing well, it’s too early for HD movie formats, DVD worked on normal TVs, HD movies don’t and HDTV penetration is too low to support a new video format especially so soon after the move to DVD)
- Support – Publishers notice trends, they have to, they’re in business to make money, yes it’s nice to have critical acclaim, but without the sales the greatest game in the world wont keep a company afloat, given the current trends in sales most of the 3rd party publisher support will be going to the Wii, for the publisher this is a win/win situation, they get a large user base to sell to and they keep development costs down at the same levels they were at last generation, of course this means that the Wii will get lots of shovelware, but the PS2 has far more shovelware than good titles and of course the occasional gem falls through this process and surprises everyone.
- Casual Gamers – Okay to clarify this, in this definition the casuals are people who are buying the PS2 currently, those that don’t have massive disposable income and can’t afford even the current price of the Wii, if someone is buying a PS2 today it’s either to replace an old one, or they just weren’t able to afford on before. I hear this argument that most of the 100Million PS2 owners will eventually move to the PS3, that’s a falicy, most of the 100Million PS2 owners didn’t buy it because it’s the successor to the PS1, they brought it because the games they wanted to play were available for it, as noted above the console with the highest user base gets the most games and the more games you have the more likely that console is to have the games you want to play, casuals aren’t about brand they’re about games. Sony is under the misapprehension that games like Singstar will sell on the PS3, the target market for singstar is not the sort of person who is willing to drop $600 (or £425) for a console but the sort who will drop $129 (£99) for a console, these people will stick with their PS2 for as long as possible and only move when they see that they are going to get the experience they want from the new consoles and can afford them. Given the current trends and what we’re already seeing publishers doing by the time those people are ready to make a switch the PS3 will be pretty much dead and the Xbox 360 will be a niche (mainly catering to the FPS crowd) and games like Buzz and Singstar will be available on the Wii (infact I’d say the Wii is the natural home of such games)
Okay if anyone still doubts the above reasoning they need to take a look at the history of the console market, particularly in the past two generations (the Sony generations), the single biggest reason for the success of the PS1 and PS2 was the games, for the PS1 Sony went out of their way to get developers onboard, the PS2 was out first and got sequels to the big games on the PS1, the problem with both those consoles for Sony was that the big games for them were all 3rd party (GTA, Final Fantasy, Metal Gear Solid, Devil May Cry), and since the PS1 and PS2 were selling well those 3rd parties stuck around and kept those games exclusive, with the PS3 two of those big 4 are already non-exclusive (GTA4 and DMC4), if things continue the way they are we may see FFXIII ported to the X360 simply to get back the massive costs of development (it would sell massively on the X360 in the US and do alright on the PS3 in Japan but no where near it’s predecessors success levels), MGS4 is still exclusive, but it’s probably not quite in the same league as GTA and FF. The other problem is that all these big games (except GTA4) aren’t due until at least April next year, by then the PS3 will be in serious trouble.
I’ve heard people claim that Home will help the PS3, well it probably will, but I look at it this way, Home is downloadable content, average Joe probably wont know much about it, or how cool it looks (it does look cool) because it will never appear on the shelves, downloadable content does not sell consoles, it sells well on consoles (look at XBLA and Nintendo’s Virtual Console) but both of these require you to have the console to find out what’s available and unless you do the research you’ll never know it’s there, when someone goes to buy a console they’re at the Point of Sale and what’s on the shelf is the biggest deciding factor, if they can’t see it in the shop they probably don’t know it exists, they might know the service exists, but the exact contents are hidden from view, and the likelyhood of a store having paid for any of that content and having it on a demo machine is virtually non-existant, so you can’t evaluate it like you can other games. The VC is slightly different, since nintendo has told us exactly what it represents, it’s an emulator (or bundled emulators, each game comes with an optimised emulator for the specific game) for old game systems where you get pixel perfect reproductions of old nintendo, sega and turbografix games, here you know what you’re getting, both XBLA and PSN have the problem that they’re mainly original content and what’s going to become available isn’t a known quantity, with VC you know exactly the sort of things you’ll be getting before you buy the console, and if it’s not there it’s likely to appear at some point.
Obvious I can’t give you exact figures, but I can give you an idea of what I expect of each consoles in relation to previous consoles (approximate previous numbers in brackets after the console)
Wii >= PS2 (100Million)
Xbox 360 > Xbox (24Million)
PS3 < Gamecube (20Million)
The 360 is a bit of an unknown, I know it'll do better than the old Xbox, that's pretty much a given, but how much better is up in the air, it could do over 40 million world-wide, but with it's failure in Japan it's not going to be able to get anywhere near the Wii.
I expect the Wii to end up doing far better in Japan than anything else with the exception of the DS, but the DS is a monster, it's closing in on the PS2s LTD after just 2 1/2 years, by the end of the year the DS will have crushed the PS2 in sales and be going after the long lived Gameboy itself (original + Color combined), it's already outsold the GBA in Japan and even in a bad week is selling over 100K, with about 30 weeks of this year left that represents 3 million minimum and it's at 17Million and the PS2 is at 20Million, with the holiday season it should smash that easily, the Gameboy is about 30Million, which should be easy to beat by christmas 2008, I dont see it slowing down, it's still supply constrained in Japan after 2 1/2 years and given the lifespan of nintendo's handhelds it's probably got another 2-3 years life left minimum.
So Japan is going to go with the Wii in a big way, but that's not enough for domination, how does the rest of the world compare, well we'll take the biggest market the USA next since we have figures for them as well. Last month the Wii outsold the X360 by 2:1 and the PS3 by 4:1 (360K, 174K, 82K respectively) and this is a continuing trend, the X360 is fairly stable, the Wii is selling everything Nintendo ship and the PS3 is continually falling (to give you an idea of how bad it's doing in the US the GBA outsold the PS3 by 2k), when Nintendo's new Wii factory comes online expect that 360K to move to about 450-500K a month (about 1.5Million a month worldwide), so we can probably extrapolate those figures, the Wii has sold 2.5Million in the US since launch (6months), the Xbox360 5.3Million (18months) and PS3 1.3Million. By Christmas the Wii will have caught up with the Xbox360 (unless Microsoft drop the price with the launch of Halo3, but I get the feeling most of the early Halo3 buyers already have an X360 given the figures on Halo3 beta participation), in 1 year it will have sold the same as the Xbox360 did in two years. The PS3 will be lucky to reach the current Wii sales by the end of the year, more likely to be around 2million.
Europe is harder to get figures but we can extrapolate the Wii figures fairly easily, here's how it works. Nintendo make about 1million Wii a month (at present), US gets about ~330K, Japan gets ~330K, so Europe get about 330K as well, since the Wii is supply constrained in all three regions that means that the Wii is selling about 330K a month in Europe, it's been out 6 months plus the initial 330K units nintendo had for launch = 7*330K = ~2.3Million. 360 and PS3 are harder to get, PS3s haven't sold out their initial 1Million units from launch, 360 has been around for 18months but is only really popular in the UK, current guestimates put the Xbox360 at about the same as the Wii currently in Europe, maybe slightly ahead.
Worldwide is interesting, the Xbox360 is at about 9Million at the moment, the Wii 7Million, and the PS3 ~3Million. By the end of the Year if production stays the same the Wii will be at 12million, then Xbox360 is likely to be at about the same, possibly a bit higher, and the PS3 probably about 4Million (there doesn't seem to be anything that can help the PS3 sell coming out this year, GTA4 wont help since the X360 is cheaper and getting GTA4 as well). If Nintendo get upto 1.5million units in two months then the Wii could be at 14.5Million by Christmas, which would mean even the X360 would be behind it, next year is when the real contest starts, by Christmas 2008 the Wii is likely to be at ~30Million (12 this year, 18 next year), the 360 at 15-16Million and the PS3 will be starting to feel the effects of being in last and probably only at ~6Million.
Just 1 year ago this was unthinkable, Sony's powerhouse Playstation brand languishing in 3rd place, losing it's exclusives and 3rd party support (who wants to make a >$20Million game for a system that wont give enough sales to cover the cost), and to quote Sony’s own advertising for the PS2, “Welcome to the 3rd place.”