{"id":4400,"date":"2008-05-29T22:36:32","date_gmt":"2008-05-30T05:36:32","guid":{"rendered":"http:\/\/www.dfcint.com\/dossier\/?post_type=forecasts&p=4400"},"modified":"2013-12-12T13:57:51","modified_gmt":"2013-12-12T21:57:51","slug":"2007-posts-record-game-sales","status":"publish","type":"post","link":"https:\/\/www.dfcint.com\/dossier\/2007-posts-record-game-sales\/","title":{"rendered":"2007 Posts Record Game Sales"},"content":{"rendered":"

\"SystemsMAY 29, 2008 \u2022 Led by the PlayStation 2 (PS2), the “128-bit” generation of video game systems has reached a record global installed base that is expected to exceed 180 million units.\u00a0 Of course, the PS2 was the best-selling game system ever.\u00a0 With high hardware prices and a slow start for most of the current generation of game systems (Microsoft Xbox 360, Nintendo Wii, PlayStation 3), DFC Intelligence had originally forecasted that it would not be until 2012 that the installed base for the current generation started to match that of the 128-bit systems.<\/p>\n

However, 2007 was a record year on all fronts, as sales of PC and video games reached an all-time high and overall worldwide industry sales soared over the $50 billion mark.\u00a0 DFC Intelligence forecasts that sales for the current generation of systems will pass the 180 million mark in 2011.<\/p>\n

Ironically, a slowing economy can actually help the game industry.\u00a0 Video games provide a high rate of entertainment return and high gas prices actually encourage people to stay home and play games.\u00a0 The latest DFC Intelligence forecasts predict that all three systems (360, Wii, PS3) will have a solid installed base.\u00a0 Nevertheless, it looks like the Nintendo Wii will be the overall installed base leader.\u00a0 The Wii has enormous momentum and appeals to the broadest audience.<\/p>\n

In doing retail checks over Memorial Day weekend, the item that everyone was asking about was the just launched Wii Fit.\u00a0 However, none of the retailers we visited had any in stock.\u00a0 It is because of this type of demand that DFC believes in 2008, the Wii could set a record for most console systems sold in a single year.<\/p>\n

\"How

How many Wii Fits can Nintendo pull out of its hat?<\/p><\/div>\n

Of course, many of the biggest games are not even coming out for the Wii.\u00a0 Halo 3 and Gears of War were exclusive to the Xbox 360.\u00a0 The upcoming Metal Gear Solid 4 is only going to be on the PlayStation 3.\u00a0 The biggest title of 2008, Grand Theft Auto IV, is only available for the PS3 and Xbox 360.\u00a0 In other words, for many third-party publishers the more important race is between the Xbox 360 and PlayStation 3.<\/p>\n

Two years ago about this time, DFC Intelligence asked the question, “Could Sony Go From First to Worst?”\u00a0 At the time, our less than definitive answer was: maybe.\u00a0 We argued that much would depend on the execution of Sony and its competitors over the next few years.\u00a0 Two years later, DFC can say with more confidence that we do no think the PlayStation 3 will be the third place system.\u00a0 DFC forecasts that the PS3 will overtake the Xbox 360 in 2009 and finish in a strong second place behind the Wii.<\/p>\n

The price of the PlayStation 3 has come down to a reasonable level and the software lineup is finally starting to look fairly strong.\u00a0 Most importantly, Sony was able to keep the PlayStation 2 installed base active.\u00a0 For its recently ended fiscal year, Sony Corp. reported that hardware unit sales of the PS2 were down by 7%.\u00a0 From our perspective we would say they were ONLY down by 7%.\u00a0 This is amazing for a system that launched in 2000.\u00a0 The PS2 managed to outsell both the PS3 and Xbox 360 in 2007.<\/p>\n

\"DFC

DFC Intelligence forecasts in millions<\/p><\/div>\n

The sales performance of the PlayStation\u00a03 has been less than stellar, but Sony has\u00a0survived. The Xbox 360 was unable to\u00a0take advantage of Sony\u2019s struggles to build\u00a0the type of large lead needed to maintain\u00a0a long-term advantage. The PS3 survived\u00a0the onslaught of AAA Xbox 360 titles that\u00a0hit the market from late 2006 through 2007.\u00a0Halo 3 had great sales, but it did very little\u00a0to enhance the Xbox 360\u2019s overall position\u00a0in the marketplace. The Xbox 360 is the\u00a0system of choice for fans of high-action\u00a0first-person shooter (FPS) games. However, for the 80%-plus of game consumers\u00a0that DO NOT play FPS games, the Xbox 360 is not the system of choice.<\/p>\n

In our upcoming Genre Forecasting report, we look at expected sales by platform based on genre. While the Wii may have the highest installed base, there are not expected to be any mega-hit FPS titles on the platform. The average FPS title\u00a0is expected to have 60% higher sales on the Xbox 360 over the PS3 and over three times the sales of the average Wii FPS game.<\/p>\n

The biggest uncertainty in forecasting the market five years from now is estimating the impact future, unannounced systems will have. In building our forecasts, DFC Intelligence has assumed that some new systems will launch in the 2011 to 2013 time frame. However, these forecasts are very hypothetical and are made under the assumption that a new generation of con- sole systems will look very much like the past generation of game systems. This may not be the case, and right now we do not even know who the major players will be. How soon will Nintendo want to launch a new system with the Wii being so successful? Will Microsoft still want to stay in the game business given their losses? Is Sony really serious about pushing the PS3 to a ten year plus life cycle? Will new game systems just be an extension of the current game systems with some enhanced fea- tures and services? These are questions we are currently unable to answer.<\/p>\n

\"in

in millions. 128-Bit includes PS2, Xbox, NGC. Current Systems includes Xbox 360, Wii, PS3. Future systems are unannounced.<\/p><\/div>\n

One thing that is worth noting is that DFC has built in different models for how heavy consumer purchasing of software will be for each system. We call these factors respectively the active installed base and software tie ratio. The Xbox 360 has a high tie ratio, but given technical problems among many early units it also has\u00a0\u00a0a fairly high retirement factor. The Wii\u00a0has both a lower software tie-ratio and a\u00a0higher than average retirement fact<\/b>or.\u00a0On\u00a0the other hand, one advantage with thePS3 is its durability and what is expected\u00a0to be a fairly strong software tie-ratio in the long-term. For this reason, the DFC Intelligence forecasting model indicates that\u00a0software sales for the PlayStation 3 will\u00a0surpass software sales for the Wii in 2012.\u00a0Of course, by this time, software sales for\u00a0all systems are expected to be on the decline.<\/p>\n

The biggest story over the next few years\u00a0may be the declining overall importance of\u00a0the console systems. Last year Sony\u2019s biggest selling game system was the portable\u00a0PSP. Meanwhile, the Nintendo DS blew\u00a0out all records for game system hardware\u00a0unit sales (portable or console) in a single year.\u00a0From a pure revenue perspective, the\u00a0biggest system for software sales in 2007\u00a0was the\u00a0PC, if you\u00a0<\/b>include revenue generated from online services. Like we said,\u00a02007 blew away sales records on all fronts.\u00a0Right now it looks like 2008 will be even better.<\/p>\n

 <\/p>\n

\"Shooters\"Software<\/p>\n

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MAY 29, 2008 \u2022 Led by the PlayStation 2 (PS2), the “128-bit” generation of video game systems has reached a record global installed base that is expected to exceed 180 million units.\u00a0 Of course, the PS2 was the best-selling game system ever.\u00a0 With high hardware prices and a slow start for most of the current […]<\/p>\n","protected":false},"author":9,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[],"tags":[],"_links":{"self":[{"href":"https:\/\/www.dfcint.com\/dossier\/wp-json\/wp\/v2\/posts\/4400"}],"collection":[{"href":"https:\/\/www.dfcint.com\/dossier\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.dfcint.com\/dossier\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.dfcint.com\/dossier\/wp-json\/wp\/v2\/users\/9"}],"replies":[{"embeddable":true,"href":"https:\/\/www.dfcint.com\/dossier\/wp-json\/wp\/v2\/comments?post=4400"}],"version-history":[{"count":5,"href":"https:\/\/www.dfcint.com\/dossier\/wp-json\/wp\/v2\/posts\/4400\/revisions"}],"predecessor-version":[{"id":11168,"href":"https:\/\/www.dfcint.com\/dossier\/wp-json\/wp\/v2\/posts\/4400\/revisions\/11168"}],"wp:attachment":[{"href":"https:\/\/www.dfcint.com\/dossier\/wp-json\/wp\/v2\/media?parent=4400"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.dfcint.com\/dossier\/wp-json\/wp\/v2\/categories?post=4400"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.dfcint.com\/dossier\/wp-json\/wp\/v2\/tags?post=4400"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}