Holiday Videogame Sales Meltdown

[norm]

http://www.1up.com/do/newsStory?cId=3171916

Holiday Videogame Sales Meltdown Part 1: Nintendomination

Slow economy not even a speed bump to the Wii and DS.

By Shane Bettenhausen, 12/16/2008
On last Thursday, the NPD Group divulged its report chronicling retail U.S. videogame hardware and software sales during the month of November 2008. Considering the nation's overwhelmingly bleak financial landscape of late, the fact that total game sales managed a 10 percent year-over-year gain during this crucial holiday shopping month seems encouraging, but closer inspection of the figures reveals that not every publisher has reason to celebrate. In this first of three parts we look at how Nintendo fared. [Part 2: Microsoft | Part 3: Sony] Nintendomination
Nintendo has plenty of reasons to break out the champagne: Sales of its family-friendly, audience-expanding Wii console exceeded 2 million units for November, a new all-time record for a non-December month. After two years on the market, Wii has clearly established itself as the home videogame console to beat. Despite Microsoft's recent price drop that makes the entry-level Arcade bundle $50 cheaper than the Wii, Nintendo's system moved more than twice as many units as the Xbox 360 during the four-week November time frame while still firmly at its launch MSRP of $249.99. Although the Xbox 360 had a full year's head start on the Wii, Nintendo's console has already left Microsoft's admittedly popular console in the dust: 15.4 million Wiis are now in U.S. homes, compared to 12.5 million Xbox 360s. It's not the only console taking a beating, though: Sony's prohibitively priced PS3 was utterly obliterated by Wii -- for every PS3 that landed in consumers' hands, five Wiis were sold.
Nintendo's first-party Wii software sales also continue to astound, with the Wii Remote-bundled minigame collection Wii Play perpetuating its evergreen sales success to the tune of nearly 800,000 units in November (bringing its U.S. life-to-date total up to an astonishing 7.9 million copies). And although neither qualifies as a new release, both Wii Fit and Mario Kart sold briskly, with consumers picking up nearly 700,000 of each. Despite receiving a mixed critical reception, Wii Music rounded out the top 10 with close to 300,000 copies. Surprisingly, new release Animal Crossing: City Folk landed outside the top 10 at number 11. After the massive success achieved by previous AC titles, this placement seems slightly disappointing, but considering its Nov. 16th release date and lukewarm critical response, perhaps this was to be expected. Plus, first-party Wii titles tend to enjoy healthy sales over prolonged periods of time, so it's possible that Animal Crossing could leap into the top 10 in December.
When Nintendo's post-NPD public relations email blast went out, crafty spin and subtle subterfuge weren't necessary. "Nintendo's record-breaking sales demonstrate that consumers are looking for the best value not only among video games, but also among all entertainment options," said Cammie Dunaway, Nintendo of America's executive vice president of Sales & Marketing. "Shoppers are looking for gifts that can be enjoyed by the whole family, and Nintendo provides an incomparable range of experiences that gets the whole family involved." Considering how effectively they've tapped into the lucrative, seemingly inexhaustible casual market with Wii, Dunaway's PR blast could have simply read, "Neener, neener."
Yet while Nintendo's first-party Wii software rakes in the cash, most third party games fail to make an impact on the charts. Activision's Guitar Hero: World Tour marks a notable exception, as the Wii version handily outsold the Xbox 360, PS2, and PS3 SKUs. Likewise, Electronic Arts' Rock Band continues to perform well on Wii, managing to hang tough the top 20 during in its sixth month on the charts. (The Wii version of Rock Band 2 didn't ship until mid-December.) Despite the console's immense popularity, even massive publishers such as Electronic Arts struggle to find success on Wii. "There's no question that having the lead platform with two-thirds of the unit sales occurring to the first party owner is a really unusual thing," said EA Chief Executive John Riccitiello. "It's a challenge."
On the portable side of Nintendo's empire, the wildly popular Nintendo DS continues to sell at an impressively brisk pace (all the moreso for its age and having a new version already out in Japan waiting in the wings), moving a staggering 1,570,000 consoles during November. That amounts to a leap of 220 percent over the previous month's sales. The debut of several value-priced hardware bundles (one with New Super Mario Bros., another with Brain Age) certainly helped spur sales during the crucial Black Friday shopping weekend, during which an estimated 800,000 DSes were purchased. Due to the sheer volume of DS software released, few titles manage to break into the overall NPD top 20, but this month, two Nintendo-published games, Pokemon Rangers: Shadows of Almia charts at #14 and three-year-old Mario Kart DS shows off its long legs at #16.

[norm]

http://www.1up.com/do/newsStory?cId=3171963

Holiday Videogame Sales Meltdown Part 2: Microsoft

Bargain pricing helps Xbox 360 win sales battles on both casual and gamer fronts.

By Shane Bettenhausen, 12/18/2008
On last Thursday, the NPD Group divulged its report chronicling retail U.S. videogame hardware and software sales during the month of November 2008. Considering the nation's overwhelmingly bleak financial landscape of late, the fact that total game sales managed a 10 percent year-over-year gain during this crucial holiday shopping month seems encouraging, but closer inspection of the figures reveals that not every publisher has reason to celebrate. In this second of three parts we look at how Microsoft fared. [Part 1: Nintendo | Part 3: Sony] Microsoft reaches for the masses
Nintendo's Wii handily trounced the Xbox 360, yet Microsoft's box still made a strong showing with 836,000 consoles sold during the four-week period. This represents a year-on-year increase of 8.6 percent. The new, cheaper-than-Wii $199 Arcade hardware bundle, aggressive holiday freebie incentives (Arcade units come with Sega Superstar Tennis while the pricier Pro and Elite models ship alongside Kung Fu Panda and Lego Indiana Jones), and a massive advertising campaign focusing on casual, family-focused entertainment all likely helped spur the increase. It's clear that the recent move to a sub-$200 price point has had an impact: Wedbush Morgan Securities analyst Michael Pachter commented that the Xbox 360's average sale price (ASP) during November was $270, which is lower than the previous months' figure, indicating the increasing ratio of the less expensive Arcade sku to the total number of 360s sold.
Despite Microsoft's strong push to market the 360 to a broader audience, the console's best-selling software remains firmly in the hardcore camp. Microsoft's phenomenal Epic Games-developed shooter Gears of War 2 edged out Activision's Call of Duty: World at War for the top spot on the charts, selling an impressive 1.56 million copies in 22 days. (If you factor in CoD World at War's PlayStation 3 sales, however, it could be viewed as the best-selling title for the month.) Valve's multiplayer zombie shooter Left 4 Dead (published by EA) also managed to sneak into the top 10 with 410,000 copies sold. It's a strong debut for an original intellectual property, seemingly fueled by passionate critical praise and strong word of mouth. After debuting to impressive sales on the October chart with only a few days on store shelves during the reporting period, Bethesda's Fallout 3 and Microsoft's Fable II hung on to remain in the top 20 for November. While these hardcore shooters and role-playing offerings continue to find a healthy audience, Microsoft's casual-focused first-party titles for the fall -- Lips, You're in the Movies, and Scene It? Box Office Smash -- failed to register.
Microsoft's risky decision to wage its battle on two fronts appears to be working somewhat though. At its new price point, the entry-level console costs roughly half that of what Sony's PlayStation 3 sells for, making it far more appealing to cash-strapped consumers feeling the economic crunch. The fact that Xbox 360 sales more than doubled the PS3's tally during November proves that Sony's prohibitively high pricing continues to stand in the way of mass-market adoption. At the same time, it's wise for Microsoft to go after the seemingly limitless Wii audience by broadening its stable of casual, kid-friendly fare. But unless Microsoft can create more compelling family software (Rare's recent Viva Pinata: Trouble in Paradise and Banjo-Kazooie: Nuts & Bolts failed to make the top 20 chart), it's doubtful that the Xbox 360 will woo many consumers seeking Wiis. Also, one must consider the fact that both the Wii and PS3 have greater potential for future price cuts, while the 360 has already sliced its asking price down to the "magical" $199.99 number. With Wiis still fetching a premium on eBay during the holidays, Nintendo has little incentive to consider a lower asking price for the foreseeable future.
The post-NPD spin from Microsoft's Senior VP Don Mattrick wisely focused on the sizable gap between the Xbox 360 and PlayStation 3, pointing out that the 360 outsold the PS3 and PS2 combined for the month of November. But he was careful to also brandish the all-important family buzzword in order to keep the fight against Wii alive. "We've created the optimal line-up of experiences this holiday season for families seeking lasting entertainment value, particularly during rough economic times in the U.S. and abroad," said Mattrick. "We have the largest library of games, TV and movie content and the most expansive and rewarding social experiences. We're confident Xbox 360 will continue to drive record sales around the world this holiday and beyond."

[norm]

http://www.1up.com/do/newsStory?cId=3171989

Holiday Videogame Sales Meltdown Part 3: Sony's PlayStation Family Struggles

Old guard of PS2 beginning to fade, PSP lacking a big game, and PS3 selling sluggishly.

By Shane Bettenhausen, 12/19/2008
On last Thursday, the NPD Group divulged its report chronicling retail U.S. videogame hardware and software sales during the month of November 2008. Considering the nation's overwhelmingly bleak financial landscape of late, the fact that total game sales managed a 10 percent year-over-year gain during this crucial holiday shopping month seems encouraging, but closer inspection of the figures reveals that not every publisher has reason to celebrate. In this second of three parts we look at how Microsoft fared. [Part 1: Nintendo | Part 2: Microsoft] Sony's PlayStation family struggles
Although the pricey PlayStation 3 appeared to be gaining steam against the Xbox 360 earlier in the year, Microsoft's September 2008 price cuts have quickly reversed the tide. Sony only managed to move a comparatively meager 378,000 consoles during November, which represents a stunning year-over-year drop of roughly 80,000 units. This decline does appear to be something of a hiccup, however, as the overall U.S. PS3 sales stand at nearly 60% above 2007's figures. But the PS3 wasn't the only member of the PlayStation family having a rough time--both the PlayStation 2 (with 206,000 sold) and PSP (421,000) showed diminishing year-over-year returns.
So what's going on here, exactly? The fading PS2 sales aren't particularly shocking considering the console's age and Sony's lack of first-party software support. Plus, Sony's inexplicable resistance to lowering the PS2 to a $99.99 price point continues to confound critics--as it stands, the perceived price of Xbox 360 ($199) is closer to that of Sony's 8-year-old relic than its current-gen upstart. Slashing the PS2's price could quickly reinvigorate that sector and give value-conscious casual gamers an even cheaper alternative to the Wii. Despite the PS2's elder-statesman status, it still managed to vault two games onto the top 20 list: Activision's Guitar Hero: World Tour charted at #17 and THQ's latest WWE Smackdown! followed it at #18.
The PSP situation seems less worrisome, as it's still unquestionably a hardware success story, even if the DS continues to trounce it. The relative dearth of PSP software clearly factors into the equation: PSP games almost never sneak onto the NPD top 20, and this fall's PSP release slate seems even bleaker than usual. It doesn't have to be this way: In Japan, where Capcom's Monster Hunter has become a massive, multi-million selling phenomenon, the PSP has given the DS some serious competition. Here in the U.S., not so much?.
It's clear that Sony isn't really giving the PS2 and PSP the support they need to succeed. The PlayStation 3 situation gives more cause for concern because it's struggling despite a solid software lineup. Sony's biggest November release, Insomniac's Resistance 2, squeaked into the top 10 with 385,000 copies sold. While this isn't a completely disappointing figure, it's not the game-changing smash Sony may have hoped for. Another well-reviewed PS3 exclusive, Sega's tactical RPG Valkryia Chronicles, only managed to sell a paltry 33,000 during this, its first month of release. And in its second month of sales, the critical-darling do-it-yourself platformer LittleBIGPlanet slid out of the top 20 entirely, allegedly moving an additional 141,000 units during the month of November. Sony's other top-quality fall release, MotorStorm: Pacific Rift also dropped off the charts during this, its second month on shelves.
In the face of the apparent gloom and doom, Sony spun the results as best it could in its post-NPD PR statement by focusing on the PS3's big-picture year-over-year success, the vague "momentum" behind the console, and the "Power of the PlayStation Portfolio." Perhaps it's wise that no Sony executives were willing to attach any pithy quotes belittling the competition, though--it's clear that it was a rough month for the PlayStation brand.
Conclusion
The fallout from these NPD numbers sent many journalists into a sky-is-falling panic, with mainstream outlets such as TIME and CNN Money penning ridiculously reactionary pieces with an eagerly eulogistic tone. Senseless claims such as "the PS3 just doesn't have any must-have titles exclusive to the console" and "no one seems to care about high-def DVDs" fly in the face of logic, critical consensus, and solid sales figures. While the crumbling economy is definitely slowing HDTV and Blu-Ray adoption (which in turn hurt PS3 sales), the recent success of The Dark Knight on Blu-Ray (claiming a higher-than-expected 30% of overall sales) seems promising. But these alarming reports do get one thing right--Sony will likely have to reduce the PS3's asking price in 2009. Even with a solid slate of impressive first-party titles on the horizon, the console remains prohibitively priced for many gamers.

[thedaxxman]

It's starting to look as if Sony might go under. After all they are loosing money from the PS3 they're barely starting to make it. Unless this is just another crash of the gaming industry which would be extremely terrible. But I had yet to see Fallout anywhere on this forum.

[thedooku]

well, hello chicken little
Always be mindful of the source, 1up has always been a little Xbot biased, similar to G4. It's always doom and gloom with the PS3 when you ask them. I'd like to see Sony drop the PS3 price, especially since the 360 price drop. It all depends what you want out of your console (out of the box). A consumer that does his research will see a COMPARABLE Xbox is the same price, if not more than a PS3. But I guess Microsoft does throw in that bonus RRoD thing everyone's been raving about. :p

[norm]

I thought the articles were pretty well done. It highlighted Nintendo's popularity while mentioning some of the problems with some popular games not doing as well on the Wii compared to the PS3 and 360.

With the 360 they talked about Microsoft's new catch phrase of "family". Which is a good and bad thing in my opinion. Yet the family games aren't the ones selling, it's the Gears, CoD and Left 4 Dead games that are selling.


The PS3 article painted a positive picture when you compare it to the other articles I read through. I do agree that the PS3 needs to come down in price. With the main difference between the 360 and the PS3 being a Blu Ray player and the price in the players dropping it doesn't really matter anymore.



I think that the major game studios are looking at how they can make popular games for the Wii and when the popular games for the 360 and PS3 don't work/sell as well for the Wii. Micorsoft has it easy by just focusing on one product. All their time and energy can go into the 360. Sony started out believing that on their name alone they could demand a higher price for a "superior" product. With the sucess of the 360 and Wii along with the failing economy it's hurt them. Plus they have to focus on 2 systems , 3 if you count the PSP.