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Analysts Believe Xbox 360 Will Lead Through 2008
Piper Jaffray analyst Anthony Gikas and associate Stephanie Wissink have just released their latest overview of the gaming industry for investors, which shows the Xbox 360 leading the next-gen console war through at least 2008.
The report projects that the Xbox 360 will lead console sales with 19.6 million units sold through the end of 2008, with the PlayStation 3 selling 15.5 million units and the Revolution selling 5 million units. While the early launch accounts for much of this early lead by Microsoft, the overall projection shows a definite shakeup of the gaming industry from the current generation.
The PS3 will move into the yearly sales lead in 2009 with 8.5 million units for the year and will lead the overall console cycle – by a relatively small amount. The model assumes this next console cycle will run through 2011, so expect your Xbox 3 and PS4 in time for the holidays in 2012 (and no, you can’t preorder yet).
Software sales are expected to rise significantly with an overall 43% increase by 2008 from both increased units and higher average prices. Publishers and console makers will also begin to see substantial revenue from in-game advertising and online downloads, as sales from these will rise from less than 250 million in 2005 to $1.3 billion in 2008. For those interested in investing in publishers, the report suggests being careful because of market volatility over the next 12 months, but Piper Jaffray reiterated its Outperform rating on several publishers including Activision, Electronic Arts, Take-Two Interactive and THQ.
Ultimatly the sales will come down to the best unique platform game in the first year of this cycle. The big house developers such as EA and Activision tend to co-release there games on all platforms, making them irrelevent in the choosing of which to buy. But other developers, particually smaller venues will not have the resources to fully port there products into each system, while multi-platform Development kits do help, it does take many man hours to get each platform fully debugged so that it is ready for printing and shipment. The winner of this round of the console wars will be attributed to who has the best games that are only available for that system that appeals to the broudest audience.
I would have to disagree with that with one word…
Halo…
That was the best game for any system at the time (and still is at the top of most lists), but it did not make the X Box sell for units than the PS2. I think it’s going to come down to the abilities and price. Basically 5 main catagories: Price, Backwards Compatability, Hard Drive abilities and availability (standard or separate and can you use it in place of the memory card unlike the PS2), Availability (we all remember last Christmas when the only system not sold out was the Game Cube), and lastly the games. Even if the 360 launched with Halo 3, it wouldn’t be enough to carry the system, but if rumors are true, the 360 won’t have that much of a jump on the PS3. Last I heard the PS3 is supposed to be released in the first quarter of 2006 which may stifle the amount of 360’s sold in anticipation of the “mystery price” and to see what Sony has decided not to throw out.
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