Next-gen Consoles in Crisis?

Technology
Xbox One vs PS4

Xbox One vs PS4 (Source: http://goo.gl/04CxpU)

Since the new flagship consoles – Sony’s PS4 and Microsoft’s Xbox One – were released in late November last year, both companies have been shouting all kinds of sales numbers to show they sell better than their counterpart. However, neither Sony nor Microsoft have reasons to be very happy about the sales of their new consoles.

So far, Sony has sold 6 million PS4s, while Microsoft have shipped just 4 million Xbox Ones. These numbers may not sound so bad, until we compare them to the previous generation of consoles. And actually, the console market appears to be not growing but shrinking. This is bad news for the whole gaming market, as the game developers and studious are highly dependent on the console sales.

Data about cumulative console sales are not easy to come by, which says something about the situation, but if we look at the data on North American sales leaked by marked researcher NPD, we can get some picture.

Here are numbers for the last generation from January 2007:

Wii: 436,000
360: 294,000
PS3: 244,000
PS2: 299,000
NDS: 239,000
PSP: 211,000
GBA: 179,000
GC: 34,000

Adding up these numbers gives us almost 2 million sold units. Now these are the numbers from this January:

PS4: 271,000
XB1: 141,000
3DS: ~97,000
PS3: ~53,500
Wii U: ~49,000
360: ~48,500
Vita: ~17,000

The total number is around 700 000 – pretty big drop in contrast to 2 million.

Of course, there are some caveats here. PS 4 launched only in February in Japan and Wii U has been a disaster. But the fact is that cumulative console sales have been down from the last year, despite the release of the new consoles.

What might be happening here is that the gaming market is being hollowed out in the middle. The thing is that the people who have traditionally bought consoles are looking elsewhere. Casual gamers are fine with their smartphones and tables, while hard-core gamers prefer their powerful PCs. This is bad news for mainstream consoles like PS4 and Xbox One.

For now it does not look so rosy for the next-gen machines, but the future is hard to predict, and with new technologies (watch video below) PS4 and Xbox One may still turn out to be a success story.

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Andrew J. Blanche

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