Every year we hear the same thing, and that is that the U.S. has reached its console saturation for the PlayStation 3 and Xbox 360.  Recent sales data from the NPD Group showed an overall 8% decrease in sales in the United States for 2011 compared to the previous year.  In December 2011 industry sales plummeted 21% from December 2010, despite big price cuts and amazing deals with console bundles.  Software sales didn't fare much better, dropping 14% from the previous year to $2.08 billion.

The general consensus was that it was a tough year for the video game industry, at least in the United States - and many believe it won't get much better thanks to the possibility of market saturation.  For those who failed economics, here's a quick explanation.  Market saturation is when a product becomes so well-distributed within a market that the majority of the households in that market already own one. Further growth of sales for that product usually depends on population growth or a gain in market share. 

Many seem to believe this is the case with the current-gen of consoles in the United States.  Almost every household these days has one, two, or maybe all three of the current gen of consoles - resulting in a lack of hardware sales.  While that very well could be the case, video game analyst Michael Pachter thinks otherwise.

"I think maybe for Wii," Pachter responded when asked if the U.S. was nearing console saturation.  "PS3/Xbox 360 still priced too high for saturation."

While current-gen system, Wii-excluded, are still priced relatively high for how long they've been on the market, this past holiday season saw prices drop to all-time lows for console bundles.  Consumers could snag an Xbox 360 4GB bundle for as little as $199, with the Kinect selling for a ridiculously affordable $99.  So what can you blame the lack of sales on?

Maybe many households already have consoles.  After all the Xbox 360 has been out for over 6 years, with the PS3 turning 6 this year.  Odds are those who wanted a console probably have one by now. 

Microsoft revealed that 66 million Xbox 360 consoles have been sold along with 18 million Kinect peripherals.  I think it's safe to say that after 6 years, those who were waiting have waited long enough - and I doubt a price drop would convince them to finally take that step if they haven't already.

http://www.gamezone.com/news/ps3-xbox-360-consoles-haven-t-saturated-the-u-s-yet-argues-pachter

i disagree i dont believe we'll see much higher sales for the HDs this year or in the future, one thing patcher is not taking into the equation is that the hardware that this gens consoles have compared to past gens is harder to sell for a lower price, we already have had $199 X-box ( i bought mine in late 2010 with a 250gb HDD and forza3 plus alane wake) and we've seen a $199 PS3 with HDD since late last year in the US aswell.  I dont believe the price could go much lower than what we've see to make a meaningful difference, along with the fact that the X-box and PS3 have similar libraries and both have there pros and cons depending on the gamer, its harder for one console to break out and achieve mega sales when the audience is split in two which could apply to why the PS3 has yet to outsell it WW and why the X-box cant pull away

MS and Sony had their best holidays sales in US this year... so I agree... no saturation yet.

With the crazy sales this year I'd say the PS360 either peeked or has yet to peek. I'm betting on price cuts next year so they may peek in 2012, which is insane because the Xbox 360 will be 7 years old next holiday season.

We also had record November.

And I don't know about US market but 200 euro PS3 would certainly help here.

WIth the magical pricetag of 199euros finally in sight for the PS3, it will have another peak year this year.

And more in the red. Do you really think you can reduce the cost of a product a 33% in one year, and with the currency exchange the japanese companies have?

The high cost at the beggining of this generation made that the peak years have been later, and the sales graphs have been flatter than past generations. We had last june, almost six years into this generation, the PS3 at the same MRSP than the PS2 at the beggining of last generation.

Slashing 50euros/dollaz from the price is 33%? A PS3 pricecut around september is plausible, they certainly won't wait another 2 full years for a pricecut, a full year when WiiU is on the market and probably PS4 release in Holiday 2013.

Last june it was 299$/€, if you sell this september at 199$/€ it's a 33% reduction from last june MRSP.

In the US 199dollaz, in Europe 199euros. I think more then 1/3 of total PS3 sales will come after it hits 199 pricetag(further pricecuts long after PS4s release date included).

Well I was talking slashing 50euros/usd from the current price. It got a 50eur/usd pricecut around sept. (160gb version 249) right? I think this september it will get another 50eur/usd priecut. Seems possible.