"What about Playstation Network and Xbox Live Arcade? Both are HUGE mediums for both systems that allow developers to make games on the cheap, distribute them cheap, and keep their costs low." PSN and XBLA requires to implement HD graphics ... XBLA also has various nasty constraints ( It's too early to judge PSN )..... For the "low cost" of XBLA : A developer reveal "Creating an Xbox Live Arcade game is taking most studios 6-12 months. Costs are currently ranging from USD $100,000 to USD $300,000," "The industry standard arms race will quickly make the top end $300,000 budget a cheap product." "Right now, I wouldn't consider attempting to make an XBLA game with a USD $100,000 budget. Development kits and Certification would eat up half of that, not leaving much for the actual game development," Here the article : http://www.gamesindustry.biz/content_page.php?aid=19821 "Remember, 1 PS3 PSU is twice as fast as the CPU in the Wii, therefore the graphics would STILL be better, and dev costs would be very very small. " Very funny, you speak about graphic on download games ... Is Geometry war fun because it has HD graphic ? Has Geometry war sold 1.5 milion thanks to HD and raw graphic ? "Yet the fact is, I seriously doubt that in the US and Europe, the non-gamer really wants to buy a game. Thus why they are a non-gamer. Yes, I am sure non-gamers would be interested in the Wii, but are they really $250 interested in it? Lets look at the facts, during the Wii launch in the US and Europe, Zelda: TP had a 85% attach rate. Zelda is NOT a non-gamer game. It is a hardcore Nintendo fanboy game" Yes TP is not for non-gamers. But TP is NOT the Killer App of Wii launch !!!!! Wii Sports is faaar more important than TP. TP is a western trojan horse for Wii Sports. DS start good only thanks to Nintendo-fan, then they promote the handheld to their friends ( and luckily in autumn 2005 the first real DS killer app appeared on shelves ). Wii cannot be taken everywhere like DS ( it's not an handheld though it is very small) but it has Wii sports pack-in that was the missing KillerApp in DS launch ... In the long term Wii Sports will become a symbol like Tetris or Pong... "Japan isn't the trendsetter anymore. It's a huge, very important market, but it isn't the be-all end-all of gaming anymore. " Strange, Nintendo DS skyrocket in autumn 2005 in Japan. Then in mid 2006 Nintendo DS' mania burst all over the western countries. Hm ... Just coincidence ... "We're comparing DS titles (which Nintendo has ALWAYS dominated the handheld market since they invented the market itself) to console titles....Huge difference. Actually, World of Warcraft is threatening the Sims, and has a 8m PAYING MONTHLY userbasis. " Aston compare games for EVERYONE with the so call "AAA console title" so loved by gamers. You must be blind to not see the huge potential of that untapped market. WoW is a game for EVERYONE ( I reveal you a secret : many females and housewivers play to WoW ) also Animal Crossing WW is a similar game ( that sold near 7 milion units ). "Thats like saying "every game with mario, added together has outsold every game with Halo characters in it"." Well Super Mario Bros 3 alone vastly outsold Halo1+Halo2 sales "Then why has Gears of War outsold Wii Sports, despite 1.1m copies being giveaways?" Well Wii launch numbers are great but it was released only 2 months ago ... I bet that on January 2008 Wii Sports copies released will be greater than GoW. ( Go, look at this site worldwide software units chart) "Your comparing Nintendo, a company that has been around for 100 years, helped create a major console market, and has atleast 5 of the top 10 franchises in history, to Microsoft a no-name console startup that recieved tons of bad publicity and negativity surrounding them cash-cowing into the console market, and asking WHY the GC nearly beat out the Xbox? Like you said, Games. GC didn't have them then, and I don't think they have them now." Yes brand recognition count but is not so decisive ... Why Xbox barely outsold GC ? Simply Nintendo fail to understand the market and the rivals and Microsoft has heaps of dollars to burns : about 4 billion $ of loss ( Xbox is the greatest financial failure in Vg history !!! ). Why I think Wii will outsold the others ? Because IMHO Nintendo understand the market and the rivals better than rivals' do . "There is still a huge list of games that will be on PS3 and 360 but not the Wii." Yeah and there is a ever greater list of games that will be on Wii but not on PS3 and 360. If Wii software will sell ( and profit ) more than PS3/360's then your sentences will become irrilevant otherwise my sentence will become irrilevant. Only time and software will tell ( maybe there will be a draw )... "Examples: Look at Xbox Live Arcade. The Nintendo fanboys get happy that the VC has sold 1.5m games. Geometry Wars alone has most likely sold that number or more." Again , even a fanboy can understand that compare two system that have 1 year difference is a fault ( especially in the early years). Also compare Ps3 launch to 360 launch is stupid for many reasons ...
In the entertainment business, there are only heaven and hell, and nothing in between and as soon as our customers bore of our products, we will crash. Hiroshi Yamauchi
TAG: Like a Yamauchi pimp slap delivered by Il Maelstrom; serving it up with style.
" Nintendogs is AAA software. By "B" software I mean stuff you've never even heard of, which just hits a little niche audience, but makes up both the bulk of all games produced and the bulk of all games sold. PS2 had it in spades, and right now you're seeing some "B" games start getting made for PS2 and Wii, but not the other consoles. " By "B software" I mean games with little expectations target to different gamers and tastes. Among these titles there are awful games, mediocre ones, small gems and also sleeper hits ( this sleeper hits can become the AAA games or genres of tomorrow ). When I think about Nintendo DS unveiling at E3 2004, I remember that most gamers thought "AAA games" for DS were Super Mario 64 DS and Metroid Prime: Hunters. In the same place Nintendogs was presented for the first time. (Almost ) Nobody , at that time, considered Nintendogs like the KillerApp few months later will become. I'm waiting for Wii music orchestra !!! I agree to Erik's ideas for the rest. Especially on 3 points ( Momentum , small market, business plan 's importance ) " And if you look at historical growth, and assume nothing can outperform it, then you haven't begun to find out what "disruption strategy" means. Which means you haven't begun to look at Nintendo's strategy. Which means why am I talking to you? " Yeah, it's very funny ...
In the entertainment business, there are only heaven and hell, and nothing in between and as soon as our customers bore of our products, we will crash. Hiroshi Yamauchi
TAG: Like a Yamauchi pimp slap delivered by Il Maelstrom; serving it up with style.
Which strategy had Nintendo?, the strategy to lost in every generation 14millons of systems and reduced at 50% the software sells?.
"No, Rumble was an innovation that improved that current market. Wiimote is one of many means to achieve new audience that hopefully ( for Nintendo ) will be bigger than Ps3/360 market." I agree with you that rumble improved the gaming landscape. Props to Nintendo on that one. But as records show casual gamers do not have the same attach rate as hardcore gamers. Casual gamers may be a slightly larger market but I really don't expect that portion to surpass the 360/PS3 in software sales. "Because Ubisoft spend about 10 milion $ to create Red Steel and with Red Steel USA sales of November-December they not only recovered developement cost but gain profit. Look at the Ubisoft financial report and see the support that Ubi is adding to Wii day in day out. Ubisoft is a smart and happy Wii third party. Resistence outsold Red Steel in USA but Resistence don't turn out a profit yet because Ps3's development cost is far superior to Wii's." And it shows. Red Steel is a horrible game. Ubi expected to make profits and Insomniac expected to lose money. But in turn resistance is a far better game (graphics, gameplay wise and in FUN factor) than red steel. "Not too cost prohibitive like HD graphic ...." HD graphics may push up production costs but I have a felling that a third part developer like Capcom or square are not worried about recouping the cost spent on the games on the PS3. The playstation line has treated third parties amazingly well. "N64 was launched in mid 1996 in USA and Japan. It outsold PS1 in USA only on early six months. Then PS1 outsold every years N64 in USA ( see charts of this site). In the rest of the world N64 do worse." http://www.vgcharts.org/usaconscomps.php?name1=PS&name2=N64&type=2 according to this the N64 outsold the PS1 for 3 years before the the PS could catch up. http://www.vgcharts.org/japconscomps.php?name1=N64&name2=PS&type=2&align=0 for japan it shows the N64 had the lead for a little more than a year. "I ask you : How many Ps2 owner do you think really care about the expensive HD feature ?" Your asking the wrong question. It is about PS2 owner seeing thier favorite games on a next gen console. The gameplay and funfactor are not a question. I would like to see the next Shadows of colossus, god of war, DMC, MGS, zone of the enders and many others on the PS3. "Xbox sold slighty better than Gamecube with the huge difference that Microsoft took 4 Billion $ loss whereas Nintendo make profit. Master System was an irrilevant system in late '80 ( Nes had about 92% marketshare in USA and Japan, Europe was an irrilevant market at that time for console becuase it was dominated by home-computer like Amiga and Atari ST) Genesis was the only "market leader" surpassed by another company ( Nintendo ) after an incredible catching up. Nintendo can did it thanks to japanese s/h support and other motives ( Genesis was the beginning of the end for Sega for many reasons ...)" What exactly are you trying to prove? MS took a loss on the xbox by 4 billion but they are stilll here. Sony can take extreme losses before making the "choice" to back off. Nintendo and sega are mainly game companies. Sega couldn't take the losses and I highly doubt nintendo can as well. "Yeah what you call childish/casual part is only one portion but it is the biggest portion. Hardcore gamers are very important in the beginning because launch console's price is expensive ( this is the reason Wii price is so low - it's a different business strategy) but in final userbase hardcore gamers are only a small portion ( it's time to understand it ). Nintendogs sold about 10 milions units worldwide but the real affair is that Nintendogs's development cost is ridicolus if compare to GTA's, Halo's,Final Fantasy's,Ghost Recon's or even most N64 games. This is why many publishers admire Nintendogs. Nowadays DS is THE casual console but in its lineup there are still Hardcore games such as Castlevani PoR : Nintendo DS is a console for EVERYONE. There are millions of harcore gamers all over around that are waiting Metroid Prime: Corruption or No More Heroes." Your point is kind off. Look at how many units GTA, halo and final fantasies have sold. They have more than recouped thier costs and without a question made more than nintendogs and or any other game that was low in cost to make. "No. We saw Nes with its 8bit graphic crush the expensive Amiga with its 16 bit graphic ( Ps3 is like PC, do you remeber Kutaragi ?) Wii is similar to Nes, not N64 , Snes or GC." When did the amiga have two very sucessful console before it? The called the PS2 a computer when it was released as well remember? Did that affect it sales? Why is the Wii like the NES? "Nintendogs outsold FF7 and GoW despite its ridicolous development cost . It's a paradigm shift. " Nintendogs sold 7.93 million, FFVII sold 8.6 million and gears sold 3 mill. GT and GTA are perfect examples of how games can have gameplay and graphics and both of those games came out on the PS2 and have achieved numbers that many games haven't reached. "Why ? Wii is radical different by N64,GC and Snes ( PS: Try to find Lucasart's Shadow of Empire worldwide sales (N64) )." Because his point is about risks to 3rd party devs. Returns making it cost prohibitive to dev.... remember. Compare those 3rd party sales to either the xbox or PS line. "Nintendo is the largest publisher in the world. It is stupid compare software sales from Nes/Snes era and those from Ps1/Ps2 era because each era had enlarge that software sales. Also games like FF had a great advantage in PS1/PS2 era because they ride the cinematic-style trend-up ( this is why FF13 is a Ps3's exclusive). Now that trend is down. Enix developed only 2 DQ original title for Ps1/Ps2 whereas 6 title for Nes/Snes thanks to lower development cost and time. Enix earns a lot more yen from DQ in Nes/Snes era therefore DQ is now leading on Nintendo platforms." I think it was a very valid question. To this day the best selling game is super mario bro's that was on the NES and the franchise that has sold the most is the mario franchise. Your comparison about DQ is overlooking the amount of titles that square enix has released on the PS line. Plain and simple no matter how hard people are trying here the playstation line has been succesful because of games. They have always talked big and everyone has always ignored them. (instead of people who hate Sony). Third party devs make amazing returns on thier games and Sony's first party games are shapping up to produce some amazing titles as well. Gamers speak with money and whether it is now or later. Whether it is on the Playstation , xbox or wii. Wherever the known heavy hitters go most gamers will follow and also be more apt to trying out new and varying titles. The wii is a fun system but I have a feeling that nintendo's direction is still flawed and they need to reign in some hardcore as well as the casual and "then" the wii will be in the market for success.
Games make me happy! PSN ID: Staticneuron Gamertag: Staticneuron Wii Code: Static Wii - 3055 0871 5802 1723
"[Our former customers] are unable to find software which they WANT to play."
"The way to solve this problem lies in how to communicate what kind of games [they CAN play]."
Satoru Iwata, Nintendo President. Only slightly paraphrased.
Consoles owned: Saturn, Dreamcast, PS1, PS2, PSP, DS, PS3
Ok, for my first post on here i'll throw my hat into what i'm sure will remain a passionate topic for all gamers (hardcore to casual and inbetween) for a long time to come. Most people raise very vaild points for all systems, with a bias in there that probably stems from their manufacturer/system of choice. Rightly so considering people invest their money and time inbuying and playing with their system of choice and so don't want to see it fail. So there is an element of subjectivity that cannot be avoided in this discussion. I too have my preferences, both past and present, but will try and discuss the issue from a different angle to attempt to remove subjectivity and make this objective. Currently the "who will win" and "is sony doomed" style questions and discussion focus on sales numbers as the sole indicator. This is important but not the whole story. To present my point i will take a different approach. Namely profit. To justify my approach i make a simple statement. Video game manufacturers (software, hardware and accesories) are in the market to take thier piece of the pie and make money. No company goes out with the intent of solely shipping or moving more consoles just to wave it in another companies face unless there is money to be made. The global market is capital driven, and in the end, Microsoft, Sony and Nintendo are responsible to their share holders to attempt to make money. So.... Firstly i do not claim to be anything more than an interested an avid enthusiast of the video game market. If people see things wrong in some of the points i present feel free to correct me,and more over, apply their knowledge to the approach i will propose. To me win or loss of any company is purely a profit based argument. If one system ships/sells more then this is irrelevant if their profit margins are small as their profits can match those generated by small sales of systems with higher profit margins. Based on the information i have read from any number of sources the current profit margins for each system can be assigned a number value or score of -5 to +5. So the systems as they stand would have a profit margin score of: XBox - 0 (current maufacturing cost, shipping etc breaks even with revenue from console sale to retailers) PS3 - -4 (Fairly widely known that on each PS3 sony suffers a significant loss on manufacture, shipping etc Vs revenue from sale to retail. This is deemed significant given the high cost of of the console on the shelves) Wii - +1 (Again fairly well established that nintendo is making a profit from the start with the Wii. However the profit margin is small given the lower pricing of the Wii.) The above numbers can change over time. XBox360 was initially running at a loss (and some will say it still is, i'm just trying to be conservative) so it would have been possibly a -3. However as time passes, better manufacturing processes are developed etc etc, the cost of manufacture and even shipping (after the establishment of fluid supply chains) lower so profit scores increase. whilst price drops on the consoles eat away at profit scores. By 2009 the profit scores may look more like the following: XBox - +3.5 (Max score, price point doesn't allow for huge profit margin growth after price cuts vs lower production cost) PS3 - +4.5 (Max score, but this is very dependant on the cutting edge technology having significant production improvements. However the higher starting price allows room for more profit margin growth) Wii - +2 (Started as a simple system, so very few efficiencies can probably be introduced at production, and profit margin growth can only be small given the low initial price point.) The above scores are relative to each other and are based on a console by console sales approach. A very similar mentality can be applied to accesories. Where all three companies have scope to make money from accesories. In the interests of brevity i will merely rank each companies possibility for profit from accesories. #1 - Wii (mutliplayer is a system strength requiring multiple Wiimotes at a fairly decent profit point, include other accessories such as WiFi dongles, classic controllers etc and Wii presents significant possibility for accessory profit overall and not generally third party "copied") #2 - PS3 (historically strong with accessories, although third party companies eat away at this market most often) #3 - XB (similarity to PC means third parties eat away significantly at possible accessory sales.) The same can be done for software profits as follows; #1 - Wii (nintendo franchise software normally performs very well) #2 - Xbox (microsoft has significant development horsepower of its own from PC side of the house. Although not having a significant number of franchises, it wholey makes the the profit) #3 - PS3 (sony often enter into joint deals on development and so need to profit share. Whilst having a number of strong franchises, this profit sharing can hurt the bottom dollar) The above rankings also take into account development cost AND most importantly the break even point and the likelihood of games reaching the break even point and becoming profitable. For example Wii lower development cost means lower sales numbers required to break even and then turn profit. The reverse is true for PS3 and XB, but more so for PS3. Finally third parties cannot be ignored in all this as so many of you have already pointed out. Keeping in mind that they too are in the business to make a profit. To this end 3rd party support can be seen to most likely follow the trends above. More people can afford to develop for Wii than PS3 or XB. The impact being that more risks can be taken with regards to wether or not a game will flop or sell well. The installed user base is important in this obviously as larger market for a game give it better chance to sell to profitable and above levels. This is an average and accounts for both the big hits and the also rans of the software race. Numbers of games available for a system also have a flow on effect back to long term sales of the console. PS2 being the ideal example. This closes the loop and allows us to make a rough "crystal ball" objctive decision on whether sony is doomed, XB will just be or Wii will go the way of the YoYo. Before i get to this culmination i would like to add one thing. That is long term corporate strategy. What you and me the average joe consumer see being a loss may be a win for a company. XB being the best exmple. The win would come in the form of market share, and for microsoft, entering and integrating into the modern digital household, such that 360 and other microsoft products become almost essential to households. Just look at the Windows monopoly, tie this with digital lifestyle through 360 and a long term corporat profit can be seen to appear. But that is a discussion for another thread. So, the winner, or more importantly losers are: (from best to worst) #1 - Wii (good initial install base, instant profit from all areas, room for significant future profit from software. Good 3rd party support given low risk on break even sales margin) #2 - 360 (head start and similarity with PC parts allows room for growth of profit margin in all areas. But inital profit losses weaken overall performance this gen.) #3 - PS3 (lowest initial install base, least room to manoeuvre for some time on profit margin, but once production cost issues are rectified and profitability in the significant score area is achieved it may be too late) Note this is very crystal ball. It is more an analysis of each companies face value business model surrounding the console. Sony is by no way or shape doomed however. They will most likely lose the race profit wise. But as a company, Sony may see significant gains from the PS3 with regards BD and sales arising from that technology. The PS3 can already be seen to be having an impact on the HDDVD market. This comes with a caveat though. For people to adopt a system, en masse, they need to see a relative increase in what that system offers them by a 10:1 (or close to) ratio of new to old performance increase. Tape to CD, VHS to DVD. They represent that increase to the masses. However CD to MiniDisc for those that know it never took off because it didn't abide by the general rule of performance increase. In this way it will be interesting to see if the general public en masse acept either HDDVD or BD as the new format. Personally i like DVD's and i'm happy enough with them. Do i need HD? not yet. Most people i talk to feel the same. In this regard, the overall business model of PS3 selling both games and movies and a new format to boot is a very big gamble. But it is one that i see paying off, at least in the long term, 10yrs+, as BD being the dominant format. As i said at the start feel free to correct any falsities in ay of my statements you percieve. I only propose a differnt approach to deciding whether sony is doomed and who will win. My gut feel is that PS3 has been priced out of the market, but will have BD to back it up. Also that the Wii will end up being the winner. Most people have been quick to point out the novelties of the Wii but slow to remember that whilst it cannot deliver hardcore gamers a visual experience that they want, the control scheme can be still made to suit with use of the GC or virtual console "classic" controllers. Allowing a return to the "hardcore gamer" control schemes where appropriate. Have fun digesting this and look forward to intelligent discussion.
I'd like to start off by saying, Erik, I think you're awesome. It's so refreshing to see that at least someone out there in the gaming world has a sense of business. Honestly, it's the sole reason I even registered for this site. Now to everyone else posting about the PS3 and 360's greatness and Nintendo's lack in the hardcore market. Its all numbers people. Hardcore gamers really mean very little beyond as Erik points out, the initial launch. I'm gonna throw some theoretical numbers at you to try to put you in the shoes of a low-level developer. First, let's take the number of 120 million as the number of "gamers" in this world. The Earth has a population of 6 billion. Lets say only 3 billion have the requirements to buy a console (electricity, a TV, money) Scratch that, lets make it two billion. Lets take the MS and Sony strategies; they are fighting for a piece of the 120 million gamers in the world. But what Nintendo has learned is that there is a much greater market in the world, an untapped one of 2 billion (our number). If Nintendo markets to that group and sells only to 1% of it, they've sold the system to 20 million people. Of the 2 billion potential customers, "gamers" make up 6% of the population. The nice thing about selling to a broader audience is that things don't have to be PERFECT for you to achieve success. So lets be a lowly developer now... You have $25 million to use. You could with that, make one game huge game for the PS3 or 360, but if it doesn't do well, you could end up filing for bankruptcy and that would just spoil your day. Now say you take that money and make 2 or 3 games for the Wii. @ or 3 average games. They wouldn't have to sell nearly as well and if the Wii has a broader audience and broader reach, you would be just that much more likely to recoup your costs and even make a profit. So while you may not make $50 million or more that some huge titles make, you might also not end up several million in the hole and that would make your investors very happy. What you all need to understand is that most of the titles sold for the PS2 and other systems does not come from million sellers, but from games that sell 500k or less. That means that selling more takes a lot of work. To make a huge game and then have it make profits for you, or even break even sometimes, takes perfection and a lot of effort. Where as a system like the Wii allows for developers to make cheaper games that we might consider mediocre and yet the developer would still see a profit. Hardcore gamers are hard to sell to, the general public is not. There is less risk in a system like the Wii than in the others. I'm a huge PC gamer and I remember when I first realized how unimportant Hardcore gamers really are. It was about a year after Half-Life (the first one) first came out.. A bunch of companies and even magazines started to notice that here was this super awesome game, yet Deer Hunter and Barbie had done better. Games that we would never even call games, which cost almost nothing to make and sold with a lower overall cost and much greater profits. The sun is rising and I havent slept yet so you'll have to forgive me if my argument starts to lose cohesion. My point is very simple. Everyone in here keeps talking about the hardcore gamers. Erik is right, there is a bigger market out there. You may not want to hear it, but hardcore gamers aren't the end all, be all of the industry and Nintendo has realized this. The demographic with the highest overall spending also happens to be one of the largest demographics in the western world, that is the "12-18 year old teenage girl." This is not a fact you'll find on this site, you'd have to go outside, but go to any business site or economic site and you'll see that if you have something to sell, they're the demographic to sell to. My brain is mush and so I'm done. I don't plan on replying any further, I think all the arguing is pointless. I think Erik has made his point as have I and I think all of you have as well. All we can do now is wait about 3 years and see. I think Erik and myself will be proven right. Oh, I almost forgot, development is far easier for the Wii than the ps3 or 360. Here's why: Consoles generally have a 3 year learning curve for developers. The Wii is essentially a Gamecube thats twice as powerful. Programming for it remains essentially the same. Also some of you have mentioned possible problems with programming for the remote, but part of the devkit is software that handles all signals from the remote and gives developers data that they can easily used, so they essentially don't have to code anything for the remote to work. P.S. Erik, you're really awesome. Again, I'm so glad someone has an understanding of business. I'd totally hang out with you, lol. You seem the most interesting person here. P.P.S. The hell is wrong with most of ya'll's typing. I had some serious problems simply decoding what you were saying in your arguments. *recalls a particular line from Pulp Fiction.* Peace out ya'll