I Believe..The End Of The 360 - A 360 Fanboy's Point Of View

[davygee]

I personally feel that the 360 could be in trouble.

The RROD and warranty issue:

MS are providing purchasers of the 360 with a 3 year warranty to cover probems with the RROD, broken DVD drives and other issues with the console. They reckon up to 10% of all 360 owners have had a RROD problem, which makes me think that it's alot worse than they are letting on. Rumours stating that all 360 (pre-Falcon) have an inherent hardware problem with the motherboard means that potentially MS could have problems for the next 3 years or so. It could end up costing them more and much more than they anticipate with the $1.1b (which is slowly creaping up to $1.4b cover).

360 hardware sales:

Everyone has been slating the poor sales of the PS3 over the first 8 months of it's release, but if we check 12 months ago, the 360 was posting very similar (virtually identical) figures. And the main point is, the 360 had no direct competition. The PS3 has the 360 and the Wii. Also add to this, the European launch of the PS3 didn't happen until March 2007, so in 4/5 months, the PS3 has sold nearly half the number of 360's and they have had 20 months to make 3.2m sales compared to 1.2m. The Wii has nearly caught up with the 360 numbers and will take over next month. Plus you have to take into consideration that the 360 price has always been $299 and $399 ($479 with the Elite). The PS3 has been generally $599 and has only recently come down to $499. A significant difference. Yes the 360 has a good supply of good games, but this does not seem to be making a difference.

2007:

2007 has been a poor year for the 360. Normally we should be seeing a better year for a console in it's 2nd year, but sales are down compared to last year. Whether this is to do with the competition or with the hardware problems, but they really aren't shifting units at all.

Europe and Japan:

Sales in Europe and especially Japan are poor (very poor in Japan). The Wii and the PS3 are outselling the 360 in Europe and this is without a pricecut for the PS3. This week especially sees the PS3 sell 60% more units than the 360. In Japan, it's a farce. The 360 has sold no more than 5k each week and normally only sells around 3k on an average week. The PS3 although not great sales is generally selling 9k minimum up to 14k this week. I don't think it will be long before the PS3 takes over sales of the 360 in Europe and then it will be onto North America.

Halo:

The release of Halo 3 in September/October is a huge thing for the 360. They need hardware sales to skyrocket for a few months after this release. MS will hope that Halo 3 and GTAIV will set them up for Xmas. But we will wait and see. I cannot see 360 sales going through the roof, although they will spike for a few weeks after both games are released, but could quite quickly come back down to the normal numbers again.

Price cut:

There have been rumours of a price cut for the 360 for months now. It's been on the market for 20 months without a pricecut and consumers are awaiting the news. It is pretty much certain that a price cut will happen pre-Xmas, although some people reckon it will happen around the time of the Halo 3 release. In either case. it needs to be a significant reduction. IMHO, all 3 units need to come down by around $100 each, but can MS afford to do this and still make the projected profits for 2002/2008? We will see!!! A price cut will definitely help with sales of the unit, but with public awareness of the RROD and other issues, will people buy in?

My view:

The 360 is in trouble.  Sales will pick up later this year, but over the course of 2008, they will start dwindling again and may even reach an all time low.  It has taken the 360 around 19 months to reach 10m WW sales (who knows how many of this number are replacement units or not).  It looks like they have only sold around 2m this year which cold easily be 1m-1.5m less compared to last year at the same time.  I reckon they will make around 12m WW by the end of this year, but will have an overall poor year next year and the year after.  I cannot see the 360 selling 40m+ units WW.  I honestly reckon they will find it hard pushed to get to Xbox number of 25m WW and this could easily be 5/6 years from now.  I think that the Wii will overtake the 360 next month and will continue to make space between them.  The PS3 won't really catch up with the 360 until near the end of next year, but will them push it's way into 2nd position this generation and then it's all downhill from then on in.

I may be proven wrong, but there just seems to be so much going against the 360 at the moment, than I can see nothing but failure written all over it.  Which is a shame!