| Squilliam said: Its not a 2 way relationship between the Xbox 360 and the PS3 theres the Wii as well. If Someone buys an Xbox 360 instead of a Wii
If someone buys an Xbox 360 instead of a PS3
If someone buys a Wii instead of a PS3/360
So based on this you could say that Sony would be winning and losing at the same time. They want the HD market to expand but not at their own expense, so I bet they would rather someone buys a 360 instead of a Wii rather than have it canibalising their own sales. But even if they do lose potential sales its better that the Xbox 360 gets them than the Wii. Sony is gaining from these price cuts - anything that could possibly keep the Wii from gaining tracting with developers for a little bit longer is going to give them more time to find their feet and cut the price. Sony is losing from these price cuts because an Xbox 360 sold is a PS3 not sold. So they lose out on potential customers. There will be substitution, even if the Xbox 360 is considered an "Inferior" product like say margarine is to butter, if the price of margarine goes down there will be fewer sales of butter as they both do essentially the same thing. |
Squil, you make a really good point about attracting HD development, but there's 2 problems:
1) It's an argument made in terms of absolutes without considering the market situation.
2) You put the 360 versus the PS3 and Wii one on one, but you put the Wii versus Xbox/PS3 together. Therefore, you're making the effect seem disproportionate. You have to consider someone buying a Wii versus 360 and Wii versus PS3 separately.
About the market situation: currently, Wii has 47% market share. For simplicity's sake, let's just say half. So that leaves the other half to HD gaming. HD development is not even close to being in danger.
Since we're on the topic of this pricecut, I'm going to say that this pricecut will not have highly significant effects for the 360. I detailed my reasons a few posts up.
So, on the scale we're dealing with, a small extra amount of 360's moving rather than Wii's (I'm assuming Arcade, since that's the Wii's main competition, thus the small extra amount) wont heavily affect the balance of HD versus Wii development. However, when it comes to marketshare of the HD market, whatever small effect this has is doubled, even though it may still be small.
So what it comes down to is, the 360 moving units against the Wii will affect HD/SD development half as much as it affects the market share of the competing HD consoles. And so, it may have a very small effect of moving development to HD, but it also had a doubled effect of that development focusing more on 360 than PS3.
So we have 6 scenarios:
Wii over 360: HD/SD, small SD gain. 360/PS3: PS3 gains twice as much.
Wii over PS3: HD/SD, small SD gain. 360/PS3: 360 gains twice as much.
360 over Wii: HD/SD, small HD gain. 360/PS3: 360 gains twice as much.
PS3 over Wii: HD/SD, small HD gain. 360/PS3: PS3 gains twice as much.
PS3 over 360: HD/SD, no change. 360/PS3: PS3 gains significantly.
360 over PS3: HD/SD, no change. 360/PS3: 360 gains significantly.
Wii over PS3+360 considered together: HD/SD, small SD gain. 360/PS3: no change.
But since we're talking about this price drop: the Wii and PS3's price hasn't changed, whatever they've done to each other up til now will mostly remain the same.
The 360, however, will go invading in Wii territory. Thus, case 3 happens: HD/SD balance not greatly affected, but effect on 360/PS3 distribution doubles, in favor of the 360.
So, my point is, the 360 dipping into the Wii market will hurt the PS3 more than case 1, someone buying a Wii over a 360.
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