Coincidences That Make Me Belive The PS3 Will Outsell The 360 This Holiday!

[Seihyouken]

Despite BHR-3's poor excuses for coincidences and poor liguistic skills, his reasoning is pretty sound.

From November 2007 to August 2008, 360 failed to outsell the PS3 in weekly worldwide sales even once, despite being at least $120 cheaper in every region. On the flip-side of things, PS3 has actually managed to outsell the 360 for at least one week despite being $200 more expensive.

I think most people agree that if the difference in price between the two consoles is $150 or less, PS3 will almost consecutively outsell the 360 in weekly sales worldwide. The only real question is whether or not Sony is capable of acheiving that difference and if Microsoft will allow it.

Overall, I'd say the chances are fair to moderate. PS3 sales are down and are only going to get lower the longer it remains the same price. Sony knows that if they allow the PS3 to go a third consecutive year at the same price-point, they're going to lose a huge amount of marketshare and software sales, which is the bread and butter of any video game publisher. PS3 will be cheaper by November than it is today, the only question is whether it will be $50 or $100 and the answer to that is known only by Sony because it is them who will determine if it is economically feasible.

The PS3 will be recieving a hardware revision sometime in the next 5 months to incorperate the new 45nm Cell chips. Based on the number of revisions the PS3 has had in the past and the unprecidented amount Sony has managed to shave off the PS3's manufacturing cost since launch, I'd estimate that with the upcoming hardware revision the PS3 could be anywhere from $50 to $125 cheaper to manufacture coming into Q3 this year. Taking into account reports and statements that suggest the PS3 is borderlining profitibility anyway, and the biggest first-party lineup of games for the period between October and March in the both the PS3 and PSP's history, it's no stretch of the imagination to think that the PS3 could drop $100 without showing a spectacular loss for the division, let alone $50. Furthermore, PS3 will undoubtably be recieving yet another hardware revision around Spring 2010 to implement a 45nm RSX chip that will further reduce the cost of the console meaning Sony would likely only have to indure about six months of selling the PS3 had a loss comparible to what they are losing on it right now before it becomes profitible yet again. And all the meantime they'll be seeing HUGE marketshare and software sales increases.

On the otherside of the spectrum, looking at Microsoft, they need to decide what to do with the 360's price point from here. Their options are a lot more limited than Sony's since they only have roughly $75 left to reduce the price of the console before they likely can't drop it anymore for the rest of the generation, which could be anywhere from the next 2 to 4 years. Furthermore, it's questionable whether or not Microsoft is currently even making a profit off of the lower-end Arcade models. They aren't going to be able to keep the $200 price difference if Sony drops the price of the PS3 by $100. In this situation, I see Microsoft issueing at most a $50 drop for at least the Arcade model and market the console as still being half the price of the PS3, despite the difference between the console dropping to $150. However, come Christmas time, the average consumer will still see the PS3 $100 cheaper versus the 360 only $50 cheaper which will likely lead to more impulse purchases for PS3. In the possible event that Microsoft lucks out and Sony determines to drop the PS3 by only $50 rather than $100, their options become much more numerous. At that price point, they likely won't drop the 360's price a full $50 since it will only lead to unnecessary losses. In that event, I see Microsoft either issuing a $20-30 price drop or axing the Arcade model in favor of the Pro at the same price.