I started this as a response to another thread, but it kept growing and growing, so I decided it belonged as its own thread.
PART ONE - Analysis/predictions for this generation
To start, each generation, the market grows more and more. We'll be seeing the same this generation.
Looking at the past, the first generation saw very minimal sales - only a couple million units at best.
Second-gen saw much better - thanks to the Atari 2600 (which had 30m total sales). Total generation's sales probably finished close to 40m.
Third-gen, despite the crash of '83, did even better. The NES won outright, selling about 60m total, with the SEGA Master System pulling in 13m, and the Atari 7800 likely finished at about 1m, with the generation finishing at about 75m.
Fourth-gen saw the SNES, the Genesis, the Neo-Geo, and the Turbografx (as well as the Amiga and the CDi, but those were embarrassments). The SNES sold 49m, the Genesis 29m, the Turbografx 10m, and the NG was an uncertain amount behind that (likely somewhere around 5m due to its price). This left the generation at nearly 100m.
Fifth-gen brought 3D gaming - the PS1, N64, and the SEGA Saturn, mainly, as well as the 3DO, Atari Jaguar, and the Amiga CD-32. The PS1 pulled about 102m, the N64 about 35m, the Saturn just under 10m, the 3D0 about 2m, and the CD-32 and Jaguar were failures, bringing in less than 1m each (although for entirely different reasons). This generation finished at just under 150m.
Sixth-gen introduced the PS2, GCN, Xbox, and Dreamcast. The PS2 is still flourishing, with the GCN mucking along behind it. The Xbox and DC are dead. Sales are currently at about 125m for PS2, 22m for GCN, 24m for Xbox, and 10.5 for DC. This leaves the generation at about 185-190m when all is said and done, and the GCN and PS2 have officially kicked the bucket.
This generation, the market has grown much more than previously, thanks to the DS and the Wii. With easily five more years left in the generation's lifespan (and, if Nintendo does things with the Wii correctly, up to ten more years thanks to casuals and fitness freaks), we can expect the three systems to pull in a combined total of about 220m (minimum) to 400m (I'd say that's the absolute, utmost max). I'd estimate generation's end at 35m-50m for both the PS3 and 360 (PS3 can pull 100m if the right SKU and price-point is released, but I think the 360 is set at 50m max), and somewhere between 150 and 250m for Wii (it all depends on how Nintendo markets it, and whether they keep it alive past 2011 or not). Given the market that Nintendo has been marketing the Wii to, while still appealing greatly to oldschool gamers, and working to appeal to hardcore gamers a bit (more and more as time goes by), I'd say that the Wii could easily beat the PS2's lifespan.
This is realistics speaking, not fanboyism, as you can tell by the comparison of previous generations. We started with no more than 3m, which grew to 40m, then 75m, then 95m, then 150m, then 190m. Given how systems have sold, and why, we can count on a minimum of 220m this generation, and we KNOW we'll see these sort of numbers from each system.
My wide-range of generation's end (220m to 400m? That's a big difference) is due to a LOT of variables. The PS3 has lots of potential, what with being a blu-ray player as well. If Sony eventually gets its price down to the $200 point, they can assuredly revive the Playstation brand-name and cement their position as second this generation. We're looking at that price happening no earlier than Christmas '09, though, and it can only happen with a new <25gb model, but if it DOES happen, the PS3 can easily pull numbers nobody would have expected from it.
And the Wii is a tremendous mystery. Marketed and produced right, it can pull numbers so outrageous, Nintendo would be able to buy out most third-party devs by generation's end. Marketed and produced wrong, it will still most definitely pull magnificent sales-numbers (and most likely push beyond the PS2), but it wouldn't be a miracle child.
The 360 doesn't have anything gimmicky to bring people to it, though. It doesn't have power that nobody else can offer, it doesn't have disc replayability of a fledgling format that more and more people want, and it doesn't have motion control. Don't get me wrong - I'm not saying the 360 is bad. It's just not done anything new, and doesn't offer a unique experience of any sort. As a result, it is doomed to a lower potential sales range than the competition. It can still beat out the PS3 if done right, but the PS3 definitely has higher likelihood of getting up there.
It all depends on marketing strategies from here out, folks.
Me, I think the generation will end at a groundbreaking 300m total - about 185m for Wii, 70m for PS3, and the remainder 45m going to the 360. This will make each console a certain success, but each for different reasons. As a result, we will see each company again next generation.
Following this generation, each company will continue in the same paths they took this generation, to a degree. The Playstation-brand will become further entrenched in its "media-center" image, resulting in gaming being only a secondary function. The PS4 will again see a high price-point, but people will start viewing it in a better light, even though I think it'll go far more extreme ($1000 at launch?). The next Xbox will still be viewed as the "hardcore gamer's system", with mainly fighters, RPGs, racers, and FPS getting attention on it. Microsoft will continue trying to market it against the Playstation brand, but they won't be willing to take it to the levels that Sony will, so it will appeal far more to actual gamers than the Playstation 4 will. Meanwhile, Nintendo will bring the thunder, and their new system will bring everything the Wii had, but with enormous improvements behind the controls (I guarantee that they're doing intense R&D into their next system as we speak), and it will put out power to rival the competitors. I think the Wii2 will still be less powerful than the competition, but it'll be something like the 360 vs. PS3 - most people won't mind, or even know, the difference. It will market more to the core market, because the Wii will still be going strong, and still be selling to the more "casual" market. However, it will still market some at the casuals, and it will still be affordable. I think the Wii2 will again dominate next generation, but it's impossible to tell how.
I also think we'll see a new competitor arise for next generation. I expect it to be a new Phillips system (but honestly, we don't know who it'll be), and it will market heavily to casuals - direct competition for Nintendo. This is the biggest reason we won't know how well the Wii2 will do. As I expect this new system to market ONLY to casuals, I think it'll get the most casual of casuals - the ones that want the cheapest, most basic system for what they're looking for. As the new Xbox will market to more hardcore gamers, I expect it will sell MAINLY to them (wouldn't say ONLY, but hardcores will definitely make up 95% of its sales). However, the Wii2 will enjoy a middleground here - marketing to both. I expect it will sell somewhere around the combined total of all competitors, and the competitors will sell fairly evenly to their niche markets. As for Sony, they'll be slightly leaving the gaming industry behind, and their system will get mainly ports of titles from the other systems. It will sell pretty well, but not due to being a gaming machine. As a gaming machine, it WILL do well, but gaming will be a secondary focus.
Numbers for next generation are entirely impossible to predict, and I'm not going to have anything to do with that yet.
And there you have it, folks. Discuss.
(in before tl;dr)
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