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Forums - Sales Discussion - Software Sales Definitely Appear to Have Peaked for Current Machines

Seece on 22 October 2010
TheSource said:

Honestly, with PS3 / X360 purchasing rates per user declining steadily over the past several years I really can't see Move or Kinect reversing anything, as those items will only sell to 20% of the base or something by the end of 2011.

Microsoft doesn't give shipment figures, but for PS3, purchasing rates are trending down fairly quickly, as is always the case once purchasing rates get to 3 games per user or so.

FY 3/2009 - 4.56 games bought per PS3 user (103.7m / 22.3m)

FY 3/2010 - 3.24 games bought per PS3 user (115.6 / 35.73m)

FY 3/2011 - Trending for 2.65 games bought per PS3 user (135m / 50.73m)

FY 3/2012 - 1.7 - 2.1 games per user * 63m users? That'd be 120m games bought (120m / 63m = 1.9)

Hard to say exactly, but after you get below 3 games purchased per FY, the drop off is usually pretty steep.

Well that's not surprising because you never give either of them a fair shot. I don't know why you giving your opinions on them anymore tbh!!

I see the bundled Wii sports counts in Nintendo SW for Wii. In which case Kinect Adventures will count and be at least 5 - 10 mill for 2011. Not to mention all the other Kinect SW that will sell alongside it. This is potential growth that they never had before, on top of the core SW they will sell. 2011 will likely be th peak year for MS SW.



 

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.jayderyu on 22 October 2010
TheSource said:

Do you guys actually read what I write?

PS3 software has already topped 100m. Its going to be 135m or so this year - thats not new. PS3 is pretty much mass market pricing now - the PS2 sold quite well at $300 and only increased a ton at $200 for a year because the base was still smallish (under 20m) when the price dropped.

Look at the figures (these are as of the EMEAA update this week, haven't done the calculation since):

Yes, yes I do thank you :P That's why I was wondering what the manufacturers are likely to do next. What's the normal move at this point. Is it after peak where they start solidifying what will go into the next gen? or do they continue to experiment for another year or two. What would Nintendo being doing this year now that's it's peaked and moved into rapid decline. What will Sony do next year once the PS3 goes into rapid decline.





Squilliam: On Vgcharts its a commonly accepted practice to twist the bounds of plausibility in order to support your argument or agenda so I think its pretty cool that this gives me the precedent to say whatever I damn well please.

saicho on 22 October 2010
leo-j said:

The ps3 is not peaking period...

 

THE SOURCE do you continue to ignore the fact the ps3 is STILL not at mass market price? Publishers don't need to start setting records so that a console's software sales peak. In fact the ps3's software sales is at the highest it's ever been, and the console still hasn't "peaked" hardware wise, and will not have its peak year until it drops to $199...

you could say the 360 and wii have peaked, because the 360 has been on the market since 2005, the wii has been at mass market price point since it launched, and the 360 has released a redesign and been at mass market price for two years, but kinect may give the console some life like microsoft said it's depending on so that the 360 lasts another couple of years...

You could say the industry as a whole may have peaked, due to PSP/DS declines, and 360/WII nearing their peaks, or have already peaked, but the ps3 has not peaked, and it's interest is growing greatly thanks to the fact the ps3 is one of the cheapest 3D blu ray players, and 3d tv interests are increasing in the television market. The move has also sold well above your estimations, and the ps3 has sold well above your previous estimations... and I wouldn't be suprised if there's a 1 million gap between shipment figures and actual consumer sales between your estimations and sony, as you have continually underestimated the ps3, and still do today.

everyone sees it, everyone knows it, and we all know, ALL OF US who have been here for 5 plus years, that a console's peak comes after it reaches mass market price point.

Every time I see this theory, it reminds me of this idea.

All console makers should make their consoles launch at a really high price so that it would take the longest time to drop the price to $199. It doesn't matter how long it takes to reach that $199 price point and will definitely peak then.

Also, some people on this forum always argue that this gen is different and doesn't follow the same pattern as previous generations. However, when it comes to console sales peaking at $199, it is always true since that's what happened in previous generations.



MikeB predicts that the PS3 will sell about 140 million units by the end of 2016 and triple the amount of 360s in the long run.

TheSource on 23 October 2010

Seece 10-15m games for Move / Kinect..alot of that would be from existing owners so it would just replace 5-10m games that would be core purchases by core users if they didn't get Move / Kinect. New users who come in because of Kinect / Move aren't going to be buying a ton of games, not when the selection is small and the price for going motion-able on PS3 / X360 is high. If you sell 10m Kinect games to 4m new X360 owners...great. But thats as big as one large core game a Halo or whatever. Its not much. If the 50m non-Kinect X360 users are trending to go from buying 2.5 games (125m) in 2010 to 1.8 (90m) in 2011 that ten million only holds the rate to 100m / 54m (1.85).

Users buying for Move or Kinect may end up with six to ten games in total - but thats completely average for a new user and the problem isn't new users in these purchasing rates, its the old users that are deteriorating and vastly outweigh the new users. Then the new users become old and so on, but the number of new users purchasing alot of games eventually falls behind the number of old users slowing down in their purchases.

To have any shot at reversing the decline in software this is the math:

AVG X360 Owner in 2010 = 2.5 games per user (just for argument). 50m * 2.5 games = 125m

Kinect User in 2011 = 3 games per user.  8m * 3 = 24m games

Non Kinect User in 2011 = 1.8 games per user.  52m * 1.8 = 94m games

AVG X360 Owner in 2011 = 94m 24m = 118m. Not a reversal. But thats with Kinect in over 1/6 X360 homes and seeing a higher purchasing rate than the avg X360 base.

For a reversal, you need something like this:

Kinect User in 2011 = 4 games per user. 8 * 4 = 32m games

Non Kinect User in 2011 = 1.8 games per user. 52m * 1.8 = 94m

There are other options too I suppose...

Kinect User in 2011 = 2 games per user. 18m * 2 = 36m

Non Kinect User in 2011 = 1.8 games per user. 52 * 1.8 = 94m

But the math is definitely tough. I think Kinect gets to a 1/6 or so of the X360 base at the end of 2011. Thats not bad at all, but with deterioration ongoing for the number of games the rest of the base purchases there is no reason to believe Kinect will reverse the software decline unless X360 owners using Kinect buy over twice as many games as Kinect-less X360 owners, and I don't see that.

The mathematical issue is the same for Move on PS3 - steady or increasing purchasing rates for a narrow segment of the audience isn't enough to reverse the decline in purchasing rates for the entire base.



People are difficult to govern because they have too much knowledge.

When there are more laws, there are more criminals.

- Lao Tzu

Edouble24 on 26 October 2010
Degausser said:

 I honestly can't fathom why you're looking at this as sales per publisher, and record years and all this stuff. If for no other reason, it depends entirely on what they release and will change year to year. Of course Konami arn't going to have a record year without an MGS, or Capcom without RE, or Namco without Tekken etc.

 PS3 and X360 are both set to have record years for software again, so to then conclude that this is the peak year just seems odd and unfounded. Sure, it could be, but it could continue to peak next year? Move and Kinect certainly seem partly designed to 'extend' the console life cycle and drive software sales away from decline, and unlike when the PS2's design began, the games coming to these systems are still all the major franchises. Your method to me doesn't really feel like a sensible way to determine industry-wide trends.

p.s. how the hell did Ubisoft sell so much in 2008 (A non Assassin's Creed year)? Did Assassin's creed sell alot after 2007's xmas or am I forgettng some big hit? :/.

This is how I look at it. Total software sales for the consoles determine the peak year, rather than comparing a handful of publishers and comparing them on a yearly basis, since they can't release GTA and Resident Evil every year it's only natural that things like this happen. I do believe next year Xbox 360 software will eclipse this year. Probably the same for PS3 as well. 



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TheSource on 26 October 2010

Stuff like RE and GTA is exceptional though. Look at the companies that have huge content that releases every year, generally without seeing the fanbase grow or shrink. EA is the perfect example - they're going to have alot of trouble matching 2011 on the HD systems and they're the number one to three biggest publisher for both of them each year. Actvision is another company - Black Ops will likely have smaller legs than Modern Warfare 2, and so they're somewhat screwed as they already have no chance of matching 2009 figures on X360 / PS3 (down 15.6m / 9.4 units respectively).

You have to keep in mind also that it doesn't really matter if the Japanese publishers peak later than the western publishers, because other than Nintendo, they're all far smaller than the Western Publishers. If Konami, Sega, Namco-Bandai, Capcom, and Square-Enix all peaked on PS3 when EA, Activision, Ubisoft, THQ, and Take Two were in decline in the same year, it'd be a huge down year for PS3 sw. When I ran this data, the Japanese publishers were only 19% of the PS3 software market, almost exactly the same size as EA on PS3. On Wii and X360 its even worse really, with Japanese publishers only 10-11% of the software market (although 10.5% of the Wii sw market is more than 19% of the PS3 sw market ltd going by units.



People are difficult to govern because they have too much knowledge.

When there are more laws, there are more criminals.

- Lao Tzu