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Forums - Sales - Why last generation was so long, and what it might mean for this gen.

Intrinsic on 28 October 2016

great work!!!

Now onto that shorter gen part.

How does the PS4pro and Scorpio play into that?

This is a first for any console generation where mid way through we have revisions that aren't just more powerful but more expensive than the original skus. I believe what this will do is prolong the gen (albeit meaningfully) not shorten it.

With this, Sony/MS has sustained interest in their platforms since their platforms aren't going to be left behind in the dust by what will typically be on PCs and also at the dame time be able to have extremely low priced "entry level skus" on the market.

I expect that both the PS4 and XB1 will be at $200 next year and even less than that a year later while still offering consoles in the $300-$400 price bracket.

That's never happened in any previous console generation. And honestly can't see how that doesn't prolong this gen too as opposed to cut it short.

What reason would Sony or MS have to jump start a new generation in 2019 if their only claim to relevance is 4k gaming which by that time will just be hitting it's stride in becoming truly mainstream (it's not mainstream till TV broadcasts are in 4k)

and no, this isnt just like previous introductions of chewper slimmer skus.... csuee right now we have that too alongside these more powerful expensive ones. Back then, sales spikes primarily because the consoles got cheaper. Now we will have two concurrent reasons for sale spikes. Cheaper consoles and the availability of newer more powerful consoles. 



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pokoko on 28 October 2016
Shadow1980 said:
pokoko said:
What's impact is the Pro/Scorpio going to have on this generation?

At best, probably something comparable to slimline models, which have historically had a similar impact as price cuts (and in many cases were concurrent with a price cut). At worst, probably something like the New 3DS and DSi, which they are close analogs to. The DSi and New 3DS did have an effect on sales, but the boosts were relatively modest and short-lived, and mostly served to delay the system's terminal decline phase. Since they're being released only two months apart, the PS4 Slim and Pro will probably have a better combined effect on sales. I still think the Slim will be the primary SKU once we get past that initial rush of early Pro adopters as it's the cheaper SKU and thus more appealing to less hardcore gamers. As for the XBO, the Slim is already having its effect, so the Scorpio, depending on its price, may have a more modest effect on its own.

My prediction is that 2017 will see far more significant YoY growth for the PS4 than for the XBO, while 2018 will see a smaller drop-off percentage-wise for the XBO. I think both systems will peak next year, though. Depending on how popular they are and what effects price drops have on them, the Pro and Scorpio could result in a slower post-peak drop-off for the the PS4 & XBO, which may extend the generation beyond what one would expect from its peak. The console cycle is itself largely predicated on sales (a topic I want to talk about more in-depth in a future post), and a new console is typically released when its predecessor has declined sufficiently, typically 35-50% of peak sales levels. If the post-peak bleed-out can be slowed by cuts to these upgraded 4K models, the PS4 and XBO may be replaced no earlier than 2020, making this generation nearly as long as last generation.

I always forget we've been through this before with Nintendo handhelds.

I'm pretty interested to see if Sony's strategy with the Pro or Microsoft's with the Scorpio turns out the best.  



SvennoJ on 28 October 2016
Shadow1980 said:
pokoko said:
What's impact is the Pro/Scorpio going to have on this generation?

At best, probably something comparable to slimline models, which have historically had a similar impact as price cuts (and in many cases were concurrent with a price cut). At worst, probably something like the New 3DS and DSi, which they are close analogs to. The DSi and New 3DS did have an effect on sales, but the boosts were relatively modest and short-lived, and mostly served to delay the system's terminal decline phase. Since they're being released only two months apart, the PS4 Slim and Pro will probably have a better combined effect on sales. I still think the Slim will be the primary SKU once we get past that initial rush of early Pro adopters as it's the cheaper SKU and thus more appealing to less hardcore gamers. As for the XBO, the Slim is already having its effect, so the Scorpio, depending on its price, may have a more modest effect on its own.

My prediction is that 2017 will see far more significant YoY growth for the PS4 than for the XBO, while 2018 will see a smaller drop-off percentage-wise for the XBO. I think both systems will peak next year, though. Depending on how popular they are and what effects price drops have on them, the Pro and Scorpio could result in a slower post-peak drop-off for the the PS4 & XBO, which may extend the generation beyond what one would expect from its peak. The console cycle is itself largely predicated on sales (a topic I want to talk about more in-depth in a future post), and a new console is typically released when its predecessor has declined sufficiently, typically 35-50% of peak sales levels. If the post-peak bleed-out can be slowed by cuts to these upgraded 4K models, the PS4 and XBO may be replaced no earlier than 2020, making this generation nearly as long as last generation.

Great analysis. Do you think price cuts for the pro and scorpio or even a pro / scorpio slim version could provide another temporary peak. Or will that be pointless. Nintendo doesn't seem to be interested in a new 2ds or new 3ds lite.

Any chance of VR prolonging the generation? An affordable ps4 pro vr bundle in 2018 is still a possibility after price cuts and the Scorpio also has plans for VR. A revision of the pro in 2 years with the extra bits build in could shave off enough of the price to be bundled with the headset and camera.



Intrinsic on 28 October 2016
Shadow1980 said:

My prediction is that 2017 will see far more significant YoY growth for the PS4 than for the XBO, while 2018 will see a smaller drop-off percentage-wise for the XBO. I think both systems will peak next year, though. Depending on how popular they are and what effects price drops have on them, the Pro and Scorpio could result in a slower post-peak drop-off for the the PS4 & XBO, which may extend the generation beyond what one would expect from its peak. The console cycle is itself largely predicated on sales (a topic I want to talk about more in-depth in a future post), and a new console is typically released when its predecessor has declined sufficiently, typically 35-50% of peak sales levels. If the post-peak bleed-out can be slowed by cuts to these upgraded 4K models, the PS4 and XBO may be replaced no earlier than 2020, making this generation nearly as long as last generation.

While that may seem to be the case and that cirvumstances may suggest its true, i dont think thats the primary determinant of vonsole cycles. 

I think sales and technology walks hand in hand. 

Not "how much" am I selling but rather how well am I selling also, what is my current attach rate for software and then what is the tech like out there and how much better is it than my current hardware and how cost effective is it to incorporate it now.

Let's not forget that consoles are about selling games. That's the key driving factor of a sustainable console business. If The 14M ppl that bought a wiiU for whatever reason bought 10 copies of each game they bought, Nintendo wouldn't have bothered with the NS. 

And then the tech, if the tech on the market isn't going to give you a generational leap in performance, then it makes no sense killing off an already existing user base to chase a new one. And that's what we are facing now too. Tech improvements have long since slowed to a crawl now, the GPUs going into the PS4pro or scorpio existed (at least in power) 3 years ago. They are just now at a price point and configuration that can fit into a console form factor.  

So what happens if in another three years Sony decides to make another $400 console? With a GPU that's a little over 2 times more powerful than the PS4pro? And sets things up in a way that all games still work across Playstations. PlayStation 4/Pro/5.....

we have the Pro now, is there anyone that really thinks this approach is impossible?

A $400 console in 2019/2020 will basically be a console with about 2-3 times more GPU power than the PS4pro and a CPU of about 2-3 times the power of the original PS4. 

I'm finding it hard to believe anyone will hit the reset button anymore. not even Nintendo. At this rate, the NS2 will just be a tablet that's 2-3 times more powerful than the one they are about to make and even plug right into the existing dock. 



HoloDust on 28 October 2016

Main reason for length of 7th gen was terrible delays of 28nm node - it took way, way too long for GPUs to hit that 8-10x of PS360 at reasonable price.

Once we see reasonably priced 10nm GPUs with about 8x PS4s GPU, we'll see start of next gen (PS5 that is).



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SvennoJ on 28 October 2016
Shadow1980 said:
SvennoJ said:

Great analysis. Do you think price cuts for the pro and scorpio or even a pro / scorpio slim version could provide another temporary peak. Or will that be pointless. Nintendo doesn't seem to be interested in a new 2ds or new 3ds lite.

Any chance of VR prolonging the generation? An affordable ps4 pro vr bundle in 2018 is still a possibility after price cuts and the Scorpio also has plans for VR. A revision of the pro in 2 years with the extra bits build in could shave off enough of the price to be bundled with the headset and camera.

Well, price cuts tend to have smaller and smaller effects over time as a given console reaches saturation. Eventually, it's sold to enough people already that slashing prices really won't squeeze as much extra sales out of the system. Also, there's only so much you can cut a system by and still make money off of it. Prior to last generation, the cheapest a system would ever get is $150-200 in today's dollars. The PS2 was doing its best sales at the equivalent of $260 in 2016 dollars.

The Pro costing more than the base model PS4 (and the Scorpio will likely cost at least $400 as well) adds a new variable here, but I think there's only only so many gamers willing and able to invest extra money in on new models of current systems that exist primarily to take advantage of 4K HDR TVs and VR.

And speaking of VR, I'm not expecting much in terms of moving additional hardware. It's a high-end accessory that costs as much as the system itself, and despite all the hype I think it will have limited lasting appeal. The first-person perspective naturally limits the variety of games that are really suited for VR, and I don't think it'll have enough in the way of added value to justify its price nor its existence in the long term. I think it will sell mostly to a smaller segment of gamers with deeper pockets than average and who already own the systems, and that it'll end up facing the same fate motion controls did: a fad that has an initial "Wow!" factor but is mostly a gimmick that isn't compelling enough on its own to warrant being a permanent or at least long-term fixture in gaming.

I fully disagree with the first-person perspective limiting the variety of games. 3rd person perspective works just as well if not better. Wayward sky (point and click adventure), Bound (3D exploration game controlled in 3rd person, camera steps along), Robot rescue playroom vr demo (3D platformer camera moves smoothly along with the character you control), Tethered (RTS game with fixed view points, control by looking) all work extremely well.
(Tethered review http://gamrconnect.vgchartz.com/thread.php?id=221948 )

It's the entry price holding it back for now, but a lot of genres open up in VR imo. Ironically it's the first person perspective games that are lagging behind at the moment as the game devs are so afraid of getting the motion sickness label that they're limiting your movement options. However the experience is second to none. It's very difficult to market though. Yet I think a streamlined bundle reducing the wire mess could make an impact in 2 years.



Turkish on 28 October 2016

You really dont need any charts to explain why it was so long. I can explain it in 1 sentence:

PS360 cost their owners billions of dough, 360 had the RROD fiasco and PS3 wasn't profitable for years, platform holders' return on investment took longer than anticipated, going HD also slowed down things.



LadyJasmine on 28 October 2016

I think something to remember is people kept playing thier PS2 till about 2010.

That is why it will never go down in consel sales ever.



DonFerrari on 28 October 2016

As always a brilliant thread from you.

Considering the points you brought and the intention of Pro and Scorpio to prolong the life of the gen I do expect it to be longer than PS2 era but smaller than X360 era... unless of course the Pro and Scorpio provide a big bump, which I don't expect.

Could do a similar analysis for SW, because on that front I believe this gen is considerably higher.



duduspace11 "Well, since we are estimating costs, Pokemon Red/Blue did cost Nintendo about $50m to make back in 1996"

http://gamrconnect.vgchartz.com/post.php?id=8808363

Mr Puggsly: "Hehe, I said good profit. You said big profit. Frankly, not losing money is what I meant by good. Don't get hung up on semantics"

http://gamrconnect.vgchartz.com/post.php?id=9008994

Azzanation: "PS5 wouldn't sold out at launch without scalpers."

Kerotan on 28 October 2016

Brilliant thread.

Can I make a request? Can you do a ps3 vs PS4 Japan sales comparison thread? It's a very close battle and an exciting one too. And with weekly mediacreate numbers we can get a very up to date comparison.