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Forums - Sales Discussion - Switch can't/won't outsell DS because...........

Shadow1980 said:
The_Liquid_Laser said:

The main problem with this argument is that you can compare the DS to the first three years of the PS2 and get a similar story.  

Data has not yet shown when Switch will peak.  If we are going by sales so far this year, Switch has not peaked yet comparing YoY Jan-Feb sales to last year (worldwide).  Data has also not given us an indication yet of what Switch's legs will be like.  Going by data alone is going to give an incomplete picture.

On the other hand we can measure market size.  If you combine all of the handheld gamers and all of the home gamers, then that is a huge potential market for Switch.  It only needs to sell to about 55% of that market in order to beat the DS.  On top of that the home version is actually more popular than the Lite version.  Home gamers are going for Switch in a big way and handheld gamers love it too.  Switch has a lot more growth potential than even the DS had.

That is why saying the Switch can't possibly outsell the DS is calling this way too early.  

What's the PS2 have to do with this?

In any case, we can look at older systems to look at trends to see when a system experiencing a period of growth might pass its peak and enter its decline phase (note: the N64 and 3DS were omitted from these charts because they peaked within their first year).

Except for the GameCube (for reasons I'll explain in a bit), every Nintendo system had a period of at least a few quarters where they experienced year-over-year growth (with the DS it was 14 straight quarters of YoY growth, the best such streak for any system ever), but that growth slowed and eventually flipped over into YoY declines. At no point in any Nintendo system released in the past 20 years have we seen a Nintendo system experience a period of growth, then some declines, and then another multi-quarter period of significant growth. It just doesn't happen. Once we see two or three quarters of YoY declines, that has always heralded the start of the terminal decline phase of a Nintendo system's life.

The GameCube was an odd duck because it had a price cut very early that gave a good boost to Q2 sales, but that had petered out, hence the YoY declines in Q2 & Q3 2003. Then it had another price cut in Sept. 2003 that gave Q4 that year a big boost, but that boost was even shorter-lived that the boost caused by the price cut.

Going back to the Switch, we can see that it already has had five straight quarters of growth. Except for a brief reversal in Q3 2019 (thanks to the release of the Lite), we've seen a general downward trend in the amount of YoY growth. While we don't have actual numbers yet, the Switch is known to be down already in January, only its second month where it was down YoY since Nov. 2018 (the other month was July 2019). Now, January could just be statistical noise, or it could be a result of Jan. 2019 having gotten a residual boost from Smash. It's possible that February and March could make up for it by being up YoY. I already admitted in my previous post that it's still too early in the year to tell for sure if the Switch is post-peak or not.

However, we do know the following two facts:

1) The Switch's YoY increases have been declining and, regardless of the reasons, Nintendo systems experiencing a multi-quarter growth period see said growth slow and then flip over into YoY declines, which initiates the post-peak period of the system's life.

2) The Switch's YoY increases have not been of the same magnitude of growth that the DS experienced. It's not even close. They're not even in the same league as the Wii's YoY increases during its growth period. They're more in line with those of the GBA.

Based on these facts, I simply do not see a multi-year increase in Switch sales in the cards (there's also no precedent for a multi-year period of flat-sales for Nintendo systems). And without rapid growth over the next two years, that gap between the Switch and the DS will grow and fast. Is it possible that we could see continued and significant growth out of the Switch? Yes. Is it likely? No. Could it potentially meet or beat the DS? Not a chance.

And as for the total size of the market, that's such a nebulous quantity as to be useless. After three generations, we can surmise that the total combined global market for PlayStation & Xbox is in the 170-180M range, something that's been pretty damn consistent so far (even the final WW total for combined PS4+XBO sales will likely end up in that range). But when it comes to Nintendo, they've been highly volatile. They went from the GameCube (bad sales) to the Wii (good sales) to the Wii U (bad sales) and now to the Switch (good sales). Even their handhelds have not shown much consistency. And this is all before taking into account regional differences in sales. And counting the home console and old handheld market separately is even less useful. We have only a vague idea what the overlap between Nintendo home console owners and PS/Xbox owners are, and we have even less of an idea what the overlap between what, say, Wii and DS owners were, or DS owners and PS/Xbox owners.

We have no idea that Nintendo's total potential market size is, and it really doesn't matter. The only thing that matters is what the sales data says, and as more time passes we'll start to get an ever more clear picture of what the Switch's trajectory will be.

Here is an article on the year-on-year sales of the Switch. I calculated it and in 2019 YoY covering the same time period, Switch's sales grew 17%. In 2020 however Switch's sales grew 21% YoY over the same time period despite having a weak Jan-Feb so far, which shows that the Switch is still growing globally in sales.

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I think the main reason why the Switch won't catch up to the DS in sales is because the Switch doesn't really have that casual appeal like the DS fan at the time. The DS released at a time before the smartphones and tablets became mainstream and most games on phones at the time were limited and shit with no real app store. At the time the DS was really the only legit option for casuals to play legit casual games like Brain Age and Nintendogs, and the high sales of those games prove how much of the DS install base were casual gamers. The DS also appealed to casuals because of it's touch screen capability, which was a feature that was very novel and interesting to casuals when it released in 2004 and was something that most mainstream cellphones couldn't offered at the time. The DS pretty much filled the gap for the casual gamers in the market before smartphone games took over.

The Switch doesn't really have that casual appeal like the DS had, most of the casual gamers who got a DS who want to play simple cheap games have completely moved on to mobile gaming and they don't feel the need to spend 300-200$ for a Switch when they're happy with gaming on their smartphones. And while the Switch may be appealing to gamers since you can play and detach joycons and play full console games anywhere on the TV or on the go, the Switch doesn't really have that appeal to attract casual gamers like the DS and Wii did where their game changing innovation and simple games filled the gap for casual gamers before smartphones hit. Nintendo has tried to appeal to more casual gamers on the Switch with stuff like Nintendo Labo, Ring Fit Adventure, 1-2 Switch. However, those games never really caught on as Nintendo had hoped as Nintendo Labo likely ended up selling disappointing for Nintendo since Nintendo didn't even mention Labo's sales in their latest financial report and while Ring Fit was a mild success selling 2.17M in about 2 months, it still would get outsold by Nintendo's more hardcore titles released around the same time period like Luigi's Mansion 3 selling 5.37M in 2 months and Links Awakening selling around 4M in 3 Months. And 1-2 Switch ended up being one of the most forgettable titles on the Switch as majority of it's 3M sales came within it's launch period where 1-2 Switch released with little competition from other games and usually early buyers purchase everything. So it's clear that those games haven't really caught on to the casual gamer crowd that the DS had as it seems like casuals aren't willling to spend 300+$ just to try out labo or Ring Fit. Maybe Animal Crossing will help the Switch appeal to the more casual crowd which I wouldn't doubt it much since Animal Crossing sold extremely well on the 3DS, selling nearly 13M copies. But even then I don't think Animal Crossing will be enough to appeal to the casual audience entirely.

The Switch won't outsell the DS because it's not designed to.

The DS was designed to be an individual users console. The Switch is designed to be either an individual user or multi-user console.

A family might each have had their own DS but are less likely to each have their own Switch. This puts the Switch reach between that of a home console and that of a dedicated portable console. Though the introduction of the Switch Lite does move it a little closer to the dedicated portable reach.

Massimus - "Trump already has democrat support."

I've not ruled it out to begin with that Switch can outsell the DS and I have yet to see anything that points in the direction of it being impossible. Sales comparisons to previous Nintendo consoles usually forget to account for Switch being Nintendo's only console, so one key assumption that is commonly wrong is that Switch is bound to the same or similar sales trajectory. After three years of Switch it's already clear that the sales curves of most older Nintendo consoles have to be ruled out, so the only good dataset that is left to compare to is the one of the DS.

How Switch can beat the DS is as simple as tossing the old rules for the length of a console lifecycle out of the window. When Sony and Microsoft began to run longer cycles than six years, everyone was fine with it. But apparently the thought that Nintendo can go seven, eight or even nine years is preposterous. However, what if Switch went for more than six years like Nintendo intends to and backs up with all of their actions so far? Then you have a realistic scenario where Switch begins to gain on the DS on the backend.

Switch becoming a personal console will play a major role. Switch Lite is a step in the direction of one console per person, but its sales haven't been impressive so far. That isn't a surprise to me, because we are still years away from the point where the hybrid SKU reaches its saturation point; there's no big need for secondary and tertiary Switch units in households when there has yet to be the primary unit installed. Nevermind that the Lite sells at a premium price for a personal console at $199, so there are still a few demand levels to unlock below that price; after all, the 2DS hit sub-$100 with a game included eventually, although it's not that good of a comparison because the 2DS had a shape that was widely undesirable which in turn limited its sales potential.

Switch has sold ~49m by the end of 2019, add another three years of ~20m per year and the total is already at ~110m. That would be too low to beat the DS, but only if Switch's lifecycle is tied to historical rules. Should Switch get seven or eight years, the likelihood to outsell the DS becomes a lot more manageable. There's post-successor support too, just like the 3DS received first party games into early 2019 because Nintendo had to cover the lower price brackets in the console market, something that the $300 Switch couldn't do, just like the Switch successor won't be able to either. So ~10 years of first party support or close to it should be expected for Switch.

In any case, those people who keep comparing Switch, Nintendo's only console, to previous console lifecycles where Nintendo always had to support two consoles concurrently will be proven wrong time and time again. Because now we are approaching the time where many previous Nintendo consoles had declining sales because Nintendo's top development teams had to focus on a different console, whereas Switch continues to receive the attention of all the top teams. This means that Nintendo will continue to release multiple blockbusters each and every year, and it doesn't need to be explained that Nintendo software sells Nintendo hardware.

Legend11 correctly predicted that GTA IV (360+PS3) would outsell SSBB. I was wrong.

A Biased Review Reloaded / Open Your Eyes / Switch Shipments

Because it isn't DS.

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

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"

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

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You know what? I'm not so sure anymore Switch can sell over 20 millions this year, we have Corona virus and Zelda is probably not releasing this year.

Animal Crossing alone is not enough to drive sales above 20 millions IMO, could be wrong.

Dulfite said:

Operating Income/Profit is the ONLY thing that matters. At the end of the day, if they have more money in their bank account by selling less but also consolidating their teams down to cost effective sizes and reducing redundancies, it's a win. Selling 100 mil of one device and one set of teams you have to pay salaries to and advertise for is better than selling 250il devices where you have to pay double on everything due to different games/markets if they have more profit at the end of the year.

Nintendo has been building towards the long game (10+ years from now) while we all obsess over the short term game. They know what's coming. Consolidation and differentiation are the only things that will keep people buying their hardware when the legion that is Microsoft/Amazon/Apple/Google has their own cloud streaming platforms. Unless Sony drastically changed their model I don't know how their gaming division can survive ten years from now. Who will want to buy a box that can only play on a TV when they could cloud stream it? I'm not speaking about now but rather the 2030-2040's when cloud gaming will actually function properly.

Yes Sony is doomed.

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

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"

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

I honestly don't see the Switch outselling the Nintendo DS, but I think it'll definitely outsell the 3DS. I think there's a chance it will outsell the Wii.

Mr.GameCrazy said:
I honestly don't see the Switch outselling the Nintendo DS, but I think it'll definitely outsell the 3DS. I think there's a chance it will outsell the Wii.

The 3DS is a given at this point. It is at 75m but it is not sellin a lot this is probably the last year. Swicth is just over 50m so by this time next year should beat 3ds, but even if it doesnt it will do it by next years holiday season

People always try to rationalize why some consoles did so amazing or so damn bad but after a certain amount of work you do, it's a random mix of people's emotions and some factors you can't control. That's why the first year, in my opinion, is so important because that's when you control the narrative and after that it becomes really hard to change direction. And the direction the switch is set on is to be successful but not as successful as the DS unless Ninty does something really amazing.

Just a guy who doesn't want to be bored. Also