NightAntilli said:
phisheep said:
Darth Tigris said: Can someone please explain to me why the 1 year head start makes a difference? I'm doing several things at once right now and just can't wrap my head around it. I thought I remember reading that the ratio is supposed to go down as a console gets older (I think that was a VGC article if I'm not mistaken). |
I’ll try – but it isn’t the easiest of things to get your head round.
First of all, remember we are talking about the attach ratio/tie ratio. That is,
the number of software units sold divided by the number of hardware units
sold. We’re not talking about absolute hardware or software numbers
(which obviously go up with time).
Now, just for ease of understanding. Let’s take a fanciful scenario.
Suppose there are two consoles, X and Y, both equally popular, both with
similar games available, and everyone who has either console buys a new
game every month.
And suppose console X has been out two years and console Y has been out
one year.
And suppose both consoles have been selling at a consistent rate since launch.
As console X has been out for two years, the average console X has been in
the users hands for 12 months. So they’ve bought 12 games. So the tie ratio
is 12.
As console Y has been out for one year, the average console has been in the
users hands for 6 months. So they’ve bought 6 games. So the tie ratio is six.
And the only difference between the consoles is that X has been out twice as long,
which gives it twice the tie ratio.
That make sense?
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You're not doing what you said. You would have to do, 12/12 =1 and 6/6 =1 also.
|
Um, yes I am.
If (on average) each console has 12 games then software/hardware is 12/1 which is 12. That's the attach ratio/tie ratio which is the headline figure that people get hung up on.
If instead you divide 12 (games) by 12 (months) you get 1, true. That gives you how often people buy games for the console, which is a much better measure and the one I prefer, but isn't the one that makes the headlines. And it doesn't explain why the tie ratio depends on how long the console was out, which is what I'm trying to explain.