360 is doing great, its numbers are so high due to thos so called "shortages" last Q1 (what WAS that all about?)

I think the PS3 will get a $50 cut in september and I reckon Microsoft will follow suit, 360 still selling slightly ahead.

Going to be an interesting year.

Have you updated those charts yet? the ones you do at the end of every month.

kowenicki, in your sig you say 'E3 will be hilarious'...what do you mean by that?

Those year end totals look crazy indeed. If that comes to pass so much for the ten year plan.

Ouch at the PS3 if those trends continue. I think the Wii is exactly where it should be at, EOY. X360 is a little too high, and the PS3 is a little too low. But it'd be one heck of a discussion if the X360 was beating the PS3 by 16 million at the end of the year!

Well, I think the biggest thing(s) to take back from such trends, are to look at what is causing the big YoY changes.

Wii: The big advantage it's having this year is a total lack of supply constraints. We rarely see it fluctuate on a weekly basis, lending to the idea that supply is pretty steady, and is selling about as good as it can at this price. Because of the increased supply, we should expect it to continue to see robust sales at this +40% pace for awhile. The big question will be later this year: the Wii saw pretty good increases in 2008 in terms of supply. Can demand keep at this fever-pitch? I think that the Wii should see slightly lowering YoY increases the rest of the year, as the $250 price point gets saturated. However, I don't expect this to hurt it much. Nintendo may move to drop the price of the Wii in Japan, it's worst market. That could give it new life in Japan, which is the only bad region for the Wii.

X360: Obviously huge spike in sales, even more so than the Wii (in terms of % increase). The big note here is the fact that the price drop in September has fueled steady YoY increases, especially in Europe. Japan is also doing very well thanks to new, great-selling games. However, as the year progresses, it will be difficult for the 360 to maintain it's forward momentum, once September comes. The X360 could see that 60% YoY increase *if* Microsoft took steps to assure it's continued 'dominance' by lowering the price, or a PR/Marketing blitz when the Slim comes. I expect the 60% YoY increase to stay steady until September, then see it reduce to similar numbers till the end of the year.

PS3: Pretty bad, and will get worse. Last year, it was seeing strong YoY boosts thanks to the price drop. Now it's dropping in the absence of a price drop, with fiercely competitive prices on the 360, and continued popularity of the Wii. The Playstation 3's fate, on a YoY level, will souly be determined by if and when Sony drops the PS3 price to a more reasonable level. If it keeps at the atrocious $400 price point (which, as we can now tell, never worked for MS, either), I expect it to drop further and further down YoY, especially when last year's big hitter, MGS, is nowhere to be seen. If Sony is smart, they will launch GT5 later this year and the PS3 at the $300 price point. If they did such, they may see flat sales (YoY) vs. last year, and a great 2010. Otherwise, this year may be the last year of the PS3 from a viability standpoint. Sony stands to falter into the 'irrelevant' category like the Saturn and N64 did late in the PS1's lifespan. But unlike Nintendo or Sega did, back then, Sony holds all the cards, not the 3rd parties.

So it really comes down to who makes what moves. The YoY increases are not static. They can be greatly effected by good, and bad, moves. I still stand by my 80/42/31 prediction.

The 360 over this Christmas period will not sell 59% more units, and the PS3 wont sell less. Those expected figures are optimistic for the 360, and maybe rather pessimistic for the PS3. This is through no fault of your own however, Its just that with an expected Price cut, the possibility of GT5 and a probable slowdown of Xbox 360 Christmas sales, I expect that gap to be quite a bit closer.

kowenicki, you think the 360 will extend its lead over the PS3 to 10 million this year?..if you do, which month will it happen?

I would like to echo mrstickball's comments, as I see a very similar situation playing out. Wii continues to do crazy numbers due to lack of supply contraints, and it should be able to maintain about a 40% increase year over year simply by releasing a stream of new software late in the year. (I mean, Wii did great numbers in the last two quarters of 2008 without releasing hardly anything big on the software side.)

360 won't be able to maintain 60% increase year over year, simply because the sales were so good after the autumn price cut last year. Still, I predicted in January that this would be an excellent year for the 360, in both hardware and software, which is being borne out thus far. This will be the year that the 360 cements its second place status (although Sony fans will continue to argue for a miracle comeback for the PS3) by pulling 10m+ ahead in hardware.

I see PS3 having a rough year. The only game that would noticeably affect hardware sales is Gran Turismo, and that's not coming until Christmas, and most likely not until 2010. Notice how Killzone 2 did great software sales, and did nothing to attract new users by moving hardware. That's kind of the year I see ahead for Sony... The only other thing they can do is cut the hardware price, which ensures that Sony will never make a dime off of the PS3. Are they willing to go there? I think Microsoft is hoping that Sony does try slashing prices, so Microsoft can undercut them on price yet again and continue to bleed Sony dry of capital. Anyway, by the end of 2009, it will be clear to just about everyone that PS3 will remain in 3rd place permanently.

I wrote down 80m/40m/30m at the start of the year for hardware, and I'm still feeling pretty comfortable with them.

Sulla, but do you agree with mrstickball when he says this may be PS3´s last year from a viability standpoint?

And do you think the system is still in the risk of becoming 'irrelevant'?

I can't say I agree with your predictions. For one, it's quite clear that Killzone 2 did in fact move a fair amount of hardware. Not to the extent of Metal Gear Solid 4 or Halo 3, but certainly more than any game released on 360 last year, and I think that's noteworthy. You also make two big assumtions in your analysis. One is that Sony couldn't profit if they cut price, and the other is that Microsoft would be willing and able to undercut them. Personally, I don't see either of these being true. For one, Sony is borderline profitible at the moment, particularly in Japan and mainland Europe. With the upcoming 40nm hardware revisions coming later this year, likely in the summer, Sony should be able to sell the PS3 at $299 worldwide without being any worse off then they were in 2008. However, with increased hardware sales comes increased software sales and with huge 1st party releases such as Gran Turismo 5, Ratchet & Clank Future 2, Uncharted 2, and God of War III, much if not all of Sony's hardware loses would be offset right off the bat. Sony could also periodically release a premium bundle similar to the 160GB Uncharted bundle at $399 to help offset losses. For your second assumption, I just don't see Microsoft cutting price to match Sony if they cut price. If Sony only cut price by $50, then PS3 still likely wouldn't be capable of outselling 360 this Christmas or even in the new year. It'd likely be a waste of money on Microsoft's part to match Sony's cut and companies like Sony and Microsoft NEVER cut price unless they need to. On the otherside of the spectrum, if Sony took the much more likely course and cut price by $100, then Microsoft really couldn't afford to match them. If Microsoft cut the price of the 360 by $100 later this year, they'd likely to cutting into the base production cost of the system, which means they'd be selling the system at a permanant loss from then until they take it off the market. And with Microsoft going on record about keeping the 360 on the market much longer than the original Xbox, that could amount to upwards of 2-3 years. Microsoft isn't that self-destructive. They won't conciously throw away all profitiblity this generation just to stick it to Sony this Christmas.

In all likelyhood, the price of the two consoles in Q4 will be $399 for the PS3 and $149 for the 360. A $100 cut from Sony and a $50 cut from Microsoft. At that price difference, PS3 will likely outsell 360 this Christmas and greatly outsell it through most of 2010. 2009 so far is, and will continue to be similar to 2007 and 2010 will be similar to 2008. History will repeat itself.