Diagnosis: Sickboy
On the surface, this week would seem like it’s been a good week for Sony’s
PS Vita handheld. The showcase put on by Sony during Gamescom this week was a
good sign. New IPs were shown. The Cross Buy promotion is an interesting idea if
consumers have a PlayStation 3. We saw the Vita used as a controller for the
PlayStation 3, not terribly dissimilar to what we’ve seen from Nintendo's
upcoming Wii U. We
finally got to see Call of Duty: Black Ops Declassified in motion and found out
that it’s still coming this year. We found out that a few more bundles are
coming, with games included.
These are good things.
They show that Sony appears committed to the handheld, despite sales that
have been disappointing to say the very least. Fewer than 50,000 units of Vita
hardware sold in July, and Sony hasn’t yet been able to crack the 700,000 mark
since launch. About 33% of total sales came from the first two weeks. It’s been
a long five months since. $250 is perceived as expensive to consumers now for a
dedicated video game portable device, and that’s not including the extra expense
of an all-but-required memory card and then buying a game or two. Shuhei Yoshida
from Sony Worldwide Studios all but confirmed this week that Vita will not see a
price cut in 2012, so the hope for a price cut to close the gap with 3DS has
vanished for the near-term.
Buying games has been an exercise in frustration for potential Vita owners
and current ones alike, because there have been so few new releases after a
fairly impressive launch slate. It’s hard to justify buying hardware that has so
very little going for it currently. Sony attempted to rectify this by showcasing
games this past week, but its decision to not focus on Vita more significantly
during E3 and the obviously small selection of games currently available have
led to uncertainty and lack of interest.
I’d like to think that Sony’s showing this past week is a step in the right
direction for hardware sales going forward, but that’s simply not the case. It’s
more reassuring for current owners of Vita hardware that there’s some kind of
future for the platform, but there really isn’t anything here that screams to
potential consumers that they need to spend the money on a new device. Cross Buy
sounds good, until consumers realize that memory card space for digital
downloads will become an issue and force consumers into a choice to either
delete data for free space on their current memory card or to spend money on an
additional one. The new IPs are interesting, but don’t seem to have a
wide-reaching appeal and likely will hook more core consumers than casual ones.
Even Call of Duty isn’t necessarily a home run, given multiplayer limitations
and the fact that it’s been farmed to an outside studio (Nihilistic Software) for development.
The chances of a turnaround for the Vita in the next 4 months, as we saw for
the 3DS around this time last year, are slim. This does not mean that the
platform is “dead” by any means, but the continued high cost of entry and likely
weak-to-moderate sales could affect how third-party publishers view the platform
and decide to allocate support. It’s a risk at this point, with likely return on
investment being low. This will mean that the onus will be on Sony to continue
to offer incentives and support to those publishers to entice them to continue
supporting the device. Sony is also going to have to continue to work hard at
delivering quality first-party efforts for the platform. That means a mix of old
and new IPs.
We’ll have to see what 2013 brings. Perhaps the economy improves, or Vita
finally gets its killer app to entice stronger sales. Or... perhaps the Vita
will continue to struggle against the 3DS and the growth of tablets and
smartphones. For the rest of 2012, though, my projections remain bearish, with
total unit sales of between 1.1-1.25 million units for the year versus a
conservative minimum of 3 million units of 3DS over the same period.
