Better Ask Again
October begins the videogaming industry's busiest three month period of the year
as the lucrative holiday season - which is only just getting started - and the
launch of a new major hardware platform highlight the home stretch of
the final months of 2012. Naturally, there are still a lot of questions to be answered in the
weeks and months to come and weíll obviously have to wait for events to play out in order to
get the real answers, but until then I have my own projections for the Q4 cycle.
Bear in mind that my data and projections are based solely on physical sales in the
United States ONLY.
With so much interest about what's guaranteed to be one of the most
interesting and closely-watched sales cycles in quite some time, itís time to
consult my Magic 8-Ball.
1. Can Microsoft repeat its Q4 2011 dominance? AS I SEE IT, YES.
This holiday season has Microsoft clearly in the driverís seat once again,
and itís tough to envision a scenario where Xbox 360 sales for the fourth
quarter donít break the 2 million mark - and thatís a highly conservative
number. It would take a YOY decline of over 47% to fall below 2 million for the
quarter, and with the many of the most significant titles in the period coming
to the Xbox 360, a plunge that steep just doesnít seem plausible.
Halo 4 is the
crown jewel for Microsoft in the period, as the Halo IP has a sizable and loyal
fanbase and I expect advertising to begin in earnest as we get closer to the
launch date. Add the definitive version of Black Ops II, which will be the
yearís biggest-selling release, and the outcome seems pretty obvious to me.
I can still see a notable YOY decline for Microsoft in this period, possibly
more than 30% lower than Q4 2011. Kinect sales (and interest) have leveled off
and thereís some price point fatigue and a matter of saturation to consider.
Fortunately for Microsoft, Sony is spinning its wheels and Nintendo is likely
going to have WiiU supply issues, so the Xbox 360 is going to still be a
legitimate purchase decision for many consumers again this quarter. My best
guess is more than 2,500,000 units sold.
2. Will Sonyís new PlayStation 3 redesign
have any positive effect on hardware sales?
DONíT COUNT ON IT.
MMultiple explanations have been tossed around as to why Sony has decided to
maintain (or hike) the price of its PlayStation 3 hardware in its sixth season
on the market, but the truth of the matter is that Sony will be missing a golden
opportunity to make any significant impact in the biggest period of the year. A
smaller and lighter console should
equate to some sort of cost savings for the consumer, but Sony doesnít subscribe
to this theory. Sony is also lacking a significant Q4 exclusive release.
PlayStation All-Stars is a game that Sony wants us to think will generate sales.
Sony wants us to think that Wonderbook is going to be a winner. I donít buy
either of these scenarios.
Hardware sales for the PlayStation 3 may eventually spike early next year,
when more exclusives hit retail, but thatís going to be too late to justify the
still-expensive price tag. Microsoft has earned the right to maintain its
pricing by virtue of consistently strong sales performance. Nintendo can at
least claim that $300 is justified for a brand new hardware platform. Sony
doesnít have either of these defenses to use, and weaker YOY sales will result,
dropping to below 1.75 million units for the quarter.
3. Can the 3DS have another huge holiday season?
BETTER NOT TELL YOU NOW.
33DS was a monster last season, moving in excess of 2,600,000 units for the Q4
period. Bear in mind that there were two new Mario games released for the
handheld during the quarter: a new 3D Mario platformer and a new Mario Kart
release. Those were significant and recognizable games, and pushed the 3DS to
impressive sales numbers. This year, however, itís a different story. Paper
Mario: Sticker Star isnít as familiar to consumers as a more traditional Mario
release, as will be seen on the Wii U. Professor Layton is an IP which pulls
decent - but not huge - unit sales. These two games are not Super Mario 3D Land
and Mario Kart 7.
I do think that 3DS sales top 2 million again for the quarter, but I donít
think we see 2.6 million again. The release slate isnít as strong, pricing has
been static for over a year (and actually increased with the larger
3DS XL), and I believe that mobile
entertainment is attracting at least a share of the casual crowd that was once
in the DS ranks. So... ďhugeĒ is difficult to quantify. Over 2 million is
certainly quite good, but itís still less than last year.
4. Will there be a Wii U supply shortage?
SIGNS POINT TO YES.
IIf you wanted a Wii U this holiday season and preordered it, you did the
right thing. If you didnít preorder one and want one, either be prepared to pay
through the nose to get one or expect to be disappointed because supply is going
to be tight. I appreciate Nintendoís Reggie Fils-Aime coming out recently and
saying that Wii U supply is going to be ďsolidĒ. After all, with just a few
weeks left before launch, why would he want to kill interest from those who
The likeliest scenario is that initial allocations for launch on November
18th and through the rest of the calendar year will be very limited. Numbers as
low as 600,000 units for the quarter have been tossed around. I donít believe
that the number will be that low, but I do feel the need to scale back my initial projection of 1,500,000
units by at least 10%... and that could be an optimistic number. This looks
a lot like 2006 all over again, although my hope is that weíll see more than
1,100,000 units sold this time. In any case, Wii U wonít outpace the Xbox 360,
3DS, or PlayStation 3 in the period.
5. Can the Vita make any kind of late-year charge
towards relevance? MY REPLY IS NO.
WhWhile the promise of more games and a brighter future is being put forth by
Sony, itís not going to amount to much of a difference this holiday season.
There should be obvious improvement, but the bar isnít terribly high when you
look at Vitaís sales performance since launch, which itself wasnít particularly
impressive, and took months for Sony to completely sell through the special
First Edition bundles. Things really bottomed out in August, when not even
10,000 units per week were sold. The only way for Vita to go is up, but that
rise will be limited by a number of factors including 3DS, continued negative
pricing perception, still-slow software arrivals, and more.
Call of Duty: Black Ops Declassified may spark some interest, but $300+ to
play it will seem like a tall order. There are other games that are either ports
of console games or derivative titles, but the Vita
continues to struggle with an
identity crisis. Is it supposed to be a portable PlayStation 3? If so, why spend
$300 on it when you can get an actual console - with Blu-ray player - for the
same price? I just canít see Vita finding its stride this year. It will be lucky
to see 2 million sold LTD. Anything more than a million in the quarter is a