360 outsells Wii for XMas

[Murgos]

Not a surprise to me but I thought someone here might be interested.

The figures, which relate to sales from the start of November until Christmas Eve 2006, are still very flabby and their firmness is not helped by a definition of ‘sold’ but they will make startling reading for Sony.

Xbox 360: approximately 2-million

Wii: approximately 1.8-million

Sony PlayStation 3: approximately 750,000

http://news.spong.com/article/11408?cb=553

[Nebu]

How much of this can you attribute to distribution issues?  I saw plenty of stock on X360's while Wii were sold out most places.  i.e. if there was an unlimited supply of both, would the Wii have outsold the X360?

[Velorath]

How much of this can you attribute to distribution issues?  I saw plenty of stock on X360's while Wii were sold out most places.  i.e. if there was an unlimited supply of both, would the Wii have outsold the X360?

Given that these are just the US numbers, I wouldn't be surprised if the Wii did outsell the 360 worldwide.

[Yegolev]

I assume that Wii and PS3 sold out.  They sure as fuck did around here.  Not sure about 360, I wasn't actually trying to get one.  If I had wanted to, I would not have had a problem with it.

[stray]

The PS3 will probably be selling like hotcakes by the time the next generation of MS and Nintendo consoles come out. Heh.

They really fucked up big time though. They marketed to the wrong gamers -- Ones that barely exist at that.

I'm also of two minds about the Blu-Ray. They'd be kicking ass right now if they didn't include it...And yet, the time is almost ripe for games to have that kind of capacity.

[HaemishM]

How much of this can you attribute to distribution issues?  I saw plenty of stock on X360's while Wii were sold out most places.  i.e. if there was an unlimited supply of both, would the Wii have outsold the X360?

I'm thinking it has a lot to do with distribution. Anecdotally, every place down here that got Wiis sold them out completely and still had people turned away. 360's were in plentiful supply, however anywhere you looked. Hell, I still can't find a Wiimote for sale around town, and even Wii Points cards have disappeared.

[Strazos]

Same around here. My store apparently got 3 Wiis in today, and sold them in about 5 minutes. Still can't find Anything else Wii related, besides memory cards and actual games.

We have some PS3s.

[Velorath]

It seems that those numbers may not be entirely accurate.

[eldaec]

Same here, Wii sold out, 360s ten a penny.

Also, plenty of anecdotal reports of nongamers who might have bought a Wii for novelty value.

[Big Gulp]

Same here, Wii sold out, 360s ten a penny.

Also, plenty of anecdotal reports of nongamers who might have bought a Wii for novelty value.

You're in the UK, aren't you Eld?  Did you guys get the Wii a couple weeks after us or was it a simultaneous release?

[HaemishM]

The Euro release was a few weeks after the US/Japan release.

[stray]

PS3's shipped 1 million to the US by the end of December.

Kind of encouraging. Not as bad as it seemed at first.

I imagine they'll start picking up now that the eBay sellers are pretty much out of the picture (it's what held me off at least).

[Roac]

PS3's shipped 1 million to the US by the end of December.

Kind of encouraging. Not as bad as it seemed at first.

I imagine they'll start picking up now that the eBay sellers are pretty much out of the picture (it's what held me off at least).

That's shipped, not sold.  By comparison, Nintendo states they have met their goal of shipping 4 million.  Anecdotally reports are the Wii sells out as soon as it arrives, whereas many PS3s are sitting on shelves. 

[Yegolev]

Also by comparison, I didn't see any Wii in Target, Wal*Mart or Sam's Club this past weekend.  I didn't really look for anything else (except UT2K4), but I believe Sam's had sold out their 360s.

[naum]

Still looking for a Wii... ...a couple of co-workers, on a whim, at lunch, called around and a local GameStop got two in and they just happened to call as they came in snagged them both...

[HaemishM]

So if Sony shipped 1 million units, that means they lost $150 million because of how much they are losing on each console. Only in the console business (or the MMOG launch business) can losing so much money be a positive thing for a company.

[Murgos]

I still don't buy that those numbers indicate actually loss to the company.  I think it's got to be opportunity cost or some other accounting who-ya.

[HaemishM]

It's still a number that feels like a kick in the chao sack.

[Roac]

It's still a number that feels like a kick in the chao sack.

Yes and no.  Depends on what Murgos or you are looking for by "actual loss".  Sony sees it as an investment, and one that they won't recoup for a while.  They do plan to recover costs though, both in long term console sales (5+ years), movie sales, game licensing, and hardware licensing.  They have spent a LOT of money both on R&D and first run production, but it's not just for the PS3.  They're also making Blu-Ray for its own sake, for PCs, for licensing, etc and intend to use it to help gain some control over all physical multimedia content.  The cell microprocessor is going into more devices than just the PS3, and you can bet Sony is getting a piece of that pie.  It's more complicated than spend money for the PS3, sell PS3 to recoup cost.  I doubt anyone at Sony is scared right now, although they should be worried about their margins midterm.  I think they're positioned very well long term, with the PS3 being at worst a nasty stumble.

[Murgos]

What I mean is that I think there is some actuarial who has a table that shows that if they had broken up production of components and sold them independently and invested R&D money differently that they could be showing a certain amount of pretty much guaranteed profit above what they are making per unit now.

To a company like Sony (or any major corporation) that counts as a net loss of income and a risky gamble even though they are probably making money atm.  I am also sure that Sony has run the numbers that show HUEG MONIES if they sell x# of PS-3s with crossover into Blu-Ray, game and other profits.

What I mean by actual loss is that the cost of research & production & distribution of a PS-3 > income of a PS-3 sale for some reasonable number of PS-3s sold (like 3 million which they can expect to hit even if the system is a total flop).

[stray]

The only thing I think they could have dropped without effecting games too much are the memory card slots in the 60 gig model, and Bluetooth (the main purpose being that they wanted to some motion sensing functionality, not necessarily wireless...Motion isn't that necessary, and wireless could have been done another way).

Dropping the Blu-Ray would not have been a good option. The Xbox already has multi-disc games -- and the good games that are on there are barely breaking 12 hours. That's not exactly ideal when their console is only a year old.

Besides that, when the 360 came out, it was estimated that it took $715 to make. Not any better than Sony really.

Historically speaking, it's MS that has blown the real money. Why doesn't anyone ever talk about that? At the end of the original XBox's lifespan (an all too short one I might add), they lost over $4 Billion. They never made a profit at all during the entire time either. Even if the 360 starts really making a profit this time around, it'll take more than that to get their game division as a whole on step with Sony and Nintendo.

[Velorath]

Historically speaking, it's MS that has blown the real money. Why doesn't anyone ever talk about that?

Because MS can afford to lose a fuckton of money and Sony can't.

[stray]

No, they can't. It's all relative. Either way, a company like MS wants to grow. Not shrink.

[Velorath]

No, they can't. It's all relative. Either way, a company like MS wants to grow. Not shrink.

They wanted to buy a foothold in the market.  Any company in the future that wants to get into the console market should probably expect to pay a similar amount.

[stray]

Haha, so Microsoft is providing a business model now? 

[Yegolev]

Haha, so Microsoft is providing a business model now? 

It's a model that apparently works.  They have more free cash than any other corporation that I am aware of, mostly because they didn't have anything to invest it in if you ask me.  Now they have a vast pit to toss it in.  If it pays off, people will call it an investment.

[HaemishM]

And if it pays off, the XBox360 becomes your set top box for Tivo, Internet and purchase of all sorts of downloadable media (not just games) as well as the DVD games you buy at the store. Microsoft lost $4 billion to make themself a player in the settop box market and they have done so quite well. To beat or equal Nintendo and threaten Sony is a pretty good feat, profit or no.

[Jeff Kelly]

To beat or equal Nintendo and threaten Sony is a pretty good feat, profit or no.

It took them 4 BILLION dollars just to get on equal grounds with sony or nintendo, that is neither a good business practice nor a good investment. It just shows that Microsoft and its OS monopoly are a real threat to any industry that Microsoft might be interested in and just how fucked up the console market really is.

Most companies out there don't even have that kind of money as liquid assets let alone as money to burn. The greatest thing is that they achieved a complete marketing turn-around. They went from devil's incarnate to baby jesus just in one generation and most of the fuck microsoft crowd even on this board has turned to raving fanbois telling everybody just how great the 360 is. WTF?

The only thing that microsoft can is throwing money at problems until they disappear, that is no feat. It would have been if they had achieved the same with 40 million loss or with a slight profit.

[Margalis]

MS will never be a significant set-top box player, especially not with thier latest infatuation with DRM and screwing the consumer.

Apple is going to eat their lunch in the living room.

[Roac]

MS will never be a significant set-top box player, especially not with thier latest infatuation with DRM and screwing the consumer.

Apple is going to eat their lunch in the living room.

The XBox as a media center is doing reasonably well.  Also, the 360 accounts for 22% of all HD players.  Sony has 58%, but there is a huge difference; everyone who owns the 360 HD-DVD willingly sought out hi def movies.  Some, and perhaps a significant number of PS3 buyers don't care about Blu-Ray, at least yet.  They will supposedly turn profit in a year or so, based on current trends. 

Microsoft is following a similar strategy to Sony, where the goal is to try and buy their way into a niche.  It can be done by either company, but historically Microsoft has run this strategy very, very well.  Moreover, if you notice they are keeping their options open by not locking themselves into either HD-DVD or downloadable content; they want to remain flexible enough to go wherever the customer wants.  Microsoft doesn't really care about HD-DVD, unlike Sony and Blu-Ray.  Their main reason to back it is of course because it's not Sony, but they could very well switch or go to a universal DVD player in attempt to one up Sony.  With the aweful publicity that Sony has been getting over the PS3, it's very realistic for MS to pull ahead in the console market and be positioned well for any media box role.

Apple is an unknown in this.  They have gotten pounded in the computer market (and have gone so far as to remove that word from their corporate name), but have always exceeded in multimedia.  Their company is virtually run on iPod/iTunes anymore, and there's some worry that they've relegated themselves to a (very profitable) one trick pony.  Thing is, Apple TV is going to cost almost as much as a 360, except that it doesn't play games.  Although unproven and more costly, the PS3 has similar potential.  I'm personally wondering what their target demograhpic is.

[stray]

Some, and perhaps a significant number of PS3 buyers don't care about Blu-Ray, at least yet.

Uh... We're still in early adopter phase. 2 months in. Blu-Ray is a huge factor.

Your assessment would be true later when more of the mainstream buys it, but not now.

I hate to say this, but that it's biggest draw right now.

[Roac]

I said that some people who purchased a PS3 don't care much about Blu-Ray, not that it was unimportant.  It certainly is a significant draw for some poeple, just as it's unimportant for some others.  This is in contrast to the 360 HD-DVD, where EVERY buyer thought that format important because it's an exclusive buy.  Additionally, quite a few critics are pissing on Blu-Ray.  HD-DVD is moving inventory in the HD arena, which isn't moving much to start with.  Of course this is early adoption phase, and things could change.  Mind you, first imprssions are VERY important, but are not always the final verdict.  Again, that's why I said some PS3 buyers don't care yet.  Maybe they will in a year. 

But here's the real problem.  At the moment, the majority (80%+) of people who are in the HD market at all are console buyers, either the 360 or PS3.  Almost nobody is buying an HD player on its own.  The people with money to burn are getting more actual Blu-Ray players out there, but the movie titles that are moving are about even or with HD-DVD taking a lead.  Meaning, PS3 guys just aren't buying as much.  Blu-Ray players are not being used as much in the hardcore market, and that's significant because it's going to make it easier to get wider acceptance and earlier price drop on HD-DVD products, so that when mass market acceptance time starts to roll around, that's where they're going to go.  Remember, mass market tends to vote cheap.  Most people are going to think you a loon if you try to sell them a $1000 or even $500 DVD player.

What Blu-Ray has going for it is superior technology, and several very large companies that support it exclusively.  It almost certainly isn't going anywhere, because the consumer won't be given a choice but to accept it.  If half the movies you want to watch are only released on Blu-Ray, you're eventually going to have a player that can read Blu-Ray disks.  With the advent of players that can read both formats and DVDs that can host both formats, it may become a non-issue for the consumer, akin to DVD+/- stuffs.  That may mean it's not a loss, but it is by no means a win for Sony because it makes it difficult for the mass market to justify the initial higher cost (which will continue to exist for some time).

Which is to say, the 360 will remain plenty compeditive because Sony dropped the ball.  Sony is far from dead, but they're not the near the leader they once were.

[Yegolev]

Was it dusematic that said they key here is that HD-DVD sounds like DVD?  Blu-Ray does not sound like DVD.  BetaMax did not sound like VCR but VHS did.  People are dumb, you have to account for that.

[HaemishM]

Was it dusematic that said they key here is that HD-DVD sounds like DVD?  Blu-Ray does not sound like DVD.  BetaMax did not sound like VCR but VHS did.  People are dumb, you have to account for that.

People are dumb, cheap and want variety. The format which gets cheapest quickest, with the biggest selection of mass market movies and least amount of hassle will win. The mass market does not support two formats for its media. CD crushed tape: even though you can still buy tapes, your selection is probably limited by this point. DVD has crushed VHS and VHS crushed beta. You will not see the mass market accept both formats, they will go to one format over another and eventually the losing format will have to fold up, exclusives or no. Early indicators say HD-DVD is in the lead (at least to me) but we'll see.

As for the Microsoft model, it certainly isn't one to emulate, because who the fuck has billions just lying around to work with? But it has worked for Microsoft, and it's been the model they've followed ever since they got big and liquid. Buy or steal someone else's shit, make it better and profit. Where the 360 really has it over both the PS3 and the Wii is it's capabilites as an ONLINE media convergence device. The online component cannot be discounted. The Live Service is a fantastically designed piece of social software, while both Sony's and Nintendo's online services are cobbled together afterthoughts, despite their strong points.

The real product Microsoft is selling is Live. The console is just its vehicle.

[schild]

It's not really fair to compare the PS3 or Wii to the 360 due to Live. Let's strip Live away for a moment. Oh, shit, the 360 is still the best of the 3 AND has the best upcoming game list. Wait, Nintendo brought out 1 online game and the PS3 brought out some downloadable shit - oh, neat, there's the Gamerscore system. Microsoft still has the best system. They used that year they had and fucking made something of it. Microsoft isn't just selling Live. They're selling the whole damn package. And as an owner of all 3 systems, I'll say this: That Package is super fucking nice.