http://www.n-sider.com/articleview.php?articleid=501
The beginning of each console generation is a unique time for those who play video games. Its a time of winding down and cautious embrace. Yet for those that cover and create games, its the time when battle lines are drawn, every statement becomes subject to review, and every moment hung onto. Before a single game is seen, so called industry insiders, analysts, and even people a lot like me will take their sides and predict the next five years in vivid detail. Whether rose-tinted or cloudy and dark, the futures we extrapolate from the smallest tidbits of news both puzzle and amaze me.
I chat with a variety of people whose console allegiances contrast almost as starkly as the things they try to convince me of. I know one guy in particular who, just as hes done for the past five years, cant go a single conversation without trying to prove to me the impending super success of the Xbox 360 and how Microsoft has plans for a handheld and this and that. I, being a Nintendo fan, naturally assume my defensive role and proclaim that the Big N has a chance as well. Its difficult not to. Hell usually dismiss that and maintain that Nintendo should stick to handhelds and bow out of the console business.
I know just as many who seem to herald the PlayStation 3 as the next coming -- the future of video games. It was only a few short days ago that Sony even unveiled anything concrete about their launch and online plans. And by concrete I mean a few incredibly broad and all-encompassing statements. The company announced that the PS3 will launch simultaneously worldwide in early November 2006 (what a shocker ) and that it will come with a 60 GB built-in hard drive. Oh and there was a vague statement about some ultimate online service -- typical anti-Xbox Live hype stuff. Nonetheless, its what we dont know that will play the largest role. We dont know what the controller looks like at all, we dont know how much the system will cost, and we dont even know anything about the freaking games coming out for it, which is the one thing were supposed to be most excited about.
The same thing goes for Nintendo. We still know next to nothing about the Revolution. At E3 2005, Nintendo showed what its basic hardware shell looked like and announced that the system will be backward compatible with NES, SNES, N64, and GCN games. No games were shown, nor was the controller or any other details about the system. Then at the 2005 Tokyo Game Show in September, Nintendo teased the world, yet again, by unveiling its innovative controller, but showing the public no actual footage of it in action. Currently (pre-GDC 2006), we know that Nintendo is shooting for an early November launch in Japan and North America. Thats it. We dont know how powerful the system is or how much it will cost, and we have no idea what its launch lineup will be like. We dont even know how the consoles online service will work, what its going to be called, or how well purchase online games. The only thing we do know is that it has an innovative new control system and Smash Bros. 3. Whoopidy doo.
I can list the number of things we know about the PS3 and Revolution on one hand a piece. The only system we know anything about is the Xbox 360 and even its future is very much mired in the relative success of its competitors.
With the recent PS3 announcement fresh on everyones mind, Strategy Analytics, an independent global research and consulting firm, released its updated prediction of next generation console sales through 2012. Below are its predictions.
Cumulative Sales 2005-2012
Sony PS3 121.8 million
Microsoft Xbox 360 58.8 million
Nintendo Revolution 17.9 million
Combined Sales 198.5 million
Explaining the numbers, Strategy Analytics said the following:
"The PS3 delay will give Microsoft more time to win early adopters, but this was generally anticipated," notes David Mercer, Principal Analyst at Strategy Analytics. "Any further delays could seriously damage Sony's position as a consumer technology leader. Assuming the November launch takes place as planned, we still believe that the PS3 will prove to be the dominant next generation console which will ultimately win a 65 percent share of the market."
Just for some background, here are the current generation sales estimates as of January 2006:
Current Generation Sales Estimate
Sony PlayStation 2 100 million
Microsoft Xbox 22 million
Nintendo GameCube 20 million
Sega Dreamcast 11 million
Combined Sales 153 million
{Be sure to note that Microsoft and Sony have only released the number of hardware units shipped. Nintendo, on the other hand, has released the total sales. The total number of XBXs and PS2s actually sold is less than the shipped figures.}
Strategy Analytics believes that roughly 50 million more consoles will be sold this upcoming generation than in the last generation (and thats if you count the Dreamcast). While I wont completely write that off, I do believe it to be a quite lofty number. Without knowledge of the games to come, it seems pretty insane to assume that a third more systems will be sold. Especially when console prices are on the rise (as are game prices) and the initial reception of the Xbox 360 was by no means any greater than past hardware launches. Under fiercer competition than ever before, Strategy Analytics forecasts that the PS3 will sell even more units than any of its predecessors and that the Revolution will sell worse than the GameCube. While Nintendo has consistently sold fewer consoles each subsequent generation since the NES, the recent success of the Nintendo DS could build momentum for the Revolution, assuming the company remains focused. Theres no way to know how the next five years will pan out. Yet, with only vague corporate statements at its disposal, Strategy Analytics has predicted the unbridled success of the PlayStation 3 and incredible failure of the Nintendo Revolution.
It reminds me of a lot of analyst reports back in 2004 that pegged the PSP as the salvation of the handheld industry. Even two weeks after the DS reported higher first day and week sales (about 250,000 first day and 500,000 within a week), the world seemed abuzz when the PSP sold roughly 170,000 units of its initial 195,000 shipment in its first day.
The following is an excerpt from a business.scotsman.com story covering the PSP launch:
Analysts said the arrival of the PSP was the biggest fillip to the sector since Sony launched its PlayStation 2 (PS2) game console in 2000, going on to sell 74 million consoles. Two weeks ago Nintendo launched its handheld DS console.
Analysts think the PSP will win. "The user who is so accustomed to PS2, which has a very high penetration rate in the world, could migrate to PSP," John Yang at Standard and Poors said.
Also, keep in mind that the Game Boy Advance and GBA SP sold somewhere around 600,000 - 800,000 units during the week of the DS launch in 04, likely selling as much as both systems combined.
Even in the face of contradictory evidence, its easy to make any prediction your mind is comfortable with. A year later, the DS is still leading in sales by a substantial margin in some regions. Today, you wont see many (smart) analysts predicting that the PSP will crush the DS. A good deal of them completely changed their stance on the DS vs PSP. If the incoming present doesnt fit what analysts predicted, they can routinely rewrite their vision to match reality. They always appear to come out looking good.
Video game analysts routinely peg the PS3 as the dominant platform, outselling the Xbox 360, Revolution, and even PS2 by crazy amounts. It could definitely happen, sure, but what kind of crystal balls do these analysts have? They are privy to the same information we are. No more, no less. The only thing anyone can accurately predict, with what we know, is that anything might happen.
Even the launch and first year sales of a system arent indicative of its long-term success. The Nintendo 64 had a very strong initial run, but was soon overtaken by the momentum of the PlayStation. Consoles like the Sega Saturn and Sega Dreamcast also did fairly well during their initial years. However, both were overtaken by the PS1 and PS2. The Xbox didnt really gain its full momentum until 2004 and the release of Halo 2. Over the holidays the system even outsold the PS2 for a period of time. One analyst has taken this theory to heart.
Just yesterday, Friedman Billings Ramsey analyst Shawn Milne issued his vision of the gaming world through 2010. While he only tackles the U.S. market, Milne displays a remarkable apathy for anything but the very specific and arbitrary sales numbers hes fabricated for the next five years.
Heres a rundown of Milnes U.S. sales predictions through 2010:
Cumulative Sales 2005-2012
Sony PS3 23.3 million
Microsoft Xbox 360 24.6 million
Nintendo Revolution 12.5 million
Sony PSP 26.1 million
Milne believes that the PS3 will outsell the 360 each year after 2006, but not enough to overcome Microsoft's year-long head start. The launch of the PS3, he claims, will usher in roughly 18 percent console growth for 2007. He predicts that the Revolution and DS have some hard times ahead. He states that the PSP will overcome the DSs lead in the US and never look back, far surpassing the sales of its two-screened competitor and any other console on the market with 26.1 million in sales.
However, the question remains: what psychic does Mr. Milne talk to? At this point in the game, hes got to be talking to a pretty good one, because, as Ive stated repeatedly, we dont know anything! We dont even know the final name of the Revolution or what its marketing campaign will be like. We dont have an inkling of whats coming out on any of these systems in the next year or two. We dont even know if the PlayStation 3 still uses the Spider-Man font or has that banana controller! Mr. Milne is in a room filled with millions of possible straws and hes capriciously picked 1 of them.
The success of any video game system is driven solely by the games released on it. The incredible success of series like Metal Gear Solid, GTA, Gran Turismo, SOCOM, Final Fantasy, and Dragon Quest in addition to the incredible variety of all game types cemented the PlayStation 2 as market leader this generation. Theres no way to know when the next breakout title will appear, and which console it will appear on. Nintendo has had huge success with the DS in Japan with a string of million sellers this past year including its Brain Training series, Animal Crossing DS, Nintendogs, and Mario Kart DS. Even without Nintendos staple Pokémon series, the DS has become a phenomenon in Japan and has sold over 16 million units worldwide in just over a year. Yet, if you were like me and judged the DS negatively based on its holiday 2004 launch lineup, the PSP appeared to have much more momentum behind it. The DS launch was marked by a few mediocre games, Feel the Magic XX/XY, and a remake of Super Mario 64 -- hardly a lineup worth drooling over.
Great games (the kind you drool over) can change the tide of any console race. Its as simple as that. Yet we know nothing about any of the games in development for the PS3 and Rev. We dont even know what kind of games each system will have. The Revolution could have a string of cooking games for all we know. The PS3 could launch with a bunch of next generation online Eye Toy games. I have no clue.
Though none of us have a clue, it isnt stopping anyone from making all kinds of sweeping predictions. I could list off all the games I think Nintendo needs to have a successful launch. Just as easily, I could make a bunch of informed predictions putting Nintendo in the position Id like to see them. Its certainly what I did five years ago when the GameCube was preparing to hit shelves. I was convinced that the system would do better than the Nintendo 64. I mean, Nintendo was correcting so many of its past mistakes, wasnt it? Disc-based media, stronger third party support, great graphics. It had everything.
Of course, I was younger then. Ill fall back on that for my excuse. Young and stupid. Yes. But I really believed the GameCube would bring Nintendo back into the fold. It didnt. It corrected many of the companys past mistakes, but introduced a whole slew of new ones. Learning nothing from my past mistakes, I (silently) predicted that the DS wouldnt do so well, and now I sit here eagerly anticipating the DS Lite and Tetris DS along with everyone else. So this time around Im refraining from the blanket judgments we all so easily make.
The beginning of each console generation is a unique time for those who play and cover video games. Its a time of winding down and cautious embrace. However, this time, lets make it more about the games and less about the war.
When I attend E3 this year, (my first E3 by the way) I will go there not as a rabid Nintendo fan, but a fan of all games. Im sure Ill make my own predictions, but deep down I wont believe them. If theres anything Ive learned over the years, its that no matter how tightly you wrap yourself in the video game industry, youre going to be wrong more than youre right. And thats the great thing about it. Video games are a fickle and crazy industry, one on the edge between greatness and mediocrity. We can only hope it falls off the right side. However, until then, Ill be hanging on every moment here with you.
Worldwide hardware sales data
Current Generation Sales Estimate
Sony PlayStation 2 100 million
Microsoft Xbox 22 million
Nintendo GameCube 20 million
Sega Dreamcast 11 million
Combined Sales 153 million
N64 / PS1 Generation Sales
Sony PS1 100 million
Nintendo 64 33 million
Sega Saturn 9 million
Combined Sales 142 million
I doubt anyone could have predicted the exponential stepping stone to power that the PS1 became.
SNES / Genesis Generation Sales
SNES 49 million
Sega Genesis 35 million
Combined Sales 84 million
Out of almost nowhere, Sega became a powerful force to be reckoned with in North America.
NES Generation Sales
NES 62 million
Sega Master System 33 million
Combined Sales 74 million
The beginning of each console generation is a unique time for those who play video games. Its a time of winding down and cautious embrace. Yet for those that cover and create games, its the time when battle lines are drawn, every statement becomes subject to review, and every moment hung onto. Before a single game is seen, so called industry insiders, analysts, and even people a lot like me will take their sides and predict the next five years in vivid detail. Whether rose-tinted or cloudy and dark, the futures we extrapolate from the smallest tidbits of news both puzzle and amaze me.
I chat with a variety of people whose console allegiances contrast almost as starkly as the things they try to convince me of. I know one guy in particular who, just as hes done for the past five years, cant go a single conversation without trying to prove to me the impending super success of the Xbox 360 and how Microsoft has plans for a handheld and this and that. I, being a Nintendo fan, naturally assume my defensive role and proclaim that the Big N has a chance as well. Its difficult not to. Hell usually dismiss that and maintain that Nintendo should stick to handhelds and bow out of the console business.
I know just as many who seem to herald the PlayStation 3 as the next coming -- the future of video games. It was only a few short days ago that Sony even unveiled anything concrete about their launch and online plans. And by concrete I mean a few incredibly broad and all-encompassing statements. The company announced that the PS3 will launch simultaneously worldwide in early November 2006 (what a shocker ) and that it will come with a 60 GB built-in hard drive. Oh and there was a vague statement about some ultimate online service -- typical anti-Xbox Live hype stuff. Nonetheless, its what we dont know that will play the largest role. We dont know what the controller looks like at all, we dont know how much the system will cost, and we dont even know anything about the freaking games coming out for it, which is the one thing were supposed to be most excited about.
The same thing goes for Nintendo. We still know next to nothing about the Revolution. At E3 2005, Nintendo showed what its basic hardware shell looked like and announced that the system will be backward compatible with NES, SNES, N64, and GCN games. No games were shown, nor was the controller or any other details about the system. Then at the 2005 Tokyo Game Show in September, Nintendo teased the world, yet again, by unveiling its innovative controller, but showing the public no actual footage of it in action. Currently (pre-GDC 2006), we know that Nintendo is shooting for an early November launch in Japan and North America. Thats it. We dont know how powerful the system is or how much it will cost, and we have no idea what its launch lineup will be like. We dont even know how the consoles online service will work, what its going to be called, or how well purchase online games. The only thing we do know is that it has an innovative new control system and Smash Bros. 3. Whoopidy doo.
I can list the number of things we know about the PS3 and Revolution on one hand a piece. The only system we know anything about is the Xbox 360 and even its future is very much mired in the relative success of its competitors.
With the recent PS3 announcement fresh on everyones mind, Strategy Analytics, an independent global research and consulting firm, released its updated prediction of next generation console sales through 2012. Below are its predictions.
Cumulative Sales 2005-2012
Sony PS3 121.8 million
Microsoft Xbox 360 58.8 million
Nintendo Revolution 17.9 million
Combined Sales 198.5 million
Explaining the numbers, Strategy Analytics said the following:
"The PS3 delay will give Microsoft more time to win early adopters, but this was generally anticipated," notes David Mercer, Principal Analyst at Strategy Analytics. "Any further delays could seriously damage Sony's position as a consumer technology leader. Assuming the November launch takes place as planned, we still believe that the PS3 will prove to be the dominant next generation console which will ultimately win a 65 percent share of the market."
Just for some background, here are the current generation sales estimates as of January 2006:
Current Generation Sales Estimate
Sony PlayStation 2 100 million
Microsoft Xbox 22 million
Nintendo GameCube 20 million
Sega Dreamcast 11 million
Combined Sales 153 million
{Be sure to note that Microsoft and Sony have only released the number of hardware units shipped. Nintendo, on the other hand, has released the total sales. The total number of XBXs and PS2s actually sold is less than the shipped figures.}
Strategy Analytics believes that roughly 50 million more consoles will be sold this upcoming generation than in the last generation (and thats if you count the Dreamcast). While I wont completely write that off, I do believe it to be a quite lofty number. Without knowledge of the games to come, it seems pretty insane to assume that a third more systems will be sold. Especially when console prices are on the rise (as are game prices) and the initial reception of the Xbox 360 was by no means any greater than past hardware launches. Under fiercer competition than ever before, Strategy Analytics forecasts that the PS3 will sell even more units than any of its predecessors and that the Revolution will sell worse than the GameCube. While Nintendo has consistently sold fewer consoles each subsequent generation since the NES, the recent success of the Nintendo DS could build momentum for the Revolution, assuming the company remains focused. Theres no way to know how the next five years will pan out. Yet, with only vague corporate statements at its disposal, Strategy Analytics has predicted the unbridled success of the PlayStation 3 and incredible failure of the Nintendo Revolution.
It reminds me of a lot of analyst reports back in 2004 that pegged the PSP as the salvation of the handheld industry. Even two weeks after the DS reported higher first day and week sales (about 250,000 first day and 500,000 within a week), the world seemed abuzz when the PSP sold roughly 170,000 units of its initial 195,000 shipment in its first day.
The following is an excerpt from a business.scotsman.com story covering the PSP launch:
Analysts said the arrival of the PSP was the biggest fillip to the sector since Sony launched its PlayStation 2 (PS2) game console in 2000, going on to sell 74 million consoles. Two weeks ago Nintendo launched its handheld DS console.
Analysts think the PSP will win. "The user who is so accustomed to PS2, which has a very high penetration rate in the world, could migrate to PSP," John Yang at Standard and Poors said.
Also, keep in mind that the Game Boy Advance and GBA SP sold somewhere around 600,000 - 800,000 units during the week of the DS launch in 04, likely selling as much as both systems combined.
Even in the face of contradictory evidence, its easy to make any prediction your mind is comfortable with. A year later, the DS is still leading in sales by a substantial margin in some regions. Today, you wont see many (smart) analysts predicting that the PSP will crush the DS. A good deal of them completely changed their stance on the DS vs PSP. If the incoming present doesnt fit what analysts predicted, they can routinely rewrite their vision to match reality. They always appear to come out looking good.
Video game analysts routinely peg the PS3 as the dominant platform, outselling the Xbox 360, Revolution, and even PS2 by crazy amounts. It could definitely happen, sure, but what kind of crystal balls do these analysts have? They are privy to the same information we are. No more, no less. The only thing anyone can accurately predict, with what we know, is that anything might happen.
Even the launch and first year sales of a system arent indicative of its long-term success. The Nintendo 64 had a very strong initial run, but was soon overtaken by the momentum of the PlayStation. Consoles like the Sega Saturn and Sega Dreamcast also did fairly well during their initial years. However, both were overtaken by the PS1 and PS2. The Xbox didnt really gain its full momentum until 2004 and the release of Halo 2. Over the holidays the system even outsold the PS2 for a period of time. One analyst has taken this theory to heart.
Just yesterday, Friedman Billings Ramsey analyst Shawn Milne issued his vision of the gaming world through 2010. While he only tackles the U.S. market, Milne displays a remarkable apathy for anything but the very specific and arbitrary sales numbers hes fabricated for the next five years.
Heres a rundown of Milnes U.S. sales predictions through 2010:
Cumulative Sales 2005-2012
Sony PS3 23.3 million
Microsoft Xbox 360 24.6 million
Nintendo Revolution 12.5 million
Sony PSP 26.1 million
Milne believes that the PS3 will outsell the 360 each year after 2006, but not enough to overcome Microsoft's year-long head start. The launch of the PS3, he claims, will usher in roughly 18 percent console growth for 2007. He predicts that the Revolution and DS have some hard times ahead. He states that the PSP will overcome the DSs lead in the US and never look back, far surpassing the sales of its two-screened competitor and any other console on the market with 26.1 million in sales.
However, the question remains: what psychic does Mr. Milne talk to? At this point in the game, hes got to be talking to a pretty good one, because, as Ive stated repeatedly, we dont know anything! We dont even know the final name of the Revolution or what its marketing campaign will be like. We dont have an inkling of whats coming out on any of these systems in the next year or two. We dont even know if the PlayStation 3 still uses the Spider-Man font or has that banana controller! Mr. Milne is in a room filled with millions of possible straws and hes capriciously picked 1 of them.
The success of any video game system is driven solely by the games released on it. The incredible success of series like Metal Gear Solid, GTA, Gran Turismo, SOCOM, Final Fantasy, and Dragon Quest in addition to the incredible variety of all game types cemented the PlayStation 2 as market leader this generation. Theres no way to know when the next breakout title will appear, and which console it will appear on. Nintendo has had huge success with the DS in Japan with a string of million sellers this past year including its Brain Training series, Animal Crossing DS, Nintendogs, and Mario Kart DS. Even without Nintendos staple Pokémon series, the DS has become a phenomenon in Japan and has sold over 16 million units worldwide in just over a year. Yet, if you were like me and judged the DS negatively based on its holiday 2004 launch lineup, the PSP appeared to have much more momentum behind it. The DS launch was marked by a few mediocre games, Feel the Magic XX/XY, and a remake of Super Mario 64 -- hardly a lineup worth drooling over.
Great games (the kind you drool over) can change the tide of any console race. Its as simple as that. Yet we know nothing about any of the games in development for the PS3 and Rev. We dont even know what kind of games each system will have. The Revolution could have a string of cooking games for all we know. The PS3 could launch with a bunch of next generation online Eye Toy games. I have no clue.
Though none of us have a clue, it isnt stopping anyone from making all kinds of sweeping predictions. I could list off all the games I think Nintendo needs to have a successful launch. Just as easily, I could make a bunch of informed predictions putting Nintendo in the position Id like to see them. Its certainly what I did five years ago when the GameCube was preparing to hit shelves. I was convinced that the system would do better than the Nintendo 64. I mean, Nintendo was correcting so many of its past mistakes, wasnt it? Disc-based media, stronger third party support, great graphics. It had everything.
Of course, I was younger then. Ill fall back on that for my excuse. Young and stupid. Yes. But I really believed the GameCube would bring Nintendo back into the fold. It didnt. It corrected many of the companys past mistakes, but introduced a whole slew of new ones. Learning nothing from my past mistakes, I (silently) predicted that the DS wouldnt do so well, and now I sit here eagerly anticipating the DS Lite and Tetris DS along with everyone else. So this time around Im refraining from the blanket judgments we all so easily make.
The beginning of each console generation is a unique time for those who play and cover video games. Its a time of winding down and cautious embrace. However, this time, lets make it more about the games and less about the war.
When I attend E3 this year, (my first E3 by the way) I will go there not as a rabid Nintendo fan, but a fan of all games. Im sure Ill make my own predictions, but deep down I wont believe them. If theres anything Ive learned over the years, its that no matter how tightly you wrap yourself in the video game industry, youre going to be wrong more than youre right. And thats the great thing about it. Video games are a fickle and crazy industry, one on the edge between greatness and mediocrity. We can only hope it falls off the right side. However, until then, Ill be hanging on every moment here with you.
Worldwide hardware sales data
Current Generation Sales Estimate
Sony PlayStation 2 100 million
Microsoft Xbox 22 million
Nintendo GameCube 20 million
Sega Dreamcast 11 million
Combined Sales 153 million
N64 / PS1 Generation Sales
Sony PS1 100 million
Nintendo 64 33 million
Sega Saturn 9 million
Combined Sales 142 million
I doubt anyone could have predicted the exponential stepping stone to power that the PS1 became.
SNES / Genesis Generation Sales
SNES 49 million
Sega Genesis 35 million
Combined Sales 84 million
Out of almost nowhere, Sega became a powerful force to be reckoned with in North America.
NES Generation Sales
NES 62 million
Sega Master System 33 million
Combined Sales 74 million
