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Analyst: Wii Sold 3.25 Million In December, $299 PS3 By April
by Leigh Alexander
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January 13, 2009
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The Wii's stellar performance in November 2008 -- 2 million units sold -- raised many impressed eyebrows, but the console likely did over a million better in December, claims a game industry analyst.
Wedbush Morgan analyst Michael Pachter says that, with Wii supplies significantly increased over the holiday season, the console sold an estimated 3.25 million units last month.
"The long-awaited Wii production increase (which started in July) finally arrived late in September and we have seen significant increases each month since," said Pachter. "We expect this to continue in December, with supply and demand in balance by early 2009."
As for the other consoles, Pachter estimates 1.35 million Xbox 360 consoles sold during December, and 750,000 PlayStation 3 consoles -- with exact numbers to be revealed when NPD Group releases its December numbers thus Thursday.
Pachter predicts a $2.625 billion sales month for December 2008, a 10 percent increase over the year prior, with $2.42 billion in next-gen software sales.
Although the PS3 comes in third in terms of unit sales, Pachter says software sales for the console grew 48 percent in December over last year, while the Xbox 360 only saw four percent software sales growth.
Pachter suggests that Microsoft's Xbox 360 bundles, which included free games like LEGO Indiana Jones and Kung Fu Panda, might have weakened its software sales numbers even as its hardware sales were "up modestly over the last two months."
As for the Wii, Pachter says it'll again outdo its peers in terms of software sales growth with a 71 percent increase.
Only the PlayStation 2 comes up short, Pachter says, foreseeing a 54 percent year-over-year decline for Sony's previous-gen console. "PS2 software sales decreased 24 percent in 2007, and are down only 27 percent for the year through November, with strong sales of games like Guitar Hero and Rock Band earlier in the year mitigating the inevitable sales decline," he says.
"While we acknowledge that the recession will impact software sales somewhat, we note that the majority of software sales between January and October are user-driven," says Pachter, "and we think that the hardcore gamer population is still on the upswing, with high price points for the PS3 and Xbox 360 causing many to defer purchases late into the cycle."
And since hardware sales still have room to grow, Pachter says more price cuts are forthcoming. "Once the PS3 is at a more affordable price point (we expect a cut to $299 in April), we think that sales of that device will once again begin to grow," he says.
"We expect another cut in price for the Xbox 360, with the feature-laden Pro model likely to come down in price to $249 at or before this year's E3 show in June."
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Microsoft fiscal year ends on June 30, which is pretty close to E3, so it may make sense to announce it at E3 for August or September.
- Even at $299 they are still not going to move that many more units. The majority of HD console buyers are buying Arcades for $199. That is the price that will always count until it is beaten.
- Blu-ray had a great year. They don't have to keep subsidizing it with the PS3 anymore.
- Their proposed software lineup is definitely the best out there for 2009 which will allow them to weather the storm at a premium price. Also, via HOME they can prove that there is money to be made from mining ePeens.
I personally believe that the smart money is on them creating a slim PS3 for the holidays. They change the form factor, keep the bells and whistles, and bring it down to $299 when they can afford to. This will reinvent the PS3, which is sorely needed, and they'll be able to catch people coming out of there holes from the recession.