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NPD: February Down 15 Percent On Lagging Unit Sales, Constrained Wii
by Leigh Alexander
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March 11, 2010
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Though revenues were down across the board year-on-year, February 2010 releases achieved big numbers, with 2K Games' BioShock 2 for the Xbox 360 leading the chart -- though last fall's big hits, such as Call of Duty: Modern Warfare 2, are still represented by strong sales.
According to the NPD Group, year on year, overall retail sales in the U.S. video game market are down 15 percent, falling to $1.26 billion from $1.48 billion.
Game software retail sales are down 15 percent, falling to $624.4 million from $736.7 million, while accessories are down a very minor 1 percent, at $204.7 million compared to last year's $206.1 million. Year to date, accessories are actually up slightly -- but that's due to higher prices, says the NPD's Anita Frazier.
"Sales came in slightly better than we anticipated (privately, we were forecasting down -19 percent)," says EEDAR analyst Jesse Divnich, who says Xbox 360 and PlayStation 3 hardware sales "exceeded expectations."
"Of course, stronger hardware numbers do influence software numbers as PS3 and Xbox 360 hardware purchasers typically purchase at least 1 software SKU attachment," he adds.
The Software
February's top 10 retail titles are as follows:
1. BioShock 2 (Take-Two, Xbox 360): 562.9K
2. New Super Mario Bros. Wii (Nintendo, Wii) 555.6K
3. Call of Duty: Modern Warfare 2 (Activision, Xbox 360) 314.3K
4. Just Dance (Ubisoft, Wii) 275.4K
5. Wii Sports Resort (Nintendo, Wii) 272.5K
6. Call of Duty: Modern Warfare 2 (Activision, PS3) 252.8K
7. Mass Effect 2 (EA, Xbox 360) 246.5K
8. Dante's Inferno: Divine Edition (EA, PS3) 242.5K
9. Dante's Inferno (EA, Xbox 360) 224.7K
10. Heavy Rain (Sony, PS3) 219.3K
It's worth noting that the PlayStation 3 version of chart-topping BioShock 2 did not chart at all -- notable, perhaps because the original game in the series released a late but acclaimed port to the PlayStation 3.
Frazier also noted that "Call of Duty: Modern Warfare 2 has become the third-best-selling game of all-time, now at just under 10 million units life-to-date."
The third-place debut of Ubisoft's casual Wii title Just Dance impressed EEDAR analyst Jesse Divnich, who comments: "Wow. I really hope Ubisoft is working on a Just Dance 2, because a sequel (released on the PS3, Xbox 360, and Wii) could be a huge success."
"These sales trends are similar to what we seen with Guitar Hero before it reached mainstream success," he adds. Just Dance 2 for the Natal, Move, and Wii? Sounds like a good strategy to me."
Frazier says that for most categories, year-over-year declines in unit sales were greater than dollar sales declines. "Higher average retail prices on all categories except console hardware boosted dollar sales performance somewhat," she notes.
"Honestly, I had expected the industry to perform somewhat better this month," Frazier continues. "Nonetheless, strong new releases and Easter gift-buying bode well for industry performance in March."
The Hardware
Console sales rose from January 2010 across the board, despite the shorter month, though hardware revenue was down 20 percent year-on-year, falling to $426.4 million from $534.2 million a year ago.
The console rankings and sales are as follows:
1. Nintendo DS: 613.2K
2. Xbox 360: 422.0K
3. Wii: 397.9K
4. PlayStation 3: 360.1K
5. PSP: 133.4K
6. PlayStation 2: 101.9K
Microsoft says that it was the best February in the console's history: "This month’s NPD results are a further proof point to what will be our biggest – and best – year in Xbox history," says Microsoft IEB COO Dennis Durkin.
Said Frazier, "Xbox 360 nabbed the top spot among the three console systems for the first time since September 2007 when Halo 3 was released. PS3 enjoyed a 30% increase over last year, even while retail supply is reported to remain constrained."
EEDAR's Divnich agrees with Frazier's perspective on supply constraints: "Our extensive retail channel checks have all indicated that, in fact, the Nintendo Wii is in short supply," he says. "We believe February numbers reflect entirely on the Wii being supply constrained and has little to do with declining demand of the product."
Separately, Sony confirmed it's been facing "tight" inventory -- but says it expects another month of 30 percent year over year growth in March, and that it's on track to see PS3's userbase hit 13 million units worldwide by the end of the month.
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Well, the PS3 is also supply contrained, and is still sold out at both Amazon and Gamestop, yet the PS3 managed to incrsease sales by 30%, while Wii sales fell by close to 50%. Meanwhile, the Wii is available right now at Amazon, even as we speak.
Software:
# 1. 7 out of the top 10 selling games were on the HD consoles.
# 2. For February, MW2 combined oustold NSMB (Wii) by 567.1K (MW2) to 555.6K NSMB (Wii).
# 3. Given that Bioshock 2 sold over 750K units combined , and the 360 version sold 562k, that means the PS3 version sold 188k (750k-562k) .
# 4. Life to Date sales:
MW 2 (combined PS3/360) : 9.97 million
MW2 (360) : 6.47 million
NSMB(Wii) : 5.44
WII SPORTS RESORT:5.11 million
MW 2 (PS3) : 3.51 million
MASS EFFECT 2 (360 ) : 820K
Hardware:
# 1. Year on year comparison Feb:
Feb 2009 NPD (on left) and Feb 2010 NPD (on right) {% increase/decrease}
PS3 : 276K --> 360K +30.4%
360 :391K --> 422K +7.9%
Wii : 753K --> 398K -47.1%
# 2. Year on year comparison YTD to Feb:
YTD 2009 --> YTD 2010 { % inrease/decrease}
PS3 479,000 --> 637,000 +32.9 %
360 700,000 --> 755,000 +7.8%
Wii 1,432,000 --> 864,000 -39.6%
# 3. This month is the 3rd biggest PS3 month outside Nov/Dec:
1. Sep 09 - 491.8k (Slim launch)
2. Jun 08 - 405.5k (MGS4)
3. Feb 10 - 360.1k (Shortages)
# 4. And this month is the 360's 2nd biggest month outside Nov/Dec:
1. Sep 07 - 527.8k (Halo 3)
2. Feb 10 - 422.0k
3. Feb 09 - 391.0k
"Well, the PS3 is also suppy contrained, and is still sold out at both Amazon and Gamestop, yet the PS3 managed to incrsease sales by 30%, while Wii sales fell by close to 50%. Meanwhile, the Wii is available right now at Amazon, even as we speak. "
Considering the PS3 had a relatively weak February in 2009 it is pretty easy for it to grow. Had the Wii not been supply constrained it would have still been the top console. I doubt the Wii would have had much growth if any if supply was not an issue.
I believe that both the Wii and the PS3 are constrained as I have not seen any in any store I have been to in the last few weeks.
"The Wii and PS3 were sold out at most places for the majority of last month. Being able to buy a Wii now has nothing to do with last months data. Nice try on the spin though Kevin"
Both were sold out last month. One increased sales by 30%, the other decreased sales by 47%. Go figure.
Plus the PS3 was arguably harder to get in February than the Wii, and is still harder to get today. Sony already indicated that PS3 supply issues may last till June.
^^^^ Same here. Went to my local Wal-Mart and Target today looking for an external hard-drive and noticed that the Wii's were out of stock. Wal-mart even had a sign up where the Wii's were suppose to be located that said pretty much that.
It is great that the PS3 is up YOY but it really shows how bad it was selling until the slim release last year. If they were not up YOY after a redesign, price drop, and revamped marketing I think everyone would be in shock.
The Wii being down YOY while being supply constrained is no surprise at all. The Wii sold over 9 million units last year. The Wii being up YOY would also be a shock to people.
We really wont know what the baseline is for the systems will be until Sony and Nintendo fix their supply problems. It looks like Wiis have been in better supply since the middle of last week, but we have to wait and see if Nintendo can keep up with demand.
:"The Wii being down YOY while being supply constrained is no surprise at all."
The Wii was in plentiful supply from April 2009 to November 2009, and still registered big YOY drops in sales in every one of those 8 months. In addition, the Wii has fallen in sales YOY in 10 out of the last 11 months. YOY drops in Wii sales are not exactly new, and it happened for 8 straight months, even when the Wii was in full supply .
To add to that. The PS3 being up YOY has not moved it out of third place. It is sad when you are up 30% YOY and still in third place. It really just highlights how bad it was selling last year.
Would you rather be up YOY and still be stuck in third place or be down YOY and sell over 9 million?
The Wii could still be down YOY when it is in full supply this year and I would bet that it will still outsell the 360 and PS3.
So yeah, let Sony celebrate selling more than last year. And let the analyst continue to predict that the Wii is doomed based on the fact it sold less than last year for a period of months. It's all good.
"Those YOY drops the Wii had last year still equaled over 9 million units sold. So I guess your point is that the Wii can be down YOY while in full supply and still outsell the 360 and PS3 combined?"
Nope.
You left out the part where the Wii had huge YOY gains in Jan, Feb and March last year, despite the Wii being sold out in those 3 months. This year, Wii sales are down in Jan and Feb already.
Plus the Wii had a big YOY gain in December last year.
" The PS3 being up YOY has not moved it out of third place"
True. But then the Wii was ahead of the PS3 by only 28,000 in Feb this year, as compared to a gap of over 450,000 in Feb 2009.
"It is sad when you are up 30% YOY and still in third place. "
I don't think so. In business, it's all about increasing revenues and profits. Company A can increase revenues and profits, and end up making less money than company B, yet company A's share price could go up, while company B's share price goes down, if company B's sales and profits were down.
"Would you rather be up YOY and still be stuck in third place or be down YOY and sell over 9 million?"
Like in any business, I'd much rather increase sales and profits, than decrease sales and profits. See above.
"The Wii could still be down YOY when it is in full supply this year and I would bet that it will still outsell the 360 and PS3"
I wouldn't bet on that.
Right now, the Wii is in full stock on Amazon, so why don't we see who comes out ahead in the March NPD's? I think the 360 will have a pretty good March, from the new ODST/Forza bundle and the FF XIII bundle, and the PS3 has God of War 3.
In addition, don't forget that for the holidays, the 360 will have Natal and the PS3 will have the Move. No one knows how they will do in the market, but both could eat into Wii sales.
^^^ Pfft! Yeah because Wii being in stock at amazon is a good indicator how well it will do in March.
The Wii is currently sold out online at:
BestBuy.com
Buy.com
Walmart.com
eToys.com
And several bundles at GameStop and other sites are also sold out.
BIG DEAL! Call me when the PS3 or 360 manages to stay on top as long as the Wii has done since 2006. Until then, nothing has actually changed much.
"The Wii is currently sold out online at:"
Like I pointed out before, the Wii registered YOY sales drops for 8 straight months in 2009, even when it was in full supply. I'ts not as if it's anything new here.
"And several bundles at GameStop and other sites are also sold out"
In a free market economy, all that matters is that a product be easily aviailable in some easilly accessible retail outlets. It's irrelevant if the Wii is sold out at Buy.com or eToys.com or not. Anyone can sit in their home, log on to Amazon.com(the world's biggest online retailer) and buy a Wii right now.
"Call me when the PS3 or 360 manages to stay on top as long as the Wii has done since 2006. "
You may start getting your wish sooner than you think, when Move and Natal are launched later this year.
In the mean time, months like March and September should prove intesresting .
Tell me in this reality is the sky green and the grass blue?
http://en.wikipedia.org/wiki/List_of_countries_by_GDP_%28PPP%29_per_capita
http://en.wikipedia.org/wiki/List_of_countries_by_GDP_%28real%29_growth_rate_per
_capita
Dead last!!! :)
"I don't think so. In business, it's all about increasing revenues and profits. Company A can increase revenues and profits, and end up making less money than company B, yet company A's share price could go up, while company B's share price goes down, if company B's sales and profits were down."
This is true in the short term and when you strip all of the context out of this situation. But we are not talking about ordinary products here. We are talking about platforms. Consoles are platforms and because of this there is a benefit to being the most popular that extends far beyond simply selling twice as much as your competitors. This is why MS and Sony were willing to sell consoles at a loss for so long. If you have a lot of friends with a certain console and game and they recommend it then you are going to need that console to play it and many people only buy one. Popularity reinforces popularity, so an early lead is important too. For this reason, no one gets into the platform business to come third and platforms aren't good at being niches. This especially applies to the PS3 where the XBox has quite similar capabilities, so it lacks significant differentiation from an already successful platform. I think this is why people were stressing that despite the YOY changes, the overall sales number is still the more important number. After all, a trend is only interesting because it suggests a possible high sales number in the future and it doesn't guarantee it.
This NPD shows a few changes on last year which could be trends. They don't show anything that significant yet and luckily this analyst seems to be one of the more sensible ones and isn't making wild assertions and predictions.
"Call of Duty: Modern Warfare 2 has become the third-best-selling game of all-time, now at just under 10 million units life-to-date."
This is obviously false. I can probably think of dozens of games off the top of my head (with at least seven of them containing "Pokémon" in the title...) that have sold over 10 million copies.
The only thing I could think of that would make sense would be if she meant that CoD:MW2 was the third-best-selling game of all time on the Xbox 360. In which case, Gamasutra's editors need to be asking analysts for clarification when they make such odd statements... and also considering whether a statement like that is actually deserving of being quoted. Personally, I think it's more impressive that the combined X360/PS3 sales of CoD:MW2 are over 17 million by now, which means it's approaching the top 10 in the all-time-for-all-consoles list. THAT kind of information deserves a quote.
I'm still call the Wii being up YoY from starting in April through to September. I'll have to wait and see the release list before I can commit to Q4 2010 being up YoY.
Feb 2010 NPD is a fluke anyways. I'm sure Microsoft will tout a 'flawless victory', but can they really feel that confident knowing they came out on top while both of their competitors were supply constrained?
I think she meant, COD:MW2 is the third best selling game in the US, I don't know many titles, that sold 10 million units in the US alone, so I think this was the meaning of the statement, correct me, if I'm wrong here.
@Kevin Jones
"Hardware:
# 1. Year on year comparison Feb:
Feb 2009 NPD (on left) and Feb 2010 NPD (on right) {% increase/decrease}
PS3 : 276K --> 360K +30.4%
360 :391K --> 422K +7.9%
Wii : 753K --> 398K -47.1%"
I would simply reply:
Consoles sold in 2009 in the US according to NPD
Wii 1.15 million units
XBox360 0.813 million units
PS3 0.636 million units
This means, the best selling platform in 2010 so far is still the Wii, not the PS3 and not XBox360.
The real problem is, that it seems, the industry will have it's second year in row with a massive decline, I fear not every publisher will survive this.
If one is going to argue that business is all about revenue, profit, and share price, one has to look at the financial numbers instead of just the raw sales.
Sony publicly announced the loss per console of the PS3 at $18 in February 2010.
Nintendo publicly announced the profit per console of the Wii at $6 in December 2008.
(For the sake of this argument, I'll ignore Microsoft, since they have never publicly announced any figure without caveats. The only thing they ever said was in November 2006, when they announced they make $75 per Xbox 360 before other, unknown costs are factored in, including packaging and shipping.)
Let's make a conservative estimate and say that Nintendo has not improved their profit per console since December 2008. That means that Nintendo has, since December 2008, made 15 million x $6 = $90 million in profit off worldwide Wii console sales in the past 15 months. Remember, this is a conservative estimate and does not include accessories.
Let's do a similar estimate for Sony. Leigh Alexander has a Kotaku post from May 2008 that says Sony's own figures show they lost $130 per PS3 at the time, and we know the loss is only $18 in February 2010. Let's be less conservative in Sony's favor: we can determine Sony has reduced loss by about $6 per month. We can interpolate loss in December 2008 at $130 - (7 months * $6) = $96. In December 2008, Sony sold 2.2 million PS3s worldwide. That means that Sony, in one month of December 2008 sales, lost $201 million off console sales in a single month! And even in February 2010, they lost $6.5 million off console sales. Wow, talk about being a "loss leader", but not in the usual context...
If I was a Sony stockholder, I'd be a little angry.
But wait! What about software royalty revenue? Surely that would help recover losses! Prash's point is very good because if all three manufacturers rely on software sales as the primary source of revenue, the one who leads in console sales over the longest period of time will make the most revenue from software sales if sales rates are similar across all consoles.
Let's assume Sony gets $10 on average for PS3 software (more from first-party, less from third-party). Let's also assume that Sony has lost $2 billion (this may be too low; I just made an estimate) so far on console sales. To recover from launch (November 2006) to the present, they would need to sell 200 million units of software. After that, they get pure profit off royalties, since the PS3 hardware will finally be profitable this year. As of June 2009, there were 189 million units of software sold. Since they have probably passed 200 million by now, one can assume that Sony's game division will be profitable this year. Let's also assume PS3 owners will buy 3 games per year. That means that if PS3 console sales went up at a rate of 4 million per year for the next 4 years, Sony would make $5.5 billion off software profits alone (((33 * 3) + (37 * 3) + (41 * 3) + (45 * 3)) * $10 * 1mil). (Again, assuming $10 per software sale, which is probably generous.)
If I was a Sony stockholder, that news would make me happier. But let's do the same for Nintendo.
Let's assume Nintendo makes $15 per game (since 52% of games sold on Wii are first-party). We don't have to calculate software sales needed to recover costs, since the Wii has been profitable since launch. Let's also assume Wii owners buy only 2 games per year. Finally, let's assume Wii sales slow down a lot and they sell worse than PS3s for the next four years. I'll use 3 million consoles sold per year for the next four years. That means they will make $8.7 billion off software sales over the next four years (((68 * 2) + (71 * 2) + (74 * 2) + (77 * 2)) * $15 * 1mil). And that's using EXTREMELY conservative numbers; it assumes that the Wii hardware sales are going to collapse catastrophically; and it even assumes an extremely low rate of software purchases.
If I was a Nintendo shareholder... geez, after looking at that, I wonder why I'm not! Wow.
So, in conclusion, one cannot seriously argue that Sony is increasing its revenues and profits faster than Nintendo, when they can't do it unless every single Wii console spontaneously combusts and every DS gets put into the wash.
There is truth to the claim that "...company A's share price could go up, while company B's share price goes down, if company B's sales and profits were down." Sony had increased from $26 to $37 over the past 52 weeks, while Nintendo has only gone from $36 to $38. However, the difference in the most recent dividend payout is striking: $0.25 per share for Sony, $0.52 for Microsoft, and $1.25 for Nintendo. Comparing yields, Sony is at 0.7, Microsoft at 1.8, and Nintendo at 3.3. At the moment, Sony is better for short-term trading, but Nintendo has been better for long-term holdings due to its focus (and success) on maintaining a positive revenue stream.
I guess my whole point is that it's silly to argue console wars on terms of console company finances. Nintendo clearly wins on that front, since their business model is the most robust.
Hmmm, now that I think about it, it would apply to the worldwide next-generation-console charts. CoD:MW2's combined sales total would be above 10 million, which is the number she used, and it would be below Wii Sports, Wii Play, and Halo 3. Wii Sports could be cut out because it was bundled with the Wii in North America, so CoD:MW2 would indeed be #3 all-time on a chart with those specific parameters.
But see, why should I be figuring that out? Gamasutra's editors should be doing that fact-checking, not me.
You absolutely right on the money using those assumptions which is why many find it odd that each year most analyst forecast the "Doom of Nintendo Wii", and the rise of the HD console (which most of are still waiting on.) It can be also noted that third parties tend not to follow the paradigm of most business structures, which is if a product is doing stealer you sink more money and resources into it. Why is this success of the Wii returned such an opposite effect concerning relations with some Western 3rd parties and Nintendo. I find the first party argument to be kind of weak.
I think it is selling better on the PS3, because 360 owners went for Bioshock 2 this month. Both games appeal to a not so different type of gamer and I think for 360 owners Bioshock 2 was the bigger title, so they bought it first. After a few months, I think the 360 version of Dante's Inferno will sell better than it's PS3 counterpart.
"It's irrelevant if the Wii is sold out at Buy.com or eToys.com or not. Anyone can sit in their home, log on to Amazon.com(the world's biggest online retailer) and buy a Wii right now"
^^^ There you go with amazon again... whew... Man you sure give too much damn credit to a site that is mostly known for selling books. Whatever dude. Keep doing your fan... thing. Heaven knows a lot of you Sonyers have been trying (and being a big fail at it) to knock the Wii down since 2006. It's 2010. Still not working out for you guys. This year? Sony is even going to emulate Nintendo's strategy. I guess they will do that because IT WORKS.
@ Zed
"Tell me in this reality is the sky green and the grass blue?"
^^^^ I'll tell you what though... next time you try to back up your arguments with a source, it probably ins't a very good idea to use wikipedia. I mean c'mon... wikipedia.
Here, get educated about the sorry state of the Venezuelan economy as it stands right now (not in 2008):
http://www.latinbusinesschronicle.com/app/article.aspx?id=3912
http://www.businessweek.com/magazine/content/10_12/b4171046603604.htm
:"There you go with amazon again... whew... Man you sure give too much damn credit to a site that is mostly known for selling books. "
If it will make you feel any better, the Wii has been easily available at Gamestop as well. If you want one, here it is right here:
http://www.gamestop.com/Catalog/ProductDetails.aspx?product_id=63944
BTW, Gamestop is the biggest games retailer in the country.
"Man you sure give too much damn credit to a site that is mostly known for selling books"
Ummm..Amazon actually makes more money from Electronics and other general merchandise than from books. You can peruse Amazon's earnings report yourself here, if you know how to read a balance sheet:
http://phx.corporate-ir.net/External.File?item=UGFyZW50SUQ9MzY2NTcwfENoaWxkSUQ9M
zYxODIxfFR5cGU9MQ==&t=1
"Here, get educated about the sorry state of the Venezuelan economy as it stands right now (not in 2008):"
Umm.. I read both your links, and I am yet to see anything in those links that backed up your earlier claims that "Venezuela's economy was still dead last compared to how things were with the other South American countries"
For example, Ecuador"gew" GDP in 2009 at -2% rate, while Venezuela grew GDP at -1.5, making Venezuela's GDP growth faster in 2009.
"I would like to ignore the usual fallout over Kevin's PS3 cheerleading and Wii trash-talk to point out a surprising comment by Anita Frazier:
"Call of Duty: Modern Warfare 2 has become the third-best-selling game of all-time, now at just under 10 million units life-to-date."
This is obviously false. "
False huh?
Now why don't we add up all the MW2 NPD sales for the PS3/360 since November?
November 2009
1. 360 Call of Duty: Modern Warfare 2 - 4.20 million
2. PS3 Call of Duty: Modern Warfare 2 - 1.87 million
December 2009
4. 360 Call of Duty: Modern Warfare 2 - 1.63 million
5. PS3 Call of Duty: Modern Warfare 2 - 1.12 million
January 2010
4. 360 Call of Duty: Modern Warfare 2 - 326,700
7. PS3 Call of Duty: Modern Warfare 2 - 259,000
February 2010
3. 360 of Duty: Modern Warfare 2 - 314,300
6. PS3 Call of Duty: Modern Warfare 2 - 252,800
Now why don't you add all that up..if you can add that is.
I make it 9.97 million or approx 10 million. Anita Frazier was exactly spot on.
If you go back to the second post in this thread, I already added MW2 total sales up there. One would have thought, you'd at least add up total MW2 sales to date, before you opened your big mouth.
"I can probably think of dozens of games off the top of my head (with at least seven of them containing "Pokémon" in the title...) that have sold over 10 million copies"
Now why don't you give us a list of them games, and let us know what the CREDIBLE NPD source it is from?
As at now, MW2 has already outsold every single Wii game, including Wii Fit and Mario Kart,
with the sole exeption of Wii Play, which most people buy for the controlller rather than the game anyway, and it's done it all in just 4 months.
"Hmmm, now that I think about it, it would apply to the worldwide next-generation-console charts."
Ummm...no. Just no.
Add up all NPD MW2 sales since November, like I have done in my post above, and you will see that it comes to 10 milion units sold..and that is just for the US alone.
Remmember, it doesn't even include Canada.
"and CoD:MW2's combined sales total would be above 10 million, "
MW2's sales in US NPD alone is 10 million. No other country involved. Get it?
"which is the number she used,"
Wrong!
" and it would be below Wii Sports, Wii Play, and Halo 3."
Wrong again!
Plus no one buys Wii Sports apart from in Japan, and Wii Sports in Japan are currently at 3.6 million units sold:
http://www.japan-gamecharts.com/wii.php
" Wii Sports could be cut out because it was bundled with the Wii in North America, "
Not just in North America. Wii Sports is bundled everywhere apart from Japan.
"notso CoD:MW2 would indeed be #3 all-time on a chart with those specific parameters."
You entire "analysis " is total rubbish.
"But see, why should I be figuring that out? Gamasutra's editors should be doing that fact-checking, not me."
You figured out nothing. You only succeeded in confusing yourself even further. Read my posts above.
" wii appeals to broader audience than xbox and ps3."
The Move and Natal may change all that later this year.
"wii doesn't really have competition while xbox and ps3 are direct competitors "
Yet PS3 and 360 are increasing sales, while the Wii's sales are falling.
:'So, in conclusion, one cannot seriously argue that Sony is increasing its revenues and profits faster than Nintendo, when they can't do it unless every single Wii console spontaneously combusts and every DS gets put into the wash. "
The trouble with what passes for an"analysis"from you is, it's based on pure supposition and conjecture, with no actual facts on the ground to back it up. All you had to do, was to look at Sony And Nintendo's latest earnngs reports for fiscal 10Q3, which are on the internet for anyone to see.
Sony. 10Q3 earnings report :
"February 3, 2010
Sony posts sharply higher earnings and offers upbeat outlook
For the first time in a while, Sony has blown earnings forecasts out of the water. And it’s predicted a much better outlook for its fiscal year that ends March 31.
After years of restructuring under chief executive Howard Stringer, the company reported net profit of 79.2 billion yen ($861 million) for the quarter ended Dec. 31, up about eight fold from a year ago and more than twice the amount that analysts expected (33.73 billion yen), according to Thomson Reuters. The profit was the first in five quarters."
http://games.venturebeat.com/2010/02/03/sony-posts-sharply-higher-earnings-and-o
ffers-upbeat-outlook/
Th video games business registered a pofits of $210 million, as compared to a loss the year before:
http://www.sony.net/SonyInfo/IR/financial/fr/09q3_sony.pdf
For Nintendo, however:
"Nintendo 9-mth profit down 41 pct, keeps outlook
TOKYO, Jan 28 (Reuters) - Nintendo Co Ltd (7974.OS) posted a 41 percent fall in nine-month profit as sales of its DS handheld game player slowed and it cut the price of its Wii console, and the company kept a forecast for a first annual profit slide in four years.
April-December operating profit at Nintendo, which competes with Sony Corp (6758.T) and Microsoft Corp (MSFT.O), was 296.7 billion yen ($3.3 billion), down from 501.3 billion yen."
http://www.reuters.com/article/idUSTOE60P0BI20100128
http://www.nintendo.co.jp/ir/pdf/2010/100128e.pdf
So Nintendo profits were down, Sony profits were up. My analysis holds. Yours doesn't.
Why is NPD the only acceptable source of sales data? I can't find any solid NPD sales data before 2002. Is this when they started collecting retail sales data in detail or perhaps when they first started releasing it publicly? That is a very short history of video games. It seems to be generally accepted that that Super Mario Bros for NES sold 40 million. We know it did big business in the US so it seems quite possible that it sold over 10 million there, though I can't find anything to confirm or deny this. I think at best we can say that MW2 is the third best-selling game since 2002.
In the Sony financial report that you linked, the PS3 is grouped into the "Networked Products and Services" division, which includes PCs and laptops. Also, this division is operating at a loss. I would think it likely that they make a profit on their PCs and laptops, so they would subsidise the larger loss from the PS3.
Having said that, I thoroughly agree that Sony's PS3 profits are probably increasing (or loss decreasing) and Nintendo's profits are decreasing. However, as I said earlier I think it's early to place too much importance on this current change since the difference in actual profits right now are huge.
:"Why is NPD the only acceptable source of sales data?"
There really is nothing stopping any company from collecting their own video games sales data.
In Japan, they have 3 video games sales data outfits, Famitsu, Media Create, and Dengeki. You can start your own data collection business today if you want. Only thing is, you gotta convince the video game companies to pay you for your data, like they pay NPD right now. That will depend on the quality of your data, and your marketing skills.
" I can't find any solid NPD sales data before 2002 Is this when they started collecting retail sales data in detail or perhaps when they first started releasing it publicly? . "
NPD started collecting video games data in 1995. Anything before 1995, will not be in their data base.
" It seems to be generally accepted that that Super Mario Bros for NES sold 40 million. "
True. Super Mario Bros. NES sold approx 40.23 million (as of 1999).
But then Super Mario Bros. NES was a pack-in, and that 40 million was for the whole world, not just the US.
http://en.wikipedia.org/wiki/Nintendo_Entertainment_System
"We know it did big business in the US so it seems quite possible that it sold over 10 million there, though I can't find anything to confirm or deny this."
It probably did sell more than 10 million in the US.
" I think at best we can say that MW2 is the third best-selling game since 2002."
Since 1995.
http://gameinformer.com/b/news/archive/2010/03/11/modern-warfare-2-now-third-bes
t-selling-game-of-all-time.aspx
"In the Sony financial report that you linked, the PS3 is grouped into the "Networked Products and Services" division, which includes PCs and laptops."
Correct.
" Also, this division is operating at a loss."
No.
You'd better read the earnings report again. The "Networked Products and Services" division, made operating profits in the 10Q3 (December) quarter of 19,399,000 Yen.
http://www.sony.net/SonyInfo/IR/financial/fr/09q3_sony.pdf
" I would think it likely that they make a profit on their PCs and laptops, so they would subsidise the larger loss from the PS3."
Nope.
The PC and laptop business is one of the most low margin, low profit businesses on the planet. Sony's market share in PC's is too small for them to be making much(if any) profits at all in their PC business.
If you read further into the earnings report, you will see that the Games business had higher revenues than the PC/laptop business.
: "I would simply reply:
Consoles sold in 2009 in the US according to NPD
Wii 1.15 million units
XBox360 0.813 million units
PS3 0.636 million units
This means, the best selling platform in 2010 so far is still the Wii, not the PS3 and not XBox360."
First of all, you mixed up 2009 and 2010.
I assume you mean 2010. If indeed you mean 2010, the Wii has sold only 863,700 ( 465,800 in Januray + 397,900 in February) so far in 2010, not 1.15 million like you claim in your post. You obviously can't even do simple arithmetic.
By comparison, the Wii had sold a massive 1,432,000 by this time last year. That's a fall of 30% in Wii sales this year as compared to last year.
Secondly, the HD consoles have vasty outsold the Wii year to date(by over 500,000 units). That's what counts, as far as 3rd parties are concerned.
http://www.gamestop.com/Catalog/ProductDetails.aspx?product_id=63944
BTW, Gamestop is the biggest games retailer in the country."
That has nothing to do with last months data. You can get it now but most of last month you could not.
I hope you get paid well for this. You put a lot of research into spinning the data to fit your agenda.
Nowhere did I claim that CoD:MW2 did not sell 10 million units. I claimed it was not the third best-selling game of all time. Is it? Let's see, using vgchartz numbers... ignoring pack-in games like Wii Sports, Tetris GB, and Super Mario Brothers, there are: Wii Play (27 million), Super Mario World (20 million), Pokemon 1st gen (31 million), The Sims (16 million), and a bunch more.
But wait, let's assume Anita Frazier is talking about just North America. In that case, there are Wii Play (14 million), Super Mario World (13 million), Pokemon 1st gen (11.4 million), The Sims (11.3 million), and Super Mario Land (11 million).
Oh, wait, now we're narrowing the count down to 1995? OH, OK... After cutting the parameters down AGAIN, now we're down to Wii Play and The Sims. In which case, Anita Frazier should have said, "Call of Duty: Modern Warfare 2 is now the third-best-selling game in North America since 1995, when NPD started tracking software sales in North America."
And that is my point on that remark. Her original statement is untrue.
Nowhere did I claim that Sony's video game division did not make a profit. Did I not say they have lost money in the past, but they would make billions of profit in the future?
I have no idea which words you're choosing to skip when reading and responding. I also don't understand why you choose to respond to a long-term analysis by posting Sony's and Nintendo's most recent quarterly reports. Four years of performance history != a single data point. Sure, your basic statement of "Nintendo profits were down, Sony profits were up" is true for that particular report, but in the long-term, my analysis shows the revenue from Sony's video game division cannot surpass Nintendo's unless Nintendo's business model catastrophically collapses. And when YOUR OWN POST shows that Nintendo, a video game company, made an average of $890 million more per quarter in the past three quarters than Sony's video game division, it's pretty obvious that even that your single data point shows only a percentage gain and not a loss in absolute revenues. You are correct that many business people do care about percentage gains, but they are not naive enough to ignore absolute dollar numbers. Percentages are often used for obfuscation.
Apologies for the false statement that that division did not make a profit. I have not read a financial report before and I have now managed to figure out that only the amounts in brackets are losses. However, this does not change the fact that the operating income is mixed in with that of several other products not related to games consoles, and is still much lower than Nintendo in the same period, which is all that was required to make my point above (i.e. that recent changes only provide speculation for possible future success). Cheers.
:"Nowhere did I claim that CoD:MW2 did not sell 10 million units. "
You claimed that MW2 had sold 10 million worldwide, not just in the US. This is what you said, and I quote from your post made at 12 Mar 2010 at 8:11 am PST :
"Hmmm, now that I think about it, it would apply to the worldwide next-generation-console charts."
As I pointed out, MW2 has sold that 10 million just the US alone, not worldwide.
"Oh, wait, now we're narrowing the count down to 1995?"
No "narrowing down" anywhere. These were NPD figures right from the get go. NPD connot supply figures from before they were in the console tracking business.
" OH, OK... After cutting the parameters down AGAIN, "
The parameters have AWAYS been NPD figures. It's not anyone's fault but your own, if you never bothered to check up on when NPD started tracking games sales is it?
"now we're down to Wii Play and The Sims."
The Sims is not a console game. These are figures for console and handheld games. When is the last time you saw PC games like WOW listed in the NPD console games charts?
" In which case, Anita Frazier should have said, "Call of Duty: Modern Warfare 2 is now the third-best-selling game in North America since 1995, when NPD started tracking software sales in North America."
She didn't need to say that. Every figure she's ever given out have been NPD sales. Have you ever seen NPD ever give out figures from another company on US games sales?
In addition, of course all their figures are from when they started tracking game sales in 1995, not before that. That's just plain common sense.