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Analysis: Did The PSN Outage Hurt U.S. PS3 Hardware Sales?

Analysis: Did The PSN Outage Hurt U.S. PS3 Hardware Sales?

June 21, 2011 | By Matt Matthews

[As part of his monthly analysis of NPD Group's U.S. physical video game retail sales estimates, Gamasutra analyst Matt Matthews examines how the weeks-long PSN outage affected PlayStation 3 hardware sales.]

In mid-April, Sony discovered traffic on its PlayStation Network that was eventually revealed to be an unauthorized intrusion that gave access to consumer data. Once the intrusion was detected, administrators took down the servers to avoid further damage.

The network, including online multiplayer gaming, was partially restored on May 14, 2011, and fully restored in many territories, including the U.S., by the first of June.

Sony's compromised, disabled network was widely reported on during this time and we wondered whether sales of the PlayStation 3 hardware, software, or accessories would suffer as a result. After all, free multiplayer gaming " a feature Sony has often touted as an important part of its product " was completely disabled for approximately one month.

Looking first at hardware, the simple fact is that Sony's hardware sales have been decreasing since they peaked briefly back in February. It would be difficult to discern without finer-grained data whether the network outage was responsible for PS3 sales declining in April and in May, since sales were already going down in March. The figure below demonstrates this.

Software is a different situation, since the release of key titles can skew the results from month to month. What we can say is that its software revenue dropped 28 percent from April, while the Xbox 360 saw only 16 percent decline, according to comments from Wedbush analyst Michael Pachter. On the other hand, the PS3 continues to generate more software revenue per installed system than does the Xbox 360.

We asked the NPD Group for some insight into how recent cross-platform titles have performed on the Xbox 360 and PlayStation 3, to see if we could discern any shift in sales trends. As NPD Group analyst Liam Callahan commented to us, "it's a mixed bag."

Data was provided to us for four key titles: Mortal Kombat, L.A. Noire, Brink, and Portal 2. For each title, we were provided with the ratio of unit sales of the Xbox 360 version to the PlayStation 3 version, for comparison to the ratio of the Xbox 360 hardware base to the PlayStation 3 hardware base, which is currently 1.6.

The table below summarizes the results.

Callahan noted: "Mortal Kombat and L.A. Noire performed better on the PS3, while Brink was favored by the 360. Portal 2 was inline with the current ratio of the 360 to PS3 install.”

The table also shows that Mortal Kombat is the only title for which the PS3 version sold better than the Xbox 360 version in terms of unit sales and not relative to the installed base. In that case, the PS3 version sold 11 percent more units than did the Xbox 360 version. On the other hand, Brink sold 160 percent more units on the Xbox 360 than it did on the PS3.

Of these four games, three of them performed at or better than the installed base ratio might have suggested.

Finally, when asked about accessories, Callahan elaborated that "PS3 accessory sales were positive in May 2011 versus May 2010." That suggests to us that PSN card sales were up relative to last year, but by how much we cannot be sure. Last month we asked about April PSN card sales and were informed that, in terms of units, card sales were up 4 percent.

Outside of PS3 hardware sales, where the situation is unclear, it appears from these data points that the PSN outage did not seriously affect retail sales of software or accessories, and in particular card sales. We expect that sales will show improvement across all three segments in June, with the new Call of Duty: Black Ops hardware bundle possibly having a positive effect on system sales and the Call of Duty: Black Ops DLC driving PSN card sales as some consumers will be wary of trusting Sony with their credit card numbers again, at least for the present.

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