US: Continued Wii Dominance Over HD Consoles

Landmark: 360 Hits 900k in Japan; Still Short of Goal

Japan - Just four short months ago we posted an article that quoted Microsoft's goal of one million units for the land of the rising sun.

That goal came a little bit closer to reality last week, if only incrementally: 360 has now passed the nine hundred thousand barrier and is just one hundred thousand short of Microsoft's goal.

When the goal was first asserted back in October, the 360 was hovering near seven hundred thousand units. Since then the 360 has seen a two hundred thousand unit surge in four months.

While some scoff at the American entry's attempts at Japanese assimilation, there's little doubt that Microsoft's machine has altered the market forever.

Potentially the most important factor is that Microsoft forced Sony to answer to the 360 before they were done milking the PS2 for long-tail software sales.

Instead, Sony pushed through plans to produce a hardware behemoth that would compete with the 360 in the US. The effects of this have been clearly felt in Japanese sales, where Sony's entry is lagging far behind the third player in the market, Nintendo's Wii.

There are numerous reasons why the PS3 hasn't met expectations (and they've been covered to death), but no small part of that analysis is price which is clearly related to hardware costs...and Microsoft, in whole or in part, can take credit (or blame) for forcing Sony's hand on the issue.

Whether or not Microsoft will translate the paltry-but-not-nonexistent userbase into future profits in the Japanese market is to be determined. But this is a start.

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US: HD Systems Losing Still More Ground to the Wii

US - The Wii has now surpassed all gains that the HD Console market made before the tiny-white-system-that-could went on sale. Combined, the XBOX 360 and the Playstation 3 have a 3.01 million system lead on the Wii--a little less than what they started with when the Wii launched.

The HD systems (referenced by the intelligentsia of gamderdom as "Next Gen") looked to be gaining momentum against the onslaught of Nintendo's mass-audience appeal, and at one point had a 5.4 million system lead on the Wii.

Now, that lead is disappearing just as quickly as copies of Wii Fit are moving off the shelf. Why is such a nebulous number important? Because analysts, including this one, have suggested that perhaps the combined numbers of HD system sales were keeping 3rd parties from making serious games for the Wii.

That argument barely holds water at this point. The HD-to-Wii ratio has been dropping nearly every month for the past year and still the Wii looks to be the stepsister of western-focused genres. The current and probably most accurate statement at this time is that 3rd parties have whole-heartedly dismissed the Wii as an "outside the hardcore" demographic and are treating it accordingly.

This latest news, though, might begin the turnaround of that perception. The Wii continues to sell despite the down economy, generally something one would expect for systems with a harder-core following. Japanese companies are committing to it, including titles like Madworld, Monster Hunter, and Dragon Quest X (a little further off).

Perhaps that will change in the west as well. EA has supposedly started to focus its energies on the Wii platform despite the majority of its catalog selling millions of copies on the 360 and PS3 (see: Madden, Burnout, etc). Maybe by focus, they mean, "make quality games for it." That would be an interesting change from the what many 3rd parties have done so far.

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Gears of War 2 Passes 3 Million

Kris Graft of EDGE is reporting that Gears of War 2 has passed three million in worldwide sales.

Launching only four weeks ago, the sequel to the 5-million-selling megahit reached the three-million mark six weeks quicker than the original.

Epic Games VP Mark Rein said in an e-mail, "Microsoft [the game's publisher] confirmed to me this afternoon that Gears of War 2 sell-through surpassed 3 million units as of last week."

This is certainly good news to GoW fans, hardcore gamers, and investors alike; when a game like GoW and its sequel can sell eight million combined it shows that the market will still support quality games in the male 18-35 demographic.

Source

Microsoft targets 1 million Xbox 360 sales in Japan

Microsoft Corp’s Japanese unit aims to achieve its domestic sales target of one million units for the Xbox 360 video game console as quickly as possible, a senior official said on Friday. Microsoft Co, the U.S. software giant’s unit, hopes to boost sales by leveraging new games and boosting sales promotion efforts, Takashi Sensui, executive officer and chief of the home and entertainment division of the Tokyo-based firm, said.

Read the whole article at JapanToday.

Analysis & Opinion
Can they do it? At roughly seven hundred thousand units sold in Japan, they need three hundred to reach that magical mark of one million units. If we start with the base assumption that the 360 will be around for exactly three more years before being replaced by its successor (the 720?), then we can extrapolate that it needs to sell one hundred thousand per year to do so.

Breaking it down further, that's 3 years at 52 weeks for a total of 156 weeks. Dividing 300,000 by 156 leaves us with 1,923 units per week for three full years to be able to reach one million.

Based on our previous assumption, this should be extremely easy, especially since at 360's lowest point ever it was still averaging 1k+. With a few bumps during big holiday periods and a few big title releases, this should absolutely be possible. What could prevent this? Clearly, the 360 being replaced early in Japan would be the biggest cause for concern.

What does it mean? What does a million units in the land of Nintendo's Wii and DS soaring into the stratosphere and Sony's PS2 having already broke every record for console sales in history? Not much, honestly. But what Microsoft has successfully done is leverage the audience of hardcore gamers unsatisfied by Nintendo's and Sony's offerings into a palpable base that can impact the market. Most importantly, they successfully dictated to Sony the schedule at which "next gen" would begin. One million units is a good launch pad from which to try that again.

PL

XB360 Top 10, July 14/08 - Aug 17/08

Hi, this is my first post.
Let's see if I can upload an image. Hmm...





Total domination by Namco there.