Tuesday, May 22, 2007

PS3 Outsold by GBA in April, Yikes!

Here are the numbers for video game console and handheld sales from the NY-based NPD Group for the month of April 2007:

Nintendo DS: 471,000

Wii: 360,000

PlayStation 2: 194,000

PlayStation Portable: 183,000

Xbox 360: 174,000

Game Boy Advance: 84,000

Playstation 3: 82,000

I'm not sure what these numbers are saying more about. Are they saying more about Nintendo dominating in both handled and console sales? Or, are they saying more about the PS3 putting up pitiful numbers for April?

Hmmm, I guess they are saying a little of both. Sony really is caught between a rock and a hard spot. Sales are lagging, partially due to a poor selection of games and partially because of the $600 price tag. My guess is that the sticker shock has more to do with the PS3's sluggish sales than anything. $300 is still the magical price point. The Xbox 360 has sold reasonably well at $400, but it won't really take off until is gets down to $300. I'm sure Microsoft thought they would have a much bigger lead over both the PS3 and the Wii by now.

But Sony is really stuck. If the reports that they are losing $200+ on every PS3 sold are to be believed, then dropping their price won't help. Can you imagine cutting the price by $100 and then losing $300 per unit? They may sell a few more PS3s at $500, but they will be so far in the hole, they may never recover this generation.

Sony's best hope is to have enough compelling software that is unique to their system, that people will start to fork over the $600. But like I said earlier, at $600, they are from from the consumer friendly $300 price point.

I'm sure Sony is shocked that not everyone 'got a second job' to pay for their system. But now they are in an unfamiliar position. They are sitting third in a 3 system race. The next year is crucial for them. If sales don't improve, developers could move along to better selling systems. And who could blame them? Even the soon-to-be-dead GBA is selling more systems.

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