CES 2005- Letter from Robbie Bach, Xbox best selling console in Nov&Dec

T

thorns

Banned
http://news.teamxbox.com/xbox/7431/CES-2005-Robbie-Bach-Letter/

With a great holiday season and year now officially in the books, I’d like to address the current state of the Xbox business and highlight a few key accomplishments as we move into the new year.

2004 was a solid year for the industry and was great for Xbox overall. It was a year of strong market momentum for our platform - as well as for our partners – as we entered the sweet spot of the current console lifecycle.


Significantly, for each of the last thirteen months, Xbox unit sales of consoles, software and peripherals grew year-over-year. We are the only company that can make that claim.

In July we announced that we had hit our annual goal and had sold 15.5 million consoles world wide through the end of fiscal year ‘04. We continue to be on track to sell in excess of 20 million consoles world wide by July 2005. The important point here is momentum. Based on NPD data for November and internal sales data for December, Xbox won the critical Christmas season in the United States, garnering a projected 40 percent market share. In the same timeframe, Xbox console sales propelled forward with an 11 percent increase compared to this time last year. At the same time, our competitors experienced year-over-year declines – PlayStation 2 dropped an estimated 40 percent, and GameCube sales fell an estimated 47 percent.

On the software side, the 2004 Christmas season was one of the strongest holidays on record, with the latest NPD data showing Xbox software sales up 77 percent year-over-year. Xbox now offers a rich portfolio for gamers of all ages and interests, with more than 600 titles available worldwide. Our attach rate – the number of games sold divided by the number of consoles – is 7.6 (8.3 with pre-packaged games), which continues to be the highest ever of any console at this point in its life cycle.

We announced last May that Electronic Arts was the latest addition to our list of publishing partners supporting Xbox Live, and this past year 13 new EA titles joined a portfolio of online-capable titles that now exceed 150. In fact, EA’s first Xbox Live enabled game “NCAA Football 2005”, saw its month one, year-over-year sales more than double on Xbox in the US, while remaining relatively flat on competitive platforms – a clear sign that gamers have embraced the Xbox Live community model of online gaming.

You may have seen the October Game Developers Magazine, which announced its top 20 Publishers of the Year. Microsoft Game Studios was named the number two publisher, just behind EA, based on revenue as well as use of third-party developers, average critical response to titles, percentage of original intellectual properties (IPs), and developer opinion. I’m extremely proud of MGS work and there are a couple of Xbox titles I feel represent two of the greatest entertainment experiences available for gamers today. A very strong performer for the company has been "Fable," developed by Peter Molyneux's Lionhead Studios, which sold more than 1.3 million copies since its launch in September. “Fable” was awarded “Best Role-Playing Game” at last month’s Spike TV’s second annual Video Game Awards in the US.

And of course, “Halo 2” mania continues, with the title outperforming all other titles on store shelves this season. “Halo 2” drove astounding retail performance, with worldwide sales of 6.3 million copies since its launch, and we expect strong sales momentum to continue throughout the year. The "Halo" franchise, which includes predecessor "Halo: Combat Evolved" for the PC and Xbox, has now sold a collective 12.7 million copies in just three years' time. “Halo 2” was also awarded two awards at Spike TV’s ceremony last month – “Best First Person Action” game and “Designer of the Year.”

Certainly, at least part of the success of "Halo 2" can be attributed to its experience on Xbox Live, and early Christmas data indicated that new customers flocked to the service in unprecedented numbers. By the end of December, more than one million unique Xbox Live users were playing online matches of "Halo 2” world wide, with gamers logging a collective 69 million hours of gameplay.

The year ahead promises continued excitement for Xbox gamers, with highly-anticipated upcoming releases that include Microsoft Game Studios’ “Forza Motorsport,” Bioware’s "Jade Empire" and Rare Studios’ "Conker: Live & Reloaded". A few weeks ago, Game Informer Online included these three titles in their “Ten Games to Watch 2005 List,” while also acknowledging that “Microsoft was a force to be reckoned with” in 2004. Our third-party partners will launch other long-awaited titles including LucasArts' "Star Wars: Republic Commando" and id Software's "Doom 3." Delighting legions of Xbox gamers, Rockstar Games announced just before Christmas that the hit “Grand Theft Auto: San Andreas” will be available this coming June. For younger gamers, Xbox Live Arcade, due to launch in Europe this Spring, will offer a variety of casual and classic arcade games for download, including "Bejeweled" and "Ms. Pac Man."

With an incredible Christmas season behind us, we continue to prove that the diverse games portfolio on Xbox and our thriving Xbox Live community are driving strong sales momentum into the New Year. We will exceed growing consumer expectations in the thriving video game sector for 2005 and beyond.

I hope you have a happy and prosperous new year.

Sincerely,

Robbie Bach

Senior Vice President, Chief Xbox Officer

Microsoft Corporation
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Wario64 said:
*insert green dancing banana here
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I see your green dancing banana, and raise you one black man dressed in mario garb:
nervgaiavatar.jpg
 
thorns said:
with worldwide sales of 6.3 million copies since its launch,
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I wonder what timeframe this includes. If it goes through December, that would put shipments at ~1.3 million for December. Now, I know there was quite a bit of inventory of the initial 5M shipment still out there when December started, but that's quite a bit lower than I expected.
 
The YoY sales comment is amusing, since Xbox had a pretty awful holiday season last year. itz gud 2 play 2gethah

Both sides are going to argue hardware shortages, but regardless of that it's very impressive that Xbox won the holiday season. I'm beginning to think Sony should be considered the underdog in the next-gen race for #1 in America.
 
I can't find the hardware sales for November 2003, only December 2003.

Place post November if you have it....I guess I can extrapolate November from the percent changes.

DECEMBER 2003
PS2: 1,970,000 [+132% over November sales] (~849K in November)
Xbox: 1,122,000 [+129%] (~489K in November)
GCN: 1,163,000 [+54%] (~755K in November)

HOLIDAY 2003
PS2: 2,819,000
Xbox: 1,631,000
GCN: 1,918,000

HOLIDAY 2004
PS2 = 2,819,000 * .6 = 1,691,400
Xbox = 1,631,000 * 1.11 = 1,810,410
Cube = 1,918,000 * .53 = 1,016,540

Xbox still narrowly outselling PS2. GameCube still getting crushed.

Odysseus said:
old, noob

:D
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That article did not have the year-over-year changes of the competing consoles, noob.

:D
 
Catchpenny said:
The YoY sales comment is amusing, since Xbox had a pretty awful holiday season last year. itz gud 2 play 2gethah
.
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EH? according to who? nintendo? MS had caught up by years end.
 
Doom 3, GTA, BUT WHERE IS HALF-LIFE 2 FOR XBOX MS!!
Where?! Where?!

Valve has stated they have it up and running on Xbox and the only thing delaying it was negotiations with MS.


I WANT MY XBOX HALF-LIFE 2!
 
This is what I calculated:
Code: 
Period	 PS2		Xbox		GCN
Nov 03	 849,000 		 490,000 		 754,000 
Dec 03	 1,970,000 	 1,122,000 	 1,163,000 
Hol 03	 2,819,000 	 1,612,000 	 1,917,000 
Change	-40%		11%		-47%
2004 est	1,691,400		1,789,320		1,016,010
Nov 04	 694,000 		 746,000 		 350,000 
Dec 04*	 997,400 		 1,043,320 	 666,010
 
Interesting, thanks for article. At same time kinda sad that blood and guts has that much power in this day and age.
 
border said:
I can't find the hardware sales for November 2003, only December 2003.

Place post November if you have it....I guess I can extrapolate November from the percent changes.

DECEMBER 2003
PS2: 1,970,000 [+132% over November sales] (~849K in November)
Xbox: 1,122,000 [+129%] (~489K in November)
GCN: 1,163,000 [+54%] (~755K in November)

HOLIDAY 2003
PS2: 2,819,000
Xbox: 1,631,000
GCN: 1,918,000

HOLIDAY 2004
PS2 = 2,819,000 * .6 = 1,691,400
Xbox = 1,631,000 * 1.11 = 1,810,410
Cube = 1,918,000 * .53 = 1,016,540

Xbox still narrowly outselling PS2. GameCube still getting crushed.

That article did not have the year-over-year changes of the competing consoles, noob.

:D
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the holiday 2004 numbers sound right, since xbox has 40% under those numbers
so nov 2004 was:
PS2: 694K (all SKUs including bundles)
XBX: 746K (all SKUs including bundles)
NGC: 350K (all colors/bundles)

that makes dec 2004 as:
xbox = 1,064,000
ps2 = 997,400
gcn = 666,000
 
Well, only in America. Sony will kill MS in Japan again, and should take Europe too.

Just from reading rumors and comments from western developers, Xenon seems to have more of their attention than the PS3 does. Some of that has to do with Xenon coming first, some of that has to do with Microsoft pushing tools to make development easier, some of it may just be Microsoft being a western company that is more approachable than Sony.

You consider that and the momentum of Xbox, and Microsoft's position looks good. Xenon will also get the larger share of the sports gamers this time, since it will get the first next-gen Madden title and has an online system that consumers prefer over what Sony has offered. The sports crowd and early-adopter Xbots alone should carry Microsoft through the first six months, and if something like Perfect Dark Zero turns out to be a big launch hit, all the better. Then they have Halo 3 to go up against the PS3.

Anyhow, I said beginning to think...I'm not completely converted to the dark side yet. :P

Barnimal said:
EH? according to who? nintendo? MS had caught up by years end.
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Oh, please. It was a disappointment after the '02 holiday season, and the anticipated hits for Xbox underperformed as well.
 
In the US, Microsoft has as much chance of beating Sony as the Xbox had of not going back to being doubled by PS2 monthly sales after the PS2 matched its price drop to $149, as Halo 2 had in selling comparably to Grand Theft Auto: San Andreas this year, and as the Xbox had in beating the PS2 in sales this past holiday.
 
(Extrapolated) December 2004 NPD

PS2: 997,400 (43.7% increase over November)
Xbox: 1,064,410 (42.6% increase over November)
Cube: 666,540 (90% increase over November)

The November-to-December increases are interesting, especially compared to last year. In 2003, PS2 and Xbox doubled their sales and then some while Cube barely squeaked a 50% increase.

This year, PS2 and Xbox couldn't even managed a 50% month-over-month jump, while Cube sales nearly doubled. I guess those shortages were really nasty, and a lot of frustrated parents ended up buying a Cube.
 
Catchpenny said:
I'm beginning to think Sony should be considered the underdog in the next-gen race for #1 in America.
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For a huge American corporation like MS to win the North American market is expected imo. Now if they can win Japan, or even be neck and neck in that market, that would be impressive.
 
Axsider said:
Letter from me! SONY sold over 75 million......... naaaaah, forget it. R. Bach is a joke!
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With the Oct-Dec sales they should have reached the 80 million mark easily worldwide.
On January 27 we'll know.
 
This year, PS2 and Xbox couldn't even managed a 50% month-over-month jump, while Cube sales nearly doubled. I guess those shortages were really nasty, and a lot of frustrated parents ended up buying a Cube.
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Yes, but it is also alot easier to double 350K then it is to double 750K or 690K
 
PS2: 997,400 (43.7% increase over November)
Xbox: 1,064,410 (42.6% increase over November)
Cube: 666,540 (90% increase over November)
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Actually this is pretty sad. Not one of the consoles sold as many as the #3 console last December. MS and Sony really screwed up. How could they have such a low amount in the pipeline. Sony shouldnt have dropped as much as they did from last year (Although I did expect a drop) and MS should have increased a great deal more with a very good bundle (For the masses) and the release of Halo 2. Propably cost Halo 2 300-500K in sales of people that would have bought an XBOX with Halo 2.
 
The only reason why Xbox sold more is because there were terrible PS2 shortages.
 
Xbox would have sold more if MS didnt screw up and got some machines on shelves. I reckon it definetly hurt Halo 2 sales
 
teh_pwn said:
The only reason why Xbox sold more is because there were terrible PS2 shortages.
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I saw more PStwos available than Xboxes near me. It varied greatly depending on region it seems.
 
joshschw said:
I saw more PStwos available than Xboxes near me. It varied greatly depending on region it seems.
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We could not keep ps2's in stock for over an hour here in florida
 
The only reason why Xbox sold more is because there were terrible PS2 shortages.
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Could basically say the same thing about XBOX.


Only reason XBOX didnt blow away PS2 and last years sales was because of terrible XBOX shortages.
 
"I saw more PStwos available than Xboxes near me. It varied greatly depending on region it seems."

Are you sure you weren't not seeing display boxes? There were plenty of those (very annoying too if you're looking for one...)

In Tennessee, they had no PS2s whatsoever. I went all over the place, but I finally found one minutes after Walmart got them in stock. They sold out almost immediatley after that.

This wasn't a local thing. Online retailers were sold out. Even the $300 bundles were all gone. They were being sold on Ebay for $300+.
 
Plenty of blame to go around this season.
The DS may have also took some cash away from the consoles this year, it being one of the "hot holiday items".
 
our competitors experienced year-over-year declines – PlayStation 2 dropped an estimated 40 percent, and GameCube sales fell an estimated 47 percent.
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Does this mean Microsoft now considers gamecube a competitor? i thought it was always ps2 :P
Its hard to say anything negetive about xbox's year in america, and it's always good to see someone challenge the dominating sony and stop a near manopoly, i just sure wish it wasn't microsoft :)
 
Could basically say the same thing about XBOX.

Only reason XBOX didnt blow away PS2 and last years sales was because of terrible XBOX shortages.
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Not really. There were no consistent Xbox shortages. PS2 had massive shortages, and Sony acknowledged this. Sony had problems manufacturing the new model.

http://news.com.com/PlayStation+2+shortage+rattles+shoppers/2100-1043_3-5471766.html
http://ps2.ign.com/articles/572/572978p1.html
http://news.bbc.co.uk/1/hi/business/4070755.stm
http://www.gamesindustry.biz/content_page.php?aid=5759
 
well it's very impressive by MS to challenge Sony in america already . Once they got an iron fist of it, It's hard to let go I guess.

Seems like Gamecube did pretty good too for a "dead" (as some like to call it) console.
 
Not really. There were no consistent Xbox shortages. PS2 had massive shortages, and Sony acknowledged this. Sony had problems manufacturing the new model.
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Your kidding right? There were news stories as well about XBOX shortages. And on the front page is a story about GameSpot lowering earnings because of shortages of hardware and we know they arent talking about the GCN.
 
The shortages were pretty horrid, and varied by region. For instance, in my area of the state I have yet to even see a PStwo at all - that's right, I have NEVER seen a PStwo in person, not even a display box. Xboxes weren't very scarce though up until like Christmas Eve.

A friend of mine in another area of the state though said the shortages were about even. I think it's pretty clear that overall Sony was really hurting for hardware supply this season, moreso than Microsoft. I mean, you had Sony gearing up the PStwo transition and then trying to get supply ready for PSP, often times in the same fabs, not the best situation they could have put themselves in.
 
You know a company's desperate when they call upon the might of year-on-year growth rates. It's a great way to make yourself look good the year after you did terribly and your competitor overperformed.
 
You also had the PS2 experiencing Year over Year declines in sales every month in 2004. So a drop in sales was expected and the XBOX experiencing Year over Year increases every month. By the way I still buy that a bunch of PS2 (Statistically measurable) owners were going to run out and replace their PS2 with a PSTwo (unless of course the PS2 died) that makes as much sense as burning the $150 to provide a little heat.
 
Links?

I didn't say Xbox didnt' have shortages, just that they were not consistent. If you searched for an Xbox at a typical mall, it would be found. You might have to go to a few stores, but you'd find one. Not the case with PS2. You could go to every store in town, and if you were lucky enough to find one, you'd probably have to buy it in some expensive bundle (this was Toys R Us's stance on it).

Sony had worldwide severe shortages because they could not produce enough of the new model. Xbox had mild shortages in the US. As seen in the articles I linked:

However, the USA is also experiencing severe shortage, and the unfulfilled demand in both territories is leading to significant price premiums being paid for new hardware on online auction sites such as eBay.

Although Microsoft is believed to be benefiting from Sony's difficulty in fulfilling demand for the PS2, the situation isn't entirely rosy for the rival firm either, with US retail sources indicating that Xbox stock is also in short supply.
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You know a company's desperate when they call upon the might of year-on-year growth rates. It's a great way to make yourself look good the year after you did terribly and your competitor overperformed.
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That would be 100% true if the year they are comparing it to had actually been a down year. Last year even tho the GCN outsold the XBOX in November and December saw the XBOX sell better then it had the previous year. This year has proved that the GCN only sold so well anyway was because of a big price drop.
 
I didn't say Xbox didnt' have shortages, just that they were not consistent. If you searched for an Xbox at a typical mall, it would be found. You might have to go to a few stores, but you'd find one. Not the case with PS2. You could go to every store in town, and if you were lucky enough to find one, you'd probably have to buy it in some expensive bundle (this was Toys R Us's stance on it).
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I havent seen an XBOX in a retail store since before Thanksgiving. This include multiple trips to multiple Best Buys, Circuit City, WalMart, GameStop, EB Games, multiple TRU, multiple Target's, Orland Square Mall, Oakbrook Mall, Old Orchard Mall and Yorktown Mall all around the Chicago suburbs.
 
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