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NPD Sales Results for November 2014 [Up3: NPD Data Error, AC:U #5]

Mooreberg

is sharpening a shovel and digging a ditch
Generally speaking, the only time we literally see everything in an entire market start selling worse is when a market collapses entirely, not when it contracts. A complete, uniform reduction in sales would spell imminent doom, and we don't see that. Contraction is not so disastrous, and tends to present with the winners winning more and the losers exiting the market, until only a few companies / franchises can still be classified as "winners." We can see that quite clearly in the console software market.
This what surprised me so much about other third parties letting stuff like Watch Dogs and Destiny go virtually uncontested. Ubi and Activision already have the most reliable annual release cycle that doesn't rely on outside league licensing, and the big successes introducing new franchises went to... Ubi and Activision. It seems like further consolidation is inevitable. The companies that did not put products out are in prime position to be absorbed by the companies that put games out. Market Darwinism, I guess. I just don't get the impression that a lot of these other companies had much of a strategy in place.

In the hardware market contraction, we'd expect to see casual consumers exit first, and that's what we're seeing in two ways; first, Nintendo had a disproportionate share of casual users, and is clearly being hit the hardest. Second, Sony/MS's last generation machines are selling unexpectedly poorly, which indicates there are fewer late buyers than people anticipated, and these buyers are disproportionately casual too. Further, if contraction is happening, we'd expect to see the remaining consumers spend more -- that's how markets tend to compensate for the loss of a broader consumer base -- and again, I believe we're seeing that.
The thing about late buyers is... what is the precedent or expectation for how an eight or nine year old system (with a horrible price cut history) should be selling? I honestly have no idea what PS2 was selling around the time Persona 4 or Yakuza 2 got released in the U.S. PS3 and 360 seem like zombie platforms to me that had their lifespans artificially extended by a horrible economy, and a market leader that fell off way before their new platform was introduced. It isn't like either platform had PS2 levels of market penetration worldwide (even the Wii ended up tens of millions of units short).

I think publishers got way, way too comfortable selling PS3/360/PC games for longer than a healthy economy would have accommodated for. You've now got instances where some games sell a vast majority of copies on new platforms (Watch Dogs, Destiny, Shadow of Mordor) along with games that still sell more on older platforms (Call of Duty). How you can simultaneously have two new platforms selling at historically fast rates and still have a protracted transition seems like a spectacular feat in poor planning and mismanagement to me.

The one thing that seems to have really worked out for them is the shift to mobile for portable gaming. Much higher potential gains, with a fraction of the effort needed to make even PSP or DS games.

Advanced Warfare had about 25% drop compared to Ghosts last year.
Well I guess I'm not alone then when it comes to wondering why people would keep aiming at doorways for hundreds of hours of each year. I like Advanced Warfare but man... nothing has changed with how people play those games since MW2 came out.
 

Opiate

Member
Not disagreeing with your points overall but how much does this one have to do with both ps3 and 360 being priced way higher than their predecessors at this period in time relative to the generation? By this time the ps2 was $99.

Totally possible. Further, Nintendo's loss of casual consumers might just be that they made a very bad product, and not because casual consumers are now inherently unwilling to buy a console.

However, I'd also caution against what I think of as a fast and loose method of analyzing these variables. As a simple example to explain what I mean, I've seen people on other tech forums suggest that if the new OLED TVs were 800 dollars like LCD TVs are today, then OLED TVs would be creaming the LCD TVs in sales. And that may be true, but of course, the entire reason that OLEDs cost more is also the reason why the super high-end tech people like them so much. If you actually found a way to produce an OLED TV for 800 dollars, it's quite likely that it wouldn't be very good, which is what made high end tech people like them in the first place.

Similarly, a $100 dollar PS3 today might sell better than a $200 dollar PS3 does, but it might not. To accomplish a price point that cheap, the PS3 might have needed to be cheaper tech to begin with, which might have made it less appealing to people from the start, which could have cut off its legs too.

I'm not saying you're wrong; I'm just saying it's more complicated than it may first appear.
 

SegaShack

Member
I think he said something about 3GB RAM limit for indie games on Xbox One.

He also said that a storm was coming, implying a big problem for Xbox One close to launch.
Yeah he kept saying their was an "epic ass storm". A mod who was a developer shut him down on posting it because he believed the information was false.
 

NickFire

Member
They haven't said anything? They should say something imo.

They are withholding comment pending an investigation into the possibility that North Korea hacked NPD and distorted the numbers to inflict further damage on them due to the Interview movie. I know this because a dog who only talks to me filled me in telepathically.

On a slightly more serious note, they really should be saying something. Its weird hearing nothing from them.
 

nannasin

Neo Member
Microsoft might not be decreasing their production costs at the same rate as Sony. If we believe that they both signed up to produce 1 million units per month for 12 months that'd be 12 million units each. Microsoft has shipped about 10 million (2 million still in warehouses) of those to retailers. Sony has shipped far more. In the coming year do you think Microsoft will produce a million a month? I don't. By not producing as many units there is a lower discount for production materials. Sony is likely to ramp up productions and will recieve an even bigger discount for materials.

thats alot of one way assumptions.
 
Overall hardware sales decreased significantly, even as Xbone/PS4 had very good months.

This is compatible with market contraction. For people who are either not well versed in Economics/Market studies or who are not well versed in games in particular (or both), this may seem superficially confusing.

A clearer example of this can be seen with software; people will point out that GTA and Elder Scrolls are selling better than ever, and wonder why anyone could suggest that the software market (in this case I mean the console retail market) is contracting.

Generally speaking, the only time we literally see everything in an entire market start selling worse is when a market collapses entirely, not when it contracts. A complete, uniform reduction in sales would spell imminent doom, and we don't see that. Contraction is not so disastrous, and tends to present with the winners winning more and the losers exiting the market, until only a few companies / franchises can still be classified as "winners." We can see that quite clearly in the console software market.

In the hardware market contraction, we'd expect to see casual consumers exit first, and that's what we're seeing in two ways; first, Nintendo had a disproportionate share of casual users, and is clearly being hit the hardest. Second, Sony/MS's last generation machines are selling unexpectedly poorly, which indicates there are fewer late buyers than people anticipated, and these buyers are disproportionately casual too. Further, if contraction is happening, we'd expect to see the remaining consumers spend more -- that's how markets tend to compensate for the loss of a broader consumer base -- and again, I believe we're seeing that.

You really have to wonder how much the 360/PS3 not being dirt cheap is hurting low end adoption for kids and casuals. 9 year old hardware still being sold for $299 is just mind boggling. I couldn't even get $200 on craigslist for my 8 year old LCD HDTV. It has probably really hurt publishers hoping to still eke out sales for cross-gen games that aren't named Destiny/Madden/FIFA/CoD.

And to think at the start of the gen, MS had no plans to support self-publishing. A shrinking AAA portfolio on PS4/One that has been absurdly padded by ports, remakes, and cross-gen games, and they were planning on putting the squeeze on the guys filling in the gaps.

As I posted before, the current console industry needs a new breakout hit on the level of COD4 or Wii Sports/Fit/Play or even MineCraft.
 

Biker19

Banned
That's precisely why I didn't participate.

If any of you guys know me, that's not how I operate.

I didn't say anything about CBOAT because the thread was way too fucking crazy and I didn't want the limelight on me when everybody and their mother is watching GAF's NPD thread.

I almost never participate in the early stages of any NPD thread for that very reason. I hate these threads when they're moving at 10 posts a second.



It was also pissing me off how people were being like "Well, she didn't correct CBOAT, so he must have been correct lol."

It's never appropriate to assume any live data leak is true unless it's from a trusted source.

Very understandable.
 
What a thread, I haven't posted in it yet. But I was following it on my phone all of last night. What a month for Microsoft, congrats Phil. Hopefully the momentum can continue for them.

It's never appropriate to assume any live data leak is true unless it's from a trusted source.

Should be at the bottom of all future NPD threads.
 
Overall hardware sales decreased significantly, even as Xbone/PS4 had very good months.

This is compatible with market contraction. For people who are either not well versed in Economics/Market studies or who are not well versed in games in particular (or both), this may seem superficially confusing.

A clearer example of this can be seen with software; people will point out that GTA and Elder Scrolls are selling better than ever, and wonder why anyone could suggest that the software market (in this case I mean the console retail market) is contracting.

Generally speaking, the only time we literally see everything in an entire market start selling worse is when a market collapses entirely, not when it contracts. A complete, uniform reduction in sales would spell imminent doom, and we don't see that. Contraction is not so disastrous, and tends to present with the winners winning more and the losers exiting the market, until only a few companies / franchises can still be classified as "winners." We can see that quite clearly in the console software market.

In the hardware market contraction, we'd expect to see casual consumers exit first, and that's what we're seeing in two ways; first, Nintendo had a disproportionate share of casual users, and is clearly being hit the hardest. Second, Sony/MS's last generation machines are selling unexpectedly poorly, which indicates there are fewer late buyers than people anticipated, and these buyers are disproportionately casual too. Further, if contraction is happening, we'd expect to see the remaining consumers spend more -- that's how markets tend to compensate for the loss of a broader consumer base -- and again, I believe we're seeing that.

Interesting analysis. So where do you see the console market in two years? Do you think that Sony and Microsoft will manage to keep up the pace even as the market is contracting around them or will they see a drop in sales as well?
 

RedAssedApe

Banned
Good numbers all around. MS did good in November. However, December might go to MS as well. Don't they have a 12 days of Christmas sale still going on. I don't see the Xbox returning to the $400 vantage point come 2015. Will Sony drop $50 or will they try to ride out the wave and see how the market reacts?

I see them at least letting it ride through the release of The Order and Bloodborne if not all the way through E3. Although we'll get an idea by January NPD as to what direction Xbone is trending. No need to make a knee jerk reaction which could very well be two anomaly months where Xbone comes down to earth.
 

Opiate

Member
As another simple example to explain what I mean: would the iPad sell better if it were $40 dollars instead of $200-600?

Some people might say "Obviously it would," but in the real world that isn't necessarily true. In fact, it probably wouldn't be; to make a $40 iPad, Apple would need to cut all sorts of corners, and the final result would be a very poor product in all sorts of ways -- it would run slow, overheat constantly, probably won't work with almost any Appstore applications, and so forth. While the new iPad may be very cheap, it's also a much less advanced product, and I suspect most consumers would rather not buy it.

I think the PS3 could probably afford to be dropped to $100 at this point without losing money, but then, they need it to actually make money now, because Sony lost so much money up front with the thing. If they wanted to lose less money up front, they almost certainly would have had to reduce the system's technical specifications (unless someone in here wants to suggest they should have started at a $700 price point), which might have kept it from ever being successful at all. Maybe it would have made it easier to port games to the Wii, which would have given the Wii a stronger foothold with "core" developers, which would have fully collapsed the Xbox/PS ecosystems. I'm not sure; I'm just saying you need to think it through, and realize that price reductions have all sorts of consequences.
 

daveo42

Banned
I see them at least letting it ride through the release of The Order and Bloodborne if not all the way through E3. No need to make a knee jerk reaction which could very well be two anomaly months where Xbone comes down to earth.

At this point I don't think Sony can afford to make such a reaction with Playstation either. They may need to re-evaluate going forward if X1 stays at a lower price point and continues to sell better than the PS4 after we get solid 1st and 2nd party games on the system. MS had the superior 1st offerings and deals this holiday. We just have to wait to see if that forward momentum sticks.
 

Biker19

Banned
The thing about late buyers is... what is the precedent or expectation for how an eight or nine year old system (with a horrible price cut history) should be selling? I honestly have no idea what PS2 was selling around the time Persona 4 or Yakuza 2 got released in the U.S. PS3 and 360 seem like zombie platforms to me that had their lifespans artificially extended by a horrible economy, and a market leader that fell off way before their new platform was introduced. It isn't like either platform had PS2 levels of market penetration worldwide (even the Wii ended up tens of millions of units short).

I think publishers got way, way too comfortable selling PS3/360/PC games for longer than a healthy economy would have accommodated for. You've now got instances where some games sell a vast majority of copies on new platforms (Watch Dogs, Destiny, Shadow of Mordor) along with games that still sell more on older platforms (Call of Duty). How you can simultaneously have two new platforms selling at historically fast rates and still have a protracted transition seems like a spectacular feat in poor planning and mismanagement to me.

And that's the big mistake that 3rd party publishers keep making, especially Japanese 3rd party publishers. They keep making games cross-gen with PS3/PS4, & Xbox 360/Xbox One when most people have already moved onto newer platforms, except Japan for some reason.

That's why I say that Japanese 3rd party publishers needs to make their games PS4 exclusive for the purpose of getting Japanese gamers to buy the platform over in Japan, instead of constantly making their games cross platform between either PS3 & PS4, PS4 & PS Vita, or PS3/PS4/PS Vita.
 

BigDug13

Member
You really have to wonder how much the 360/PS3 not being dirt cheap is hurting low end adoption for kids and casuals. 9 year old hardware still being sold for $299 is just mind boggling. I couldn't even get $200 on craigslist for my 8 year old LCD HDTV. It has probably really hurt publishers hoping to still eke out sales for cross-gen games that aren't named Destiny/Madden/FIFA/CoD.

And to think at the start of the gen, MS had no plans to support self-publishing. A shrinking AAA portfolio on PS4/One that has been absurdly padded by ports, remakes, and cross-gen games, and they were planning on putting the squeeze on the guys filling in the gaps.

As I posted before, the current console industry needs a new breakout hit on the level of COD4 or Wii Sports/Fit/Play or even MineCraft.

I'm really surprised Microsoft isn't heavily discounting the Xbox 360 for those markets. They would end up with more people subscribing to Live Gold which is more money in their pockets. It's a bit more understandable why the PS3 isn't doing that as Cell is still really expensive and their free online wouldn't translate to very many PS+ subs.
 
If Ubisoft comes out of this feeling like they got one over on people with Unity, I really fear for the quality level of their output for the next few years. Ugh.

I don't think they think they pulled one over on anyone with only selling in the neighborhood of 600k unbundled copies.
 

Mpl90

Two copies sold? That's not a bomb guys, stop trolling!!!
Call of Duty: Advanced Warfare being 27% lower than Ghosts means 4,453,000
360 - 1,291,370
XBO - 1,246,840
PS4 - 1,157,780
PS3 - 757,010

Thus, Destiny (bundles excluded) between October and November

XBO- ~ < 301,840
PS4- ~ < 266,780
360- ~ < 670,370
PS3- ~ < 514,010
 
You really have to wonder how much the 360/PS3 not being dirt cheap is hurting low end adoption for kids and casuals. 9 year old hardware still being sold for $299 is just mind boggling. I couldn't even get $200 on craigslist for my 8 year old LCD HDTV. It has probably really hurt publishers hoping to still eke out sales for cross-gen games that aren't named Destiny/Madden/FIFA/CoD.

And to think at the start of the gen, MS had no plans to support self-publishing. A shrinking AAA portfolio on PS4/One that has been absurdly padded by ports, remakes, and cross-gen games, and they were planning on putting the squeeze on the guys filling in the gaps.

As I posted before, the current console industry needs a new breakout hit on the level of COD4 or Wii Sports/Fit/Play or even MineCraft.

I bought a 360 4GB model for $99.99 on ebay on Black Friday, since that was pretty much impulse purchase price (bought it as a gift for someone). I'm surprised that's not the actual standard retail price for that model, lol.

A 360/PS3 that has free streaming apps and also plays a shitload of games would definitely be a good fit for the casual market, and the media box market.
 

Opiate

Member
Interesting analysis. So where do you see the console market in two years? Do you think that Sony and Microsoft will manage to keep up the pace even as the market is contracting around them or will they see a drop in sales as well?

I think it will still be fine. I think MS and particularly Sony will be the last to feel any squeeze, because contractions (if a contraction is actually occurring) usually start at the bottom and gradually work their way up. But sometimes, markets contract and then stabilize. That happens, and it can work out just fine for the remaining players, even if they are smaller in number. There are really two risks I see that it make it difficult to prognosticate:

1) New Blood. To continue to attract new audiences (which is necessary even in stagnant industries as you always lose old customers over time), you need new, break out products that appeal to people who weren't already interested. The easiest way to accomplish this is the way iOS and PC have done it; throw tons of crap at the wall. Yes, there is tons of shovelware on iOS and on PC. Yes, there are tons of random people making crappy games in their garage on those platforms. But occasionally, one of those games ends up not being so crappy, and becomes Minecraft or Clash of Clans or League of Legends or Counter Strike. It's really hard to predict these types of games which change the landscape, but the best way to get them on your platform is just to have tons of games trying lots of different things. Right now, that's the opposite of what's happening on consoles; there are fewer games, and those games are increasingly safe. It doesn't mean a breakout hit couldn't happen, it just makes it less likely.

2) Relentlessly increasing production costs. A stagnant user base is not, by itself, a disastrous thing; for instance, Harley Davidson motorcycle consumption has not increased appreciably over the last few decades (it has increased, but only marginally faster than population growth), but it doesn't have to. The product is profitable and produces a steady net income, even if it's not growing very significantly, and that's fine. But now imagine that motorcycle product costs were continuously increasing, such that motorcycles were twice as expensive to produce (even adjusting for inflation) as they were a decade ago. That would be a serious problem looming on the horizon; that would not be sustainable long term.

I don't think these issues are unfixable, and I'm always hesitant to predict the future. For the moment, the console market isn't set for imminent collapse, but does appear to be contracting. I think that contraction could cause problems long term, but then, every industry has potential clouds on the horizon, and sometimes those industries manage to dispel those clouds before they turn in to a major storm.
 

Mooreberg

is sharpening a shovel and digging a ditch
And that's the big mistake that 3rd party publishers are currently making, especially Japanese 3rd party publishers. They keep making games cross-gen with PS3/PS4, & Xbox 360/Xbox One when most people have already moved onto newer platforms, except Japan for some reason.
Japan decided a long time ago to hitch their wagons to handhelds to keep costs under control, and then Android and iOS happened. If you told me now that third party publishers from Japan were making less on mobile + handheld than companies from China, Korea, and United Kingdom, I would believe you. Your brand name and legacy doesn't count for much among people who are completely indifferent.

Meanwhile Konami seems to be doing fine with health clubs and realistically rendered watermelons. Poor forecasting intensifies?

I don't think they think they pulled one over on anyone with only selling in the neighborhood of 600k unbundled copies.
I'm talking about the decision to push a horribly flawed product out the door being rewarded. It is hard to say how bad any YoY drop is without knowing how much Microsoft paid them for bundled software sales.
 
Does everyone asking for a Sony reaction forget that they are doing very well worldwide? Even if Microsoft pulls ahead slightly do they even care? considering they are crushing Microsoft everywhere else?
 
2) Relentlessly increasing production costs. A stagnant user base is not, by itself, a bad thing; for instance, Harley Davidson motorcycle consumption has not increased appreciably over the last few decades (it has increased, but only marginally faster than population growth), but it doesn't have to. The product is profitable and produces a steady net income, even if it's not growing very significantly, and that's fine. But now imagine that motorcycle product costs were continuously increasing, such that motorcycles were twice as expensive to produce (even adjusting for inflation) as they were a decade ago. That would be a problem; that would not be sustainable long term.

A good comparison point because I don't think this is how shareholders see it. They see gaming divisions as ones that should constantly be growing, and absent that growth, may actually cause decisions that hurt the division in the long run because it somehow victimizes the loyal consumer base.
 

QaaQer

Member
I think the first 30 or so pages of this thread could be a case study in confirmation bias. People latched onto something from a clearly biased source, and the evidence itself was nonsensical (I tried to point out that the fact alone that the "leak" was a range of numbers made no sense). People just gobbled it up like it was a fact without any critical discussion.

What is scariest is that within minutes, people on other forums like reddit and twitter were parroting the statement as if it was an early source, but without mentioning who the source was. It shows why FUD spreads so fast in the gaming community.

Hopefully this whole thing will be a reminder to people to think before they repost information, even if that information fulfills their hopes and dreams.

dude, it's about toys.
 
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