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Report: PS2 sales shortfall likely to continue
- Thread starter Odysseus
- Start date
Doom_Bringer
Banned
looks like they wanna discontinue the old ps2 model
I don't know how PS2 sales can be down only 20% when my whole city is pretty much sold out entirely.
I bet the redesigned PS2 will fly off the shelves, its been a few months now that PS2 supplies have been close to zero, I bet there is a significant built up demand and you just know that there is going to be a production short fall on the new PS2s as well.
I bet the redesigned PS2 will fly off the shelves, its been a few months now that PS2 supplies have been close to zero, I bet there is a significant built up demand and you just know that there is going to be a production short fall on the new PS2s as well.
Using the 41/40/19 ratio for Xbox/PS2/GC, and using PS2 sales at 80% of last year, September could look like this:
Xbox 273,880
PS2 267,200
GCN 126,920
On the other hand, using the same ratio but factoring on GC sales at 70% of last year, sales could look like this:
Xbox 249,237
PS2 243,158
GCN 115,500
My guess is that the numbers will be closer to (but lower than) the first projection.
Xbox 273,880
PS2 267,200
GCN 126,920
On the other hand, using the same ratio but factoring on GC sales at 70% of last year, sales could look like this:
Xbox 249,237
PS2 243,158
GCN 115,500
My guess is that the numbers will be closer to (but lower than) the first projection.
Jumpman
Member
This is a serious mistake by Sony. Nintendo's shortage in december 2003 lasted a few months and completely killed their holiday momentum, allowing Microsoft to cement themselves as a solid number two in the U.S. Nintendo has not been able to recover from that yet. Now Sony (although in a much stronger position as far as market share goes) is giving Microsoft an oppurtunity to take a sizable bit of marketshare from them until November. Chances are, with Microsofts mega release coming out then, Sony's redesigned PStwo will not be able to regain all of the market share that they ceded to the Xbox during that time. It is dangerous for a market leader, who in the recent past has been absolutely dominant, to be seen on the same level (or below) its closest competitor. Sony is in such a rush to phase out the old PS2 model, that they are arrogantly neglecting the hardware market until the PStwo arrives. Bad move. It will backfire on them in the long run.
Microsoft knows that they can't catch the PS2 userbase. Their goal leading up to the release of Xbox 2, is to raise their market position as high as posible. If Xbox is regularly selling in Sony's league when Xbox 2 releases, then Microsoft's new system is likely to do very well. Xbox 2 will launch as a viable competitor to PS3, with a whole year to cement a strong market position. If this all comes to pass, then even if PS3 eventually leads the next gen market, it won't be by much.
Microsoft knows that they can't catch the PS2 userbase. Their goal leading up to the release of Xbox 2, is to raise their market position as high as posible. If Xbox is regularly selling in Sony's league when Xbox 2 releases, then Microsoft's new system is likely to do very well. Xbox 2 will launch as a viable competitor to PS3, with a whole year to cement a strong market position. If this all comes to pass, then even if PS3 eventually leads the next gen market, it won't be by much.
Jumpman said:
GTA SA + GT4 + Sexy new PS2 = PS2 sales will explode.
The limited numbers of PS2 are only going to increase the value of the PS2 in the eyes of consumers before christmas.
These few extra 10K per month of Xbox sales aren't going to make much of a dent in Sony's over all mind and market share.
PS2 will be the hottest thing again this Christmas because of this.
open_mouth_
insert_foot_
Microsoft is in attack mode, baby. So what if it takes massive PS2 shortages to get the job done. The fact of the matter is that the Xbox is kicking so much ass at retail, that I can't even think of a relevant dependent clause to finish this sentence.
sonycowboy
Member
open_mouth_ said:
1) They're kicking so much ass they'll overtake the PS2 in total sales. No, that won't work
2) They're kicking so much ass they'll overtake the PS2 in YTD sales. Nope, can't make that either.
3) They're kicking so much ass they'll overtake the PS2 in Holiday sales. Nope, again no chance.
4) They're kicking so much ass that they're lucky to outsell the PS2 even when there are zero PS2 units on shelves. Ding, ding!! We've got a winner.
sonycowboy
Member
Schafer said:
The sales, IMO, are barely halfway over. Sure, more people jumped on earlier than ever before, but we havent' even had a holiday season with the PS2 being $149, $129, or $99. The PSOne had only sold 8.25% of units before the $149 price point. And it sold 67% of it's units After the $129 price point. Given that the PS2 still has two years before the PS3 is even released, I think saturation is not a problem.
Pedigree Chum
Banned
Err, they forgot to factor in that PS2's have been in short supply for months now.
sonycowboy said:The sales, IMO, are barely halfway over. Sure, more people jumped on earlier than ever before, but we havent' even had a holiday season with the PS2 being $149, $129, or $99. The PSOne had only sold 8.25% of units before the $149 price point. And it sold 67% of it's units After the $129 price point. Given that the PS2 still has two years before the PS3 is even released, I think saturation is not a problem.
Your fallacy is in comparing the established market leader to the company that at the time was the challenger. PS1 was a slow-starter trying to make a name for itself. PS2 was a fast starter living off the success that was the eventual PS1 juggernaut. PS2 did not have the obstacles to overcome that the PS1 did, so you should not expect the PS2 to see the same late generation success that the PS1 did, either (relative to the early generation numbers, mind you). There was no hesitation to adopt the PS2, the same could not be said for PS1.
PS2 sold far less at $179 than they did at $199*, and sales are down further this year (yes, they were down even before there ever was a shortage). Don't get me wrong, I do not expect anyone to overtake the PS2 in yearly sales, it just will not be as dominant as it was before, and it most certainly not follow the same late-generation trend that the PS1 did.
*PS2 US sales in year following price cut
$199 - 5/02-4/03 -- 8840982
$179 - 5/03-4/04 -- 5966298
sonycowboy
Member
Odysseus said:
Absolutely every generation up to this point has shown pretty much the exact same curve for the market leader. Until you hit $149, you're generally not even half over. I am certainly cognizant of the fact that the PS2 came out of the gates like a rocket, but you have to respect the bargain conscious buyer. For the most part, they are not the hardcore who buy the systems right away.
I certainly believe that the PS2 is wayyyy past the 8.25% that the PSone had at this point. But how far do you think it should go. The PS2 has broken absolutely every metric we have for trying to determine how the remainder of the cycle should go. So we have to make some reasonable guesses.
The generation is ~60% over. If you simply considered the launch of the Xbox 2 the end of this generation, it would be 80%. If you considered the end, the launch of the PS3, it would be 67% over. However, publishers have been very vocal in their supporting the PS3 well past the launch of the new systems. For a very good reason. They don't want the incredible drop of software sales during the transition. So, let's be nice and say that the generation will be over in 2007. 3 more years, with 4 already gone.
This is exactly why Sony has been holding their prices so long this generation. Do you think they're going to have 3 price drops inside of 1-1/2 years? They are trying to extend this generation by holiding off on price drops. This extension of the price is having the effect of stalling sales somewhat, but that is by design.
I think given the fact that the PSOne was only at 8.25% of it's sales at this point, that it's fair to concede 60% for the PS2 at the same point, giving the PS2 about a 700% increase over the PSOne.
sonycowboy
Member
Odysseus said:
Well, duh.
How would you expect the public to react to the price drops?
$299 -> $199 = BIG RESPONSE
$199 -> $179 = Huh? It did get quite a large boost, considering
$179 -> $149 = Price drop in May, shortages since June.
I think it's ridiculous to think that the $149 price drop had nothing to do with it. They were clearly planning on releasing the new PS2 this fall and they probably thought they had the inventory to do it, but it ran out within a month. Poor planning on Sony's part, but clearly if they knew they had no systems, why not simply wait for the new PS2 and launch it with a price drop to $149? Their surely would have run out of their existing supply.
sonycowboy said:The sales, IMO, are barely halfway over. Sure, more people jumped on earlier than ever before, but we havent' even had a holiday season with the PS2 being $149, $129, or $99. The PSOne had only sold 8.25% of units before the $149 price point. And it sold 67% of it's units After the $129 price point. Given that the PS2 still has two years before the PS3 is even released, I think saturation is not a problem.
What do those numbers on the sides of the bar graph (left of the PS1, right of the PS2) represent?
sonycowboy
Member
Culex said:
Millions of units sold at that price point.
Jumpman
Member
Fatghost28 said:
True, but will that explosion be that of a small pipe bomb, or a of nuclear blast?
Fatghost28 said:
Things have changed a lot more than just 10K per month. Compare last years April - August sales to this years. Momentum is not on Sony's side.
Link316 said:
The shortage is affecting alot more that 100K gamers.
Serious gamers are hardly a factor at this point. They already own a PS2, it's the casuals who determine the market leader. I haven't predicted the "downfall of Sony", but they are putting themselves in the position to lose a significant amount of market share.
sonycowboy said:
I would agree with these assertions, but if these shortages continue, it could be closer than you think.
I respect the amount of research you have invested in your predictions sonycowboy, but you just admitted "The PS2 has broken absolutely every metric we have for trying to determine how the remainder of the cycle should go. So we have to make some reasonable guesses." Based on this fact, it is impossibe to use data from previous generations to plot the future sales of PS2. My guess, and that's all it is (just like yours), is that the PS2 is about two thirds done with it's hardware sales. It will see a big boost when it hits the $99 price mark, but not enough to reach any where near your projections.
If Sony was smart they would release PStwo at $99, that move might be enough to kill Microsoft's momentum. However, if they stand on their $149 price tag through the holiday season, Sony will probably never again achieve the dominance they have grown accustomed to in the past.
the genesis 3 was sleek and it sold like crap. everyone has a ps2 already. it'll sell just like it does every other christmas regardless. i dont think there will be notable gains. Halo 2 may just be enough to keep the xbox UPRISING in full swing. if MS releases a cool colored xbox bundle this fall, thats another plus. the only console that WONT do well this fall is gamecube. the DS will get a huge push with nintendo THEMSELVES leaving the GC behind.
SolidSnakex
Member
Jumpman said:
That's not smart. They've got another price drop to 129 before they go to 100. The thing to keep in mind that before this shortage is that the Xbox had only outsold the PS2 1 time, the PS2 consistantly outsold the Xbox every month even when the PS2 didn't have a strong lineup of games coming out. Now the PS2 is coming up to its biggest holiday lineup ever and a new system design. There's going to be a definite boost even with a 150 pricetag. There's no reason to drop it right now.
"everyone has a ps2 already."
People keep saying this while consantly ignoring that the PS2 hasn't even outsold the PSone yet.
SolidSnakex
Member
"the ps1 had no real competition."
The N64 and its games have performed better against the PSone than the Xbox has to the PS2.
The N64 and its games have performed better against the PSone than the Xbox has to the PS2.
Late Stage Marxist
Member
This is nothing more than a strategic move by Sony to swat out piracy by phasing out the HD compatible PS2. Unfortunately for them they still have to worry about their current install base giving into the temptations that HDloader offers. HDloader is quickly becoming the new "modded Xbox". Looking at Future Shop's web store it appears they don't even sell the old model PS2 even though PStwo isn't listed as shipping until Oct. 19th. If this isn't Sony trying to recoup losses on software piracy, I don't know what is. It just doesn't seem like a smooth transition (PS2 to "PStwo") to me.
MS is doing the exact same thing. Xboxs are sold out all over the UK, waiting for the crystal ones on the 8th to become the new standard Xbox (stopped making black ones for Europe)
But they've just dropped the price to £99, so there are a whole bunch of people going into game stores wanting an xbox, and there aren't any for a couple of weeks. Some will buy gamecubes or PS2s.
But they've just dropped the price to £99, so there are a whole bunch of people going into game stores wanting an xbox, and there aren't any for a couple of weeks. Some will buy gamecubes or PS2s.
Die Squirrel Die
Member
mrklaw said:
Crystal Xbox as standard at 99 quid? I may have to be extravagant and get another one.
Die Squirrel Die
Member
I just hope Nintendo leaves the Cube alone for a while otherwise I'm going to have repurchased each console at least once this gen, twice for the GBA if you count GBA -> GBAsp -> NES GBA sp.
Jumpman
Member
SolidSnakex said:
Well it certainly wouldn't be a bad idea for the PS2 to drop to $99. Sony is obviously releasing the PStwo in an attempt to make that price tag a possibility, while still making a profit on the hardware. If they wait until May, and then drop to $129, the sales boost will be nominal. If they want to get good mileage out of their next price cut, they need to go straight to $99, preferably during the holiday season. You are right in saying that this is Sony's strongest software lineup ever, probably stronger than MS and Nintendo's combined, but that doesn't necessarily mean record hardware sales. Don't get me wrong, I don't think that Microsoft has even the smallest chance of beating Sony this holiday season. However, under the right circumstances, it could get very close. A 1.8 million to 1.5 million victory for Sony in December is really no victory at all. If that kind of ratio were to persist into 2005, it would mean bad news for Sony next gen (as stated in my previous post). Sony can not sit idly by on its past acheivements. They must be aggressive in dealing with their rivals if they want to maintain the dominant position they currently have in the industry.
sonycowboy
Member
Jumpman said:
If one thing is clear this generation, it's that Sony does not use price as a weapon. They have had the opportunity to clearly undercut the Xbox. At launch, they could have dropped to $199 immediately, when the Xbox was $299. They certainly have the cost advantage.
They, by all appearance, are more interested in making as much profit as possible as opposed to trying to hurt Microsoft with their pricing. Many analysts have taken Sony to task as they believed that Sony had the opportunity to cut prices and force Microsoft to lose enough money that they would get out of the business. However, I think it's clear that Microsoft isn't going anywhere and they didn't join the industry, only to be outbid in the first hand. They would have done what was necessary.
It's also, to me, a much stronger sign of weakness, when you have to use pricing as the differentiator between you and a competitor. It certainly hasn't helped Nintendo at all to be the "value" choice. Software is the differentiator, particularly exclusive software.
The balancing act is trying to create the must have software in-house vs having to pay big bucks to get the third party exclusives. People can argue, but to me, Sony has the most compelling exclusive software and that reason is why they will continue to lead this generation from here on out (minus the shortage's which will give the Xbox the lead in Sept & probably Oct).
Jumpman
Member
sonycowboy said:
You know as well as I do, that if Sony dropped to $99 then Microsoft would follow suit. It wouldn't be a case of Sony going for a price advantage. What it would be, is an attempt to get the most mileage possible out of their next price drop. Both the PS2 and Xbox would see huge sales this holiday if they drop their price, but whoever drops first will see the biggest surge. Sony should go for the jugular IMO. I think Nintendos drop to $99 last fall showed us just how succesfull a holiday price reduction can be. Since Sony's PS2 is much much more visible than Gamecube, a holiday price cut would benefit them to an even greater level. I'm thinking close to 3 million units moved in December alone as a strong possibility.
I know that by reading this, some people might think that I'm saying that Sony's empire is burning, but my assertions are much more mellow than that. I'm just suggesting that Sony remain vigilant against their competitors. The Doomsday predictions in my earlier posts (if you want to call them that), are not written in stone, and are just one possible scenario. The fact that Microsoft has made significant headway since last year (market share wise) against the PS2 should be troubling to Sony, and in my opinion now is not the time to fall asleep at the wheel.
SolidSnakex
Member
"The fact that Microsoft has made significant headway since last year (market share wise) against the PS2 should be troubling to Sony, and in my opinion now is not the time to fall asleep at the wheel."
It's also not the time to jump the gun on a pricecut. The PStwo was all they needed to secure this holiday season. If you look at that price listings above on how much Sony's sold at each price, its clear that what they're trying to do is get the most out of each price point. They haven't yet gotten the most out of the 150 price point.
It's also not the time to jump the gun on a pricecut. The PStwo was all they needed to secure this holiday season. If you look at that price listings above on how much Sony's sold at each price, its clear that what they're trying to do is get the most out of each price point. They haven't yet gotten the most out of the 150 price point.
Pedigree Chum
Banned
"You know as well as I do, that if Sony dropped to $99 then Microsoft would follow suit. It wouldn't be a case of Sony going for a price advantage. What it would be, is an attempt to get the most mileage possible out of their next price drop. Both the PS2 and Xbox would see huge sales this holiday if they drop their price, but whoever drops first will see the biggest surge."
What? whoever drops first will see the biggest surge? No they won't, cause if one drops the other drops a few days after...it means nothing the in the grand sceme of things. And another thing, PSTwo is going to be hot as hell this holiday, every system that comes into stores is going to sell out immediately. Sony doesn't need a price drop for that. GTA:SA, MGS3, GT4 and overall the best line-up this holiday will ensure that PSTwo will sell like hotcakes. Even with Halo 2, MS should be thinking about dropping the the XBox's price before Sony...not saying that Sony has nothing to worry about from MS, cause MS is going to do mighty well this holiday. But Sony is going to do that much better IMO. Regardless, at the $150 price point, both competitiors are safe...they willl both sell loads of systems this holiday season. A price drop is not necessary.
What? whoever drops first will see the biggest surge? No they won't, cause if one drops the other drops a few days after...it means nothing the in the grand sceme of things. And another thing, PSTwo is going to be hot as hell this holiday, every system that comes into stores is going to sell out immediately. Sony doesn't need a price drop for that. GTA:SA, MGS3, GT4 and overall the best line-up this holiday will ensure that PSTwo will sell like hotcakes. Even with Halo 2, MS should be thinking about dropping the the XBox's price before Sony...not saying that Sony has nothing to worry about from MS, cause MS is going to do mighty well this holiday. But Sony is going to do that much better IMO. Regardless, at the $150 price point, both competitiors are safe...they willl both sell loads of systems this holiday season. A price drop is not necessary.
There is absolutely no reason for SONY to drop the price on the PS2. Dropping the price now wouldn't boost sales, because the reason their sales are down is due to not having any units available on store shelves. If they want more sales, have supply match the demand. It's quite simple.
Pedigree Chum
Banned
Laguna X said:
Exactly, and considering PSTwo shipments are already sold out due to pre-orders...that should tell you something. Sony needs to up the supply of the machine and they'll be fine.
Jumpman
Member
SolidSnakex said:
I agree that a price cut now would be ahead of schedule, but regardless of Xbox sales, PS2 sales are on a massive decline lately, and are in need of a boost. Now it may be normal for a system's sales to decline like this in its fourth year of production, but IMO PS2 should still have a lot left in the tank. A move to $99 now would rejuvenate PS2's relatively stagnant sales, and open the floodgates to the mass market casual gamer.
What would you propose Sony do. Wait until May to go to $129 and then the following year drop to $99, only months before the release of PS3? I don't think that's wise. Sony needs at a minimum, one full year at $99 before PS3 comes out if they want to get the most out of the drop. Sonycowboy would agree that the $99 price point is important if Sony wants to tap in to the remaining casual market. Dropping to that point with the shadow of the PS3 launch hanging over its head would not be nearly as effective as it would be now.
The PStwo alone won't cause a massive surge in sales. At best it will slightly eclipse last holiday seasons sales. And it will only do that because of Sony's powerful holiday software lineup. The PStwo may look cool, but is still the same hardware, minus some of the older models feature set. Last holiday season was not good for Sony, they almost lost November to Gamecube. Think about that. Now one year later the monthly sales gap has closed, and you want me to believe that it would be smarter for Sony to close their eyes, and pray for success?
Pedigree Chum said:
When I said surge I wasn't referring specifically to actual numbers. I was speaking on the overall benefits gained by leading the way into a price cut. The company who drops first will get the most buzz. Drop second, and youre brushed off as a copycat. You will still see a substantial boost in sales, but more people will be talking about the product that dropped first. If you drop right after your competitors then the negative effects are smaller. But if you wait too long (see earlier this year), you can lose a sizable chunk of market share.
Laguna X said:
If you read my earlier post, I stated the shortage as a reason why Sony should lower the PS2's price. The shortage is costing them heavily in the area of market perception, both by investors and consumers alike. Now obviously a price drop won't be helpful if they can't get more PS2's on shelves, but assuming they can restock in time for Black Friday, a price drop makes perfect sense.