SoundofSilence
Member
This is on the front page of Yahoo today.
http://www.fool.com/investing/gener...corporations-xbox-one-is-selling-so-poor.aspx
http://www.fool.com/investing/gener...corporations-xbox-one-is-selling-so-poor.aspx
When do you think Microsoft will react to potentially losing next gen battle?
- Thread starter Tak3n
- Start date
SwiftDeath
Member
I think the greatest problem MS is dealing with right now is price. The power difference/multiplat disparity is another problem but much much smaller a concern in the whole scope of things.
I would say that based on PS4's sales trajectory relative to the XB1, the average consumer values 3rd party games more than 1st party games as I think the XB1 clearly presented a better exclusive lineup to the average consumer than the PS4. [I don't mean that XB1 has the better exclusives but that the average consumer would view it as such based on what they would see.]
As such considering the large sales disparity even in MS's home market the average consumer values $100 in their pocket more than whatever exclusive game advantage they perceive the XB1 to have.
Thus I can only envision the XB1 having any real impact if they drop the price to at least match PS4's. Another thought I've been wondering is that perhaps the power disparity that in previous gens does not permeate to the average consumer would be more rampant this gen for two reasons
- social media/internet accessibility - In essence the instantaneous dissemination of information to thousands upon thousands of loud-mouthed individuals
- If the average consumer values the $100 more than whatever perceived exclusives advantage they see for the XB1, I think that consumer who buys a PS4 would more readily look for and listen to other reasons that justify his decision. I.E. I got a PS4 because it was cheaper and I don't care enough about exclusives. Oh my cheaper PS4 is also noticeably more powerful? Purchase vindicated let me tell all my friends about it
/end ceaseless ramblings
Looks legit...
Look at the authors other articles. This is nothing new from him.
SwiftDeath
Member
Fool.com -> Part of the Motley Fool
It's a investment site, not someone's random weekly blog
All right after looking at some of his other articles he is super hyperbolic. So yeah lol
I agree with everything you said. Price is their biggest obstacle right now, those other factors you mentioned aren't as important to the mainstream (though they do matter to an extent). The problem is that a price drop only makes a difference in NA and possibly UK, the rest of the world won't care. Even then the best they could hope for is 1:1 sales parity with PS4 in those markets while being crushed in every other market. No matter how you slice it, PS4 is going to heavily outsell XB1 worldwide. All they can do is make a few smart moves now to make sure that gap isn't as big as it can be if they don't fix their current issues.
Lol the comments are gold
What do you think people would have said 13 months ago if you told them PS4 will outsell xbox720 in the US in total? By almost 2:1 in January?
Anyone with a lick of sense stops reading articles when they see "by Sam Mattera".
There are a number of scenarios that could play out, but what's certain is that cable boxes are on the way out. That could mean a la carte HBO via an app on your TV, or it could mean devices like Roku or Apple TV grow. And like the leaps in processing power mobile phones make every year, those TV devices will make leaps as well.
When Gigabit internet becomes widely available over the next 20 years then a lot of processing can take place in the cloud. Your TV just needs a Xbox or Playstation app. Sony and Microsoft already have prototypes of services that can stream PS3 and 360 games, respectively, over broadband. They'll figure out how to keep pushing cloud processing to a point where the games reach a fidelity that's enough for mass market appeal.
I think dedicated game consoles are on the way out. They probably have one more generation after this one. Personally, I'm looking forward to the era where gamers don't have any more to talk about with respect to specs and just talk about games.
I'd agree Microsoft's execution leaves a lot to be desired, but they're definitely looking in the right direction. Sony has a similar roadmap, they're just playing their cards soooooo much smarter given current market conditions.
It was in response to a post that didn't seem to disagree with the assumption that the board would "pull the plug" after Titanfall fails to sell. Yes, a poster actually believes that before dropping the price or offering a bundle they will basically write off years of investment as losses because a single game fails to turn things around. Retailers are already doing MS's job with the bundles and gift cards. A price drop or bundle is the next step and my guess is that it's coming very soon.
I think the 2:1 thing in January thing is funny because we're talking 140k and 270k not 2 million and 4 million. Sure it widened a gap but in reality that's not much.
13 months ago though, I would have said it's anybody's game to lose since Sony had had a strong 2012 and Microsoft had pretty much abandoned first party games after Halo 4.
I still think the system should have launched at $399 and this conversation would be about how does either Sony or Microsoft make that next step to pull away. At E3 this year we'll see a $100 price drop if and when sales continue to trail.
Pretty much. He writes hyperbolic articles for the hits.
Sorry, my bad. There's lots of doom and gloom in this thread.
A price drop and/or bundle is most likely coming this year, but I personally don't think we'll see one until summer.
SwiftDeath
Member
The problem I find with people mentioning that no matter what MS does they cannot win WW in HW sales is I cannot imagine MS didn't expect that going into this gen.
The XB1, as it is, is far too US-focused. The UK has the lovely 50hz judder, Canada still doesn't have the tv guide, and don't get me started about the rest of the world.
It seems obvious they were willing to accept 2nd place WW and probably the UK, maybe even the US. It is not that they are being outsold so heavily by PS4 that is worrying it's that they don't seem to be making much progress anywhere but in the US and their sales are starting to stall even there.
I think it would be fascinating to get MS's internal HW projections for the XB1 and what numbers they wanted to hit to achieve what level of profit. As mort goes on about quite often, I think MS was more than happy to accept 2nd place this gen and make more money per user while gaining mindshare into those higher paying customers living rooms. Obviously though even for this they need a certain install base to make the profit they forecasted and I'm not sure they are on track to hit that, in fact I highly highly doubt they are.
You are of course right by the way, a price drop will only cause a real effect in the US, UK and maybe maybe Australia/NZ. And it won't start obliterating the PS4 just because of the price drop either.
Regardless of what happens it seems obvious MS will be hit by quite a bit of unforeseen costs for the XB1 that are quite large. So while I in no way think they will "kill" the division or sell it. I do worry about the XB1's future exclusive-wise.
Games aren't cheap to make after all. I'm sure everything leaked and announced will come out though.
The whole 2:1 thing is really being blown out of proportion. When it's 2:1 cumulative totalling 20 mil combined sold (aka a few years), then start this crazy talk of bailing out and such (even then itd be kinda dumb IMO). IJS, its a wee bit premature.
Microsoft is now fighting to keep their head above water in the US and UK, something they didn't have to think about at all last gen. That's going to distract them from thinking about the rest of the world where they will fall hideously behind this gen if the start of the generation is any indication of where it's going.
makingmusic476
Member
Fighting to keep their head above water? They're not selling as well as the PS4. That's the story. This isn't a disaster at all. Consider where they were at E3, and consider where they were last gen 3 months out. We are just 3 months into next gen and people are going batshit insane with hyperbole.
Yuck. I hate when people bring this up while COMPLETELY ignoring the PS1 AND PS2.
The PS3 was the cheapest blu-ray player on the market, was PS1/PS2 compatible, and had built in wifi. You can bring up silly quotes, but the value at the launch price was there. A lot of people just didn't pay that much for a gaming system. There was nothing "horrible" from them dominating from PS1>PS2 and going into PS3.
At least bring up some good points to explain why them dominating is bad. The competition will still be there if they lead by a large amount. Again, look at the PS1, PS2 or Steam. Gamers were/are happy and the market leader didn't suddenly turn into satan.
Killing_Joke
Member
I don't think they planned on "winning" anything. Everyone with a brain knows Sony would pull ahead or at best be neck neck like PS3/360. Xbox doesn't have the WW appeal like PS does. I think all they wanted from the start is expand their biggest markets, US/UK and other smaller areas. Get the ball rolling on ad/tv revenue and maximize sales with DRM. Handing out free games in UK and paying god knows how much for TF. But nothing could stop the PS4 train.
First of all thanks for ignoring the question but I guess it's irrelevant as we both know the answer anyway.
And for your information - I did not start the "crazy talk of bailing out", people who are financially invested in MS did...
Come on. The sales of the Xbox One are tracking better than the 360 were and the 360 was the only gen 7 console out for a year. The fact the Xbox One is where it's at is nothing short if astounding considering an abysmal reveal, E3 and marketing last year. Sure they're behind the PS4, is that a result of the price, probably. There is obviously something there to have brought 3+ million sales since launch.
Your question is irrelevant and has nothing to do with either those who are doing the crazy talk at this point or my OP which is why it was ignored. Secondly, I never directed my OP to you or anyone else but you chose to respond to it......there's no need for you to fall into he said she said crapola.
I'm not saying it was horrible. But in the face of the cheaper Xbox 360 with the better looking games and superior online features, it caused Sony to promptly remove the hardware backwards compatibility from future PS3 models, lower the overall price to stay competitive, and add PSN.
Syphon Filter
Member
They never had a chance but they had a chance to be in a much better position than what they are in today. Now U.S is questionable for them and UK looks like Sony will run with it. U.S is still their last hope but they need to make changes and fast.
IdreamofHIME
Member
I won't believe that MS is serious about "winning" until they release a Kinect'less SKU. Until then, it's all about getting that thing into as many homes as possible and making money from ads and apps.
My only big knock against Sony is their shitty handling on online on PS2 and early PS3. If it wasn't for MS and their strong focus online gaming, I don't know if Sony would be where they are with PSN today. So in that sense competition was a positive thing.
Also another thing was the hard to dev for architecture with PS2/PS3. With PS2 they got away with it because of overwhelming sales momentum and an earlier release than the competition. With PS3 it bit them in the ass hard for years, Xbox 360 being easier to develop for gave it a major advantage for almost the entire gen. PS4's simple architecture was born out of that mistake.
Sorry, didn't mean to come off hyperbolic. What I mean is last gen they sailed out of the gate in the US/UK and never really had to think about it. Now they are in a position of having serious competition in their two biggest markets.
If they bring great games year after year, then I have no problems with this.
They hit the right price at the right time with the 360. With Sony dropping the $599 bomb on the PS3, the 360 was a great alternative for everyone. Specs and Kinext aside, the issue remains the price of the Xbox One.
I think there's a lot to be said for the pressure of MS and Nintendo to make Sony design consoles that weren't a fucking nightmare for developers to work with too.
[edit] Oh, you edited it in. But I wouldn't describe it as a 'mistake' on Sony's behalf, the Cell was a very calculated and cynical attempt to push technology.
On the OT side they're discussing how Netflix's 4k resolution is going to chew through peoples' data caps. Telcoms seem to be willing to fight tooth and nail to prevent services like PS Now from taking off by getting rid of net neutrality and imposing heavy fees on heavy internet users.
So none of what you're saying about physical consoles going away within 2 generations seems to be happening. If suddenly all physical consoles go away, PC gaming suddenly will see an incredible spike in users because people simply don't want to rely on a stable and fast internet connection with lag in order to control their games, nor do they want to reach their data caps by simply playing a game.
BTW, when you say something like "Sony and MS are going to allow 360 and PS3 gaming respectively", you're saying Sony is going to allow 360 gaming and MS is going to allow PS3 gaming.
Exactly. That's why I feel if we want console gaming to remain alive and well, there has to be multiple major competitors. So that way if one company makes a misstep, the others are there to pick up the slack and correct the mistake going forward.
Consoles aren't usually sitting on pallets in the middle of stores within 3 months from their release while those stores start offering $50 incentives to buy. It's a troubling situation whether or not you want to put some arbitrary boundary of 20 million NA console sales before we discuss it.
So Microsoft overestimated console demand for the holiday season and there's lots of leftovers. Put them in the fridge, they'll keep.
I would have preferred they did that than underestimate the demand and not have enough to supply everyone who wanted one.
If Microsoft goes through a holiday season with Wii U like results, then it would be time to worry. Right now there is a lack of games that are available exclusively on either system so seeing sales dip really is expected.
Killing_Joke
Member
Shitty January aside the X1 is FAR exceeding a lot of people's expectations. Even beating out PS4 in Dec. Could they be in a better position? Who knows. Probably not since the DRM shit was always planned. The PS4 is just doing better than anyone expected. 1 mil day one and now outpacing PS2/Wii is just crazy shit. I don't think MS could have ever had that kind of steam.
SwiftDeath
Member
I'm sure MS is worrying less about the XB1's sitting in stores and more about the ones sitting in warehouses both in the US and in China. Storage fees on 500K+ units is no joke
On the OT side they're discussing how Netflix's 4k resolution is going to chew through peoples' data caps. Telcoms seem to be willing to fight tooth and nail to prevent services like PS Now from taking off by getting rid of net neutrality and imposing heavy fees on heavy internet users.
So none of what you're saying about physical consoles going away within 2 generations seems to be happening. If suddenly all physical consoles go away, PC gaming suddenly will see an incredible spike in users because people simply don't want to rely on a stable and fast internet connection with lag in order to control their games, nor do they want to reach their data caps by simply playing a game.
BTW, when you say something like "Sony and MS are going to allow 360 and PS3 gaming respectively", you're saying Sony is going to allow 360 gaming and MS is going to allow PS3 gaming.
You seriously believe something like Google Fiber is not going to force ISP's to change their ways over the next two decades? Google has the warchest to disrupt the market. It's going to change and the telecoms are going to have to adapt.
I misaligned Sony and MS with their respective devices. Good catch.
What I got from Sony domination was a console capable of playing all PS1, PS2, and PS3 games. A $600 blu-ray player when blu-ray players were $1000. The only console with HDMI output. The only console capable of lossless sound and DTS sound in games. The only HD console with wifi capability. They provided 3x the HDD space of their main competitor. They provided the capability to upgrade the HDD to whatever size you wanted within the physical dimension limitations.
What I got cost Sony $850 BOM to build and they only charged $600 for it.
Yes, their PR was arrogant and they glossed over omissions like rumble by claiming it was a "last gen feature" and told people to get a second job to afford the system. (If I built something for $850 and tried to sell it for $600 and everyone told me it was still too expensive, I'd probably get upset too)
But the console itself outside of the blunder that was Cell, was a beast of value. And I didn't even buy the PS3 to game. I bought it ONLY for blu-ray and it was an incredible value. 360 was my gaming console of choice last gen.
It's a Catch-22 no matter what. Having all these consoles out there makes the XBO look less desirable. Underestimating the demand and you have people crying out that they aren't supplying enough.
Consoles also dont sell 2 million units at 499 in 3 months either. There's perspective somewhere in there I think. Im certainly not saying everything is peaches and cream. Just saying it aint quite time to start looking for the grim reaper or listening for the fat lady.
Syphon Filter
Member
xbox one is not exceeding my expectations at all, i expected far better Jan sales since it is available everywhere. If they never did the drm thing,etc then they will be in a way better position today for sure. PS4 is doing as good as everyone expected,they did well with their reveal and followed up with that at E3. You really thought a less powerful machine and more expensive was going to keep up with a better cheaper machine? As for the outpacing PS2/Wii,that is not going to last. Wii and PS2 were anomalies,at the time for both they were harder to ship in bulk compared to today.
Google fiber needs to expand quicker to be a concern. The issue there is the infrastructure for fiber costs so much that they have to take their time. I know they just announced 6 new cities, but that's barely a drop in the bucket compared to a company the size of Comcast.
If you're working at Xbox right now I think you have to be concerned about where you'll be in 12 months. They really need Xbox One to be a quick and obvious hit, any wavering gives Microsoft a lot of cover to spin-out or deprecate the Xbox program. It's not so much what the Xbox One has done thus far, it's the next few months that will really matter and January was a pretty obvious bad sign. Thank god they have Titanfall coming soon.
20 years. Look at how broadband became widely available in 10 years. Like I said, Google, Apple, and Microsoft are looking out long term for how to be in your everyday life in work and play. It's going to be all about devices and online services.
When Comcast and TimeWarner continue to lose customers they'll adjust if they want to survive long term.
They don't exactly need Microsoft. There's plenty of other companies out there.