News
 

Bookmark and Share

(5) 

While Sony Computer Entertainment division recently bumped up shipments estimates for the PlayStation 2 game console (see this news story for details), analysts believe that the company may lose significant part of its market share in the longer term as a result of late launch of the PlayStation 3 machine compared to Microsoft Corp.’s Xbox 360. The situation may get worse for Sony, as it is believed that game development for the PlayStation 3 is more expensive compared to the new Xbox.

Presently Sony holds about 70% of the whole console market, whereas Microsoft Corp. and Nintendo command about 15% each, but some analysts believe that Sony can lose up to 20% market share in the following years, Reuters reports. Much of the lost share is expected to be grabbed by Microsoft Corp. Wedbush Morgan Securities said in an industry report in July that it expected worldwide PlayStation 3 and Xbox 360 sales to be tied at 23 million units each in 2007.

“The risks are surprisingly higher than people think because unless they can replicate its 70% dominant market position, things are going to be very difficult for them going forward,” said Hiroshi Kamide, a Tokyo-based game analyst for KBC Securities.

The problems with going forward are believed to be associated with the cost of the game console itself, which may prevent some users from getting the machine, and also higher cost of developing games for the console. Both problems may form vicious circle for Sony: if there is not enough consoles sold, fewer game developers will create games for the machine and if there is not enough games, buyers are likely to avoid expensive game machine.

“PS3 will do very well, but it’s said that development costs will be high and it’ll take longer to make games, so it’s likely that it won’t have a full line-up of games until the end of 2006 or the beginning of 2007,” said Hirokazu Hamamura, president of Enterbrain, the publisher of leading game magazine Famitsu.

Recent surveys said that even Japanese consumers are gaining interest in Microsoft Xbox game consoles.

Discussion

Comments currently: 5
Discussion started: 11/21/05 12:39:49 PM
Latest comment: 11/25/05 04:18:13 AM

Add your Comment




Related news

Latest News

Monday, April 14, 2014

8:23 am | Microsoft Vows to Release Xbox 360 Emulator for Xbox One. Microsoft Xbox One May Gain Compatibility with Xbox 360 Games

Tuesday, April 1, 2014

10:39 am | Microsoft Reveals Kinect for Windows v2 Hardware. Launch of New Kinect for Windows Approaches

Tuesday, March 25, 2014

1:57 pm | Facebook to Acquire Virtual Reality Pioneer, Oculus VR. Facebook Considers Virtual Reality as Next-Gen Social Platform

1:35 pm | Intel Acquires Maker of Wearable Computing Devices. Basis Science Becomes Fully-Owned Subsidiary of Intel

Monday, March 24, 2014

10:53 pm | Global UHD TV Shipments Total 1.6 Million Units in 2013 – Analysts. China Ahead of the Whole World with 4K TV Adoption

10:40 pm | Crytek to Adopt AMD Mantle Mantle API for CryEngine. Leading Game Developer Adopts AMD Mantle

9:08 pm | Microsoft Unleashes DirectX 12: One API for PCs, Mobile Gadgets and Xbox One. Microsoft Promises Increased Performance, New Features with DirectX 12

3:33 pm | PowerVR Wizard: Imagination Reveals World’s First Ray-Tracing GPU IP for Mobile Devices. Imagination Technologies Brings Ray-Tracing, Hybrid Rendering Modes to Smartphones and Tablets

2:00 pm | Nokia Now Expects to Close Deal with Microsoft in Q2. Sale of Nokia’s Division to Close Next Month