Next-Generation Game Consoles Will Not Meet Sales Expectations - Analysts

Smartphones, Tablets, Social Games to Dwarf Sales of Next-Gen Consoles

by Anton Shilov
04/25/2012 | 10:04 PM

Mobile and social games will have a drastic impact on sales of next-generation video game consoles as well as games. Neither console from major platform holders - Microsoft Corp., Nintendo and Sony Corp. - will outsell the current devices, moreover, their sales will be much lower, according to analysts.

 

According Michael J. Olson and Andrew D. Connor, analysts at Piper Jaffray, expect an average decline of 53% for software sales in the first 14 months of the next-gen console cycles from the three companies, based on "meetings with industry sources", reports Gamasutra web-site. At present, sales of video game systems are slowing and platform refreshes will not help as mobile and social games are improving extremely quickly.

"Unfortunately, we do not expect a console refresh to fully offset the secular declines in console gaming. We believe console gaming will continue to be a time-share donor to social networks, mobile games and tablets. We, therefore, favor companies with increasing exposure to social/mobile gaming, including Zynga and EA," the analysts said.

Nintendo Wii U will sell only 35% of the volume of the original Wii during its first 14 months. Unit sales of Sony PlayStation 4 "Orbis" in the first 14 months will represent 50% of the PS3's sales in the same timeframe. The successor of Xbox 360 will sell only 55% of the volume that the Xbox 360 has in its first 14 months before it.