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Microsoft resets finish line to 100 million after winning the 10 million unit dash

According to the latest NPD console sales numbers, Microsoft holds the lead in terms of total current-generation console sales in the U.S. with 10 million Xbox 360 sold. Microsoft touted this number as being particularly significant as it believes the first to this milestone wins the generation overall.

“This year will be the largest in the history of the video game industry, with Xbox 360 leading the charge in the U.S. and abroad,” said Don Mattrick, senior vice president of the Interactive Entertainment Business in the Entertainment and Devices Division at Microsoft. “History has shown us that the first company to reach 10 million in console sales wins the generation battle. We are uniquely positioned to set a new benchmark for the industry.”

More than 19 million Xbox 360 consoles have sold worldwide – a number already eclipsed by the Nintendo Wii on the global scale with 25 million total units sold. The Wii with 8.8 million in the U.S. is also rapidly gaining on Xbox 360 and is selling at a quicker pace, despite having launched a year after Microsoft’s console. The PlayStation 3 has sold 4.1 million in the U.S., with a total of more than 12 million worldwide.

One area that the Xbox 360 is the undisputed leader in is the online space, where there are currently more than 12 million Xbox Live subscribers.

“Perhaps more important is the Xbox 360 worldwide online base – 12 million Xbox Live gamers is the largest community in the connected console games sector, which represents the greatest growth opportunity in the console market and where Microsoft has been the leader for two generations,” commented Billy Pidgeon, research manager at IDC.

With the 10 million mark under its belt, Microsoft appears to now be resetting the finish line at 100 million. Microsoft Games Studios corporate VP Shane Kim said in a Wired|Game|Life interview that the console war will finally be decided “When somebody's well on their way to reaching 100 million units.”

Microsoft may have a problem reaching the 100 million mark ahead of its competitors if the Japanese market isn’t buying the Xbox 360, where the console has yet to sell 1 million units. “Well, we've always known that we weren't going to win in Japan, right?,” Kim replied. “And I think we can build a very good business, an exciting business with a pretty big installed base with success in places like North America and Europe. Even though you may not think it's big numbers, we're actually strong in Latin America as well. Canada's been a big market for us as well. So there are ways to get the scale.”

“Now, if you don't get 10 million units in Japan, can you get to 100 million units overall? I'd love to get 90 million units and have that problem. That's what we're really trying to focus on,” Kim added. “I think it's way too early to declare a winner.”



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RE: Yeah right
By michael2k on 5/22/2008 6:26:49 PM , Rating: 2
The extensive RRoD issues probably eroded all the shine they gained from the XBox endeavor. Last I checked XBox has 1/3 of the installed base, compared to 44% for Nintendo, so yes it has gained them significant marketshare. However it hasn't given them commensurate profits as they are far and away behind Nintendo.

And no, Nintendo can't afford to sell at $130 because they are sold out. They could afford to raise the price $10 and probably still sell out. If that is the case, what is the point of selling a Wii for $130? At least this way they sell out AND make a profit.


RE: Yeah right
By OblivionMage on 5/22/08, Rating: -1
RE: Yeah right
By robinthakur on 5/23/2008 7:11:29 AM , Rating: 1
I think you're grasping at straws here. You seem to imply above that since MS is a bigger company, their name proceeds them and gives people confidence in the hardware and the platform offered. This does to a degree as long as MS are doing well...

The long-running RROD issue, which has not been fixed, merely band-aided with dollar bills, together with their current issues in the OS sector means that there is less money coming in to offset any losses from the console division. Then there is the $1bn write down for the warranty extension. Shareholders will be concerned that the gaming division is costing them more than its worth to MS. Getting your name out there is one thing, but eventually this must be translated into profit, and this has not really happened. This is a division which is pretty much a vanity project by MS to take the PC gaming market away from the PC and stomp its competitors into the ground, powered by cash, and so far, I'm pleased to say this strategy has not worked. This strategy is not good for gaming in general. The problem with taking a market like the pc and transplanting it to the console world is that you have a thin range of genres available on pc. The more diverse types you probably can't comfortably play with a gamepad. You also split the userbase into hardcore and ultra hardcore who refuse to play on consoles and are happy with their tr-SLI, further narrowing the PC gaming market. This means that the 360 primarily appeals to the more hardcore gamers than the mass-market and I don't see this changing. Whenever they try something like Viva Pinata or Blue Dragon which has got mass market appeal, there is a deafening silence when they work out that since the console hasn't sold squat in Japan and the non-hardcore FPS types typically bought the Wii instead, that there isn't a huge target audience. Its a chicken and Egg situation. They have failed in Japan. Failure is a bad smell, and hard to wash off. Ask Sony.

Nintendo meanwhile has probably been storing its cash in huge Godzilla-proof reservoirs somewhere in Osaka and has a more consistent focus on console games and hardware development because that's all they do. The Wii is still sold out pretty much everywhere in the UK and the games as well, mario Kart and Wii Fit in particular are incredibly difficult to find in the shops.

Whilst I think big N might be controlling supply a little, the genuine fact is that the Wii has not lost momentum so far and looks like it will accomplish all it set out to do * infinity. It is genuinely popular. Dev's have barely scratched the surface of what they can do with the Wiimote and I admire Nintendo's dependable focus on making a profit with its hardware. It means that they don't use tech which either is in a immature/expensive state and it means that developers have time to exploit it more if they put in the effort. The PS3 and the Xbox 360 have such hugely different and vastly complex internals, it will take years to fully exploit them and probably longer than their shelf life. Games for them are vastly more expensive to develop and take far longer to see the market. This means that they are a far bigger gamble. Given the Wii's selling substantially better *worldwide* and seemingly to capture the public's imagination, lower RRP for games and the more forgiving nature of the target consumer, i would imagine that its a no brainer to develop for it.

I own all three consoles and am therefore able to argue dispassionately on the current state of play. I held shares in Nintendo since 2003. Cough.


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