PS3 sales suffers from weak software slate
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Sony platform trails behind Wii, Xbox 360, PS2
By George T. Chronis -- Video Business, 5/25/2007
MAY 25 | Despite all the hype surrounding Sony’s PlayStation 3 launch, the game system trails Nintendo’s Wii, Microsoft’s Xbox 360 and even Sony’s own PS2 in sales, due in part to a weak software slate.
When the NPD Group released its tally of April’s best-selling videogames by units sold, not one PlayStation 3 title made the list. In March, only Motorstorm (Sony) made the Top 20. Similarly, in February, Resistance: Fall of Man (Sony) was the single PS3 title to appear, while games for Nintendo’s Wii and DS, as well as Microsoft’s Xbox 360, dominated the charts.
Mike Goodman, director of consumer research at the Yankee Group, said the PlayStation 3 platform needs better titles to drive higher adoption in the coming months.
“The software we’ve seen so far has been good, not great, and does not include a must-have videogame,” he explained. “Exclusivity drives platform sales, and Sony has to find titles that define the platform in the same way that Halo and Gears of War define the Xbox.”
Unfortunately for Sony Computer Entertainment of America, the PlayStation 3 can’t count on the kind of blockbuster third-party exclusives the PS2 enjoyed, because publishers need a minimum of 500,000 units sold of a title to break even, and the PS3 can’t guarantee those numbers right now, and Goodman says Sony’s own studios are not know for producing huge hits.
“They’ve released more singles and doubles over 1 million-plus units sold,” Goodman said, using a baseball analogy. “When you have a 100 million installed base, singles and doubles are great, but not when your installed base is 2 [million] to 3 million units.”
Sony is well aware of the challenges it faces. At a presentation of upcoming PlayStation 3 titles for journalists and analysts in San Diego on May 14, SCEA president and chief executive Jack Tretton said people who are buying PS3s today are already PlayStation fans, and he said he accepts that mainstream consumers are still waiting for a title with a wow factor.
“I don’t know of any developer that has built a game that makes full use of the PS3 architecture yet. So we had to invest more in our first-party development to encourage better games from third-party developers,” Tretton explained.
Of the 30 first-party and third-party PlayStation 3 titles on display in San Diego, Goodman believes none of them a substantial enough to drive system sales.
Rob Smith, editor-in-chief at PSM magazine, is more optimistic.
“When we were planning a Top 10 of PS3 games hitting this year, we initially joked that we may not be able to come up with 10, and then had to increase the number to 20 since there were easily that many games that we were genuinely excited about,” Smith said.
“From Sony, Uncharted: Drake’s Fortune looks really interesting, as does Heavenly Sword, and I’d even throw Ratchet and Clank Future: Tools of Destruction in there. Of the third-party games, we eagerly await the next showing of Metal Gear Solid 4, but in the meantime, Call of Duty: Modern Warfare looks outstanding, as does Devil May Cry IV,” Smith said.
During a May 23 financial conference call, GameStop chief operating officer Dan Dematteo said the retailer expects Tecmo’s Ninja Gaiden Sigma will drive PS3 hardware sales, with other key titles including Electronic Arts’ Madden NFL Football 2008 and Rockstar Games’ Grand Theft Auto IV.
Although Goodman believes Sony will do well in the long run once the PS3’s installed base increases in two to three years, for now, the system’s $599 price point raises the bar substantially for any title to drive platform adoption.
“Price is an albatross around their necks,” Goodman concluded.
