Direct Comparisons

While each system has its own story to tell, this is ultimately a horse race of a sort and comparisons among the three big systems are inevitable. Below is a graph of the quarterly system sales for each system since the launch of the Nintendo Wii and PlayStation 3. For the period at the end of 2006, we've included only the months November and December (i.e. neglecting Xbox 360 sales in October 2006) to make a more direct comparison.



Shown in this way, the monthly variations in data smooth out into more easily discerned trends. In particular, both the Xbox 360 and the PlayStation 3 diminished in sales until the end of the first half of 2007, but then rebounded on the back of their respective price drops in July and August. What is clearly visible from the flat Wii graph is that they were supply constrained for most of 2007, with supply finally ramping up slightly in the third quarter of the year.

Sales for all three consoles then increased in the final quarter of 2007. One can easily discern that the Xbox 360 roughly kept pace with the Wii, and the PlayStation 3 lagged behind both.

The scale of the increase in sales at the end of the year always skews the kind of graph shown above, making system-to-system comparisons more difficult. The graph below is an attempt to even out that fluctuation. It shows the launch-to-date (LTD) sales of each of the Xbox 360 and the PlayStation 3 relative to the LTD sales of the Wii. Think of the Wii as the horizontal axis, at a height of zero. Then the Xbox 360 graph in the positive range shows that it has a larger installed base than the Nintendo Wii and we can see how that lead has changed over time. The installed base of the PlayStation 3 has always been smaller than that of the Wii and therefore the PlayStation 3 curve lies below the horizontal axis, in the negative range. Viewed in this way, November and December sales do not skew the graph.



Both the Xbox 360 and PlayStation 3 graphs are generally decreasing from left to right, showing that the Wii installed base is growing faster than either other platform. The only exceptions are on the Xbox 360 curve in December 2006 and September 2007 – the latter of which corresponds to bump that Microsoft's system got from the launch of Halo 3.

From December 2006 to December 2007, the Xbox 360 curve dropped by about 1.7 units. That means that the Wii cut the Xbox 360 lead by about 1.7 units in that time period. The average rate of change on the PlayStation 3 graph shows that during that same period the Wii gained a lead of more than 3.7 million systems over Sony's console.

From a mathematical point of view, these graphs are enticingly linear, enough so that one is tempted to make simple predictions based on them. Given the volatile market, especially with price drops and new models introduced as late as October 2007, the situation could change dramatically at the beginning of 2008. However, should the trends on this graph remain valid for the next 6 or 12 months, here are the estimated relative LTD figures:
 

• By mid-year 2008, PlayStation 3 would be behind the Wii by about 6 million systems and the Xbox 360 would still be ahead of the Wii by 1 million systems.
• By the end of 2008, PlayStation 3 would be behind the Wii by around 7.9 million systems and the Xbox 360 would essentially be tied with the Wii.

Even if these figures are wrong – and the year-end figures are quite possibly poor – that's not a bad thing. If the same graph in a year shows the fortunes of the PlayStation 3 turning around or the Xbox 360 maintaining a stronger lead over the Wii, then it will be ample evidence that the market has shifted in an important way.

As we move into 2008, here is a graph showing the LTD system sales for each of the big three.