Create new account
Forgot password?

NEWS

Hardware Price Cuts Might Not Rescue Sales - Analyst

Tom Ivan's picture

By Tom Ivan

August 13, 2009

  • Login or register to post comments

See also:

Related Articles:

Cowen Group analyst Doug Creutz has questioned whether expected upcoming hardware price cuts can rescue flagging console and software sales.

According to Creutz, investors are anticipating a $100 cut on the PS3, a $50 cut on the Wii, and the Xbox 360 Elite to receive a new price point of $300. The analyst forecasts hardware price cuts “on all platforms by September, with announcements possibly as early as next week’s Gamescom in Leipzig.”

However, he thinks that these prospective cuts might not be enough to effectively address declining sales in the current marketplace.

“… We are concerned that, given pressures on the consumer, price cuts may not have the stimulative impact to hardware and software sales that they have had in the past,” he said.

Creutz expects US software sales to suffer a fifth consecutive month of year-over-year decline when July games industry data is released by the NPD Group after market close today. He predicts software sales to be down by 23 per cent. Other analysts have forecast a 15-16 per cent drop in monthly US game sales.

ravenor's picture
On August 16th ravenor said:

Game sales are down because everyone is being more selective on game purchases(money). That and most game run on ether the same engine tec, or somthing that looks almost the same. Modern warfare 2 will sell in droves but will the next one fare so well. I honestly think not (in shooters at least) there is only so long you can pass off the same tec. The next game will be the forth game running on the same engine with minor tweeks. And being a year on year title won't help unlike games that come every 2-3 years. For instance if Halo Reach does not have new tec behind it , the fan base and general public in my eyes wont be inclined to buy it(at launch). In my eyes a new generation of consoles WILL be needed sooner rather than later. Every game looks too much alike, that breeds complancency and in the end "the core" will stop buying(as many) games. And it's the core that buy games and consoles, not your nan, your mom. They buy DS's&Wii's and Wii FIT & Brain training and litle else.

Belcaw's picture
On August 14th Belcaw said:

I agree. Nintendo needs to release some new colored Wii's. Microsoft and Sony should release systems that are noticably smaller; and ideally stackable. Even I would consider a new purchase if they made the PS3 and/or 360 with a slimline look and a flat top that allows me to place other electronics on top of it.

Indrema's picture
On August 13th Indrema said:

I want to see how the Slim will fare.

I don't think price drops rejuvenate, but a whole new console could. The new generation of motion controls could also, but companies will have to be willing to wait out the year. Microsoft needs to change the look of the elite. It sounds silly, but a sense of "newness" can really go a long way to turn things around; whether or not there's anything new underneath. They need to get the excitement back.

Of course, if Sony change the controller as well, I wouldn't kick it out of bed.

ArronC07's picture
On August 13th ArronC07 said:

"I don't think price drops rejuvenate, but a whole new console could."

If you can't get the consumer to buy established cheap consoles with massive software libraries and well developed offerings then good luck with getting them to buy expensive, untested hardware with small software libraries and uncertain future support.

Indrema's picture
On August 13th Indrema said:

I think you missed my point.

I think a redesign is in order, not a whole new system. I believe that will bring new users to the table. In the case of the Slim, it even helps their pricing problem.

Sorry for the miscommunication.