Can Halo 3 Save Xbox from Nintendo's Wii? The Difference Between Incremental and Paradigm-Busting Innovation.

Posted by: Bruce Nussbaum on September 23, 2007

For hard-core gamers, this week’s introduction of Halo 3 is a gigantic event and this third iteration of the Halo game series is said to be totally awesome. That will certainly help push Microsoft’s Xbox 360 into the black and may be the last chance for Xbox to become a truly profitable operation.

But the real issue is whether the Xbox can take on Nintendo’s Wii which is now the No. 1 best-selling game console in the US. And the answer is probably not.

Why not? The Wii broke out of the tight confines of “young, avid gamer” category the Xbox and Sony’s Playstation inhabit with new technology and experiences that appealed to a much wider audience. Old folks swinging virtual golf clubs, middle aged folks doing their thing all found the motion sensitive Wii fun and fantastic. Wii opened gaming to the entire population, while Xbox and Playstation stuck with the small segment of young gamers.

Halo 3, of course, with its’ science fiction, shoot-em up action, appeals to just those guy gamers and that’s great. But the speed, performance and terrific graphics—innovations all—are incremental and narrow. Wii’s innovation is revolutionary and it’s impact is wide. In fact, I would venture that companies that use technologies that enhance experiences for boomers and beyond will do amazingly well in the years ahead.

My guess is that Halo 3 will help Xbox grab some market share from the troubled PlayStation but not take anything away from Nintendo.

Paradigm-busting innovation trumps incremental innovation in the gaming space.

Reader Comments

Daniel

September 24, 2007 3:53 PM

The Wii, is a hit, then a miss...

Why?

In short, console makers have generally never made money from the console. They make money from accessories, and licenses from games makers to make games for thier console. In house game publishers, and now content downloading services. The Wii, grabbed many new people, but selling on average 2 games to each console, they are losing money by subsidising, something that will not make them money. The average games each Xbox 360 owner has is 6 and 1.5 for the PS3. The PS3 is the most subsidised console this generation, so until games sell these big companies are going to post losses.

alipshitz

September 24, 2007 4:02 PM

If the XBox 360 came with a keyboard and a mouse the games written for it supported keyboards and mice I think the XBox 360 would sell much better.

Jauregui

September 24, 2007 4:02 PM

Of course H3 will help X360 to grow Wii is only for fun while the sxbox 360 and Ps3 are for hardcore-pro gamers that really want to make something with games.
But I also think that Wii will come back with the release of Smash brothers brawl.

H3 FTW MTFUKER

Richard

September 24, 2007 4:08 PM

You have it all wrong - the issue is NOT whether the Xbox can overtake the Wii. You are right that the PS3 and Xbox appeal to "young, avid gamer", but you act like that is a demographic to be ignored. Look at Sony's success with PS2 - 120 million sold and millions upon millions of profit. The Wii has expanded the market, and when the tide comes in, all ships in the sea rise. "Young, avid gamers" spend more on video games, and they do not support the Wii as much. PS3 and Xbox could be said to have a "niche strategy", except that "niche" is hardly a small, unprofitable segment. There's something to be said about winning the market on people willing to pay over 40% more for a console $350 & up vs. $250).

Matt

September 24, 2007 4:57 PM

Richard you have no idea what you are talking about. The playstation 1 sold so well because of one game, (Final Fantasy 7), gamers had never experienced such beautiful animation in a video game and the 64 couldn't provide that. The PS2 lauched early and was doing ok until GTA came along and people had to own a PS2 just to play that game. Unless PS3 has an exclusive must have title, it will never take over again. Trust me, no one is going to go out and buy a PS3 just for MGS4. Nintendo learned their lesson with all of their exclusive titles and decided to create something new and revolutionary, and its working.

deekay

September 24, 2007 5:34 PM

Daniel, According to various articles I've seen the Wii is making a profit out of every console sold.

How are they losing money by subsidizing, I don't understand what you mean here and what sources do have to back this up.

Plus if you take a look at software sales you will see that the attach rate for Nintendo's own software is significantly higher than that for third party's. Mario Party, Zelda, Wii Play all million sellers. So definitely no loss for Nintendo there.

Although I might be missing your point about the subsidising

Jose

September 24, 2007 5:43 PM

To Daniel,

Unlike Sony and Microsoft, Nintendo makes money on the hardware they sell.

They are making about 50$ USD in NA and over 70$ in Europe per Wii console. Add in all the DS sales and the upcoming titles and Nintendo will be making even more money in the coming quarters.

reviewer11

September 24, 2007 6:21 PM

A hit but a Miss??? Uh.. you haven't been paying attention.

Nintendo hasn't lost money on selling a console since the very early days of the GameCube. Unlike Sony or MS, they actually make money not only on licensing and games sold, but on their console sales as well.

XBOX division of MS has burned over 21 BILLION US and has not even turned a profit, other than a small one 1 quarter before announcing another BILLION write off for more repairs.

MS's venture into video game consoles from a fiscal standpoint has been an ABSOLUTE disaster, and no end to losses is in sight.

Halo will move some more 360s for a few months, and that's it... its the swan song for the console. 360 is a ~25 Million unit appliance... which will be enough to warrant them a 3rd place in this generation of consoles and more losses for the company.

Nintendo is currently making ~$75 profit per console sold, so their profit margin on a console is far far far superior to the 360 with its 6 games per console. Profit on every console sold plus profit on every game... MS is still hemoraging money on the 360... and the xbox in general.

MS is stuck on stupid, losing money hand over fist and trying the same old same old that's been done for over a decade. They have a limited appeal factor, and are battling with Sony for that small pie... Sony of course has the far more reliable and technically superior product, but its price point and lack of impressive games out of the gate have hurt them initially, but the PS3 will outsell the 360 quite well by the time this gen is over.

In one year the PS3 will have sold about 5 Million units, even at its higher price point, and lack of catalogue. That's about on par with what 360 did its first year out with no competition in the next gen. As PS3 price declines and killer apps appear and the technical superiority becomes obvious in the 2nd and 3rd generation of software, 360 will be left, much like it is now.. with a decent camp in North America, no presence in all in Japan, and a spattering of consoles in the EU and AU. Not enough to take down Sony... and certainly not enough to take out Nintendo.


Fiscally and critically and adoption wise, the wii is an unmitigated success. It has won this generation of the consoles. PS3 while off to a bumpy start, is well positioned to take second place overall this generation... leaving MS with a 3rd place finish and more red ink on its books.

David

September 24, 2007 6:42 PM

I agree nintendo wii is the best seller, and kids and adult can all enjoy at once, and 360 and ps3 is for young adults and hard-core gamer, not including the price tag for the Wii, its much cheaper then oher system and helps it sells more. And Richard MGS4 is one of the most successful game out there,come on people are buying 360 for halo3, no doubt they will buy MGS4 for Ps3, and the fact there are still many game, not just MGS4.

Adam

September 24, 2007 6:47 PM

Nintendo makes 50 bucks per console. Big deal.

The games are where the money is at for all of them. Nintendo will never have great third party support because they screw third parties over. Always ahve and always will. They want first party games that feature a gay, tired Mario and Link to be the prominent games. They expanded the market. Again, big deal. No one buys new games for the Wii.

Conversely, the attachment rate for the 360 is insane. Thats where the REAL money is made. 50 dollars off one console, sell one extra game (because it comes with a game) or lose 100 bucks on a console and sell 6-10 extra games at 60 bucks a piece PLUS the accessories they are banking off of.

Halo 3 may not over take the Wii in total console sales, but it certainly will make MS more money this year than the Wii will make in 3 years. One game will do that.

And conversely, those new games coming out for Wii, guess who buys them. Not the expanded market, the niche young gamer guys that are disappointed because their console isnt in HD.

Lipo Network

September 24, 2007 6:49 PM

Whatever man... I pre-ordered mine a few months ago at Amazon... now I have to wait for a few days to get it. I just finighed Bioshock last night and need a new game

Eugene

September 24, 2007 7:20 PM

The reason why the 360 only sold about 5 million the first year teven without competion is because people were waiting for the PS3 and the Wii to come out so that they could better decide. 2007 was basically free game for all and the 360 kicked Ps3 to the curb. The wii sold well,but not to gamers, so outside of the Mario,Metroid,Zelda, Wii games will never have chart topping games like the 360

Hollah

September 24, 2007 7:31 PM

Funny how the reviewer is the typical target market for the Wii. Older with moderate to low hand eye coordination. Halo 3 is going to make a ton of money regardless of this article. I think Adam hit the nail on the head.

Trent

September 24, 2007 8:00 PM

I agree. The Wii has made a ton of money. Microsoft and Sony have been struggling to dampen the severe losses that they have sustained financially. I may have a romantic view of the gaming industry, but I'll be damned if our next generation of games doesnt include Sony and MS as major competitors with the strategies that they employ now. I don't want to be sitting at home in 10 years thinking about the next console that I am going to buy and having the option of a console with a processor half as powerful as my laptop, and only a few times more powerful as my graphing calculator... and some other company (I heard Apple was going to try to enter the race), who both have genious ideas for appealing to 4 year olds and 80 year olds, but not much in the way of sexy, over-violent pleasures.

The numbers do not lie. Nintendo did a great thing making the Wii, but I pray that MGS4 and Halo3 do their jobs and make some revenue so future generations can display the same kind of guilty pleasures that our current generation of consoles can provide.

reviewer11

September 24, 2007 8:03 PM

Sorry, but fanboying aside, the 360 is a net loss. You seem to think that that $60 a game makes up for lost profits on consoles, it doesn't. #1, Games aren't free.. $60 per game doesn't go to the bottom line.. they cost a lot to make, market and distribute. #2 the cost to produce a PS3 or 360 game is more than double the cost of a Wii game... meaning you have to sell even more of them to make a profit.

Halo 1 nor Halo 2 made XBOX profitable... HALO 3 will make little difference. It will sell some consoles for a few months, and they will sell a lot of copies of the game, but it won't change their 3rd place outcome of about 25 Million total console sales.

360 cannot become a global first place console, it has ZERO support in Japan, and not much outside the US in general. This makes it IMPOSSIBLE to be the best seller. 360 is in a battle with Sony for second, and PS3 has a broader adoption base worldwide, and better technology (they don't have a 1 in 3 failure rate either)

PS3 has been stifled by high cost which the incorporation of Blu-Ray caused, but this expense while slowing PS3 adoption due to cost, has helped BD format win dominance in the HD marketplace, a far more profitable win for Sony in general.

PS3 will sell well and continue to grow. Attachment rates have been high for the 360, this however is not enough to make the 360 a winner. The 360 can have attachment rates of 10 or 20 and if they only move 25 Million units, the division of MS that owns the XBOX still won't show an overall profit! THye have to have profits of over 21 BILLION!! Yes, that's right BILLION before they even break even.

Sony and Nintendo know how to do something MS doesn't, at least when it comes to consoles... and that is HOW TO MAKE MONEY. Even if the XBOX division suddenly started showing a 500 Million US profit per year.. it would still take the 42 years to break even and get into the black.. if they managed 2 Billion a year profit it would still take them nearly 11 years to be overall profitable.. and the 360 even with an attachment rate of 10 or 20 is nowhere near that sort of situation.

360 is a third place finisher for MS... and they'll start all over with even more losses when they release their next hardware as well, without paying off their previous 2 generations. The 360 and XBOX division in general has been a fiscal disaster 7 years and $21+ Billion in losses, with no foreseable end in sight.

Don't have to like it, but thats the truth.

Jeremy

September 24, 2007 8:06 PM

Xbox 360 in the western world is and will be the number one console for Young Gamers and for Adults, as MS Xbox has more to offer for all age groups, and with Media Centre can hook up to any Vista or Windows Media Centre Pc's which by the way is the Biggest selling O\S on the market today. More and More Adults are buying Xbox 360's because of all the extra's it offers.

Nicco

September 24, 2007 8:09 PM

In all fairness, the attach-rate for 360 is phenomenal--but the the fact remains that MS has not made A PROFITABLE CENT from it from it while Nintendo is reporting RECORD PROFITS, actually SURPASSING the market value of its rival Sony.

Not only is Nintendo reported to be making $50 a console in the US, but the fact that demand is high PUSHES COSTS DOWN. Sorry, you could justifiably argue that Wii is lacking quality software but you simply cannot compare the business model of Nintendo and Microsoft when it comes to making consoles.

Furthermore, Mario Galaxy and Brawl that are almost certainly going to be multi-million sellers. Throw Pokemon Diamond/Pearl in the mix, which has collectively sold well over 8.5 MILLION COPIES--and Nintendo has the potential to have four or five of the top ten best selling games of the year.

hans

September 24, 2007 8:26 PM

lets be honest with eachother who really cares who wins the console war i couldnt care less if ps3 won it cuz i kno that my xbox 360 is way more fun in the end then any ps3, so who cares if wii wins because we all kno xbox 360 is the best even if they dont make enough money we are still getitn wat we want

dedalo

September 24, 2007 8:42 PM

Nintendo has been dominating the software and hardware sales charts for the PAST TEN/ELEVEN MONTHS.

The Xbox 360 has never been able to sell better than the Wii since that system launched last year.

And yeah, MS has been losing BILLIONS since the first Xbox days. Never has made a profit.

And here's another thing... Halo 3 will not motivate much console sales. Not as many consoles as some seem to think. Because the "hardcore" user base (400 pound nerds & annoying 12 year old kids that infest Xbox Live) already got a Xbox 360 years ago. If any consoles are sold, those will be of all those people who still have their Xbox 360's at the repair shop due to the red ring of death curse.

reviewer11 got it right.

Joe

September 24, 2007 8:53 PM

It's really ammusing to watch fanboys shower thier respective system with love, and then bash the compition. I myself am very happy with my 360, but I don't look at the others just to bad mouth them. I work at a GameStop and I hear these rantings everyday, but I'm going to explain things the way I see them as a working Nerd, and remember, these are just my opinions, not law. I am going to look at what they have done right, and what they have done wrong.

Wee will start with Sony, The PsOne and PS2 were not overly reemarkable machines in the way of power, but they were stellar platforms for entertainment. Nobody can ignore how well Sony overtook the market with their consoles. Maybe it was a case over ego that caused them to make the PS3 such an engineering nightmare, or it could even be a lack of mental stability by the former CEO. Everybody knows about the hardware issues, lack of games, lack of BC support, but lets not forget, even though Nintendo kicked off the next entertainment medium with the NES, Sony streamlined the idea and brought us all to the next level. I know there are rabid Sony fans out there who will defend the PS3 to the death, which is fine, it's an admirable trait to be loyal. But you can't really justify your arguments with the single fact that the PS3 plays Blu-Ray. The PsOne played CD's, and how many people just coudn't wait to play thier new CD in the PsOne? Nobody.. Same with Blu-Ray, not only that, the Blu-Ray selcetion at the local Target, Wal-Mart or even Bes Buy is sad. HD is no better. It's going to be very tough fro Sony, but they aren't exactly the new kids on the block, I think with a little re-vamping and some creative thinking, theyy can flip this bird around.

Next is Nintendo, now I'm not going to lie and say I haven't played the Wii, I have, but it was very brief. It to me is the idea of innovation, another jump up in media interaction. Is it boasting the best graphics? No, is it touting the largest library? No, but it is letting the rest of the world know that it's ok to play video games. It doesn't make you weird. Some could even look at the Wii as the gateway drug, bring in a new customer base, get them hooked on the cheap simple ideas, then get them addicted to videogames all together and bam, now they can't decide if thier next fix comes from Sony or Microsoft. The Wii is a good machine, well built, hasn't suffered the hardware issues like the 360, or the BC issues of the PS3. It is a nicely engineered machine. The only downside I see that could cause a problem, is why is it that only Nintendo can make decent games for the system? Third party's can't seem to catch a break, maybe it's just that the new control scheme is still in it's infancy, and that the market is still trying to get used to being that much more interactive. Will the Wii be the leading contender this Holiday season, perhaps, provided they can prooduce the units, expand the library, and drop another triple-A title, they stand a good shot. They are leading the war on console sales, and even though they suffered a small drop in sales last quarter, that is no reason to call them KO'ed. I peronally am still toying with the idea of getting one just to play tte virtual console. I'm a lover of classic Nintendo, what can I say?

Now for Microsoft, I saved them for last not because I love my 360, but because they are the ones with the most to prove. It is true that usually a company won't turn a profit from the machines. And to theoriginator of this column who said they make money from the accesories, I think you're view is a touch off. Software is where it's at, thats is how the companies make thier bread. Stamp a game for a dollar, sell it for sixty. Doesn't take a math whiz to pound out those numbers. Microsoft has had to struggle with serious hardware issues, I myself have had to replace my box once the red ring made it's apearence. Now, granted, it took Microsoft a while to step up to the plate and offer a one billion dollar fix for it, but at least they admitted to the issue and are resolving it out of their own pocket. This problem also extends to the racing wheel, it too has it's own bag of issues. Now I know you all are expecting me to talk about H3, and yes, Halo is Microsofts flagship, we all know this. Will H3 be enough to upset Nintendo and Sony, maybe, will it be the biggest media launch in history, very good chance, am I getting a copy? Yes indeed. I think what Microsoft is doing wrong is not addressing the hardware issues for the future. I don't think the hardware fix is the right one because there isn't a guarentee that this will fix all issues permantly but maybe ttey will get together after the H3 launch and come up with a good alternative, to people sending in thier 360 and waitinn 4-5 weeks to play thier games. What Microsoft is doing right is the library, it's not the largest in histtry, but it's got some girth and some great titles. And they do have more slated for the Holiday season. H3 is going to be huge, no doubt, but where I think Microsoft really shines is Xbox Live. This is the place where we all meet to nerd out, so-to-speak. 7 million members, and of that, 5 million have played Halo 2 online. Thats pretty huge.. Microsoft better be smart, and taae advantage of this situation while the iron is hot. Use Christmas as a catalyst to push the 360 over the top, at worst, they should only come in 2nd place, behind people who wish to get thier excersise from the sofa and thier Wii, instead of going outside, like we used to do.

Overall, each company has thier shortcomings, and thier strong suits, is it an even match? No, but to count out any one of the three companies is silly. None of them have a shortage of funds, and none of them have a shortage of creativity. Honestly, I'm glad we have all three, gives us all choice, and that my friends, is what makes videogaming great, we choose what hero we want to be that day..

Eve

September 24, 2007 9:31 PM

To Adam

In one year the Wii has already made millions while the 360 hasn't even broke even. So please explain your little piece of irrational nonsense. Go on, ENLIGHTEN us. Oh, and while you're on it, fix my RROD will ya? Cuz the billions M$ lost fixing them hasn't help me at all.

David

September 24, 2007 10:16 PM

I think we're really talking about two different things. Nintendo made a brilliant decision to reinvent the wheel and it's paid off for them. But don't think Microsoft and Sony's decision to stick with the tried and true formula wasn't calculated. The result: the Wii is in one corner, and the 360, PS3 are in the other.

The fight between the new (Nintendo) and the old (MS, Sony) is on. Where it gets interesting is in the next generation. If Nintendo continues on path, success will be measured in whether it marginalizes the competition by further distinguishing itself from them, or not, allowing MS and Sony to make their incremental innovations and draw even with their competitor. For MS and Sony, success will be measured by their ability to turn the mainstream towards powerful technology by capturing some of the Wii's magic. If they fail, it will be the last time we see an "Xbox" and maybe the last time we see a "Playstation". Will the Wii continue to Paradigm-Bust and end the console wars for good, or will they stumble, and let the slow and steady incremental innovation back into the race? Time will tell.

Arizona kid

September 24, 2007 10:16 PM

The Wii is for non active people. The xbox is for more mature and the wii is more for younger kids. Halo 3 is an absolute shocker. My coach works at Gamestop and he said 800 PEOPLE PRE_ORDERD Halo3. WOW!!!! And that is just one GameStop not the one in the whole city. But if over 5 million people play Halo2 and Halo sold 9 million copies, who KNOWS what will happen. So that would help Xbox with the ring of death.

!!!!!!!!!!!!!!!!HALO 3 RULES!!!!!!!!!!!!!!

Havok

September 24, 2007 10:40 PM

"No one buys new games for the Wii"
I do actually, I'm looking forward to when I have enough cash for Metroid Prime 3, and almost every person I know is buying Super Smash Bros Brawl when it comes out.

"Thats where the REAL money is made. 50 dollars off one console, sell one extra game (because it comes with a game) or lose 100 bucks on a console and sell 6-10 extra games at 60 bucks a piece PLUS the accessories they are banking off of."

Nintendo- $50 on console, add in another $25-30 or so for extra controller and one game. Total- $75-80 dollars profit per sale.

Microsoft- -$100 for the console, 3 games at $10 markup apiece (I'm a salesperson, and almost no-one buys 6-10 games when they buy their console),
plus 1-2 accesories ($15-20 markup). Total- $-50 profit.

Plus the fact that Nintendo has now sold more consoles than Microsoft has...

Don't know where you are getting your math buddy.

John Smith

September 24, 2007 10:42 PM

Mr. Nussbaum and some of those who've posted comments are mistaken because they're missing some key facts. First, the stories that the Wii is outselling the Xbox 360, while widely report, is inaccurate. The figures used in those reports are based on PROJECTED sales figures gathered from MANUFACTURER'S reports not retailers reports and they only estimate current console sales. In short, these figures DO NOT account for ACTUAL retail sales. When using global data collected DIRECTLY from retailers from all over the world, the picture becomes very different. The actual retail data shows the Xbox 360 sold 7.15M in America, 0.44M in Japan and 3.51M in others countries. Compare that to the Wii. In America the Wii only sold 4.81, in Japan it leads with 3.61 and in other countries it sold 3.36M. As you can see, the actual retail data clearly shows that the 360 is outselling the Wii in vitually every market place with the only exception being the Wii's native Japan. But when you consider the next generation market place, even that lead will not be able to be sustained for very long.
Consider the fact that the general concensious in market research shows the targeted gaming demographic is male, in their teens to 30-something and are avid gamers. This is a demographic the Wii doesn't come close to serving. You don't have to look further than the Wii's current catalog of games or their upcoming titles to see who they're focusing on. If that doesn't convince you, simply read any of the leading articles on the topic. With core gamers, next gen. titles are the future. That's why some of the most popular titles and those that are highly anticipated are all next gen. games (dark sector, assisins creed, gears of war and bio-shock to name a few.)
The Wii is a great niche console, offering a unique gaming experience and certainly has it's place in a 3 console market place. But consoles are quickly moving into the next generation and
the Wii simply does not have the capability to realistically offer any next gen. titles and in a 3 console, next generation marketplace, it will simply be impossible for the Wii to sustain top sales in any marketplace, even it's native one.

CARLOS

September 24, 2007 10:59 PM

well i was a young avid gamer some years ago, now im all grown up and i still like to play, not as much as in the past, 4 hours a day, but definitively im going to be awake at 00 hours to have my copy of halo3, just as someone would go to a world series championship and be soon to buy a ticket. i dont see the nintendo one realy profitable either, kids and parents play w it just some minutes when theyre at a family reunion or something like that. and if i hadnt to pay some bills i would surely buy a ps3 just for metal gear thats for sure. the evolution of the humans brains started in the 80´s and thats why i can use my middle,thumb and trigger finger outstandingly, no need to swing around a nice tv-like controller

Kendall J.

September 25, 2007 1:28 AM

You all make such valid points on the best of the game systems but I will have to agree that the Nintendo Wii is the best. It has opened up a new way to play games, to be interacting with a game and not have to sit still for 14 hours just moving your fingers. If this is the start for Nintendo just think of the possibilities it has and it doesn't have to end with gaming. The Wii also appeals to a much larger population than the PS3 or the XBOX 360 and while these companies may make more money by selling more games and accessories they have had problems to move their products. You can walk into any store and find a XBOX 360 or a PS3 but the Wii is sold out every shipment. Microsoft has lost a ton of money by having to replace systems and the PS3 are so expensive that very few people want to spend the money. Nintendo has come up with a system that is affordable to the consumer and reaches a much larger demographic area of the population which in turn Nintendo makes a profit but a smaller one but by having the number one system the profit increase and surpasses Microsoft and Playstation. One more thing people do not play the Wii because they are inactve(thats like saying Bush is the greatest president of all) people play because you get to interact with the game and it has titles like Metroid Prime, Super Smash Brothers, Paper Mario and Zelda.

xx

September 25, 2007 1:52 AM

I don't know about the rest of the world, but here in Australia the Wii is definantly gaining momentum. 3-4 months ago I had to go to the back corner of the local department/games store to see the range of games for Wii while xbox/ps3 were right up the front.

I had a look yesterday and saw the Wii in the front of the store and ps3 games in the back corner. Xbox were in the middle mixed in with all the pre-owned games of all 3 consoles.

Penguin Warlord

September 25, 2007 2:02 AM

Iam a Wii60 owner in that I have both a wii and a 360. In my opinion the Wii isn't really much competition for the Xbox 360 in that they have 2 very different target audiences. The Wii is great and innovative, I mean my little sister can beat me at wii bowling however she can barely move around in Halo. It's simple and fun to use.

However I have yet to seen any depth to the console. Name one game for it that has a solid back story. You can't. A "serious" gamer will not be satisfyed with minigames and games based on a mushroom trippin Italian plumber. That is why every single Wii owner who is a gamer (your grandpa doesn't count) has either a 360, ps3 or pc sitting beside it (not literally). And guess who makes money off that 2/3 of those options, - Microsoft games division.

Microsoft will not be hurting for money no matter how many consoles the Wii sells.

So you see my point is that the Wii is not actually losing Microsoft any money all it's doing is creating new gamers by dragging in people who wouldn't normally play.

And this pretty much sums up why Microsoft is doing the best job with their console for gamers:

:
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GO TO THIS LINK TO SEE WHY MSFT IS TEH BESTORZ:
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http://www.cubetoons.com/index.php?option=com_content&task=view&id=146&Itemid=1

chimp

September 25, 2007 2:08 AM

Arizona Kid, what do you mean by non-active gamers? i mean, the wii is the only console that actually gets you active.

i have a ps3 and a wii, and im no fanboy like alot of other people here, but i can see alot of fun games coming out for those 2 consoles. im not saying that it's the opposite for the 360, but it seems to me like it's in the middle. the ps3 is the hi-tech machine with great graphics and alot of great features. then the wii is the innovative console that gives you alot fun for a little money. where does the 360 fit in? it's the original on steroids. but maybe thats how it will do so well, being in the middle.

no one can tell how things will turn out in a couple years, hopefully nintendo comes back after it's fall with gamecube.

Dan

September 25, 2007 2:13 AM

To John Smith:
I would like to request the source you got your information. I don't want to Google because what I find might be different than what you found.

On other news, doesn’t core gamers already moved to next-gen consoles? I wouldn’t expect them to buy a game unless the graphics kick a$$ and is more of a shooter-action. What happens to those that wants a new console, but doesn’t really have the time or money to pay for it? I do agree that 360 is reasonable priced to buy and the games are great, but remember that Microsoft will always port majority of their KICK A$$ games to the PC. Granted that they won’t be the same as those for the console, but why should I spend up to $450 for a console plus $60 for the game when I can just buy a $50 game and play it on my PC. Most people, with a limited amount of income, would invest in a long term product, like a computer, than something that can be “obsolete” in a few years, like a game console.

Second, it doesn’t really matter who wins the console war this time. In my mind, I believe that PS3 will come out the winner; however, Sony, Microsoft, and Nintendo just need enough “fanbase” for their next console. Look at Nintendo. When it was the Revolution and the controller was not announced, basically no one paid attention to it. Many believed that Nintendo was still kiddish and will be eliminated like Sega in the console war. Most of gamers paid attention to Sony and Microsoft, seeing what kind of graphics they have. However, why fight someone if you and your opponent have the same weapon, yet your opponent’s weapon is much better than yours. Wouldn’t you think of another weapon to use? I believe that Nintendo found, like a user said best: “reinvented the wheel.” And it seems to paying off. Think about it. If you played Halo 3 all day (a week since it came out), wouldn’t you want to play a different game just for a few hours or do something else besides playing video games? (Some would say no, but most would) Many gamers, if they still have the obsolete consoles, will, from time to time, take it out and play for a while.

Chris

September 25, 2007 2:55 AM

xbox 360 has had a a year's headstart. They will obviously have more sales. Were their GODLY GAMES when 360 came out? No? Then why does everyone expect GODLY games out of Wii when it first came out? Its not an even playing field when it comes to who started earlier. I mean people are bashing wii but wii's pulled metroid prime 3 , brawl, AND GALAXY WITHIN THE FIRST YEAR. I don't see ANY killer apps for 360 within their first year. how can you even begin to compare that?

Match your apples with apples; your oranges with your oranges.

Wii makes an amazing 2nd console to any hardcore gamer. You are not hardcore if you don't appreciate first party nintendo. You seriously are not hardcore if you despise mario. what a crime to humanity. With that in mind, the idea of nintendo is to piggy back off everyone else; any1 who gets a 360 will get a wii. people who get a ps3 will get a wii.

O and btw about hardcore gaming-if your really insane about gaming and you game all your life, look to computer gaming. It's pretty rewarding.

Captain

September 25, 2007 3:22 AM

The Wii is revolutionary? Because of the "Wii-mote"?!?!?! That type of technology has been around forever. The ONLY reasons why the Wii is even close to the 360 in sales is because of the gimmicky remote and the $249 price tag. The graphics on the Wii are easily 3 years old, no high def, and their online service pales in comparison to Xbox Live. Man Bruce, know the facts before you start jumping on the Wii bandwagon.

Texan_2112

September 25, 2007 3:33 AM

For all you doubters, 65nm CPU and GPU 360's will be filling the market chain shortly, and 45nm of each is already in test production.


As for attachment rate, while MS enjioys a better than projected attachment, PS3 is clearly failing to produce any revenue at all to recover their per-console loss, a situation which can not continue indeninitely.

Mike

September 25, 2007 4:01 AM

I don't have a lot of numbers to throw around, but I do know that Nintendo has all but surpassed the 360 in half the amount of time on the shelves.

I have been a gamer for many years now and am smack in the middle of that "hardcore" user base. I think that the 360 and the PS3 are really good gaming machines, but as a student I find the price tag to be way too high. And there is one universal truth about student, and that is that we have no money.

I think 4 years from now, the Wii will have a slight lead over the PS3 with Xbox trailing. Personnelly I am looking forward to next generation of machines. Nintendo has said that it will leap into HD with their next console. So the tech gap will not be as large. However, We all know that for as long as there has been console gaming, Nintendo has been the driving force behind the Phisical way we play games ie. rumble, analog sticks, pressure sesitive shoulders, and now motion sensing. I think that this, like all the others, will be taken and used by Sony and MS. (For the record I am not suggesting Nintendo invented these technologies, only that they were the first to use them in console gaming)

Also to comment on games such as halo 3, I want to point out that Nintendo has the most recognized Franchises and mascots and they know how to use them. I think that Mario Galaxy will be a huge success, more so than H3 because every one of those millions of Casual gamers that bought a wii know who Mario is and will buy that game. Maybe not a first, but in the long run I would put money on Mario and smash bros Brawl outselling H3 and nintendo will win this generation.

JOE

September 25, 2007 4:30 AM

Havok,
Nintendo only makes about $10 per console after the cost of print, packaging, shipment, and the retailers cut. When the console first came out they were making just a couple dollars, but obviously their cost has gone down a bit.


-Joe

Jake

September 25, 2007 4:39 AM

Hey John Smith, add up your numbers and tell me which comes out higher... genius. Anyway, this is a Business Week article and a bunch of video game fanboys that understand very little about business, and how money is made beyond their allowance, have found their way here. Regardless of which console you own or support, the money earned and lost by the companies do make difference. These companies post their earnings on losses on these consoles for the whole world to see because they are publicly traded and they have to. This is not an article about which console is superior, it is about which is MAKING MONEY and which are LOSING MONEY. I have a 360 and a Wii, I enjoy them both for the same reasons that everyone else enjoys theirs. I CAN imagine my grandma playing Wii Sports, I CANNOT imagine my grandma playing Halo 3, but hey I like both and I have other people to play Halo with.

Carlos

September 25, 2007 4:43 AM

wow. You know, teenage males can be very self-absorbed. Yes, you are willing to pay for many games now, but let's be honest, this country's wealth does not rest in your hands. It doesn't even rest in the hands of twenty-somethings with their $20,000 a year starter jobs. Several of you gave your opinion saying that the Wii is for kids and PS3 and XBOX360 are for adults, but you will eventually come around to a different understanding.

I had been an avid gamer all my life. Bought all of the latest technology, and oohed and awed when the NEO-GEO's and 3DO's graphics were so much better than the 16-bit consoles (Super Nintendo and Genesis). But, look at who won those console races.

The time moves on and at some point you get a family, a mortgage, a good job... But it is not those in my category that hold the wealth in our country either, it is the retired and about-to-retire folks, with lots of TIME and a NEST-EGG saved up that can really afford whatever they want. They hold the potential in the video game industry. Don't get me wrong, hardcore gamers are important, but reality is reality, and Nintendo dominates it right now.

As has already been pointed out, Nintendo's business strategy is far superior to that of the other two consoles, as either XBOX 360 or PS3 would have to sell twice as many consoles as the Wii to come close to making the same amount of money as Nintendo is currently making, and that is accounting for the markup of the games (don't forget, Nintendo's markup of games is also higher, because of low development costs and higher proportion of first-party titles). At a lower price-point, Nintendo makes a lot more money per-console and per-game.

But Nintendo's ace is probably the Virtual Console. Sure, I have only bought 4 new games with my Wii, but I have purchased 6 Virtual Console games, and those are much more profitable for Nintendo (considering that they appear in their original format without redevelopment costs). Then when I consider how many more casual-gamers are out there who used to be hardcore gamers, but that do not have 30 hours per week to waste, but do have $40 dollars each month, then I have to give it to Nintendo for their come-from-behind victory, in this console. Nintendo exudes profitability.

I know that flashy-graphics are sexy, but in the end it comes to playability. That is why I would rather buy Ms. Pacman than almost any 3-D platformer. Oh, and of the eight families (All in their 40's and 50's) that came to my house for a work party and that played Tigerwoods 07 on my Wii, 3 have already bought at least one Wii for themselves. One even bought several to give out as gifts.

Don't worry hardcore gamers, eventually you will get there too.

Rebecca

September 25, 2007 4:57 AM

I'm a 30 year old female and I've been playing video games since I was 8. I have a wii and I love it. I have owned all of Nintendo's systems. Nintendo has done a brilliant thing by going after "non gamers" and older people. Nintendo is # 1 because of this. Sony and Microsoft and all of their fans can bash Nintendo all they want, but Nintendo is # 1 again and it's not going to change in the near future. Halo is targeted at one audience. Halo is not a system seller. No one wants to touch Sony's ps3 at their crazy prices. Nintendo bashers should stop being bitter and join in on the fun. Who cares about graphics and blu ray? The wii is fun and isn't that the point of video games anyway?

randy

September 25, 2007 5:09 AM

To Jauregui

"But I also think that Wii will come back with the release of Smash brothers brawl."

You bet your ass it will!!!

SSBB For the win!

Jon Do

September 25, 2007 6:09 AM

Where are you coming up with this 21 billion dollar lost claim?

As of 2005 the xbox division lost 4 billion dollars. Even with Microsoft being able to throw away money like no one else, if they had truly lost 21 billion dollars on the xbox project would've been abandoned already.

Its more likely they have lost 21 billion (if that is even accurate) as whole in their entertainment and device division. That division houses various projects over the years such as webtv, ultimate tv, the zune. People though tend to regard it as the xbox division.

Kenny McWilliams

September 25, 2007 6:19 AM

WII to me doesnt belong in the same catagory as ps3 or xbox 360. To me, its like DS or a Gameboy, everyone has one for kicks and giggles. But for a true gaming experience, u either need a ps3 or xbox 360. Xbox 360 has the best experience in my opinion, and with halo 3 coming out, its going to take over the "Next Gen" market. So in conclusion, i think this article is fubar, you can sell a billion honda civics, but who the hell gets any thing out of it? (excitement wise)

KNIGHTWING

September 25, 2007 7:17 AM

This article has a mistake in it's facts. The Wii has NOT outsold the 360 in the US. It has outsold it INTERNATIONALLY. The 360 is still #1 in America. The Wii sales are #1 internationally. This guy should check his facts before writing an article. Calling the Wii Paradigm-busting innovation is a joke. It is a innovative gimmick, that has caught on like a fad. Sure it is neat, but ask anyone that has owned a Wii for more than 6 months...The appeal wears out and the funfactor diminishes as there just aren't than many good games available for the Wii.

Jack

September 25, 2007 7:23 AM

Could all whiners please stop?

Who cares what money the make or loose as long as the price is right and the games keep coming?

Stupid arguments:
"The Wii is better because Nintenod makes money"
"The Xbox 360 is no good because Microsoft is loosing money"

Just buy what you like and post some praise or constructive critisism.

Michael

September 25, 2007 7:28 AM

"The actual retail data shows the Xbox 360 sold 7.15M in America, 0.44M in Japan and 3.51M in others countries. Compare that to the Wii. In America the Wii only sold 4.81, in Japan it leads with 3.61 and in other countries it sold 3.36M. As you can see, the actual retail data clearly shows that the 360 is outselling the Wii in vitually every market place"

Yes.. the 360 is outselling the wii in those places, however add them up and the Wii is outselling the 360... isn't that the point? Or do you believe America is centre of the planet?

jonathan

September 25, 2007 9:38 AM

People need to remember who buys games. It used to be parents buying them for their kids. Now those kids have grown up and buy them for themselfs. The largest portion of the games market is taken up by the 20-40 male age group. The rest of the market is split between casual gamers and children. Most of whitch either dont buy games coz they dont have an income of their own (kids) or people that dont play games that much (casual gamers).

In my experence the console that will come out on top is the one with the highest attach rate. Ok so the wii has sold a lot of consoles but people arent coming back to buy extra games. Once the novity value of the wii runs out (about a month in my case) poeple move back onto their serious consoles. The wii spends the rest of its life in the cupboard only to see the light of day when your drunk and fancy a few party games.

The ps3 is dead in the water (esp here in the uk) no one wants to buy an overpriced console that has no games. The wii only sells consoles and not much in the way of games. The 360 sells consoles and people buy games at a much higher rate than any other of the consoles, and that in my eyes gives the console a much better chance of survival than the other consoles on the market.

One thing we must remember is that microsoft are not in it for the money. They want your lounge at any cost. You gotta remeber out of all the console companys microsoft is the only one in a position to be able to take big losses in order to expand their market share. They will happly lose billions to ensure that they stay in the game. Once they crush the opposition only then will they start worring about money.

b

September 25, 2007 11:21 AM

To Arizona kid:
Nintendo have the most successful gaming franchise of all time at their disposal: Super Mario. I hope you are aware that in the USA alone Super Mario Galaxy has already gathered over 400,000 preorders. For a console that apparently does not cater to the 'hardcore gamer', Super Mario Galaxy looks to have quite a fanbase already and it's not even out yet. And you can't even begin to tell me that casual gamers are out there pre-ordering Mario games because you and I know that is a rediculous statement to make.

To John Smith:
I agree with what you are saying about actual console sales when compared to predicted console sales, but you have to be in serious denial if you think that Wii can not and will not last as a next gen console. You talk about all these so called 'next gen games' but the reason you point them out is because of their graphical quality and the power behind the console it is on, not because of anything else. If you want to discuss the power of the next gen consoles, then PS3 will NEVER be in first place because history shows that the most powerful console in every generation NEVER comes first. And at its current price and lack of library it's even further evidence that will never happen with the PS3.

That leaves Wii and Xbox 360 in the run for 1st place. Sure, 360 caters to the hardcore dedicated gamers more than Wii does, but that in no way guarantees its success. Wii's broader appeal has quite obviously boosted it to great heights already, and it is more likely that the Wii's success will continue rather than decline. Call it a fad and a niche console if you like, but the numbers show that people are buying Wii's left, right and center. If it hasn't happened already, Wii WILL overtake 360 sales within the next 6 months, especially leading up to Christmas.

The problem so many hardcore gamers have with Wii is that they can't distinguish between a fad and a revolution. Look at Apple. Sony dominated the portable music market with Walkman, and Apple brings along iPod and pulled the carpet right out from under Sony's feet. People didn't think iPod could do what it did. iPod became a revolution because it has changed the way people listen to music. Sure, Wii still has a lot to prove in this generation (just like all the consoles I must say), but from what I can see, Wii seriously has the potential to become the revolution of the gaming world.

Never underestimate the power of Nintendo.

Polo

September 25, 2007 11:37 AM

Wow reviewer11: get your head checked.

The money to be made with consoles in in accessories and games...not the consoles themselves. The 360 will start making a profit on the consoles within 12 months and with their attach-rate(games) they will be making money hand over fist in the near future. Wii owners hardly use their machines and play the same game over and over..why because the games suck. I've seen 10x more wii's for sale than 360's and PS3's put together...its a fad that VERY quickly fades after one purchases a wii only to discover its really not much fun at all.

HuRTLoCKeR

September 25, 2007 11:54 AM

Let the masses have their Wii and age friendly gaming... Personally I'm 23 years a gamer and hardcore and it seems Nintendo have stabbed their loyalest fans in the back... There are no titles on the wii bar metroid I would even consider buying, and fps has been done so much better on other platforms... The ps3 and 360 are great consoles with a lot to offer - I just hope one of them does well enough to continue to have games made for it...

Jabroni

September 25, 2007 12:11 PM

You know what, the wii will be number one for now, but sooner or later, when people will get tired of it, it will be second or third.
The PS3 and the 360 are the two heavy hitters. In 2008, great games will be raining on these two consoles and analysts predict that 2009 will be the year when the winner will be revealed.

As long as we enjoy the games who cares about the profits

D.Smith

September 25, 2007 12:30 PM

As a long time gamer while I can understand the appeal of a toy like the Wii, the fact of the matter is that your understanding of the market is lacking. The main reason that the Wii has such a high selling point is that it was the cheapest system to market. PERIOD!

The Wii appeals to the parents who do not want to spend $400 for a toy for their children as evidenced all throughout last holiday season as desperate moms trolled the stores attempting to pick one up.

So while in the short term Nintendo's strategy is good it's the long term race in which I see them having a problem. Considering the Wii is nothing more that a slightly upgraded Gamecube and obviously last Gen, what will happen in say 2 years from now? Those kiddies who got a Wii will eventually want a real system (consider that the Wii has only had 2 serious game releases in 8 months). In addition the graphical gap which is extremely evident even if you attempt to underplay it will continue to widen over the years.

I see the wii more like a nice entry system that can create more interest in the market, but as more people become aware of gaming and of the other capabilities of the bigger systems - you may end of seeing a shift.

Also your calculations are incorrect - while the Wii is the fastest selling system thus far, it is still not the Market leader anywhere other than Japan. In the states I find it hard to beleive that the Wii, which most people who own it admit they do not play it will be able to maintain it's momentum during this holiday system, especially with no A list games in the works.

Also, consider that it is the hardcore gamer that sustains the market and while a large install base is nice if most of your owners are people who only buy games on the holidays - game makers will have to limit their support since selling software is what moves the bottom line.

Nate

September 25, 2007 12:53 PM

It's really tiring to see someone point out that the people buying wii games by 2 while xbox consoles by 6. Also, that avid gamers already buy in quantities.


Let me point out that the Wii is very young. Hell, let's see if we can say that about xbox a year ago had this success; no. Who knows how many games causal gamers are going to buy. Have you seen old people play the wii? It's like their new Matlock.

J.R.B

September 25, 2007 1:05 PM

The Wii could possibly sell more systems, but its a niche product that will never sell more games. The market for the Wii is either a non-gamer, who is going to buy 2 or 3 games over the systems life OR Heavy gamers, who also own the more powerful systems (usually the X360, since the PS3 can't seem to get a foothold). Those heavy gamers, multi-console owners - will always purchase games for the 'high end' system first.

So, the end result is Nintendo sells more hardware and is back in the same boat, with a system primarily selling its own games (not 3rd party developers)...only this time with great success (unlike the Gamecube, N64). Microsoft sells less hardware, but far more games and gets the better developer support, because they sell a lot of games. If the Sony PS3 can get a foothold remains to be seen. It's way too far behind and doesn't have the games to compete, and I don't see any coming either, at this point.

raindog

September 25, 2007 1:32 PM

The attach rates being bandied about here were publicized back in January. At that point, the Wii and PS3 had been out for 2 months and the 360 for 14 months. The 360 is always going to have an edge over the other two for attach rates because it was first and it didn't fail outright.

More interesting would be to compare the attach rates by number of months the consoles have been released. This would be of more interest to people reading businessweek.com because they're into business than it would to all you fanboys for one system or another. But it's the only attach rate figure that would mean anything.


But the question posed here was whether Halo 3 would be enough to prevent the 360 from being eclipsed in the marketplace by the Wii. And I think it will, but only for a couple of months. People are going to buy 360s and Halo 3 like crazy this month, and other 360 titles will benefit as well. But is one game really enough to double the 360's sales in the mid- to longterm, which is what would be necessary to stop Nintendo from overtaking them? I don't see that happening.

Richard

September 25, 2007 1:44 PM

@ John Smith,

When you give out these numbers you are forgetting one very important piece of information. That is the 360 has had one extra year on the Wii in sales.

So if you look at your numbers the Wii (in ONE YEAR) has matched what the 360 has done in two years.

How about we look at where the systems stand after the holiday season, when the Wii has Mario Galaxy on the shelves.

Jason

September 25, 2007 1:51 PM

The comment comes up, over and over, that Nintendo is a secondary system. That everyone will own the Wii, but they'll own a 360 or a PS3 as well, and that their "primary system" will receive game purchase priority. Crap, whatever.

Mario Galaxy, Metroid Prime, Zelda, Smash Brothers, Wii Fit, Mario Party? Nintendo's making money hand over fist and making the HIGHEST quality games consistently. I'm an old school gamer, and I'm sick of buying random hit or miss quality games from Sony and Microsoft. Nintendo first party games are ALWAYS entertaining.

And the only way that Nintendo hurts third parties, is that the first party games are always so much better. But if the third parties make good games TOO, then their games will sell.

eric

September 25, 2007 2:29 PM

Why do people seem to ignore the fact that third party games do not sell on Wii or Gamecube for that matter. Nintendo consoles sell Nintendo software and nothing else.

Third party developers will eventually abandon the Wii like they did the Gamecube.

Mr Smart

September 25, 2007 2:46 PM

(1) A lot of people is not getting why MS is in the gaming market. Gaming is the next home entertainment trend. Not being in that space is going to cost them tons when SONY convert their PS3 into a mini PC. So a $21B loss is affordable. The last report i read, MS is still making tons of $$.

(2) People that say that wii is for kids doesn't seem to know they are once KIDS. Graphics is not a problem for KIDS, playability IS. Do you think parents like to buy console that promotes hardcore games that shoots people etc etc? PS2 is KING last gen because it has a good library of games. Whoever has that this generation will have a good chance of being 1st. Xbox has and i think it might have a good chance (depending how long this next gen war last).

(3) Wii is going to lead the pack. It has an innovative new way of playing. It WILL have a good library of kid games for family fun. It MIGHT have a good library of "hardcore" games. The only thing stopping this is when SONY and XBOX go on to the next generation, introducing new input devices.

(4) Wii is cheap. $$ talks, cheap means bigger market. If xbox is consistently cheaper than PS3. Xbox will get second.

Dan

September 25, 2007 2:58 PM

My WII is a piece of crap, My PS3 is gathering dust & only used at a Blu-Ray Player. My 360 ELITE on the other hand gets daily usage, and kicks the arse of the other 2!

Dont really give a shit who wins the console wars.

I have a feeling though it will totally reverse to the following:

1) PS3
2) XBOX 360
3) WII

My reasonings? people will start to see that the wii is just an underpowered console less powerful than the original XBOX!, Why dont sony just promote their tilt controller which is better than the wii remote anyway! And once the price of the PS3 drops and sony promote some amazing looking games, people will choose PS3 over the 360.

All Sony & Microsoft need to do is emphasise their cutting edge graphics, and better rated games, play a little bit dirty!

The XBOX 360 core version is the same price as a wii.

Unfortunatley people fall for gimmicks, which is all the WII is.

Cody Gaither

September 25, 2007 3:21 PM

I will agree with Bruce that one game doesn't make a console, but One game can bring people in, and the catalog can keep them. The Wii is a great console but in my opinion the are somewhat short sighted in their production. Sure they have expanded the market, but what kind of market have they opened? I doubt the boomers are going to create the same kind of fanatical buzz surrounding both the XBOX and PS3. Take the PS3 for example - 7 of the top ten titles are available on the XBOX with much better online support, and the price point is nearly double that of the XBOX, but people are still buying it. They aren't buying it for the great games or fantastic online support, They are buying it on faith that those will come. And if Sony fails to deliver on either of those things, they are really going to be hurting. And with so many titles going both ways, where do you think the gamers who are "on the fence" are going to go - same game looks good on one system, but all their friends are playing it together on the other. It doesn't help that the only exclusives on the PS3 haven't been rated nearly as well as the Xbox either. SOny has promised a huge number of games by the years end, but unless they can produce high quality games, you may see more of a market slide.

Brad

September 25, 2007 3:32 PM

I have a nintendo Wii and I have to say it is by far the worst system I have ever owned... I buy games and after a week or so they suck...I should have invested in an xbox 360...in regards to the playstation 3 I would never buy one due to the fact that I have encountered so many problems with the playstation 2 and since bought an xbox and never once had a problem....bottom line don't waste money on a Wii or PS3 get a 360

nate

September 25, 2007 3:39 PM

Hey, HurtLocker, don't be an idiot. It wasn't Nintendo that turned their backs on gamers, it was gamers like you who turned their backs on Nintendo. If you paid attention to the Gamecube games, you'll see that they've been making the same games they are now. You turned your back because you wanted to play with more shooting games and you know Nintendo doesn't cater to shooters as much as they cater to actual games.
And fps on other platforms, please, if Nintendo wanted to compete in that platform, they'd definitely do a better job, design wise, but why run the with the current?

Chris Woulds

September 25, 2007 3:57 PM

Microsoft & Sony has stuck with their small segement of young gamers?

Hardly small when if you combine the 360 games sales with the PS3 you get many many times more sales than the Wii's supposedly bigger target audience.

Personally, from a business perspective, i'd take your small young market demographic any day. Whats the point of selling all those units if no one buys any games for them?

Profit is all in the games sales and Wii severely lacks in that department. Developers will develope more games for Nintendo's machine over the coming years but they will for the others too, only more so. This is because those are the customers that actually buy games and at the end of the day, thats all the developers (software sellers) give a toss about.

I dont care if nintendo sells ten times more consoles, just as long as microsoft is selling more games then thats all that counts. Wii really needs to sort out its attach rate but how can it with its system and games portfolio targetted towards young kids and old folks with families who arn't willing to purchse well over 6 games a year?

Microsoft is in a great possition and sony hopefully will get a bit of strength behind it soon.

Its all in the games sales!

Danny

September 25, 2007 4:40 PM

The Xbox 360 is currently making a profit. It's well known that the hardware is now selling for a profit (and has been for some months) and that the attach rate is high. Currently, the losses/small profits being incurred by Microsoft's Entertainment and Devices division are largely due to expenses associated with the Zune -- not the Xbox 360. The Xbox 360 has been profitable for a while now. The Xbox was the albatross that kept the Entertainment and Devices division down, but now that the 360 is making a profit, the Zune has taken over the as the product that's cutting into profits. With Halo 3 and a slew of great games coming out on 360, the Xbox 360 is in a great position to be a leader in the console market. At the end of the day, the 360 is going to have the most games that people want to play, and that's what counts.


For me, the Wii is an overrated, but fun console. It will make Nintendo loads of money, and if that's Nintendo's goal, then it will succeed. The Wii is a fad, but a profitable one, and I'm not sure how well the hardware or control scheme are going to hold up in the long run.

Attachment rate wise, I own 20 Xbox 360 games, and two Wii games. My wife loves the Wii, but casual gamers more often rent than buy games.

My money is on the 360 this generation. Nintendo is going to make huge profits, but if great games keep coming out on the Xbox360, then it's going to keep selling. The ps3 is too expensive and has no great games out yet. The longer it goes without great games, the worse shape that Sony is going to be in.

Zee

September 25, 2007 5:03 PM

reviewer11,

Dumb fanboy. At least don't lie, the XBOX Division did not lose over 21 billion thus far, they lost a little over 4 billion.

You must be on crack if you think that the 360 will constantly lose and end up 3rd. Even with the loses the 360 is already winning this generation hands down with its huge variety in game offerings, attach rate per console and the online (Live) offerings which everyone fails to mention..MS is the only console of the three that currently makes profit on its online offerings. Microsoft might be losing money now but they will be reaping the rewards very soon. Once they include the new 65nm Chips into the 360's, they'll be in a position to reduce the price of the console even more. Afterwards comes the reduction to a 45nm process. That will come later down the road but it too will be a very vital piece in Microsoft's dominance in pure profit, this generation. They're already winning with the library of games, the attach rate per console, and the profits from their online offerings. That's 3 places where they're making a substantial profit. Once they cost reduce the 360 and its production they'll be turning a profit on the consoles sold as well. That's three major pieces of the puzzle where MS will be turning into a mighty profit; attach rate per console, Xbox Live, consoles sold.

MS will not only win this generation, they'll recoupe their previous XBOX Division loses of 4+ billion and leave themselves in a very good spot with a newly found recognition/love by the gamers, for the next round.

Steve

September 25, 2007 5:24 PM

"The Wii, is a hit, then a miss... Why? The Wii, grabbed many new people, but selling on average 2 games to each console, they are losing money by subsidising, something that will not make them money."

The only thing that is hit and miss is your comment. Have you read any news? The Wii is making Nintendo $50ish in profit per machine -- just the opposite of what you are saying. The Big N is doing well for itself, and that's why its stocks are currently the second most valuable on the Japanese stock exchange.

Albion Knight

September 25, 2007 5:53 PM

Weird set of "facts" have been posted here
1) The Xbox has lost 21 Billion

Umm No they haven't 21 Billion would be the cost
21 Billion would mean they sold 52 Million consoles for free!

2) Xbox loses 100 on every console.
Wrong again with the new chips they have been making 50-75 per console since July

Sony Does continue to lose money on the PS3 but they are still cleaning up with the PS2.

The Nintendo Wii was and continues to be a simply brilliant move. With all the Hype on positioning to be the "Next Gen" console they Went for "This Gen" HDMI Blu-Ray HD-DVD matter not to most people because they don't have an HDTV. to make that leap your talking another $600 minimum. Sony recognizes that this and will keep the PS2 around until 2010.
If you talking Who will win the next gen market It's either the PS3 or the 360 or some other entry . The Wii is not a Next Gen machine but it doesn't need to be because that won't be here until 2009 2010 when more and more people have a high definition TV. (I predict that you will see more TV's in the 27" and under category by then as well) I'm not dismissing the Wii as some might I think it is a fantastic machine and I was very tempted to get one. I've owned the NES SNES and N64. I was very torn about the GameCube. How could I abandon my buddy Link? But he had reverted to a Saturday morning cartoon character. It may sound trivial but they lost me at that point. I still almost got it until I saw the add for Fable. From then on I was Xbox all the way. My Point in all this is it's the Games that matter.
The Wii has Zelda and Galaxy. The PS3 has Heavenly Sword. But the Xbox 360 has BioShock and Mass Effect and Fable 2. The only thing that means one console wins over another to me is if the game I want to play is on that console. As of right now the Xbox has more of these games than any other console. I'm not saying that will change in the coming years but as long as the best games are on the 360 I'll stick with it. Ultimately people buy consoles to play games. If a console has a solid install base designers will make games for it. If Sony can catch a break and get more must have games that are exclusive to the PS3 in the next year they might swing the tide but why would a developer leave out the largest install base. There are a few games that developers have said won't play on the Wii but I expect more games to be out for it in the next year. I still say it is a "This Gen" machine in between Xbox/PS2 gen and 360/PS3. I hope that all the console double there sales and more and more developers make cross platform games. If I have my wish I'd get them all. I have a 360 now. Id get the Wii next and I'd get the PS3 in a year or more.

Oh and to be more on topic most analysts are saying that Halo 3 will bring the Xbox back to profitability. It will Not win the war but if you want to play it You'll have to have a 360. I don't think there are any games that will draw consoles sales more in any system. at the time of this posting it has already sold going on 2 million copies.

tke965

September 25, 2007 6:19 PM

To me its not about which console will dominate. You can't compare the Wii and the 360. Two completely different systems with different target groups in mind. Yes, the Wii has had a great marketing campaign and it's sold a lot of units. But if you look at the titles being sold on the Wii they are the traditional Nintendo titles. 3rd party publishers aren't sharing the success. Also, keep in mind that the gaming world progresses. The Wii is great at reeling kids into the gaming market. Eventually those kids will grow up and the Wii will play like a childs toy. MS may have a great strategy. Games are what make a console. The Wii's done a great job, but as a gaming platform it excludes many gamers. The few adults (18-34) that I know who purchased a Wii said it was fun.....for about 40 minutes.
Also, more importantly, Bloomberg disagreed with you this morning and so did the individuals from financial consulting firms.

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September 25, 2007 6:38 PM

The Wii has expanded the market, and that's a great thing, because that means there is even more room for everyone. The industry needs all three console makers, and Sony and Microsoft both have very deep pockets...nobody is going anywhere, regardless how well the Wii does. The PS3 and 360 will never catch up. But honestly, WHO CARES? Unless the Wii can somehow pull 1080p HD, a robust online gaming network, a hard-drive, and the best third-party selection of games and exclusives out of its magician's hat, there will always be a substantial market that will buy the PS3 and the Wii. And particularly in the case of the 360, it doesn't matter if Microsoft comes out in third place and are still losing money (though hopefully the 360 will help reduce those losses in the long run). Just remember, all the new gamers who are cutting their teeth on the Wii, especially the kids and the middle-aged, are eventually going to become more sophisticated and demanding of their games, and you can bet that Microsoft plans to be around when these people outgrow Mario and Zelda and realize that wiggling a Wiimote will not help them lose weight.

Roujin Z

September 25, 2007 7:03 PM

"will always be a substantial market that will buy the PS3 and the Wii"

Sorry, I meant "PS3 and the 360".

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September 25, 2007 7:06 PM

Wii vs the 360?! What an idiotic comparison, they don't even come close to occupying the same marketing space. I own both and neither are a replacement for the other. There isn't a real gamer out there who'd trade a true 'next-gen' console (360) for a Wii - nor is there a boomer who'd see a benefit in trading the other way... truly ridiculous to compare the two or say that one is beating the other. It's as moronic as stating the sales figures for the Porshe 911 next to the VW Golf and trying to derive some meaning...

Kevin

September 25, 2007 7:28 PM

i love reading everybodys comments about wii not having the best games out compared to the xbox but how come barely any of these 360 fanboys have mentioned that xbox has had a full years headstart on games and consoles.. i own a wii and go to my buddy's place to play 360 all the time, and i can say that owning both of them would be idea.. the "hardcore" gamer market is only a piece of the puzzle, but have any of these people seen the games that are coming out in the coming months for the wii?? the new resident evil looks amazing, metriod is already out, manhunt 2 is getting the go ahead, mario galaxy, smash brothers, and an online version of mario kart.. all of these withing around a year release will keep the software sales for the wii on top..

everybody always keeps talking about how the consoles aren't where people make the money, well that's just another way nintendo is breaking the mold where they are making good $$ on just the consoles.. i own 5 games for the wii as of now and am looking forward to getting about 4 more by the end of the year.. i would label myself as more than a casual gamer, but not diehard enough to be a hardcore gamer..

bottom line is, before you judge the game selection on the wii take a look at them and play them yourself, they are even fun for people who aren't just casual gamers.. and to the people talking about total wii sales vs 360 sales, we can compromise and say they are close to the same with usa and international sales accounted for, but keep in mind the head start that 360 had.. once the wii fit comes out and they have skateboarding games and surfing games with that piece of hardware it'll change even more..

i'm not really even mentioning ps3 too much because they are just about the same graphic wise to me as 360, but since they are marketing their machine as a 10 year machine, they will be left in the dust when ninty and microsoft make their next next-generation system around 2012..

D

September 25, 2007 8:03 PM

The wii is just a GameCube with a CHEAP gimmick. It can not be compared with other consoles.
I'd rather clean my windows with some friends (or girlfriends), instead of waving my arms (or jerking off) to the television screen. All those games are the same. They just have different pictures on TV.

Bob

September 25, 2007 9:01 PM

Don't forget Xbox's 7 million monthly live subscriptions.

D+

September 25, 2007 11:29 PM

'Cube with a cheap gimmick? Sounds like you haven't played any of the PROPER games. Oh and by the way, if Halo 2 was on the wii, it would pwn the xbox version by 7 to the power 55.

jake

September 26, 2007 2:32 AM

Penguin Warlord,

If you are bashin' Mario, you dont know what gaming is, no REAL gamer would dis' Mario like that. If you think video games are all about blowing people up, then you are very narrow minded. Now I'm not sayin' I dislike assasinating someone on Halo, but Mario deserves some respect.

As far as the consoles go I think Wii is the best. It doesent have the best graphics, or the fancy features, but the motion sensing concept ie eons ahead of any other kind of gameplay, I mean its just fun. And Wii's internet capabilities are pretty cool, once more games come out the Wii will defenitely be the best system.

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September 26, 2007 4:25 AM

It is just a game!

X

September 26, 2007 7:18 AM

Hi, i consider myself a hardcore gamer, and i have a wii. I was about to buy a xbox360, but it doesnt convinced me. In that console, gaming hasnt changed. Im playing Halo 1 and Half life 2 on my mac, and half life seems way better than halo 1, i dont know why so many kids die for halo and xbox. People can't always win, you know.

dedalo

September 26, 2007 9:18 AM

@ D.Smith, your the typical example of a 12 year old fanboy that believes he needs to play M rated games to make up for a lack of manhood.

Seriously, what's with calling the Wii a toy? The Wii is much a toy as your beloved next-gen console. Playing Halo 3 or Resistance does not make you look less like a kid playing "tv games".

And get your facts right. Parents buy Xbox 360's and PS3 for their kids too, not just Wii's. That's how people like you can even afford to have a $400-600 game console in the first place.

You might not like it, but the Wii is bought by a diverse type of consumer. We're not just talking about 400 pound nerds or 12 year olds that make up the hardcore demographic. I'm talking about young adults and people of any age. As it was reported on the news, the Wii is used by adults in health spas, retirement homes, trendy restaurants (by chefs) and by college students who love to drink beer with one hand while they use the Wiimote with the other to play party games.

And please, enough with the overused fanboy quote "my console is collecting dust". That line is so old it was probably first mentioned in the Bible.

Besides, the quote is stupid because every game console starts to collect dust the moment they pull it out of the box. Unless you live in a bubble... in that case, that would explain why some are ignorant over the fact that the Wii is currently #1 in sales worldwide.

That's only natural, since the Wii has been #1 in hardware sales since 10/11 months ago... ;)

ij

September 26, 2007 3:18 PM

for the record...Xbox division has invested about 21 billion into the game consoles (Xbox and 360 combined) and so far has a net loss of about 6 billion.

http://seekingalpha.com/article/32642-when-will-microsoft-own-up-to-the-xbox-360-bomb

IWATA-san

September 26, 2007 9:57 PM

The 360's attachment rate is 6. According to page 7 of http://www.nintendo.co.jp/ir/pdf/2007/070725e.pdf, the Wii attachment rate is about 4.5. It has probably gone up with MP3 and will go up even more with Super Mario Galaxy.

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For me the Xbox 360 and PS3 are nothing more than machines that can be modified to Run Mac OS X for my protest of Apple's stupid move to x86. It has been proven time after time that Power Architecture is more secure because there are few hackers to write viruses for it. All you need it one slick hacker and then all the intel Macs will fall and they do not need to attack the OS directly. Ask the Linux users who use those crossover programs like Wine how easy it is for a virus for windows to muck up a Linux system. Open Office was hit recently by a cross platform virus, how long do you think will it be when a hacker strikes. That is why despite voiding Microsoft and Sony warrenties I am going to make OS X run on it, or remove their chips and upgrade my old PowerPC machine. By the way I only bought Xbox 360 for Halo 1-3. Sony has my vote.

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Want to stop talking about innovation and learn how to make it work for you? Bruce Nussbaum takes you deep into the latest thinking about innovation and design with daily scoops, provocative perspectives and case studies. Nussbaum is at the center of a global conversation on the growing discipline of innovation and the deepening field of design thinking. Read him to discover what social networking works—and what doesn’t. Discover where service innovation is going and how experience design is shaping up. Learn which schools are graduating the most creative talent and which consulting firms are the hottest. And get his take on what the smartest companies are doing in the U.S., Asia and Europe, far ahead of the pack.

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