Friday, December 30, 2005

What 2006 will bring for the videogame industry - part I: Sony´s PlayStation3

Being at the same inspired by PC Magazine´s and Games are fun´s idea, as well as amused and shocked by their conclusions, respectively, here are my own predictions for the coming year in videogames. Let´s start with the PlayStation3. I will add predictions about the other two consoles in the coming days.

PlayStation3:
Launch date/price: The PS3 will be delayed until at least the later summer, probably July or even August, when it will launch in Japan. The US market will most likely see the console in time for christmas. Europeans will have to wait until early 2007. The console will be priced between $400 and $500 and will soon be dubbed the ´PayStation´.

Pre-E3 press conference: At the pre-E3 press conference, Sony will expand on the titles shown a year ago. ´Killzone 2´, ´Metal Gear Solid 4´ and ´Unreal Tournament 2007´ will be presented as the killer apps for the console. There will be a more concrete showing of ´Eye Toy´ for the PS3 (using colour recognition), but the main focus of the presentation will be on games for the core gamers, as well as the usual talk of the PlayStation being the media hub of tomorrow´s living rooms. On a sidenote, a new controller design will be revealed. It will be more reminiscent of the classic PlayStation controller.

E3 showfloor: There will be between ten and fifteen playable games on the showfloor but, similarly to the Xbox360, the majority of general interest journalists will be disappointed with the look of the games. With studios still unfamiliar with multi-core development, they will not be able to deliver on the promise of the ´Unreal´ and ´Killzone 2´ demos shown the year before (again, like the Xbox360 titles compared to the first demos).

Sales and reactions: Consequently, the PS3 will have a similar launch to the Xbox360. Fans will buy it, casual gamers will not see enough of a difference between the PS3 launch titles and current PS2 games to make the investment. Also, the PS3 is the first PlayStation to lack Sony´s superior industrial design that consumers have gotten used to. The weak design and amateurish logo will not make consumers see the console as a style gadget. By the end of the year, Sony will have sold between two and three million consoles, a sobering result.

Successes and setbacks: Sony´s biggest success will be their marketing and PR. Though the expected PS3 sales will not materialize, publishers will not quickly lose faith in the PS3. They will be forced to consider the possibility of Sony slipping from the top spot. For the first time, they will have to question the inherent strength of the PlayStation brand. But in 2006, there will be no official changes in Sony´s third party support. It will continue undeterred.

The biggest setback for Sony in 2006 will be Blu Ray. Blu Ray and HD-DVD will battle it out for most of the year. But a number of companies that had pledged to only support Blu Ray will come out supporting both. By the end of the year, the tide will have turned slightly in favour of HD-DVD. Essentially, though, neither format will achieve any noteworthy market penetration.

Conclusion: 2006 will not be a successful year for Sony. The PlayStation3 will not live up to its expectations and sell only reasonably well. It will suffer from the lack of consumer interest in Blu Ray technology and from its sobering launch line-up. Publishers will continue to support Sony the way they have, but 2006 will be the year that faith in the PlayStation brand is starting to slip.

35 comments:

Anonymous said...

Gears of War is a Xbox 360 exclusive. NOT a PS3 title.

Falafelkid said...

Oops, sorry. I meant Unreal Tournament 2007. Thanks for the correction.

Blizz419 said...

i agree with that post 100% falafel

Anonymous said...

You could also mention the number of games. I mean the development is more complex and time consuming then ever. And because of the high price much younger gamers that have a ps2 now will not be able to buy one. And the games will cost more.

Anonymous said...

Just waiting for "What 2006 will bring for the videogame industry - part III: Nintendo's Revolution"!

Falafelkid said...

Thanks for your comments. Good points, there. I did omit the price of the software. An expected $70 is way too much for a whole number of casual gamers. Forgot to mention this.

Falafelkid said...

@Anonymous: You are absolutely right, I was going to save Revolution to last. (God, I´m predictable *lol*) I´ll post part II: Microsoft´s Xbox360 hopefully by tomorrow.

Metaldave said...

PS3=N64. I remember paying $79.99 for the original Turok. I bought it because I had faith in Nintendo. People will do the same for the PS3 but over time(just like N64) it will lose support and the sales will just not be what they used to be.

Nintendo Revolution=PS1

Michael said...

Hey Falafelkid,

Good to have you back. I've missed your insights and analysis the last week or so.

Anyway, I'm not sure you're right but boy I hope you are. Your predictions are probably the best Nintendo can hope for at this point.

If Sony is going to release its grip on 1st place, its going to do it slowly and grudgingly. It will take a couple of years at least for Devs to realize that the platform is not the most profitable anymore.

Also, I think that in order for Sony to get beat, its going to take major leaps from both MS and Nintendo. Neither one is powerful enough that they can do it alone.

If MS can match the visuals and Nintendo is much cheaper, then Sony won't have a major selling point besides its name.

Can't wait for your take on MS and Nintendo in Parts 2 and 3.

Anonymous said...

In Japan, some pro. such as game distributors started to say that Rev. may win the race in Japan. They realized that Rev. will bring back light gamers as DS has dominated 2005 X'mas sales. The Rev. will be cheap and user friendly. Other machines are for PC gamers - difficult to play and expensive.

Anonymous said...

Yeah, considering the tremendous success of the DS in Japan (even when compared to the PSP) and the lackluster XBox360 debut, I'm definately seeing Revolution taking the top spot in the Japanese market. I think that PS3 may stay on top in the US, just because we Americans are all about horsepower, pretty graphics, violent games, and name brand recognition.

Anonymous said...

I agree. I think (at first, anyway) that the 360 will sell best, then Rev, then PS3. Even though the PS3 will have a lot of cookie cutter games, it is bound to have some amazing titles.

After a while the Rev might catch up to and pass the 360

Tim_Tibbetts said...

I love Nintendo, but I'm afraid that the Revolution will be about the same level of success as the Gamecube. Nintendo will have problems going mainstream because in every household there is a 8-15 year old boy. Every 8-15 year old boy isn't going to want a Nintendo console because it has kiddy games - they want blood and guts! Still we'll see, I think the PS3 will be a success - it has blu-ray which will interest people in the same way a DVD drive did, and of course Playstation is a very popular brand name kids.

Anonymous said...

Your article for the gaming industry outlook 2006 regarding the PS3 was a good read, with that said I going to have to respectfully disagree with some of your predictions.

Although it is true that the PS3 is difficult to develop for this has not stopped third parties from singing on. Sony’s strongpoint was never their hardware specs (PS1 and PS2 were weaker systems then their competitors) but their ability to rally a legion of developers behind them to deliver a vast library of titles. (Granted that many of these titles are not high quality but still attract consumers)

Don’t get me wrong, I’m not a Sony fan by any means. The DRM on Blu-Ray makes Microsoft blush.

Anonymous said...

My friends in Japan tell me that every PS2 game plays same way - pretty visual and same boring game play. If you check the PS2 sales during X'mas period, most except KH2 dis very poorly despite 20 million instration (vs. 5 mil for DS). I think they are tired of playing PS2 games.

runnin_blue said...

Hey falafelkid, I thought you've been working on something special. Very nice write up.

I really think the Ps3 is going the way of the N64 and by this I mean, delay, delay, delay.

I wouldn't be surprised if it sees a 2007 launch and by then Microsoft will have a massive install base and Nintendo will take some of their launch limelight by offering something different and unique.

It's not looking good for Sony and their Ps3 in my eyes.

Can't wait for your Rev writeup, keep up the stellar work!

Anonymous said...

First of all:

1) The whole machine costs like heck
2) Games cost like hell
3) Making games is hard and will cost our asses off
4) IT HAS BUMERANG!
5) It looks like printer
6) Its huuuge
7) Killzone was CG movie(its proven) and didnt look more amazing than gears of war
8) Kids would hate that they cant play GTA cos of age lock
9) first games will feature thousnads of enemys to smash
10) you cant use your old memory cards on PS3 (or ps1 or 2 controllers) so that means you cant sell your PS2 to get money for PS3

-iceleaf

RPGuy said...

Sony’s strongpoint was never their hardware specs ... but their ability to rally a legion of developers behind them to deliver a vast library

This may be true for the most part, but I believe that we're already seeing developers' faith in Sony cracking a bit. Upon the PSP's release, Sony claimed to have an obscene number of developers signed on to work for the system. However, the handheld's basically been neglected by third parties in favor of the DS, which is both less powerful, and [at the time] less hyped by the media. Actually, if I recall, a majority of publications expected the DS to be a failure.

The PS3 will get a lot of attention, and, if Sony isn't out of its gourd in pricing, a ton of sales. However, something tells me that they'll continue their "consumers are just walking wallets" philosophy. We'll likely see shoddy hardware, games that are out of the customer-base's price range, and more developer bullying. If we do, then I sincerely hope that gamers are smart enough to look at the alternatives.

Anonymous said...

YAY for biased articles. Regardless of price people will shellout the money for a PS3. The PS3 launch will see the same of 360. Take off the nintendo colored glasses.

While i support Nintendo more than Sony or M$oft the PS3 is going to have an awesome launch business wise.

Don't let personal bias get into your articles. It discredits the blog.

Anonymous said...

I don't think the article is biased I actually think it is being realistic. If Sony keeps going the way they are then that will happen. I think it is merely giving an option of what could happen.

Tim_Tibbetts- Yeah right. About the SAME level of success as the Gamecube? Come on. Nintendo has been starting to do too many things right for them just to do a little bit better/worse than the Gamecube. I think they will definitely sell more "Revolutions" than Gamecubes. Check out any reasonable PS3 or 360 forum and you'll see what I mean

Johnny B said...

I completely agree with the majority of your predictions. 2006 will not be a good year for Sony. But I think you're underestimating the P$3 a bit. True enough that Killzone and the like were pre-rendered, but I still think PS3 games will look noticeably better than current 360 games. Even if not, the Playstation name itself can harvest a descent market share. But I agree, in the end, Sony will have lost considrable ground to the competition.

Anonymous said...

I partially agree. PS3 will probably cost around $500 @ launch, will see lots of delays, have a slow start and be difficult for developers to program for. I think Sony will remain number one though. They aren't stupid and it appears they have all of their bases covered. They have the best graphics and Eye Toy 2 for people wanting different gameplay. Games will have a varied price range. BluRay will be a huge push for PS3. It might not happen in 2006, but it will certainly affect 2007 and beyond. Looking at the success of PSP UMD's how can people not think BluRay will have a mojor impact on PS3 sales. People with HDTV's will buy it just for that. By 2007, Greatest Hits games will be out hopefully along with a system price drop. When PS3 hits the $300 price range they will start flying off the shelves. It would happen much quicker if it launched for $400 but I doubt Sony would take that much of a loss up front. I predict:
Fall 2006 - $500
Fall 2007 - $400
Fall 2008 - $300
Fall 2010 - $200
and Sony remains no. 1
Nintendo Revolution will be no. 2

Anonymous said...

Just think if Apple produce i-Pod Living with Rev. like price.

This machine will download music, games, movie and TV programs. This will change the gaming world upside down.

Except hardcore gamer everybody will be interested in buying this dream machine

I believe the next year will be a year to remember!!

Anonymous said...

Just curious - I could not really find these numbers anywhere but I thought that Falafelkid would know the answer. So, Falafelkid, do you know the break down of Japan, America, and Europe console wise. I mean which console has about what percent of the market in these regions and how many systems there are in total. I never really saw this explicitly stated, but I always thought that even as big as the ps2 is here, it is even bigger in Japan. The reason I would like to know this information is to try to understand Nintendo Japan's thinking. The more I have learned about the Japanese market the more I can see why Nintendo is making the decisions they are making. I also see the Japanese market as being about five years ahead of the American in terms of percentage of people playing games and systems sold. There are a variety of other reasons I would liek this information and I would really appreciate it if any one could give me the numbers.

Anonymous said...

I kind of think MS and Sony will fight it out for the same crowd with neither doing as well as they would have hoped. MS will lose less money and Sony won't make as much.

I think the Revolution will suprise and do better than expected.

Anonymous said...

Do you know? : Ps3 cost more than xbox 360
now look in this link

http://joystiq.com/2005/12/28/
xbox-360-costs-715-to-make/

only microsoft can sale 715$ cost in 299$ price

Now... How much ps3 will? - 400$ ? 500$ ?
It cost more than xbox360 (cell rsx bd-drive). and sony don't have money as much as m$

Shoxware Games said...

sorry, if this is a little off-topic, but this might be interesting:

nintendo patented the name "nintendo floor vision" last week! what could that mean?

source: gamefront

rox said...

I hope Revolution will be the DS of the consoles. Everyone thought Sony would just enter and conquer the handheld market with it's handheld but DS sales are soaring right now in Japan. Last two weeks DS sold over a million units, kicking PSP's *ss all over the place.

A technically different system is able to sell a lot with the right amount of good and original games. So I have good hope now for Revolution. They better release the system before PS3 though...

Anonymous said...

Gamers have been manupulated by media since Sony and MS are pouring so much money.
No wonder they love to talk about HD which most of them can not afford.

PS3 does not change your game play. If you are a gamer, you should appreciate a new way of playing games. I am looking for a new Zelda with a new game play.

Anonymous said...

i've been playing games for about 15 years of my life already. first game i played was duck hunt and the mario combo. since those days video games where always revolutinonary, not just only about graphics and GPU's. nintendo had the most powerful system on the market in 95 with the N64 but it had less support from third party developers. it cost to much to manufacture the cartridge. dumm mistake for nintendo cost them mad money. now nintendo is going back to being an innovator and being diffrent. video game systems where always diffrent u had sega genensis with three buttons no shoulder buttons SNES had shoulder and four face buttons. it was diffrent you had diffrent playing styles for each game that came out on each system. snes always had more support but on sega the controversial games came out like MK. it was never direct competion on my part with sega and nintendo at the time. it was more of an understanding that both system offer diffrent ways to play each game. like each company was aiming for a diffrent target audience.

nowadays people are attracted to just graphics in my opinion. in my eyes why would some one say that XBOX had better games than the gamecube its just dumm. Xbox had like 5 great games the two halos DOA that ninja game PGR. after that in my eyes there wasnt any genre changing games on that system. xbox didnt have that Mario 64 or that GTA:III. ps2 had a few at the beginning then after the first 3 years the innovation drop down dramatically. gamecube had few diffrent game compared to its competitors u had celda and pikmin. IT also was another system whose innovation dropped. that has pushed me away from playing games like i used too with that pation i had when playing a game like mischief makers or a game fun game like Oddworld: Abe's Exoddus or even Lost Bronx on saturn(loved that game)those games where diffrent if u played them u know what i mean. each with a unique story line and they where both side scrolling amazing right they werent in 3d like tomb raider or pilot wings. what happen to that sort of fun. its not there any more and if u dont know what type of fun i mean go playsome of ur older games is not just nostalgia. after u play one of those play some of the current generation third tier games. games see if u get that same feeling compare the control schemes and the innovation each had.

to all these HD BLU-RAY "fans" think about if u want a media console buy a PC and hook it up to ur home network, home theather, or what ever other things. It easier to use than the 360 media center and you wont have to buy one every 5 years just upgrade memory or what ever. Game systems where always bout games not about what goodies it had. think about it if ur a video gamer u appreciate great innovation not goodies. it was always cool to say oh crap those are some hot graphics. then if u play the game and its crap ur gonna be like crap i wasted 60 0r 50 on a crappy game. but wat ever just a rant on innovation think about it.

Anonymous said...

I think the PS3 will do very good, because Sony created its own market. Just have a look at the PSP. 250 Euro for a handheld is just crazy but it's still selling very good. Sure the DS outsells it easy in Japan, but the PSP being over 100k last week is not weak, that's still a very good number.
I'm sure if the PS3 launches for lets say 450-499 USD/Euro there will still be plenty of people who are going to support sony. Hopefully Nintendo can reduce the Sony lead a bit next generatio though.

Anonymous said...

There are few questions regarding Japanese PSP sales figure.

1. The PSP sales figure is same as its production figure. Sony has never gave them actual sales figure.
2. According to some shop owner the PSP sales figure is much less than that of DS (less than 10%). He wants to know the PSP figure at Playstation.com. This store sells primary PS2 games.
3. PSP owners do not buy games. And UMD sale in Japan is so small. People can not believe that PSP buyers are buying the machine just for downloading pictures and games.

Anonymous said...

First the Xbox 360 did have a very good launch (at least for the number of units they shipped, excluding Japan). Your comment on a negative consumer reaction for the 360 is nothing more than speculation because we have yet to see enough units on the shelves to tell what the general consensus is for the product is yet.

Since early adaptors will pay anything for the system(shown through insane auction prices and bundles for the 360), I don't expect the market share of Sony to decrease anytime next year. On a similar note, I don't expect the 360 to slow down either given that it will probably be avalible at a smaller more attractive price point than the PS3.

The outcome of the winner between the two will most likely come in future years. Xbox 360 may exceed the PS3 with a lowered price point but PS3 may gain some ground on the 360 with MGS4. It also depends how close their library's are (if very close, I expect the 360 to have the uper hand).

I don't see the REV really hurting any sales for the other two systems next year either. Everything is going to sell out like mad. It may come down to who can get the most units out, keep the hype machine moving, and convince 3rd party support to be exlusive. Nintendo's little box also has enough hype going for it at a reasonable price to keep it compedative and sell out in its debute just like the other two have/will. The demand for anything next gen in 06 will probably make it impossible to make conclusions about any one of the big three having a bad year.

I only can see Sony having a bad year if they have a large number of defective units or loose major exclusive 3rd party support.

viejodani said...

Many consoles and handhelds have a strong number of sales at launch date and the first weeks after. But that doesn't mean it will be a sucess forever. It happened to the Dreamcast who had a drastic fate (I really liked the console). If I recall properly, it happened to the GC too and it's in third place. So launch date sales mean nothing.

Many of my friends who bought a PSP are bored because as a handheld for playing games it sucks most of the time. PSP's sucess comes from the multymedia funcionality and not the games. The DS is more friendly in terms of development and can have great games like Castlevania.

About PS3. Developers are making games for many reasons:

1. Sony ask them to make a sequel of a sucessful PS2 game. A good move but also a double-edged sword because as sequels are appearing, the number of innovative ideas can reduce and the game could appear as a "port with awsome graphics". And the fact that the controller is not new in terms of gameplay a new idea for a sequel could be a bad one.


2. Developers have a blind trust towards PS3. Their PS2 games had good sales so looking at the new console could be a safer move for them. In order to obtain profit, a sequel or a new game with the same winning formula is a safe move to make. But the same problems can occur.

3. Developers who were amazed by what PS3 is promising us and want to make games for them, no matter the inherent problems in development, they want to show off graphic achievements and tell a good story. The problem is that it takes a lot of time and money in development so new ideas may not be safe.

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