theedge

Xbox or GameCube? (from cnbc.com)

Videogame consoles produced one of the hottest retail wars this season. So who won: Microsoft with its Xbox, or Nintendo (NTDOY, news, msgs) with its GameCube?

Maybe neither. Credit Suisse First Boston found that in the Nov. 11-Dec. 8 period, Sony's (SNE, news, msgs) PlayStation 2 videogame console outsold both, CNBC reports this morning. That means 962,000 PS2's, vs. 934,000 Xboxes and 602,000 GameCubes. But note: Microsoft launched its box four days after CSFB started counting, and Nintendo dropped its Cube onto the market Nov. 18.

One factor: a greater assortment of games for the PlayStation. Another: both Xboxes and GameCubes seemed to be in short supply, so purchasers may have just been buying what they could find rather than making a choice.

Nintendo stock is up about 10% this year; Microsoft stock is up much more and Sony down much more, but of course, both companies make a lot of stuff besides videogames.

If you haven't invested yet, you may be too late anyway. Since the videogame console life cycle is five years, researchers told CNBC, sales are due to level off shortly for several years until new boxes enter the market.

That means the names to look at now are game makers like Activision (ATVI, news, msgs), THQ (THQI, news, msgs) and Electronic Arts (ERTS, news, msgs), and even smaller names where one big game can move the stock price. Without games to play and aliens to blast, after all, they're all just stylish boxes.

darkside

I think it will be some time before a winner can be decided, but I won't be surprised if the PS2 reigns supreme. Maybe this time next year we will have a better idea. With Final Fantasy X, Grand Theft Auto 3, Metal Gear Solid 2, and Gran Turismo 3 in their library the PS2 is going to be a hard act to follow. All three consoles have a bright future, however. I don't really think any of the three is a bad choice. They may all have success, but Microsoft has dumped so much money on Xbox marketing that I doubt they will break even anytime soon.

joltaddict

Gamers won.

ScandalUMD

Games are now spread over three incompatible pieces of hardware, and the console makers will be struggling to get the best games as exclusives. That means that gamers will have fewer games to choose from than ever before, or else they'll have to purchase more than one console. I'd say, whichever company wins, gamers got screwed.

joltaddict

I can buy whatever I want so now I just expect tham all to compete for my money (and love).

Michael T Hudson

You know I was watching CNBC this morning and they were talking about the same thing, at the end of the segment they said the average age of gamers was 28. I was happy to hear that being that I am 28 with all four systems and all.

lordzeppelin

Huh? This defies market logic, as well as general marketing number curves and sales numbers. It's been a multi console market for a decade now, and the gamers have yet to suffer. So each console has exclusives...that's how the Video Game Market works...

Chaos

Ask again in about 2 years, then we'll know.

KnightLerxst

How is this different from the console competition that has been going on for the last 10 years? I mean if I wanted Konami games I had to have a SNES at first because of that stupid Nintendo Seal of Approval. If I wanted a good Madden game I had to have a Genesis.

ScandalUMD

By market logic, do you mean the theory that market competition always benefits the consumer? Because in the console games market, that simply is not true.

One way that competition benefits consumers is that it drives prices down, but prices for consoles are already at the highest level the market can tolerate.

The real beneficial competition is among the game developers, and more consoles actually reduces that competition. Since there are more incompatible platforms, exclusive games only have to compete with other games on their own platform, rather than all other games. Essentially, competition among hardware platforms reduces competition between software.

The more divided the software pie becomes, the less value gamers get out of their investment in one console. If competition is good, then 10 console platforms would be great, in theory, but, in reality, if 10 companies were running around buying up developers, there wouldn't be very many games worth buying on ANY platform.

Josh H

Nope gamers win. Third party games will be spread across all three platforms in most cases, i.e. Tony Hawk, Madden, etc. They will be competing with other third party games in the same genre's on all three platforms, so they still have to be high quality games if they want to sell well.

Where gamers really win, is in first and second party exclusive games. Nintendo, Rare, Sony, EA, Microsoft, etc. all have to go balls out trying to come up with the best possible games to get people to buy their system. After all the third party support is going to be nearly equal on each system, so it is the few exclusive games that gamers will use to decide which system(s) to buy. This increased competition leads to great, exclusive games (Rogue Leader, Smash Bros, Super Monkey Ball, Pikmin, Halo, Oddworld, DOA3, GT3, Devil May Cry, Metal Gear Solid, Resident Evil, etc.). This is where gamers win.

Sure if you can't afford more than one system, you are going to miss out on some games you'd love to play. That's they way it's always been. You needed a Genesis and a SNES to play all the great games; a N64, PSX, and Saturn to play all the great games, etc.

Sure it sucks if you can't afford to own more than one consoles, but the increased competition is still good for you. It means you will see more great games on the system you own. I currently only have a Gamecube out of the next-gen consoles and couldn't be happier with the outstanding game line-up. If it was the only console out there wouldn't be nearly as many good games out. Look at the first year of the PS2, it had no competiton, and as a result, no killer games. An even better example is the Atari. It killed off the competition and was eventually the only console out there. With no competition the quality of games dropped dramatically and the market was flooded with a bunch of crappy games and as a result the atari died and nearly took the entire video game industry with it.

In summary, more competion=equals more great games. Big third party games will usually appear on all three systems and as a result will be in competition with more games than if there was only one console, forcing third party develpers to put out higher quality games in order to suceed. However where we gamers really win is in first and second party, and exclusive third party games, as Sony, Nintendo, and MS have to put out top notch, exclusive games to entice people to buy their system(s).