Generation game: console market to drop by 19pc this year

1 May 2012

Does the proliferation of smart mobile devices among a new generation of gamers spell the demise of the once-powerful console business?

In a generational shift it seems the onslaught of high-definition video games and apps on devices like the iPhone, iPad, Android phones or PlayStation Vita devices are taking a toll on the TV console market. Strategy Analytics predicts a 19pc decline in the TV games console market in 2012, with the Xbox 360, PS3 and Nintendo Wii all taking a hit.

New research from Strategy Analytics projects a decline in global Xbox 360 sales to 13.8m units in 2012; and PS3 sales will also fall, to 13m units.

Nintendo is fully focused on preparing for the upcoming Wii U release; however, even the launch of the new Wii U will not save Nintendo, or the industry, from this downward trend.

A recent Strategy Analytics ConsumerMetrix survey revealed that users of Sony’s PS3 games console showed the highest level of usage frequency, topping its two major competitors.

Forty-four per cent of PS3 owners use their consoles on at least a weekly basis, in contrast to 40pc of weekly Xbox 360 users and 30pc of Wii users.

Xbox 360 sales beat PS3 globally in 2011

“Last year, Xbox 360 sales beat PS3 globally, despite its relative weakness outside the US,” Jia Wu, director in the Strategy Analytics Connected Home Devices service, explained.

“However, Strategy Analytics research indicates that PS3 is slightly more popular among core gamers than Xbox 360,” Wu said.

“On the other hand, Xbox 360 appeals to a broader audience, as more consumers buy the Microsoft console for non-gaming as well as gaming functions,” Wu said.

But it seems sales figures alone do not determine winners in this generation’s console competition.

“Wii has sold the highest number of games consoles cumulatively; but Sony’s and Microsoft’s advancement in online game distribution and cross-platform integration grants them higher user engagement and a solid foundation for the next-generation console war,” said Kantideep Thota, analyst at Strategy Analytics.

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years