Are High Prices For Next-Gen Gaming Consoles Propping Up The Market For Old Machines?

from the the-smurfs-game-never-cost-this-much dept

The talk of the video game industry at the moment is the imminent launch of Nintendo's next-generation Wii console and Sony's long-awaited (and oft-delayed) PlayStation 3. But despite all the hype, recent earnings reports reiterate that it's older consoles that generate all the money in the games business, with analysts surprised by the strength of sales of games for the six-year-old PS2 and the two-year-old Nintendo DS. This is to be expected, on one hand, since there are so many of the older machines in circulation: more than 106 million PS2s have been sold, and though Microsoft is thrilled with Xbox 360 sales, only 6 million of the console have been sold since its launch a year ago. What makes the strength of PS2 game sales so surprising is that as the release of a next-generation system gets closer, many gamers tend to hold off on purchases, wanting instead to spend their money on new systems and games. Game publishers also tend to slow down releases, working to create games for the launch of the newer platforms. However, price sensitivity seems like it is playing a big role here. For instance, Sony recently cut the suggested price of the PS2 down to $129, whereas the Xbox 360 starts at $300 (with no price cuts forthcoming), and the PS3 will start at $500 -- not to mention games for the newer consoles typically run about $60. That might be acceptable to video game companies' core demographic, but as a wider range of people get interested in gaming and are looking for games that aren't necessarily based on ultra-realistic graphics and surround sound, it seems unlikely that they'll jump in at the high end of the market, and flock instead to cheaper systems with cheaper games. This means the supposedly old and busted likes of the PS2 -- which is currently outselling the Xbox 360, incidentally -- and other older machines could have some life left in them yet.

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  1. identicon
    Information Scientist, 31 Oct 2006 @ 11:43am

    Hardware then software.

    The good news:

    Moore's Law: States that computer processing capacity will double about every six months. This could be why good 'ole' systems seem to have considerable longevity for our entertainment purposes.

    The bad news:

    The reality is, that these computers that can run and compute at incredible speeds--speeds we can just barely understand. Our code and algorithms that deal with the amount of data that can be processed is almost never optimized for the machine it runs on. This means for the consumer, who is looking for new gaming paradigms (outside of the FPS, RPG, etc...) is going to have to wait until human intelligence makes it up a little higher--and fully program these new machines to their potential.

    Right now, graphics are the focus--because its a technology that affects our interface with the machines and its something that is marketable. Until people invent new ways to interact with the computer, ways that will actually enhance our ability to escape into the 'code'; our gaming experience will be limited to the code that a few programmers can write.

    Finally, everyone has a different opinion. Some people love FPS and some will love RPG. Go figure-- the bottom line is--with the right marketing, no matter how expensive, crappy, fast, cool, fun, unique, same, or whatever it is-- YOU'RE STILL GONNA BUY IT.

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