Sales of PlayStation Vita in the USA during March were hovering around the 10,000 mark. Whatever trouble the Wii U may be facing in that market (and it's facing plenty), Vita is in a much tougher position. Week to week, there are fewer Vitas being sold in the USA than original Wii consoles, let alone Wii Us. Back of the envelope calculations suggest that on average, stores stocking the Vita are selling less than two consoles a month; the reality is probably tougher for most, given that stores like Amazon will have accounted for the lion's share of purchases. In many retail stores across America, a Vita probably hasn't been sold in the past month at all.
Disaster, right? It's certainly not the position Sony would have wanted for its latest handheld. Its performance is massively behind that of its older stablemate, the PlayStation Portable, at the same point in its life; and the PSP itself wasn't considered an enormously successful platform, as it was eclipsed throughout its life by the Nintendo DS and struggled to maintain a decent tie ratio for software sales. Now the same story seems to be repeating. 3DS is doing remarkably well for Nintendo, and maintaining healthy software sales along the way; Vita is underperforming, assailed on one side by Nintendo's continuing success and on the other by tablets and smartphones which are encroaching into the core gaming space.
So goes the conventional argument which ends up saying "Vita is a bust". There are, however, other factors worthy of consideration here, and I don't think that we should expect Sony to cash in its chips on the Vita platform any time soon. Moreover, I don't think developers will be abandoning Vita any time soon. Instead, I think the type of developer targeting Vita is changing; and it may, surprisingly, end up being a change for the best.
"if you're a smaller developer making indie games, Vita is an increasingly intriguing option... Developers have told me that Vita is among their best-selling platforms, despite the low installed base"
Let's look at some other factors in Vita's performance. Firstly, a blanket statement - Vita isn't doing well by any measure. Global sales of the console aren't good - it's tracking ahead of the Wii U at the moment, but celebrating that fact would be like triumphantly announcing your victory in a battle of wits against a rock. It's likely that PS4's sales will overtake Vita within the next six weeks; Xbox One will quite possibly do the same within the first half of this year. As for the comparison with the 3DS, don't even ask. It's simply embarrassing.
There are, however, bright spots in this story. For a start, things look worse than they ought for the simple fact that the USA is the primary focus of the games media's attention. Even overseas media outlets are guilty of a US-centric approach, not least due to the dominance of US-owned websites, but also due to the ready availability of figures and expert commentary from the US market. As a result, everything from the NPD sales report to the various pronouncements of analysts like Michael Pachter is reported around the world, leading to a slightly skewed viewpoint that sometimes forgets that the US is a minority market; the largest market, certainly, but dwarfed by the rest of the world and actually rather unique and unusual in its tastes and purchasing decisions, by global standards.
Vita is having a disastrous time in the USA, but that's the baseline; rock bottom. In Europe, Vita is selling at three or four times the rate of its US sales. In Japan, it's doing ten times the US numbers. Ten times "dreadful" is still in the "mediocre" range, but if Vita were to sell globally at some midpoint between its Japanese and European performance, it would be comfortably outpacing sales of its predecessor, the PSP. Moreover, it implies a very different market for the console in different territories. In Japan, where handheld gaming has traditionally held an edge over home console gaming (for various reasons ranging from the simple "living rooms here are tiny" through to more complex and interesting social factors), Vita is attracting a reasonably large audience of core gamers - what we might think of generally as the PlayStation demographic. In the USA, it's attracting a very hardcore minority, while Europe lies somewhere in between. That western demographic, focused on very core experiences, is a particularly interesting niche. It's an audience of people whose interest in the Vita is, I believe, based heavily on the growing library of indie and retro titles for the platform, as well as on its interaction with the PS4 (for which many of these gamers are probably also early adopters).
That leads to the other important factor in this discussion. If you're a publisher making expensive AAA games, you've probably all but written off the Vita already; not without good reason. The installed base is small, the growth curve is negative and as retailers cut back on Vita's shelf space (which they will obviously do if they're only selling one or two per month), they'll also be cutting back on the chance of major new games getting a significant retail presence. With limited resources at their disposal, publishers will quite rightly look at the rapid growth of PS4, the strong position of 3DS and the solid performance of Xbox One, not to mention the potential of PC, tablet and smartphones, and decide that Vita isn't the right place to place a bet.
On the other hand, if you're a smaller developer making indie games, Vita is an increasingly intriguing option. An installed base of 8 million doesn't look appealing if you're a publisher with a mainstream title hoping for a multi-million seller - but indie developers ought to be concerned with the quality of the audience on offer, not just the quantity. Speak to indie teams with experience of the Vita, and you often find that they're full of praise for the platform. Among those 8 million Vita owners, it seems, are a huge number of devoted core gamers who proactively seek out interesting indie experiences and are heavy users of the PlayStation Network online store. Developers have told me that Vita is among their best-selling platforms, despite the low installed base.
This puts Vita in an interesting position in between rival handheld platforms. The 3DS has a huge installed base, but the vast majority of its software is sold physically at retail - I don't know what percentage of 3DS owners have ever bought anything from Nintendo's clunky and unlikeable eShop, but I don't imagine it's terribly high. As a consequence, if you want to develop a successful title for the 3DS, you really need to have a publishing contract that's going to get you put into a box and into stores; a gigantic hurdle to leap for any indie team. On the other side, you have iOS, which has an even more massive installed base and does have lots of users downloading software; but free-to-play is dominant on this platform, and getting users to actually pay for game software up-front is a major challenge. Moreover, iOS devices lack physical controls, which limits the kind of games that can successfully be played on them.
"Vita has the potential to be an evolutionary niche that's beloved by gamers and remarkably successful for developers operating at the right scale for the platform"
In the middle you have Vita. Small installed base, yes, but an enthusiastic one; indeed, one only needs to look at the comments thread for any Vita-related article on the internet to see how devoted many Vita owners are to their console. Moreover, it's an installed base that's interested in trying out indie and niche titles, wants to play them on a portable platform, is comfortable with downloading them and most of all, is happy to actually pay money for them. In a sense, buying a Vita and supporting the developers who work on it has become the default action for gamers who bemoan the rapid rise of F2P and mobile gaming, and would rather actually do something about it rather than crying on Twitter all day long. It's an enclave where the old business model still works nicely; not that it's entirely free of F2P (nor should it be, since F2P is a perfectly valid model for many types of game), but it's far from being the default, as it is on iOS.
As this perception of the Vita grows, I expect it will do something quite odd; even as the console's installed base continues to disappoint in terms of headline figures, Vita will actually attract more development support, not less. The AAA tentpole releases will have to come from Sony, for the most part, but the rest of the console's library will be filled in with panache by small developers and other firms seeking to address the niche market forming around the Vita. Nobody will make huge fortunes, but not every business ecosystem has to be enormous; Vita has the potential to be an evolutionary niche that's beloved by gamers and remarkably successful for developers operating at the right scale for the platform.
What about Sony, in all of this? Sony's take on Vita, at this point, reminds me a little of Apple's long-term view on Apple TV - which Steve Jobs famously described as being a "hobby" rather than a core business. Vita is Sony Computer Entertainment's hobby. It may, in the end, be much more than that; its interaction with PS4 may see it becoming a must-have accessory for the home console, which would drive sales significantly. Its future role as a client device for PlayStation Now could prove to be a killer application for the broader market. Vita TV, barely selling at all after a bizarre soft-launch in Japan (a territory with no streaming video market worth a damn, which snuffs out much of the appeal of the device right out of the door), could equally turn into a hugely important product once PS Now is up and running; I suspect that Vita TV will launch alongside PS Now in the USA, marketed primarily as a client for the service, with integration into other Sony devices (primarily TVs) also coming down the line. A lot could change, commercially, and Sony will not stop enthusiastically supporting Vita while any of those irons remains in the fire.
Comparisons with the Dreamcast are inevitable when a console fails to impress commercially. In this instance, the comparisons are all the more compelling since Vita has also found itself in the mantle of the plucky underdog; beloved by core gamers and media, yet failing to catch the eye of the wider public. There, however, the comparisons end. For Dreamcast, the moment where the big publishers stopped being willing to put millions behind the development and launch of AAA games was the death knell of the system. For Vita, birthed in an era of digital distribution, indie development and niche publishing, that moment may just be the beginning.