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Core console software sales are higher than ever - EEDAR

Living room gaming experience not going away any time soon, says EEDAR VP of Insights Patrick Walker

As the 7th console generation was coming to an end several years ago, there was much pessimism regarding the impending launch of the 8th generation. Just as 7th generation software sales were starting to lag, mobile gaming exploded, and PC gaming experienced a renaissance. It was easy to think that the console players were going to be going elsewhere to find their gaming entertainment by the time the new consoles hit the scene. However, the 8th generation consoles have had a successful launch. In fact, the Sony and Microsoft consoles are as successful as ever.

A comparison of the year over year console software sales suggests that the 8th generation is performing better than the 7th generation - provided you exclude the Nintendo consoles. The following graph shows physical and digital software sales for years 1 through 3 of each generation for the Xbox and PlayStation platforms.

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The annual numbers take into account the staggered launch cycle, so year 1 comprises different sales years for Xbox 360 and PS3. The data shows that the Sony and Microsoft platforms have outperformed their 7th generation counterparts, especially in the first two years of the cycle. The 8th generation outperforms the 7th generation even in an analysis that excludes DLC, which now accounts for an additional 5-10 percent of software sales.

However, the picture is far different if we include the Nintendo platforms. The graph below shows the same data, but now includes the Wii and Wii U in their respective launch years.

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The data shows how much the "Wii bubble" contributed to the explosive growth in software sales in 2008, the year the Wii really took off as a family and party device. This data corroborates a broader theme EEDAR has seen across our research - new, shortened gaming experiences that have added diversity to the market, especially mobile, have cannibalized the casual console market, not the core console market. People will find the best platform to play a specific experience, and for many types of experiences, that is still a sofa, controller, and 50 inch flat-screen TV.

The shift in consoles to core games is further exemplified by an analysis of sales by genre in the 7th vs. 8th generation. The graph below shows the percentage of sales by genre in 2007 versus 2014, ordered from more casual genres to more core genres. Casual genres like General Entertainment and Music over-indexed in 2007 while core genres like Action and Shooter over-indexed in 2014.

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It has become trendy to call this console generation the last console generation. EEDAR believes one needs to be very specific when making these claims. While this might be the last generation with a disc delivery and a hard drive in your living room, EEDAR does not believe the living room, sit-down experience is going away any time soon.

Latest comments (13)

Jeff Kleist Writer, Marketing, Licensing 2 years ago
Anyone who thinks the hard drive is going away is also nuts.

You cannot stream many kinds of games due to performance requirements, , and the infrastructure to support streaming them is cost prohibitive.
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Greg Wilcox Creator, Destroy All Fanboys! 2 years ago
Yup, Jeff - dead on there. I think some of these folks pushing the enforced evolution of all digital and all streaming need to take a trip amongst the consumer base they wear blinders to to see how crappy they have it with getting some non-streaming content. Money is getting tighter in some circles and when many of those buyers are making purchases, they prefer physical media and/or games that are smaller downloads that can get while using borrowed bandwidth (with a nearby friend or family member usually providing that service).
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Klaus Preisinger Freelance Writing 2 years ago
No hard drive does not have to mean no permanent local storage. It could mean a 1TB flash rom soldered onto the main board. The same goes for disks. Sure, discs were great when they meant cheap storage beyond the art team's capacity. But discs have a limited data rate, bad seek time and no IOPS to speak of. We might see some SSD/USB hybrid thing. Even further down the line, we have mram.

None of those changes requires an Internet connection on the consumer's part. They are even compatible to traditional point of sales requiring snap decisions, particularily mram.
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Show all comments (13)
Alfonso Sexto Lead Tester, Ubisoft Germany2 years ago
Pushing changes on the consumer is not a good idea and is prompt to cause a rejection or an aggressive reaction against it. We should stop doing that. In the last two years I've seem more steps back caused by customer backslash than in the previous ten.
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Alan Blighe Research Associate 2 years ago
Agree with the comments here. Finances dictate that I have the cheapest possible broadband package. Would be disinclined to rely on any external service to play my games in future. And even if I could afford good broadband, its still going to destroy the experience of playing very fast-paced games like Street Fighter.
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Shane Sweeney Academic 2 years ago
Bruce has been quiet lately.

Edited 1 times. Last edit by Shane Sweeney on 12th August 2015 2:59am

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Alfonso Sexto Lead Tester, Ubisoft Germany2 years ago
Not sure if Bruce still comments in the web. Haven't seen a post from him in months.
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Justin Biddle Software Developer 2 years ago
He made so many bold and confident claims that pretty much all proved to be completely wrong. I imagine it would be a bit hard to have to eat humble pie now
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@Shane I believe he went full UKIP during the election, and now bequeaths his ancient wisdom on filthy lefties instead of us whiny nerdhippies.
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Keldon Alleyne Developer, leader, writer, Avasopht Ltd2 years ago
The data shows how much the "Wii bubble" contributed to the explosive growth in software sales in 2008, the year the Wii really took off as a family and party device. This data corroborates a broader theme EEDAR has seen across our research - new, shortened gaming experiences that have added diversity to the market, especially mobile, have cannibalized the casual console market, not the core console market.
Something I've been saying repeatedly for the last few years, which is more than obvious when you simply analyse the data.

Edited 1 times. Last edit by Keldon Alleyne on 14th August 2015 11:36pm

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Alfonso Sexto Lead Tester, Ubisoft Germany2 years ago
Bruce had very bold ideas, indeed (Even today I can't understand that logic of creativity in games being dependent of in which platform the games are made). But everyone makes mistakes. I predicted a mobile game bubble popping and a collapse of the smaller studios focused only on mobile. I'm happy that I was wrong and reality turned to be those studios starting a slow migration to PC and console development.
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Patrick Walker VP, Insights, EEDAR2 years ago
Regarding when the full shift to digital - exponential curves feel gradual and then sudden. It is hard to predict when it will happen but when it does it will feel super rapid.

Fantastic post on this by Chris Dixon:

http://cdixon.org/2015/05/12/exponential-curves-feel-gradual-and-then-sudden/

Edited 1 times. Last edit by Patrick Walker on 14th August 2015 3:30pm

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Thomas Peter Technical Designer R&D 2 years ago
"provided you exclude the Nintendo consoles". Why should we do that? Make no sense for me. Remember, Nintendo Wii was the most successful console last generation. So we can assume that the success of the other two consoles has to do with the migration of Wii customers towards Xbox and Playstation. And casual and core has nothing to do with genres. A casual player I would call someone who spends less time with games. You can now specify Games course after how much time the players spend so on average, but many games appeal to both. COD is a good example that appeals to a large number of casual gamers who make up the great mass and then the hardcore gamers who play very ambitious and competition.
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