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Combined Kinect and Move sales could hit 8m this year

Microsoft and Sony likely to run aggressive promotions in early 2011

Wedbush Morgan analyst Michael Pachter believes that combined sales of Move and Kinect could top 8 million units by the end of the year.

Looking further ahead, he expects the peripherals to shift between 20 and 25 million units by the end of 2011, although he noted that software sales will only rise marginally.

"These 20-25 million households are likely to buy 2-3 games apiece, resulting in software sales of 40-75 million units and publisher revenues of $1.6billion-$3 billion next year.

"These sales are not all incremental; clearly, consumers who buy Kinect or Move are console owners, and presumably, they would have bought other games had they not purchased the peripherals. We think that the incremental contribution from the two devices will be around $500$800 million in 2011, or around 2.5-4 per cent of industry sales next year."

Both Microsoft and Sony have pushed out numbers for the peripherals this week, with Microsoft claiming 2.5 million sales, and Sony 4.1 million sales - although it later amended the number to units shipped to retail.

Pachter added that he believes Microsoft will cut the price of its basic Xbox 360 model to $249 in the US, prompting Sony to bundle Move with its standard 160GB $299 PlayStation SKU.

The new bundle could add value for Sony, as he believes Move has a manufacturing cost of around $40. Currently, Sony's Move and PlayStation 3 bundle retails for $399 with a 320GB unit.

"If Sony were to take such action in early 2011, we think it would accomplish its goals of profitability, solid console sales and Move penetration, and think that its controller would have a dramatic impact on software development and sales next year," he added.

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