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With a price cut, PS Vita could hit 12.4m units in 2012

New handheld will generate sales of $2.2 billion, says Strategy Analytics

Sony's new PlayStation Vita handheld could sell as many as 12.4 million units in 2012 - provided it gets a price cut.

That's according to research firm Strategy Analytics, which assumes with an average selling price of $180, hardware sales could generate as much as $2.2 billion for Sony.

"The real value of the PlayStation Vita is its drive for content revenue growth and its strategic position in Sony's entertainment ecosystem," said Jia Wu, senior analysts at the company. "The PlayStation Store will have a vital role in selling games, videos and other content through its online access.

In the time of austerity, consumers are considerably sensitive to prices, and Nintendo proved that a price cut can save a product.

Jia Wu, Strategy Analytics

"We believe that PlayStation Vita will cause Sony's 2012 portable console software revenue to grow by $800 million compared with 2011. Although it's too small a device to turn the company around in terms of financial contribution, we expect it to bring in $2 billion incremental revenue from both hardware and software sales in 2012."

The company expects a price cut this year, in a move similar to Nintendo reducing the price of the 3DS once the initial hardcore gaming crowd had made its purchase in the first month of sale. There's a similar trend in Japan for the Vita, which released in the region before Christmas.

"In the time of austerity, consumers are considerably sensitive to prices, and Nintendo proved that a price cut can save a product," offered Wu.

"Sony now is experiencing the same story in Japan. Sales of the Wi-Fi version of PlayStation Vita at $249 initially exploded, selling more than 300,000 units in the first week of release. But the new console is barely moving 20,000 units per week in its home market after all the hard-core fans made their purchases, mirroring the experience of the Nintendo 3DS."

"Despite the solid design and strong processing power, it is challenging to convince consumers to buy a dedicated game console above the $200 price range in today's economic environment as Nintendo has learnt. Sales of 3G models will be a particular challenge as it demands a $50 premium and additional data plan charges and in the long run is likely to represent only a small portion of total PlayStation Vita sales."

He added that Sony can strengthen the PlayStation brand with the new handheld, "even if the console hardware itself will not generate much profit."

And with the continued growth of smartphones and tablets, Strategy Analytics said Sony's challenge is to create unique content only available on the PlayStation Vita.

"To survive the march of smartphone's entering the casual gaming space, Sony needs to achieve the Holy Grail of inventing innovative new gameplay whilst at the same time investing heavily in exclusive content," said Wu.

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Matt Martin avatar

Matt Martin

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Matt Martin joined GamesIndustry in 2006 and was made editor of the site in 2008. With over ten years experience in journalism, he has written for multiple trade, consumer, contract and business-to-business publications in the games, retail and technology sectors.

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