Monday July 27, 2009 – Shelby Cunningham
Looks like video game consoles aren’t as immune to the recession as everyone had originally thought. They sold well for a while, but now it turns out people bought their single consoles and aren’t going any further than that. Sure they’re playing more games than usual, but the variety of consoles in the home isn’t expanding, and people are playing a few games for longer periods of time rather than many games for shorter time periods.
But once you look at the numbers you realize, maybe some consoles are doing better than others, and it’s the others that make the whole market look like it’s taking a small dive. The Xbox 360 and PlayStation 3 (PS3) are more high-end than the Nintendo Wii and PlayStation 2 (PS2). They double as home entertainment centers and include more features and tote more connectivity than the Wii and PS2. Is that what people need right now?
So it appears that people are willing to spend money on entertainment, just not high-end entertainment. Consumers are keeping to the basics. In 2008 over 35 million “basic” consoles shipped worldwide, while only about 20 million “high-end” consoles shipped. The trend should remain the same for the next few years. Consumers can’t justify the need to purchase a high-end console when money is tight. During times like these a basic video game console and a working DVD player hooked up to whatever TV you already own should suffice as a home entertainment center. And apparently gamers can survive without being able to check Facebook and Twitter while they play Gears of War 2.
Source: DTC
Just take a look at the PS2. The PS2 was released in 2000, making it 9 years old, and yet it is still selling strong. The PS2 even outsold the 3 year old PS3 in 2008. And because of the low $99 price tag Sony is even still releasing the PS2 into new markets around the world. Maybe if the recession hadn’t hit, the PS3 would be the top seller in the Sony lineup. But it’s hard to resist a $99 price tag, especially when current hot games are still being released for the console.
