43 Comments

Summary:

By now you’ve probably been buried in the hype surrounding Halo 3, Microsoft (MSFT) Xbox 360′s exclusive “killer app” game released this week– the canny live action commercials featuring old veterans praising the franchise’s hero, Master Chief, the prominent coverage in the New York Times, the […]

Halo 3By now you’ve probably been buried in the hype surrounding Halo 3, Microsoft (MSFT) Xbox 360′s exclusive “killer app” game released this week– the canny live action commercials featuring old veterans praising the franchise’s hero, Master Chief, the prominent coverage in the New York Times, the long lines and Chief tattoos and other totems of gamer enthusiasm.

With all that excess, you might assume this means Halo 3 is the game phenomenon of the year. And that would be a mistake.

From the market’s point of view, all that fanboy energy is a sideshow. The reality is that the 360 is no longer the market’s most popular next gen console: the Wii owns that spot, now with more than half a million more units sold worldwide (currently 11.78 to the 360′s 11.10 mil, according to Video Game Chartz). For that matter, the 7 year old Playstation 2 is still going strong, and even into this year, was still outselling the 360.

(Only last month did the 360 finally manage to slip past a system released during the Clinton administration, for God’s sake.) On pure numbers, then, the 360 is still a niche system, and while Halo 3 will sell well with the 11 million who already own one, the big question is, will it move significantly more 360s? And the even more crucial question, will it move the 360 back to its short-lived lead among next gens?

I’ll go on record right now and say No and No.

Hardcore gamers dominate console adoption patterns in the first couple years, and not coincidentally, Halo 3 will appeal to them most. So it’s safe to say most of those who want to play Halo’s final chapter already own one. Of course there’s stragglers (like me), but will they spend several hundred dollars for a new system plus $60 dollars for the game itself just to find out what happens to Master Chief? (Especially when influential game reviewers are beginning to express buyer’s remorse and deep disappointment with Halo 3.)

“I don’t think it’s really going to do much for the 360,” says Alexis Madrigral, very recently a game industry analyst with DFC, now a contributing writer for Earth2Tech. “The rest of their holiday lineup is what’s going to count. Can they get games out there that appeal to kids, women, and non-FPS fans not just in the US but in France, in Spain, in Germany?”

And of course, the significantly cheaper Wii has far more appeal to all those groups, not to mention the market-driving Japanese, who’ve never taken to anything from Microsoft. Meantime, Nintendo, which had a dearth of Wii titles at launch, is rolling out a massive variety of games and peripherals for the holidays, including a Wii-exclusive Metroid title, and even more seductive, a gun-shaped controller. And while Nintendo’s new console has already won over non-traditional gamers, these will do a lot to bring the hardcore into the Wii fold. While hurting the 360′s sales.

Don’t believe me? According to the Wall Street Journal’s game blog, just days into Halo 3′s launch, the Wii is back to outselling the 360 on Amazon.

Image credit: Halo 3.com.

Related research

Subscriber Content

Subscriber content comes from Gigaom Research, bridging the gap between breaking news and long-tail research. Visit any of our reports to learn more and subscribe.

By Wagner James Au

You're subscribed! If you like, you can update your settings

Related stories

  1. Are you a Nintendo shareholder?

    Share
  2. HIGH-larious!
    Posting a link to one negative review out of thousands of glowing, positive ones. Quartertothree.com?

    Nice reach. Except not at all.

    Nintendo’s Wii will fade, just as the Gamecube did. Hell, I even bought into the Wii hype. Only to have the P.O.S. sitting in my entertainment center, collecting dust for the past 6 months.

    The 360 is this generation’s Playstation 2.

    Share
  3. James,
    What are you smoking? You and Om are so in love with Apple you can never give credit to Microsoft no matter what they do! Microsoft has a hit in Halo 3 and it will drive 360 sales. The Wii is not outselling the Xbox 360 on Amazon since the Xbox has three SKU’s. Funny how you you fail to mention that little fact. Lazy or do not want to tell the truth?? If this was Apple you would fawning all over Halo. This blog become less and less significant as the objectivity quickly disappears.

    Share
  4. No need to have a vested interest in Nintendo to see what’s going on. The Wii is cheap enough that the hardcore get it as a second console and friendly enough that everyone else gets it as their only console. Nintendo literally said they can’t compete in the hardware wars, leaving Microsoft and Sony to fight a bloody war. While the men are off to war, Nintendo slips into your village and has their way with your women. Mwahahaha!

    I’m a Wii60 owner, BTW.

    Share
  5. I don’t know why people keep comparing the Wii to the 360. They’re for TOTALLY different markets.

    If you’re a hardcore gamer, you’re not going to want to play a Wii when you’re down for real gaming. The Wii is for play and goofing around.

    This isn’t from a 360 fanboy either. I own and enjoy both consoles and used to have a PS/2.

    When friends are over, we play the Wii. It’s awesome for playing with the family or, hell, just drunk after a night out. When I’m in for real gaming, the 360 is up. I’m not even entirely sure why the Wii is considered “next gen”, it isn’t even HD.

    You’re right it’s a niche market, but real gaming has always been a niche market. I think you’ll find that PS/2 users will graduate to being 360 users, not Wii users.

    Share
  6. “The Wii is not outselling the Xbox 360 on Amazon since the Xbox has three SKU’s.”

    No, Halo 3 has three SKUs. The WSJ reported that the Wii is outselling the 360 on Amazon on a week that should be the system’s strongest:

    “New sales for Wii blasted the hardware past the Xbox 360 Premium to rank at No. 3 on Thurs. The Xbox 360 held a previous position of No. 6.”

    Share
  7. WRONG AGAIN JAMES!

    SKU 1 Xbox 360 Elite System Console Includes 120GB Hard Drive

    SKU 2 Xbox 360 Console Includes 20GB Hard Drive (with HDMI)

    SKU 3 Xbox 360 Console Halo 3 Special Edition (with HDMI)

    ALL IN THE TOP 25. Is this three SKU’s James???

    Share
  8. oh james, stop being such a silly goose. everyone loves a good david and goliath story, but, it’s only a fairy tale. besides the fact that you’re reaching, like comparing a DVD player to a Beta Max, and then distorting facts is sad :( James, that’s a sad emoticon.

    Share
  9. Again, the issue is not whether Halo 3 in all its variations is selling well, of course it is; the issue is whether it’s substantially moving more 360s over the Wii. And again, that doesn’t seem to be the case.

    Share
  10. It doesn’t matter whether you guys think that the 360 is a better console or that the Wii isn’t for the ‘hardcore’, the fact of the matter is that number of units sold = profits = success

    It’s just not doing as well as the Wii (worldwide); and I have to agree, I don’t think Halo 3 will translate into lots of extra 360s sold. Halo 3 will be an amazing hit (amongst existing 360 owners), but I don’t think it will sell enough new consoles to break the Wii’s lead.

    Share

Comments have been disabled for this post