It’s no secret that the US video game market has been on the decline as of late, with the four last months each dropping in sales. Most look at the software line ups of last spring/summer, compare them to this sprummer, and say sure, sales should decline. However, analyst Michael Pachter points the finger another direction. The price of consoles and one word, strategery.
Pachter sees the 43% decline in hardware sales to be much more troubling than the software numbers. The problem with consoles? Perhaps are simply to expensive, and have been for quite some time now, according to Michael. Click over for his full thoughts.
We think that the console manufacturers will therefore be forced to consider a price cut before year-end, with Sony cutting the PS3’s price by October 1. Further, we do not think that Nintendo’s hardware forecast figures are achievable without a price cut, and we expect one around the same time as the PS3 price cut. It is likely both manufacturers will cut by USD 50, with Sony making up any lack of increased demand with a software bundle. We expect Microsoft to follow suit, giving us confidence that US software sales will grow later in the year, notwithstanding negative sales in the early part of the year.
I tend to agree, although I wouldn’t blame the slowdown of the industry solely on the console price. It would be nice to finally see the Wii get $50 bucks taken off the price, or at least bundled with a couple oldies-but-goodies.
