Both PS4 and Xbox One have been on the market for about a year and a half. However, both Sony and Microsoft got the ball rolling by first promoting their systems in the first half of 2013 (about two years ago).
In that time span, Sony’s PS4 has been on cruise control. A combination of poor MS marketing, a more expensive Xbox One $500 bundle, and fewer countries having Xbox Ones. Coupled with PS4’s slightly better multiplatform games and its marketing position of “a gamer’s system” have all combined to give PS4 a sizable lead. At last count in the ballpark of 7 or 8 million consoles. The guesstimate across the internet is PS4 in the low 20 million units sold, while Xbox One is around 13-14 million. Give or take a million for each.
As time passes, PS4 is starting to show its true colours. And it’s not a good thing.
Xbox One Beats PS4 in April 2015 NPD
In early May, the April 2015 NPD report came out. While exact data has to be reverse engineered due to NPD not releasing data anymore, Xbox One actually sold more. In a battle of PR statements, Microsoft stated:
“As the best-selling console in the U.S. in April, fans set record April sales and engagement for Xbox One last month,” Xbox marketing boss Mike Nichols said. “Xbox One console sales in the U.S. increased 63 percent in April 2015 compared to April 2014 and Xbox Live comparisons showed the number of active global users [Xbox One and Xbox 360] grew 24 percent. We are grateful to our fans for their passion and support and are looking forward to sharing more on the best game lineup in Xbox history at E3.”
How to fix it
You can’t fix the past, but you can fix the future. Microsoft systems have been selling quite well despite no key exclusive games so far in 2015. What they have relied on is improving internet PR which is upcoming games and system features, and bundle promos going for about $350, which includes a system and game. The $350 Halo: MCC bundle is their latest offering.
Sony can easily top this.
However, they’ve stood firm on $400 with games bundled in. Regardless of which games are included, that’s still $50 more than Xbox One. People see price first. And some people base their purchase on price no matter what. Some people will do math and factor in the costs of the games and trading them in to get a more accurate “net cost” basis, but some don’t.
Sony doesn’t seem to be promoting key exclusive games yet either. While Microsoft plugs Rise of Tomb Raider, Halo 5 and monthly OS updates, Sony is more concerned with humming along so far in 2015. Although E3 can change that, and we don’t know what Sony has up their sleeve. Sony has to start marketing games and system features more and get back to the PS3 days where their unique games overshadowed endless Forza, Gears and Halo games.
Or they can simply match Xbox One’s $350 and blow it away.
The Shift to Third Party Games and Ancillary Revenue Streams
Sony held an Investors Relation Day 2015, which covered various divisions. Gaming and entertainment included of course. To recap a a previous article that covered the gaming slides in more detail (link here), the summary of the slides is that Playstation gaming will focus on third party games, VR, PS Vue, PS Now, various third party apps and trying to maximize PS Plus subscriptions. There was literally one line about first party games. PS Vita was mentioned solely on the basis of “writing off expenses”.
Add up all the slides and as Sony stated, a key goal is increasing ARPPU. That means increasing the Average Revenue Per Paying User.