Daily GameFunk analyzes the 360's prospects for the immediate and long-term future. With the 360 being surpassed by the Wii in North America, and the Playstation 3 in Europe, the article seeks to answer the question: Is the 360 dead? And if not, what can Microsoft do to keep the 360 viable against strong competition?
In terms of sales, the 360 has been struggling to gain its footing on very slippery slope this year. After being the leading console in the US for more than 2 years, it was finally surpassed by the Wii at the end of May.
In addition to this, Sony announced a few weeks ago that they had finally outsold the 360 in Europe, landing another critical blow to the 360. With this on top of numerous other issues, many have began contemplating whether or not Microsoft has already closed up shop on the 360 and began looking at future consoles. However, this is simply not the case.
Microsoft has lost the advantage of having the largest install base in North America. However, while having the largest install base is important, developers often look towards a console's attach rate(the average number of games sold per console) as well.
After all, while having 25 million potential customers is better then having 18 million potential customers, if the 25 million only average 4 games per console while the 18 million average 6, theres clearly still incentive to develop for the later. And this is the case - the 360 has the best attach rate out of all 3 next gen consoles, at 6 games per console.
Hardware sales are good for the manufacturer, while attach rates are good for developers. This will keep developers pushing 360 games, and continue to breath life into the 360.
Many also seem to think that because the original XBox had a 4 year life span, the 360 will have a similar 4 year span as well. The situation for the 360, however, is largely different then that of its predecessor. The 360 is still largely in the race in comparison to where the original XBox stood.
In 5 years, the original black box sold about 24 million consoles. In 3 years, the 360 has sold close to 19 million units, just a few million shy of its forerunner. Axing the 360 so early would also further hurt the companies reputation in the industry.
Also, by unleashing a new console so early, Microsoft runs the risk of the 360 looking VERY dated when Sony and Nintendo come up with a new console. A one year head start doesn't allow technology to become radically more advanced, as seen with the PS2 to Gamecube or XBox. 2 or more years, however, does allow this to happen - look no further then the Dreamcast compared to the PS2.
In addition, right now, the standard 360 SKU(the Premium model) has still yet to hit the price point in which consoles really tend to take off in sales. Generally speaking, $200-$250 is the range many people deem an appropriate price to pay for a console. The Premium is still stuck at a pretty $350, $100 more then the standard price point. If Microsoft slashes the price, the 360 will be sure to take off.
Plus, rumors are also pointing to a 360 'slim' model being developed for 2009. Typically, these redesigns come at mid-cycle, which would indicate Microsoft is still vested in the 360.
Also in 2009, the DTV transition will occur and broadcast signals will change from analog to digital. Standard analog TVs will no longer get reception without the aid of a signal down converter device.
Though these devices will be readily available, many will be in the market for a new HDTV. As it is, the 360 is the cheapest HD console. This makes the 360 an attractive choice for many of the new HDTV owners, especially over Sony's PS3. If a Blu Ray playing 360 is also really in the works, this tilts the scales even more.
Though in general, the Wii is marketed towards a different audience, this new market of HDTV owners may also even give the 360 an edge over the Wii. This is especially the case if recent rumors of Microsoft developing a motion controlled '360mote' have any bearing in reality.
This would greatly expand the audience of the 360, incorporating both the casual audience and core gamers. Combine this with the DTV Transition and a price cut and the 360 becomes a power house once again.
Finally, theres this myth that the 360 doesn't have a 2009(or beyond) line up. While its not as definite and clear cut as the PS3's, there are already several big name games slated for an 09 release. Alan Wake leads the pack, but theres also Splinter Cell Conviction and most likely Halo Wars and Mass Effect 2 joining it. With E3 right around the bend, expect even more titles to be announced as well.
The 360 is still alive and kicking. Microsoft is not going to release its next console so early, theres no need to. With a solid line up, some innovative new hardware, a possible price drop, and the DTV transition around the corner, you can expect the 360 to be around for quite a while.
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