Xbox 360 Is “Clealy On Downside Of Life Cycle” Says Analyst PS3 Facing Consumer “Confusion”

E3, arguably the biggest and most important gaming event for the industry. It’s where Sony, Microsoft and Nintendo, along with publishers and developers show off what they’ve been working on.

Analyst group DFC intelligence has outlined its findings and concluded that Nintendo stole the show, while Microsoft and Sony dove head first into the motion control arena.

The research firm also noted that while Microsoft’s Xbox 360 clearly has some life remaining, the console’s on a downward spiral, it’s near the end of its life cycle.

“Kinect is definitely an interesting product. We think it is more compelling than Microsoft’s Xbox Music Mixer product released in late 2003 (for those that don’t remember, Music Mixer was a music application with a microphone designed to turn the Xbox into a karaoke machine). At the end of the day, we see Kinect has having some appeal to a well-heeled fitness audience. In terms of changing the overall video game hardware platform market share we see it having a negligible impact,” DFC noted.

“The Xbox 360 clearly needs to diversify beyond the core first-person shooter audience. At E3 it was clear that Kinect is not designed for the hard-core game consumer. Microsoft is putting almost all its eggs into the Kinect as a way to appeal to the ‘casual’ consumer and expand its user base. Of course, Microsoft has been trying to do this for some time and in that regards the Kinect can be seen as the latest in a long line of products intended to make Microsoft a mass market entertainment company. Unfortunately, based on what we have seen, DFC continues to feel that Microsoft is going to struggle to expand beyond its core audience.”

Moving on Sony’s case, DFC said 3D will not last but instead be a gimmick, and combined with Move and other peripherals, consumers will end up being confused more than anything else.

“In terms of the overall vision for 3D in gaming, DFC remains skeptical. The reliance on glasses in all but the 3DS is something we see as a possible impediment to widespread consumer adoption. We still think 3D may remain more of a gimmick than something consumers want to do on a regular basis. Nevertheless, it could work as a selling point for a system like the PlayStation,” the firm continued.

“Consumers may not actually use any of the 3D features, but just the fact that they are there could encourage them to buy a PlayStation 3 over a competing system. In other words, 3D could be a great showroom feature. It is definitely a selling point for someone purchasing a 3D TV, but even if a consumer does not yet plan to buy a 3D TV they may want the PlayStation 3 “just in case.” As for actual day-to-day practical use, we don’t see it yet.

In our view, much of what Sony is doing is trying to say their system has something for everybody. Of course, the big risk is consumer confusion. We have to admit we are still coming to grips with all the different gadgets available for the PlayStation 3 and what games require what devices. Explaining that to consumers will be a major challenge for Sony and it will be interesting to see their approach this fall.”

DFC concludes its analysis by stating that having a lot of peripherals isn’t necessarily a bad thing, especially when looking at the PS2, it’s now the best selling console of all time, and it had many peripherals.

“”For Sony, the PlayStation 2 became the best-selling system ever because of its diverse product line. In Europe, the Eyetoy camera and Singstar microphone were extremely popular add-ons that helped drive hardware sales,” DFC noted. “Those gadgets had much less of an impact in North America. Meanwhile, the Wii has all kinds of add-ons: the Nunchuk, the Zapper, the MotionPlus, the Wii Fit Balance Board, and the Wii Wheel being some of the official ones from Nintendo. It is clear that far from confusing consumers, these accessories have helped the system appeal to a larger audience.”

Good points, but I’m not sure 3D will be a gimmick, it’s looking like it’ll actually take hold.

But that’s just me, what do you guys think?

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Author: Ernice Gilbert View all posts by
Ernice Gilbert here. Founder and Editor-In-Chief of Gamesthirst. Thanks for stopping by, make yourself at home!

2 Comments on "Xbox 360 Is “Clealy On Downside Of Life Cycle” Says Analyst PS3 Facing Consumer “Confusion”"

  1. nick July 2, 2010 at 4:36 am -

    3D will definetly take hold, there are already TVs in china that are able to do 3D without the need for glasses.
    give they say 2 to 3 years and they should be out worldwide.
    once they have hit the market than thats when 3D will really shoot off, because all the cons will be gone and there will be plenty of content for it.

    as for kinect thats what ive been saying all along.
    M$ are putting all their eggs in the casual basket for kinect, if they dont drop the price of kinect, or change it, than its going to sink faster than the titanic!

  2. Ernice Gilbert July 2, 2010 at 12:08 pm -

    Faster than the Titanic, that’s awfully fast!

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