Post by: WindyMan on April 26, 2004, 07:02:19 PM
A Bloomberg report is saying that now that the videogame industry has more information about the Sony PSP, investors have started to realize that Sony might not swoop in and take a chunk of Nintendo's 95% global handheld stake quite so easily.
In large part due to the expected PSP price range and features the unit will have, analysts have figured out that the PSP is more directly targeted to the adult pocketbook, while Nintendo's handheld audience is spread out across all age groups. This means that even if Sony does do well with the PSP, it's likely that they'll only be affecting half of Nintendo's audience, those above the age of 16. Since parents are the main source of games for the young'uns, and no mother or father with intellegence would be willing to fork out $250-400 for a portable game system, it would seem that Nintendo and the $99 Game Boy will be fine in the short term.
Last year, in the days following the PSP announcment at E3 last year, Nintendo's stock dropped 16%. Since investors took a look at the big picture, though, Nintendo's stock has shot up 39% and is still going strong. Expect stock prices to sway again at this year's show, where Nintendo will lift the lid on the Nintendo DS, and Sony will fully show off the PSP.
Post by: Shift Key on April 26, 2004, 08:05:25 PM
Post by: Ian Sane on April 26, 2004, 08:42:55 PM
I don't think the PSP can beat the Gameboy brand on it's own merits. But it could take over the market if Nintendo f*cks up with the DS. That's a risk I wouldn't gamble on without at least seeing the DS first.
Post by: Doerr on April 26, 2004, 09:05:50 PM
Lately everything I read about them is so negative.
Post by: Shift Key on April 26, 2004, 09:18:46 PM
QuoteI'm going to leave the DS in the experimentation basket alongside the Virtual Boy at the moment, because we still know so little about the total package.
Plus the GBA is not Nintendo's future, the DS is.
As for making or breaking Nintendo, don't start jumping to conclusions yet. Pass judgement once the contenders have shown their true form.
Post by: Bloodworth on April 26, 2004, 10:16:20 PM
And yeah, the DS is an addition to the Game Boy line. It can play GB cartridges simply so people don't have to carry both.
Post by: odifiend on April 27, 2004, 01:11:21 AM
This though is good news and it indicates that Sony has probably thought only prematurely about their pocket system. Still its not like they can't 'Xbox-it' and throw money in PSP until the genereations over.
Post by: thecubedcanuck on April 27, 2004, 02:20:07 AM
Post by: Mario on April 27, 2004, 02:30:23 AM
My gut instinct from the beginning has been that the PSP won't be the slightest threat to Nintendo, so far it's still holding up, i can't wait for E3.
Post by: Bill Aurion on April 27, 2004, 02:46:47 AM
Post by: RABicle on April 27, 2004, 02:50:02 AM
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I still wouldnt rush out and invest your life savings here folks.
Master of the obvious, please sit down.
Post by: ruby_onix on April 27, 2004, 03:15:10 AM
Here's the worrysome part.
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Sony expects to make money on the PSP, though it may take a loss when the console first goes on sale, Sony's Furusawa said.
...
Sony lost money on PlayStation and PlayStation 2 immediately after the consoles went on sale, Furusawa said. Both consoles are now profitable.
The PlayStation and PS2 did sell at a noteworthy loss at the start. As costs went down, they eventually started to turn a profit (although the PS2 is notoriously overpriced right now). Was the later profit enough to offset the initial losses in the final tally? Maybe. Maybe that's what Sony's shooting for here.
A $450 "GameBoy killer" is doomed to fail horribly. But a $200 one?
But then again, taking a $200-250 loss per-unit on the hardware is one heckuva big risk. Especially since Sony's been saying they plan to have 10 million PSPs on store shelves (or preferably people's hands) by the end of their first year. Do the math on that one yourself.
And not only is that a much bigger risk than any $50 loss they've tried to maintain on their earlier consoles, but their other consoles have had game-royalty fees coming in for them. Just about everyone knows that royalty rates on handhelds are pretty slim (to try and keep the game prices below those of their superior home-console cousins). And the average handheld owner (read: GameBoy owner) in America only owns about 2.5 games, compared to 8 games for a PS2 owner.
Don't get me wrong. I still expect a horrible flaming death from the PSP (at which point I'll probably miss it, and want one). But that suggestion of "$200", combined with those quotes from an SCE spokeswoman, lead me to believe that if Sony lets it all hang out and goes for broke on this one, they will have a pretty decent chance for success. Lets call it the "Can they run through the deadly-volcano-path fast enough to survive, if they take their pants and shoes off first?" question.
Of course, their better bet for success is if they abandon the "GameBoy killer" idea and carve out their own niche somewhere (maybe eating a small PDA market or two). Like, if Nokia goes out and makes a cell-phone called an "N-Gage 2". It might be a success, but it won't have "won where the N-Gage lost", because it fought a completely different battle.
Post by: Ian Sane on April 27, 2004, 07:49:15 AM
I'm basing that on the fact that Nintendo execs have basically said as much. From all the interviews and soundbites it sounds like Nintendo is banking their future on the DS.
"So why don't they just call the damn thing a Game boy then?"
To fool investors I guess.
All these investors who are supporting the GBA obviously think the DS is something different. All this "third pillar" talk seems to have worked. I think Nintendo may use the Gameboy name for the DS but is probably waiting until E3 for the very reason of keeping investors interested. If they announced it was the new Gameboy before actually showing the system to the public some investors may prematurely back out.I think a $200 PSP has a reasonably good chance of taking off. Rumour has it the DS won't launch at the usual $100 Gameboy price so the prices may be comparible. If the PSP is $200 and the DS is $150 then the difference in price is comparible to the PS2/Cube difference and that failed to affect anything until the Cube dropped to $100. There are still other factors though. The PSP has to be durable and if it's anything like the PS1 or 2 it won't be.
Post by: KnowsNothing on April 27, 2004, 09:22:38 AM
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With portables, it's not just a matter if you can afford to buy one, but whether you afford to let an eight-year-old leave it on the bus.
Heh, my bro'gameboy SP was stolen when we were on vacation. Whithin a week of getting back we justr went oundought a new one. We are stiloing of recompence for the stolen gameboy from the hotel, but we wouldn't buy a new system if it was 400 bucks. Heck, if were 400 bucks, we wouldn't take it on anywhere for fear losing it, and then it wouldn't really be a portable system anymore. =p
Post by: theRPGFreak on April 27, 2004, 01:27:06 PM
Post by: Ian Sane on April 27, 2004, 02:04:32 PM
Okay it's obvious that Nokia failed in this department but what's your point about Microsoft? Although they lost money it was by choice and the Xbox has done quite well in terms of market share which was Microsoft's goal in the first place. MS is in a pretty good position for the next gen. The Xbox accomplished exactly what it was supposed to.
Plus the N-Gage's failure has nothing to do with the target market but entirely to do with the fact it was a poorly designed piece of sh!t. It doesn't matter who it's targeted to, a portable that requires the battery to be removed to switch games is going to fail.
Post by: mouse_clicker on April 27, 2004, 02:11:51 PM
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Okay it's obvious that Nokia failed in this department but what's your point about Microsoft?
Careful what you say- the XBox has done slightly worse than the Gamecube worldwide, so if you want to imply MS did good, the same would have go to for Nintendo, as well as the reverse case. If Microsoft is in a good position for next gen, so is Nintendo.
Post by: Ian Sane on April 27, 2004, 02:38:36 PM
I don't know about that. More is expected out of Nintendo so from a relative perspective they didn't do as well or at least that's how I see it. MS is a console newcomber that managed to carve themselves a decent sized piece of the market and have managed to make the Xbox more known in North America than the Gamecube. Plus they exeeded what people expected of them and achieved their goal of gaining a foothold in the console industry.
Nintendo is in a different situation since they're the veterans in this console war. Because they have more experience more was expected on them. In the end it's likely that from a console perspective Nintendo will have a worse public image and smaller marketshare then they did with the N64. The Cube was expected to fix the mistakes of the N64 and put Nintendo back into the role of a serious contender. It didn't. And although I don't know what Nintendo's own goals for the Cube was it's probably fair to say they didn't reach them.
Microsoft's position in the console industry grew this gen while Nintendo's shrunk. That's why MS is in a good place going in to the next gen while Nintendo is not.
To tie this in with the current topic I'll point out that if the PSP grabs a decent sized chunk of the portable market (say 25%) I would consider it to be a success in the same way I consider the Xbox to be a success.
Post by: nickmitch on April 27, 2004, 02:55:45 PM
Post by: mouse_clicker on April 27, 2004, 04:27:50 PM
Post by: odifiend on April 27, 2004, 04:40:29 PM
It is naive to just look at current numbers. What companies and investors do is look at the past to determine the future. Nintendo's marketshare is constantly shrinking, so companies will think the trend will continue. That's how business works.
Post by: mouse_clicker on April 27, 2004, 04:52:39 PM
Besides, we should all know by now that expectations mean jack squat- they're proven wrong more often than right.
Post by: odifiend on April 27, 2004, 05:25:16 PM
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Originally posted by: mouse_clicker
you can't make predictions on MS's future in the industry based on performance this generation without the same thing applying to Nintendo. If you say the XBox Next is poised for success, well, so is the N5.
Besides, we should all know by now that expectations mean jack squat- they're proven wrong more often than right.
You can't make accurate predictions.
Yeah, you're right of course about expectations and predictions being broken. However it was just worth noting that "the same thing" does not exactly apply to Nintendo because of the psychological factor of expectation.Back on topic with the typical blanket statement:
PSP's price is suicidal. At least Microsoft knew enough to price its console with its competition.
Is it me or am I praising M$ way too much lately?
Post by: Djunknown on April 27, 2004, 06:24:54 PM
its good to hear some good news from the media for a change, looks like even they can sometimes behave.
While the software programmers have boasted its ease of...programming, all that's left is the hardware. It seems for the people who I know have a PS2, its almost expected for it to break down. The PSX was discontinued in Japan, because they couldn't fulfill the hardware specifications that were originally announced. Will the PSP inherit Sony's legacy of 'questionable' hardware?
Post by: Ian Sane on April 27, 2004, 06:53:21 PM
Sure they do. It relates to consumer good will. If you're an Xbox owner and the Xbox performed better than you expected then it's likely you'll buy the followup. If you're a Cube owner and the Cube performed below your expectations you might think twice before buying the followup.
To tie that in with the current topic the original GBA was quite flawed. It was just really hard to see anything. Yet people still bought it because of the good image of the GBC. They were able to overlook the flaws of the GBA. The Cube had flaws too but people didn't overlook them. Instead they dwelled on them. That's because the N64 failed to meet expectations set by the NES and SNES so in the eyes of most people it was a failure, even though it really wasn't. The Cube has created the same "failure" stigma as a result of not meeting expectations. Thus unlike the Xbox it's not in a good position going in.
Post by: KDR_11k on April 28, 2004, 01:51:27 AM
Quote
Originally posted by: odifiend
At least Microsoft knew enough to price its console with its competition.
Hahaha, HAHA MWAHAHAHAAA! Sorry, just couldn't hold it. I mean, they launched the thing at 480 Euros and only dropped the price to 300 after they realized noone's going to buy it at that price!
Post by: mouse_clicker on April 28, 2004, 03:30:08 AM
Quote
Sure they do. It relates to consumer good will. If you're an Xbox owner and the Xbox performed better than you expected then it's likely you'll buy the followup. If you're a Cube owner and the Cube performed below your expectations you might think twice before buying the followup.
But the Gamecube has sold better than the XBox worldwide, so I don't say the XBox did "good" and the Gamecube did "bad" without using different comparisons for both. Hell, relatively both consoles BOMBED compared to the PS2, but we don't see that comparison very often. Ignore expectations, which, like I said, are wrong more often than right, and look at the numbers- you can't say the XBox is doing well without saying the same for the Gamecube, and vice versa. You can say the XBox did BETTER than we thought, but that doesn't mean it did well. Or you could say the Gamecube didn't do AS good as we thought, but that doesn't mean it did horrible. Regardless, you can't use different comparisons for both consoles and then expect to compare them to eachother. It's like measuring one car's speed in miles per hour and another's in kilometers per hour and then announcing a winner based on those numbers.
Post by: kovu_br on April 28, 2004, 06:51:31 AM
Lord knows what Nintendo wanted with the Gamecube, but I'll tell you what it didn't want to: Fix the mistakes regarding 3rd party support that plaged the N64. Nintendo, for better or worse, plays the game by it's own rules, and they design their consoles for their own needs, not the needs of other developers. As much as they say they lowered licencing fees and made the Cube an easy machine to develop for they still ignored everything the PS2 had (And like it or not the PS2 is the standard of this generation) and created the least viable plataform to develop for in this generation. Most people buy Nintendo consoles to play Nintendo games, but instead of changing that (And build *the* console to own) they're contend with it, therefore right now Nintendo makes great "secondary systems" as most Cube owners have a PS2 or a X-Box as their main system. And right now I'd say that of the big 3 Nintendo has the worst image with the public and with developers, regardless of how well the Cube performed, and that doesn't bode well for it's future.
Of course, as long as there are people like me (And like most of you, I bet) Nintendo will sell consoles but right now I'd say that Microsoft has a bigger chance of dethroning (Bet I wrote that wrong) Sony than Nintendo. Not that I think Sony can be removed from the top anymore...
Oh yeah, and on topic: That's good to hear and I hope Nintendo delivers on those expectations, otherwise their stocks may plummet again after this year's E3.
Post by: theRPGFreak on April 28, 2004, 08:38:43 AM
Post by: Ian Sane on April 28, 2004, 08:57:14 AM
Okay, that makes more sense. And it made me think of something. If the PSP is designed to be more than a portable game system and has a lot of extra features then it's pretty likely that not too many kids are going to own one. Therefore it would be a waste of time for any games targeted to younger gamers to be released for the PSP. If it's a scaled down Palm Pilot the only people who own one are going to be tech savy adults so games like Ratchet & Clank for example wouldn't sell with that target market. Ironically the first PSP game to be shown, Death Jr, also probably wouldn't be popular with that market.
I think that adding extra functionality to the PSP could very well be what prevents it from reaching it's full potential. The Playstation brand has been popular because it has something for everyone. However if the PSP is for adults (whether intentional or it just turns out that way) then the advantage is immediately with Nintendo as the GBA (and I assume the DS will as well) is a system that has something for everyone. By trying to make an all-in-one machine Sony may very well be giving up what has given them an advantage.
I think that same problem could translate to the PS3 which would give Nintendo a huge opportunity since they provide a more balanced lineup than Microsoft.
Post by: KDR_11k on April 28, 2004, 09:31:03 AM
Post by: WuTangTurtle on April 28, 2004, 03:14:08 PM
Whatever happens im just glad about the DS because so far it looks like a huge stage of evolution for the portable market I bet this wouldn't have happened if Sony didnt decide to go portable.
Post by: Bloodworth on April 28, 2004, 10:47:17 PM
I mentioned that price is important because portables can easily be lost by younger gamers, but the other thing to keep in mind is that a portable is pretty much a personal device. When you buy a home console, that's something that everyone plays and can watch along with, and when someone leaves home, that gives another family member a chance to play. Portables aren't as easily shared; you leave home and you take it with you, plus to play multiplayer games, you need to have more than one in your household -- and many people do. So yeah, it's going to be very interesting to see how the first real portable contender since the Game Gear turns out, and whether it can overcome some of these hard traditional barriers.
