Analysts: Next Generation Sales to Drop due to Tablets and Smartphones

by William D'Angelo, posted on 23 April 2012 / 3,824 Views

Analysts Michael J. Olson and Andrew D. Connor at Piper Jaffray have made predictions about the next generation of consoles. Hardware sales for each console are expected to be down compared to the current generation consoles, while software sales are expected to decline 53 percent in the first 14 months. The decline in sales is due to competition from tablets and smartphones.

Olson and Connor expect the Wii U to ship in the fall of this year with a price tag of $299 or greater and is expected to sell just 35 percent of the original Wii in its first 14 months on sale. Sony's next generation console is predicted to launch during the 2013 holiday season and to sell 50 percent of what the PlayStation 3 has managed. They expect Microsoft to be the last to launch their next generation console, with a release date in 2014. They expect it to sell 55 percent the volume of the Xbox 360.

"Unfortunately, we do not expect a console refresh to fully offset the secular declines in console gaming," the firm said. "We believe console gaming will continue to be a time-share donor to social networks, mobile games and tablets. We, therefore, favor companies with increasing exposure to social/mobile gaming, including Zynga and EA."


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25 Comments

crissindahouse (on 23 April 2012)

they don't even know what the next consoles will be and they expect sales to drop 55 percent. yeah that makes absolutely sense to make these predictions without even kowing shit about the next gen! i love analysts jobs, making a lot money but having no clue about anything. i say what i believe: people who did never play console games play maybe with tablets nowadays (and console players as well). people who played xbox 360 or ps3 won't stop playing with a real console anytime soon as long as tablets won't have the same games and controls. what i can believe is that from tohose millions who only play on tablets, that some of those will get hungry for more and better games and maybe tablets will even help real consoles. as example the wife of my brother, she did never care about gaming, then she bought a tablet and started to play there mini games and she started playing on facebook. but she sometiimes asks me about 360 and so on because she wants MORE now^^ and i can totally see her buyng the wii u this or next year.


crissindahouse (on 23 April 2012)

so what i believe is, that of some 100 millions of smartphone, tablet and facebook players, that some of them will "grow" into the gaming business and start to want playing more compicated games and not only "as simple as possible"


  • +4
Alby_da_Wolf (on 24 April 2012)

Agree. I myself, despite already being a gamer with more complex tastes, fell for a while for evil FarmVille, until eventually I realised the crappiness and repetitiveness of its mechanisms and dropped it cold turkey. As a side effect now I hate trophies and achievements, as their mechanism is one of those used by Zynga to keep gamers hooked to its poor games.


  • +1
DanneSandin (on 23 April 2012)

How is it that analysts earns so much money when they apparently don't know anything about anything!! I predict that the next gen HW will end up at around 300m units...


MonstaMack (on 23 April 2012)

Ironic, considering the Wii U uses a tablet.


Salnax (on 23 April 2012)

This does not mesh with the current trends. Handheld and console gaming have gone through their regular cycles these past few years, despite your mobile platforms and "social" games. I can imagine there being a 10 0r 20% drop maybe, but 65%?


Chark (on 23 April 2012)

Yeah, I agree with you. But remember, all new consoles are "DOOODOOMMMEDMED" - the doom sayers


  • +1
happydolphin (on 23 April 2012)

DooDoomed? Wtf do you think this is, kindergarten?


  • +1
wfz (on 23 April 2012)

Good thing Wii U is a tablet console then!


Alby_da_Wolf (on 24 April 2012)

Ninty will sell the controller like hot cakes, but consoles will remain on the shelves!!! :-D


  • +1
GameAnalyser (on 23 April 2012)

i would rather pity those companies increasing or trying to push exposure to social/mobile gaming.


Alby_da_Wolf (on 24 April 2012)

I won't believe any doom and gloom prediction that not be made by Pachter!!! :-D


Panama (on 24 April 2012)

I imagine sales will be no different than they are now with perhaps only the Wii U dropping off a bit in comparison to the Wii due to the major success of Wii. To predict that PS4 and 720 will sell only 50% of their predecessors is more defeatist than realistic. There are more core gamers out there than these analysts know of and these gamers would not deny themselves from purchasing these consoles just to game on a Tablet and/or Smartphone.


Majora (on 24 April 2012)

Bullshit. As technology becomes greater so will the hunger for bigger and better mediums to utilise it and experience it. Gaming and games are ways to experience this in our own homes. When my parent were my age, coming home from work meant a night in front of the tv watching programmes. At 23 in 2012, my boyfriend and I play consoles all night when we get home to relax as do many of my similarly aged friends.


Tammi (on 24 April 2012)

I'll believe that when I see it.


mike_intellivision (on 23 April 2012)

What else would an Internet analyst for an investment banker to say?


duckypwns (on 23 April 2012)

Good. The relevance of consoles in 2012 needs to be questioned. That hasn't happened up to this point.


benao87 (on 23 April 2012)

Some thoughts: - You can find better "analysts" in this site, - There are a lot of people in denial, tablets and smart-phones will affect video-game consoles, specially handhelds, - This guy is just rushing, you can't really come up with those predictions, unless he has some incredibly huge inside information, which I think it's not the case.


VGKing (on 23 April 2012)

"We, therefore, favor companies with increasing exposure to social/mobile gaming, including Zynga and EA." That explains it. This isn't their prediction, this is WHAT THEY WANT.


GameAnalyser (on 23 April 2012)

bull crap...


ghettoglamour (on 23 April 2012)

Oh these guys are so smart...


happydolphin (on 23 April 2012)

There will always be a market for quality games, but casual and non-gamers may find their pleasure elsewhere. Nintendo is the one to possibly lose the most from it, but then again they make the most family-friendly entertaining games, so they also win. What will the verdict be, time (not analysts) will tell.


snowdog (on 24 April 2012)

I can't believe these people get paid a small fortune for spouting such nonsense. The nearest competitor to smartphone and social gaming is portable gaming, and the 3DS is flying off shelves. By the time the PS4 and 720 are released, assuming that they're both released a year after the U, the U should have a user installed base of 10-15m by my reckoning, and if Nintendo have any sense they'll have a system selling first party title or two released before Christmas next year to scupper the launches of the next gen efforts from Sony and Microsoft.


dr3b (on 24 April 2012)

How do analysts nack up these percentages? Gaming generates more sales than movies! Although I can see a poss drop in sales as the casuals that bought the Wii for Wii Sports or Wii Fit may not buy in this generation.


dr3b (on 24 April 2012)

This on top of the fact this gen has alreafy outsold the last by over 20 million units.


  • 0
Podings (on 24 April 2012)

Maybe these guys know more about the new consoles than we do. I think it seems reasonable that Wii U will sell considerably less than Wii in it's opening year. The rest seems like educated guesswork, which is all anyone can really espect from analysts predicting the future anyway. Who knows? Maybe the new Xbox will bomb hard, or there won't BE a PlasyStation 4, or the Wii U just doesn't work like advertised.


DieAppleDie (on 23 April 2012)

"Unfortunately, we do not expect a console refresh to fully offset the secular declines in console gaming," consoles sold last gen 200m consoles sold this gen UNTIL NOW 225m MASSIVE DECLINE FOLKS!


bobgamez (on 23 April 2012)

I'll guarantee you the Wii U will beat the Wii's original sales for it's first 14 months.


benao87 (on 23 April 2012)

Quite unlikely, Wii sold like a monster during it's debut.


  • 0
bobgamez (on 23 April 2012)

benao, it defiantly did, but also had quite a few shortages. It ended up selling about 6 million in America when it should have sold about 10 million, Wii U beat solely because of it's first and second Christmas because Nintendo won't be dumb enough to have shortages twice.


  • 0
ryuzaki57 (on 23 April 2012)

No doubt social/mobile gaming will crunch a bit of the traditional market, bu IMHO not to such a big extend. That's why Sony and MS mustn't rush the release of future hardware : the current gen has to last longer, which will improve profitability, reduce price and help fight the rise of other forms of gaming


GameAnalyser (on 23 April 2012)

console gaming will evolve into superior class of graphics display to which no smartphones or tablets would ever be a match. The reason why handhelds never took a major chunk of the sales share from the market in every generation.


Comments below voting threshold

Slimebeast (on 23 April 2012)

So they expect Xbox to be number one in next gen. Cool.