Wedbush Securities analyst Michael Pachter has released his estimates for the video game industry in the US in March. He focused on the poor Wii U sales which he expects to have only sold 55,000 units. This would be a 17 percent drop when compared to February. Pachter expects the Wii U to continue selling poorly even if it receives a price cut.
Pachter expects software sales to up one percent year-over-year, due to the strong release schedule. Gears of War: Judgment, God of War: Ascension, BioShock Infinite and Tomb Raider were all released in March.
"The only key hardware device to underperform our expectations was the Wii U and its fortunes appear unlikely to improve for several months, even if Nintendo decides to drop price, as there are an insufficient number of core titles that are generating interest in the console," said Pachter.
We think that core gamers are far more likely to turn their attention to the PS4 (due in the holiday season) and the next Xbox, which we believe will be unveiled before E3 and have a launch alongside that of the PS4, and believe that the long-term appeal of the Wii U will be severely limited by the perception that the PS4 and next Xbox will be much more powerful with greater online integration and multimedia functionality."
Pachter believes that if the PlayStation 4 and next Xbox are priced reasonably at launch, that Wii U sales will not improve due to strong the competition. He believes that Microsoft will sell the next Xbox with a payment plan like it is currently testing out with the Xbox 360 and similar to what cell phone providers do. Sell the device at a loss, but have consumers sign up for a two year plan which will more than make up for the loss. Pachter also believes that Sony will use the exact same strategy with the PlayStation 4.