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PS3 and Xbox 360 to perform poorly this holiday

As the busy holiday season creeps upon us, PS3 and Xbox 360 manufacturers, Sony and Microsoft are anticipating massive sales. However, according to industry experts video game sales may suffer from the downturn in the economy. Also software developers may be releasing fewer AAA titles in an effort to offset financial woes in the near future.

According to GI.biz, Strauss Zelnick, Chairman for Take Two Interactive, indicated that the entertainment industry is not immune to recession. This is in contrast to what other industry analysts have predicted. Historically, the entertainment industry has fared quite well during periods of recession, mainly due to an increase in consumer spending on home entertainment.

Zelnick says that the current state of the industry "doesn't look very promising." While speaking at a conference, Zelnick indicated that the company is starting to see software sales drop at retail locations.

He said:

"In the last couple of weeks specifically we're beginning to see some softness in retail, it's pretty broad and it's beginning to have an impact on the industry and by that I don't mean a good impact."

Zelnick also indicated that the company will reduce development of AAA titles in order to offset high overhead costs. This strategy will also help software titles break even quickly.

He said:

"In that context we think our strategy, which is to release a limited number of top tier titles, somewhat cushions us in the environment because must have products should still sell … your overhead should be lower, your marketing costs should be lower…"

However, it is difficult to say if this strategy is even feasible. Reducing top tier titles means that there will be fewer games on the market that might be worth buying. Such a move could impact hardcore gamers who crave AAA titles throughout the year. We will just have to wait and see if Take Two Interactive's strategy pays off in the end.

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Danja3314d ago

Well we are currently experiencing a recesion and sales were great in October and the gaming industry is actually so far not showing any effects of being affected by the current state of the economy...

PS3/360 will sell well this holiday...and theres just no going around that

GrieverSoul3314d ago

I agree with you but the problem I see is too much content for our less money! XD

We had a period from summer end to Autumn where 1 or 2 games or AAA titles were worth of buying, now, suddenly a lot a games get released and our pockets cant take it all at once. This Xmas will sell games but it wont sell trucks loads off all of them. Maybe CoD WaW will top everything since its a sure bet and long term game U know you´ll be playing for a long time (till the next one comes out). In this recession we tend to invest in game that we know it will give us value for our money.

MURKERR3314d ago

even during this recession, so this article is a fail

google if you dont believe

SRU96003314d ago

Being able to buy two Xbox 360's for the price of one PS3 is really going to hurt the PS3's sales this holiday season, I believe.

Microsoft picked the perfect time to cut prices.

The Matrix3314d ago

Personally, I'll be buying more games with Christmas for ps3 and 360 than ever before.

theKiller3314d ago

199$ for 360 is good but at the same time u get the risk of taking ur console to the repairing shop every few months

400$ is cheap and perfect deal for ps3 but it doesnt change the fact that 400$ for a gaming machine is still expensive and specially in this economy crisis

for 360 i dont see a way for them to escape unless they manage to make their console RROD&disk scratching free, which i have great doubts

for ps3 all they need is a price cut with bundles and a huge advertising which i dont see it will happened soon, sony sucks in advertising and dont want to take more hits from ps3 by cutting the price!

StephanieBBB3314d ago

Im just sitting and waiting for 2009. Holy christ! Then it's really GAME ON!

+ Show (3) more repliesLast reply 3314d ago
Tacki3314d ago (Edited 3314d ago )

http://www.gamecyte.com/oct...

"Though more than one CEO has cited an October retail slowdown in recent investor conference calls, such a slowdown happily does not seem to have afflicted the U.S. video game industry sales as a whole. Today, the NPD reports that game industry sales actually increased 18% year-over-year to $1.31 billion."

I dunno... looks ok to me. And it seems like 'experts' have about a 90% failure rate when it comes to predictions.

Max Power3314d ago (Edited 3314d ago )

i didn't read it, is it interesting?

pp3314d ago

NO only PS3 will have a miserable holiday SALES.

Mahr3314d ago

Not a very useful article in my opinion. But on the bright side, I managed to add to my collection of facepalm images. Score!

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