Analysts Forecast Next Gen Won’t Outsell Current Gen – We Disagree

Usman Pirzada

ABI Research is a well known consumer research and market intelligence company, they released a forecast that the next gen consoles ie the PS4 and Xbox One will not outsell the predecessors. Current Gen sales are somewhere around 140 Million Units (In First Five Years) and Next Gen should sell 5% less than that according to ABI Research. However we think that now after 3 months we can finally disagree.

Next Gen PS4 Xbox One

ABI Research: Next Gen (Xbox One, PS4, WiiU) wont Match Sales for Current Gen (Xbox 360, PS3, Wii) And Why We Disagree

First of all this is an extract from the report by ABI Research regarding Next Gen Sales:

"ABI Research expects cumulative shipments of 8th generation consoles from the big three to pass 133 million during the first 5 years on market, compared to nearly 140 million 7th generation consoles over the same length of time..........Without solid titles and first-party franchises, platforms will have a difficult time finding traction. Streaming media is not enough when low-cost STBs are readily available. While we don’t anticipate a drop-off in game console households, barring significant changes to less developed console markets in Asia and Latin America there isn’t a great deal of growth opportunity beyond the current installed base"

Simply put the Market Intelligence Analysts believe that because Next Gen lacks "solid titles" and "first party franchises" next gen will suffer. Also note that this statement was made after E3, meaning they know all about the console exclusives. However we have a feeling that Next Gen will outsell Current Gen. Heres why:

1. The Chinese Market Effect

Even though the report has listed this effect, it would appear that they are terming it as a wild card. Another important thing is that at the time of the report, the Chinese Market was NOT fully opened at that time. The ban was fully lifted on 30 Sep. And even after accounting for illegal console sales in China, this will be a major gamechanger.

WWSalesChina Next Gen

2. Underestimating the power of Present Console Exclusives

The time of the report is 15 July which was immediately after the reveal of console exclusives. However 2 days is hardly enough to estimate console exclusive impact. If you take into account PS4 Exclusives like Deep Down and Xbox One Exclusives like Ryse and then if you dare look at the cult following they have amassed, you would be hard pressed to say there are no "solid titles".

3.Overestimating the Power of Mobile-Shift of Gamers

The report also lists the shifting of gamers/consumers towards mobile devices, but from what we can see, the two aren't mutually exclusive. Ofcourse ABI Research forecasts by pure number crunching and not human nature. Sometimes trends can be chaotic and in that case no amount of numbers can forecast the outcome. Predicting the outcome of Next Gen is something like that.

4. The Sheer Resilience (In a Good Way) of Console Fanatics Fans

Though this doesn't really qualify as a logical counter to the ABI premise, we are willing to bet that if the analysts over at ABI Research had talked to the console gaming community they would have gone home licking wounds and changed their forecast. The loyalty of console fans to their console of choice even when the said console makes glaring mistakes is admirable to say the least. This by the way is another variable which is chaotic.


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