Crossbar
01-27-2006, 11:10 AM
I could not find that this has been posted yet after searching the forum. Strange as it is a couple of days.
I find it to be a very good description of the current situation.
Comment: PS3 predictions are all shooting in the dark
Rob Fahey 14:26 23/01/2006
Sony's plans for the launch of PlayStation 3 are likely to be one of the biggest factors defining publisher and developer planning for 2006 - but in the absence of hard facts, it's essential to be wary of uninformed speculation, says Rob Fahey.
We'd like to express our sympathy to anyone reading this who is, as some of you probably are, in the unfortunate situation of having to make business decisions based around the launch of PlayStation 3 later this year. In the wake of Microsoft's Xbox 360 launch, with all its attendant supply problems (which are still afflicting retail even now), deciding how to treat a next-generation console launch from a publisher or developer perspective right now is a game not dissimilar to playing Snakes and Ladders. While blindfolded. In a room full of hyperactive monkeys. (crossbar: i.e. analysts).
The situation is hindered significantly by the fact that every pundit has a wildly different view on how Sony's PS3 launch is going to pan out. Typically, US analysts - who often favour the Xbox 360 to take a large chunk of the market in the next generation - seem to be downbeat on the prospects for PS3's early days, while Japanese analysts are generally more convinced by Sony's plans. Those in the Blu-Ray camp are convinced that PS3 will be a conquering hero, HD-DVD's supporters talk darkly about the console costing roughly the national GDP of Sweden to purchase and being shipped in numbers that you can count without having to use all your fingers and toes.
We have a great deal of respect for many analysts in the videogames sector, who have gone to great lengths to gain a deep understanding of the marketplace and its players, and who intelligently apply that knowledge and the insight they gain from countless conversations with industry players across the value chain to make rational and well-argued, if not always entirely accurate, predictions. The videogames industry analysts at Wedbush Morgan Securities and Banc of America Securities both spring to mind in this camp, and they are by no means alone.
However, some of the predictions flying forth this week from analysts have caused raised eyebrows, not least since they are so radically at odds with the message coming out of the industry. The most pessimistic prediction we've heard so far for PS3 comes from Pacific Crest Securities, which believes that PS3 will hit shelves in Japan in summer, then in November in the USA, in both cases with a million units at launch, with a European launch to follow in early 2007.
Under that model, there could be as few as 2.5 to 3 million units of the PS3 worldwide by the end of 2006 - leaving Sony with a huge margin to make up over Microsoft, which expects to have shipped 4.5 to 5.5 million units by this June, let alone next Christmas. If you were to take Pacific Crest's model to heart, you'd have to question whether PS3 was in for an even tougher launch period than Xbox 360 experienced in the run-up to Christmas - and even after such a forecast, the firm's analyst also suggests that manufacturing difficulties could push the console back even further.
That doesn't tie in with what we've heard from publishers in Europe, several of whom have told us that Sony seems adamant on the question of shipping in Europe within 2006 - with a slip to 2007 being avoided "at all costs". It also disagrees with comments from a senior executive at Pioneer, one of Sony's Blu-Ray partners, who claims to have heard that four to seven million PS3 units will ship this year - a rather more healthy figure, and one which suggests a far stronger Christmas than more pessimistic forecasts might suggest.
At the end of the day, much depends on both Blu-Ray and Cell. The former may, to some extent, determine the price point of PS3 - although we're sceptical of claims that a drive targeted at consumers is really going to push the cost of the console up by the hundreds of dollars some commentators seem to believe. The latter will almost certainly determine the shipment figures, with yields from IBM and Sony's plants of this complex chip defining in a very absolute way how many PS3s can be sold.
And ultimately, those two factors are still unknown quantities - about which no analyst really knows any more than any well-informed person in the industry does. Blu-Ray may drive costs up; Cell may drive shipments down; we simply don't know, and won't know for sure until either of those eventualities actually becomes real - or not, as the case may be. Under the circumstances, there's little hard information out there to help the unfortunate people who need to make decisions now about how to handle the PS3 launch - and on a topic like this, it's important to bear in mind, when reading analyst reports or comments from third parties, that your guess probably actually is just as good as theirs.
http://gamesindustry.biz/content_page.php?aid=14211
I find it to be a very good description of the current situation.
Comment: PS3 predictions are all shooting in the dark
Rob Fahey 14:26 23/01/2006
Sony's plans for the launch of PlayStation 3 are likely to be one of the biggest factors defining publisher and developer planning for 2006 - but in the absence of hard facts, it's essential to be wary of uninformed speculation, says Rob Fahey.
We'd like to express our sympathy to anyone reading this who is, as some of you probably are, in the unfortunate situation of having to make business decisions based around the launch of PlayStation 3 later this year. In the wake of Microsoft's Xbox 360 launch, with all its attendant supply problems (which are still afflicting retail even now), deciding how to treat a next-generation console launch from a publisher or developer perspective right now is a game not dissimilar to playing Snakes and Ladders. While blindfolded. In a room full of hyperactive monkeys. (crossbar: i.e. analysts).
The situation is hindered significantly by the fact that every pundit has a wildly different view on how Sony's PS3 launch is going to pan out. Typically, US analysts - who often favour the Xbox 360 to take a large chunk of the market in the next generation - seem to be downbeat on the prospects for PS3's early days, while Japanese analysts are generally more convinced by Sony's plans. Those in the Blu-Ray camp are convinced that PS3 will be a conquering hero, HD-DVD's supporters talk darkly about the console costing roughly the national GDP of Sweden to purchase and being shipped in numbers that you can count without having to use all your fingers and toes.
We have a great deal of respect for many analysts in the videogames sector, who have gone to great lengths to gain a deep understanding of the marketplace and its players, and who intelligently apply that knowledge and the insight they gain from countless conversations with industry players across the value chain to make rational and well-argued, if not always entirely accurate, predictions. The videogames industry analysts at Wedbush Morgan Securities and Banc of America Securities both spring to mind in this camp, and they are by no means alone.
However, some of the predictions flying forth this week from analysts have caused raised eyebrows, not least since they are so radically at odds with the message coming out of the industry. The most pessimistic prediction we've heard so far for PS3 comes from Pacific Crest Securities, which believes that PS3 will hit shelves in Japan in summer, then in November in the USA, in both cases with a million units at launch, with a European launch to follow in early 2007.
Under that model, there could be as few as 2.5 to 3 million units of the PS3 worldwide by the end of 2006 - leaving Sony with a huge margin to make up over Microsoft, which expects to have shipped 4.5 to 5.5 million units by this June, let alone next Christmas. If you were to take Pacific Crest's model to heart, you'd have to question whether PS3 was in for an even tougher launch period than Xbox 360 experienced in the run-up to Christmas - and even after such a forecast, the firm's analyst also suggests that manufacturing difficulties could push the console back even further.
That doesn't tie in with what we've heard from publishers in Europe, several of whom have told us that Sony seems adamant on the question of shipping in Europe within 2006 - with a slip to 2007 being avoided "at all costs". It also disagrees with comments from a senior executive at Pioneer, one of Sony's Blu-Ray partners, who claims to have heard that four to seven million PS3 units will ship this year - a rather more healthy figure, and one which suggests a far stronger Christmas than more pessimistic forecasts might suggest.
At the end of the day, much depends on both Blu-Ray and Cell. The former may, to some extent, determine the price point of PS3 - although we're sceptical of claims that a drive targeted at consumers is really going to push the cost of the console up by the hundreds of dollars some commentators seem to believe. The latter will almost certainly determine the shipment figures, with yields from IBM and Sony's plants of this complex chip defining in a very absolute way how many PS3s can be sold.
And ultimately, those two factors are still unknown quantities - about which no analyst really knows any more than any well-informed person in the industry does. Blu-Ray may drive costs up; Cell may drive shipments down; we simply don't know, and won't know for sure until either of those eventualities actually becomes real - or not, as the case may be. Under the circumstances, there's little hard information out there to help the unfortunate people who need to make decisions now about how to handle the PS3 launch - and on a topic like this, it's important to bear in mind, when reading analyst reports or comments from third parties, that your guess probably actually is just as good as theirs.
http://gamesindustry.biz/content_page.php?aid=14211