Why the Xbox 360 will outsell the Wii

Firstly let’s look at how the numbers stack up. According to the best guesses there are about 30 million Nintendo Wiis in the world, 20 million Microsoft Xbox 360s and 15 million Sony Playstation PS3s. So the Wii has currently sold 50% more than the 360. And 10 million is a lot of units to make up. Here is how it will happen:

  • As this site has been predicting for a long time the Xbox 360 is now $199. This is the price point at which historically 75% of consoles sell. However the 360 has got to this point very early in its life, so far, far more than 75% of 360 sales are yet to happen. Currently the Wii is above the magic $199 price point, expect it to come down as predicted here. But even at a new, low, price point the Wii will have difficulty in perceived value against the Xbox 360.
  • Sony are making massive losses on the PS3 so cannot bring the price down. All they have been able to do recently is pass on lower hard drive prices by giving customers bigger drives at the same price. As the PS3 and the Xbox 360 are very similar in their capabilities Sony will now lose a huge number of potential sales to the Xbox 360.
  • The Wii is for many people little more than a glorified toy. It is just a box for playing Wii Sports or Wii Fit. If these people want proper gaming they will buy a 360.
  • The 360 has by far the best catalogue of games in this generation. This is because they launched first, because it is far easier to develop for than the PS3, because Microsoft have invested a lot in exclusives and because 360 owners buy more games than owners of the other consoles. The Wii has some brilliant first party exclusives, but these are relatively few and most third party games are little more than shovelware.
  • The Wii is very stunted in capabilites being largely just an uprated gamecube. It’s capabilities are far behind those of the Xbox 360. This is especially damaging in the lack of HDTV support and a hard drive. Comparing the two machines side by side is like looking ar a Ferrari next to a bicycle.
  • The Wii is going to have a very short production life, perhaps four years, before it is replaced by a SuperWii that will correct its weaknesses. The Xbox 360 is going to be in production for at least eight years, the last half of that life as the low cost partner to the Xbox 720 (Phoenix) in a two model range. So the 360 has a long time to catch up and overtake the Wii for total sales.
  • The 360 is being engineered into a single chip (+memory) combining the GPU and CPU. The effects of Moore’s Law are such that this will become cheap enough to incorporate into televisions, which Microsoft seem to be gearing up to do. Nintendo have no chance here with the Wii, who would want a non HD console built into their HDTV?
  • The Xbox 360 has Xbox live which is by far the best online gaming portal there is. Microsoft have built a formidable USP here and are not about to lose it anytime soon. They will invest what it takes to keep their online offering well ahead of those of its competitors. So great will the power of live become that every keen gamer will be forced to buy the hardware necessary to access it, just so as to remain a viable member of the gaming community.
  • Microsoft have now made the Xbox 360 commercially viable in Japan by creating the games that the Japanese want. This is a huge turnaround and adds a lot to the potential total sales of the console.

The success of the 360 goes against Microsoft’s traditions, normally they wait for the third iteration of a product to become the market leader. And of course if you add the sales of the Wii to the sales of the SuperWii then Nintendo have the potential to still end up ahead.

25 comments ↓

#1 Jay on 09.08.08 at 7:57 am

With all the great games coming out this holiday season and the lowered price point I don’t see any reason why people won’t jump on the xbox band wagon. Now is a great time to be a gamer Great article.

#2 Callous on 09.08.08 at 1:00 pm

You don’t honestly believe this?

I suppose the 360 has a slim chance of outselling the Wii in the US..but not a chance worldwide.

As you live in Europe you must realise that over here the 360 has been around $60 cheaper than the Wii for about 6 months..and yet the Wii still outsells it by around 3-1.

All the reasons you’re giving for a 360 win..are the same reasons that were being spouted by analysts from day one.

The masses don’t care.

The masses see the 360 as a hardcore gaming machine (with a poor build quality) aimed at hardcore gaming geeks….and it won’t shake that image IMO.

#3 Chris on 09.09.08 at 1:55 am

Agreed with the poster above. The 360 is a fine gaming machine, but it’s aimed at traditional gamers. That group is a relatively small group compared to the size of the audience that Nintendo is successfully courting. Even if those people are buying the Wii for Wii Fit and Wii Sports, they are still buying Wiis, and that console will continue to lead the market as long as the software remains popular.

We (by ‘we’ I mean the game industry) believe the 360 to be a “better” machine because it has better technical specs, a more mature line-up of games, and some fantastic features like Xbox Live, but those features are all pretty much inconsequential to the masses. A person who buys a Wii for Wii Fit (or even for Rock Band) isn’t necessarily interested in Bioshock or Portal or Halo 3; we should be careful not to project our opinions upon the market as a whole.

It does remain to be seen if Nintendo can maintain its current momentum or not, but even if they can’t I think that their platform has been designed to be fundamentally appealing to a much wider range of people, so at least as far as sell-through is concerned, they have this gen buttoned up.

#4 JC Barnett on 09.09.08 at 2:32 am

I think Bruce has sneakily moved the emphasis on this blog from editorials to comedy satire.

#5 Ronnano on 09.09.08 at 10:51 am

The wii launched a year later, and are still 10 million units ahead of the x360 with absolutely no sign of slowing down (i’m 99% sure that it will even increase its monthly sales vs x360 because of increased production). The war is clearly won by nintendo this generation, one has to have an incredible lack of business intelligence to not see that (or blind fanboy mentality).

#6 ramparter on 09.09.08 at 12:20 pm

Nice article, now you only have to explain how Ferraris can sell more than bicycles…

#7 Marc on 09.09.08 at 12:25 pm

The fact alone that the Wii, being out a year less and the only console of the current 3 without a price drop, still outsells the others every single month is all the proof I need that this generation has already been claimed by Nintendo. If anyone has a chance of beating them, it is SONY because people will get the PS3 for the Blue Ray player. The 360 has no HD-DVD to brag about any more, so that is out. The fact that the price has dropped again so fast indicates that Microsoft is getting desperate for sales and is obviously afraid of the power of the Wii. You don’t lower your price when you can still sell out at a higher one (ie, Nintendo Wii). The 360 does have better on-line, agreed, but the majorty of the gaming market isn’t basing their decision entirely around that one area.

#8 Basher on 09.09.08 at 2:36 pm

You people posting here need to get your heads out of the sand. It is the fate of the ignorant to deny truth in the face of fact. I am a video / gaming store owner, and I’ll tell you right now, every sales pattern we see these days confirms that Bruce is dead on. You’re all going to have to accept that.

#9 Stephen Williams on 09.09.08 at 2:38 pm

360 is probably going to be first generation. No just kidding. Look at the facts the 360 has been out for a year longer than the wii and is millions in sales behind the wii is pretty much every country. And the wii is ahead in the one place that counts most the USA. And being cheaper means nothing when the hardware is unreliable. This the worst console hardware made. The original xbox has better made than this one which just bad. And people hear the stories and stay away from this console. And someone else posted that it has been cut in place in other places and is not even outselling the ps3, so how do you expect them to outsell the wii. So in the end the 360 will be dead last this gen.

#10 Raphael on 09.09.08 at 2:57 pm

RE: Marc
Nor are the masses basing their purchase of a GAMING SYSTEM on a Blu-Ray player. Personally, I care about how my gaming system plays games, not movies.

#11 W_in_Disguise on 09.09.08 at 3:02 pm

Aww, someone’s still butthurt that their favorite console lost the sales battle. Boo hoo!

Cheer up, slick, there’s always next generation. In the meantime, how about maturing a little bit and stop caring so much who’s winning the battle for sales. Start focusing on what you became a gamer for – games, and start enjoying them. If half you fanbots put as much time into playing the consoles you tout as so utterly superior to the competition as you did whining/crying/carrying on about how BLAH’s the best and BLEH sucks, you’d probably be able to win enough MLG tournaments to have your OWN gaming brand.

#12 stedaman on 09.09.08 at 4:05 pm

You don’t honesty think the xbox360 will outsellf the wii do you?

The expanded audience don’t care about the machine, even if the price is $199 in the US.

The xbox360 has been out a year longer, and the gap between wii and the 360 is already significant.
The PS3 will beat xbox360 with sales….nevermind the wii.

#13 Robin on 09.09.08 at 4:42 pm

Oh, Bruce.

Point by point:

1. Firstly, read this: http://venturebeat.com/2008/09/05/xbox-360-defects-an-inside-history-of-microsofts-video-game-console-woes/ – Microsoft have been very slow to bring the price down to the magic $199. You neglect to mention that it’s only the crippled HDD-less version of the machine that retails at this price, making it useless for digital distribution (or much else) without incurring hidden costs. And it is not the price alone that is driving Wii sales.

2. Obviously Sony will continue to drive down the price of the PS3. The fact that the HDD and Blu-Ray drive are standard components means that they can’t mask the true price of the machine with a ‘lite’ version, is all.

3. ChartTrack suggest otherwise. Yes, there are probably a lot of Wiis that are only going to be used for one or two games, but that doesn’t translate into Xbox sales.

4. The 360′s catalogue is strong, but the PC and PS3 seem to be encroaching on it further with each passing month. It’s difficult to point out enough exclusives to clearly favour purchasing a 360 today, taking into account the reliability issues, the lack of HD movie playback, the technical roughness compared to the same games on a midrange PC, etc.

5. The Wii is as powerful as it needs to be, you see. For all the 360′s technical might, there seem to be an awful lot of games with sub 30-fps framerates, screen tearing and interminable loading pauses (more fallout from the decision to make the HDD optional).

6. So you predict that both machines are going to be replaced with upgraded versions rather than new platforms (which is probably right). If the ‘SuperWii’ corrects the perceived shortcomings of the Wii, why would the vastly larger Wii userbase change horses midstream?

7. The single-chip solution is to allow a smaller, cheaper machine (like the psTwo), not to integrate consoles into televisions.

8. Xbox Live is a terrific proprietary, interim solution for an online service. Just like AOL and Compuserve were in the early 1990s. Nobody is going to be forced to use it as it only works on a minority platform and Microsoft are strategically incapable of cooperating with other platform holders.

9. You evidently didn’t take on board the comments when you originally posted this piece of hyperbolic cheerleading.

#14 EdEN on 09.09.08 at 5:17 pm

Sorry, but the failure rate of the 360 means I’ll never buy one. I own a Wii and have bought over 50 games since release and it, along with a PS2 and a DS, are enough for my gaming fun for now. The 360 released earlier and a year advantage from the Wii means nothing in the present since it has been surpassed by the Wii by over 10 million units.

I’m considering buying a PS3 as a Blu Ray player and for about 5-6 games I’m interested in… but mostly as a BR player since I just bought a 1080p LCD.

Bruce, the 360 has been cheaper than the Wii on Europe for a while and it’s still being outsold by Nintendo by a large margin. A price cut in the US means nothing unless said price cut is reflected in THE WHOLE CONTINENT and the Wii is not manufactured for 6 months…

Graphics are great, but having fun while PLAYING (think about it for a second) is what matters.

The Legend of Zelda: Twilight Princess, Excite Truck, Wario Ware: Smooth Moves, Elebits, Resident Evil: Umbrella Chronicles, Zach & Wiki, Trauma Center: Second Opinion, Trauma Center: New Blood, Super Paper Mario, Metroid Prime 3, Super Mario Galaxy,
Batallion Wars II, Cooking Mama, Fire Emblem, Rayman Raving Rabbids, Rayman Raving Rabbids 2, Red Steel,
Nights: Journey into Dreams, Mario & Sonic at the Olympics, Mario Strikers Charged, Dewy’s Adventure,
Link’s Crossbow Training, Ghost Squad, Wii Fit, Wii Sports, Endless Ocean, Mercury Meltdown, Okami, Opoona, Guitar Hero III, Geometry Wars, Harvey Birdman, Tomb Raider Anniversary, Dragonblade, Dragon Quest Swords, Pinball Hall of Fame: The Williams Collection, Chicken Little: Ace in Action, Kororinpa (just to name a few) and all the Virtual Console and Wiiware games a new Wii owner can purchase overwhelms what either the PS3 or 360 can offer as a whole to all demographics.

#15 bobsagget on 09.09.08 at 11:54 pm

I’m pretty sure this is a joke, because there’s no way he could be so stupid and still figure out how to make a website.

this was pretty funny, keep up the good work!

#16 Darius on 09.10.08 at 6:48 am

To the author:

I’m sure this is going to blow your mind, but I had a 360 once, sold it, and bought a Wii. Based on the tone of your article, I’d say you still have a lot to learn about casual gamers. I’ll give you 2 hints:

1. Imagine if you only spent an hour or two playing video games every week, either because that’s alll the time you had or all the time you want to spend on the hobby. Do you think that would change the kind of games you play? suddenly, those ‘pick up and play’ games you used to turn your nose up at suddenly become more appealing, because just one of those 30-40 hour epics enjoyed by the hardcore crowd would take you about 6 months to finish. What little time you had to go online and play your favorite FPS would result in you getting your ass kicked, because you don’t spend 30+ hours a week glued to the console like your competition does.

2. Imagine if you spent most of your time playing games with your spouse, parents, or people that don’t normally play video games and wouldn’t go near a controller with 14+ buttons and 2 analog sticks. What kind of games would you be playing

Are you starting to get the point???

#17 Nick on 09.10.08 at 5:35 pm

“The Wii is for many people little more than a glorified toy. It is just a box for playing Wii Sports or Wii Fit. If these people want proper gaming they will buy a 360.”

Oh really? How much research did you do? I can tell you I have more than just Wii Sports (and I don’t even have Wii Fit).

Sorry the Wii isn’t as “serious” (since I guess that’s what gaming needs to be) as the 360.

And even though the 360 costs less than the Wii, you can’t really do anything with it. Games on the 360 assume you have some decent storage, and a 256MB card isn’t going to cut it.

#18 Scarface on 09.13.08 at 11:41 am

absolutly no chance in hell for xbox to catch up wii. right now it is almost certain that the xbox 360 will finish way below both sony and nintendo. microsoftshould be embarased with the sales. the xbox is getting outsold by ps3 everywhere in the world but sometimes it picks out wins in america and look at the price difference! ps3 is twice as much! my point is that, the 360 will probably never ever outsell the ps3 again never mind the wii.

#19 zerohour on 09.15.08 at 7:23 am

I like how the author thinks its a given that 75% of Microsofts sales will come once its hit 200 dollars. Did that happen when the xbox one got to that price? Or the GameCube?? The Playstations are the ones that have done that. I honestly cannot see Microsoft beating Sony never mind Nintendo!

#20 Rale on 09.21.08 at 3:01 pm

This is sheer idiocy. 360 is a last-gen console with boring games. It was discounted because nobody wants to buy it.

#21 Buzz on 09.23.08 at 6:03 am

Curious how the PS2 had the worst graphics and whatnot for its generation, yet it totally dominated the sales charts for an eternity. Then, Sony attempted to EXPLOIT its customers by selling an overpriced, overpowered black brick. It turns out they weren’t as loyal as Sony would’ve hoped.

Want another example? The DS is dominating the handheld market despite PSP having much stronger specs.

When are you gonna get it through your head that no amount of excuses will explain away the Wii’s success? “Oh, the Wii only appeals to soccer moms.” “The Wii had weak specs; it won’t last.” All the more power to Nintendo! Sony and Microsoft lost out on the opportunity to collect on the millions of soccer moms; way to dominate the “hardcore market”, guys!

#22 NE on 10.04.08 at 11:46 am

I think the person who said “Nice article, now you only have to explain how Ferraris can sell more than bicycles…” said it all

#23 HeHe on 10.12.08 at 12:36 pm

Following years of industry experience is how Sony and Microsoft lost this generation. It’s not suprising that some people still haven’t come to terms with it. Bruce is a great example. Next, he’ll be telling us that Microsoft has made a profit from the Xbox brand.

#24 Wormwood Snortskagle on 02.02.09 at 11:04 pm

I don’t see how X outselling Y which outsells Z is relevant to which system is better. It merely shows the demographics of what the consumer base wants.

XBOX 360 and PS3 have by far better systems as well as better games than Wii, but the people who buy Wiis don’t necessarily want better systems or games. Parents who want child friendly games are going to go with Wii and their cartoon games vs. 360/PS3 and their gruesomely detailed combat games. Families with little pocket money to spare…especially these days… are going to be more interested in a $200 system than they would be in a $400/$500 system. And so on. There are naturally going to be more concerned parents and families on a budget than there are people who enjoy killing blood spurting zombies with chain saws.

The Wii people need to reconsider what their fanboy enthusiasm really means, as it doesn’t really highlight their case for the Wii to us veteran zombie killers when their audience includes mothers buying Wiis for their 8 year olds who race cute go-carts with Mario and that giant turtle thing.

#25 james braselton on 04.18.10 at 4:10 pm

hi there wait a minite i am not intrestested in $200 gaming consoles i am intrested in $1,100 supper high tech gaming consoles like ps 4 or ps 12/2 xbox 720 nintedo 3DS or ipad and ipen powered buy nasa/intel cpu coreless cpu 100 terabytes of ram 4,095 terabytes of light speed ram disk 300 hour battery life 5 miniute recharge a 24 inch multi-touch screen resolution 10,000 by 8,000

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