Quote:
Originally Posted by fjtorres
In the video game industry, which ebooks are starting to resemble, there is an important term that exemplifies the fact that not all customers are equally valuable to a platform holder: attach rate. At its simplest, this is the ratio of unit game sales divided by the number of unit consoles sold. This current console generation, the Nintendo Wii has clearly outsold the second place Xbox 360 in total number of consoles sold, yet the 360 regularly ranks way higher in total game sales and has recently been generating more game software revenue than the Wii and Sony PS3 combined. This is due to a combination of factors but it is mostly due to the Xbox managers' relentless focus on marketing the 360 as a gaming platform for serious gamers. Where the Wii drew in buyers who hadn't previously owned game consoles and Sony drew in buyers interested in the PS3 as a bluray player, Microsoft drew in a disproportionate share of buyers who's primary interest was gaming and routinely bought 8-10 or more games a year. In simple attach rate terms, the average Xbox owner has bought 9+ games per console while Sony and Nintendo buyers average more like 6 games. And this in an industry with healthy used and rental businesses on the side.
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I've owned all 3 of these devices, and the 360 is the only one I still own. Wii got the boot when the games failed to mature (though I admit that Boom Blox was more fun than I expected), but my parents, my grandparents, my in-laws, and several of my young cousins (younger than 10) all own Wiis. But, as you note, these are not the demographics that
buy games. The PS3 games just don't grab me. Meanwhile, Xbox 360 continually puts out games I want to play, and so I buy them.
It's fascinating stuff, how a system can be a commercial success (I can't speak to profits), but the recurring revenue stream just isn't there. Amazon nailed it with it's hardware and tie-in store.