- Xbox 360 will not be coming to the rescue of the industry any time soon.
- Supply to the U.S could be about 300,000 units a month, at best.
- We do not expect sales of next generation software offsetting the current generation software sales decline until the PS3 and Revolution are launched.
Although it doesn't come right out and say it, the details of the report also indicate Microsoft won't make the fiscal year sales goals it reaffirmed just three weeks ago.
- First, note that between 850,000 and 900,000 Xbox 360s were sold through January 2006 (using NPDs and Microsoft's estimates, respectively).
- Second, Wedbush Morgan estimates that Microsoft can sell at most 300,000 Xbox 360s per month in North America for the next few months.
- Add these up and Microsoft can hope to have sold at most 2.4 million Xbox 360s in North America by 30 June 2006.
Regardless, with reports like the one from WMS and Activision recently pointing a finger of blame for its own reduced earnings, Microsoft isn't exactly optimizing the headstart it said was critical to taking the crown from Sony this generation. As Ruffin said recently, "[w]hen you consider how quickly hardware goes out of date, this seems like the largest of blunders."
With the PS3 delayed possibly till 2007, and likely to cost around $900 according to a Merrill-Lynch report, I still won't count out the 360 yet. That's a BIG first-mover advantage -- enough time for Microsoft to resolve the hardware issues, cut costs, and pressure even Japanese developers to pump out some noteworthy titles for their platform.