With the 3DS now planned to launch next year, Wedbush Morgan analyst Michael Pachter doesn't see many catalysts for the remainder of 2010, he said. While the Wii has certainly seen a decline, Pachter already told us previously that Nintendo isn't likely to drop the price just yet. Pachter believes that another round of price cuts is probably going to occur next spring, and Microsoft may lead that charge.
"We estimate that a $50 console price cut across the board will impact software sales by a positive 5%, and we expect Microsoft to lead with a cut some time in Spring 2011," he said.
Pachter also thinks 3DS and, to some extent, Move and Kinect should drive sales. "We think that Nintendo’s 3DS, scheduled for March release in the U.S. and Europe, has the potential to reinvigorate packaged product sales. Similarly, we think that Kinect and Move have the potential to drive console sales, broadening the installed base and giving new purchasers a reason to buy a greater number of packaged goods," he added.
None of the real sales impact will be felt until next year, and even though some great titles are coming out this fall and holiday season, the comparisons with last year remain tough. "There may be some commentary from the publishers about charging for premium multiplayer features, but we don’t expect these charges to be widely understood and adopted until early 2011. Although we see the potential for higher packaged goods sales in September and October, November presents a difficult comparison due to last year’s launch of Call of Duty Modern Warfare 2, and December has a difficult comparison due to aggressive price promotions at Wal-Mart. We think that console and handheld software sales in 2010 will end up in negative territory, offset by an increase in PC software from the launches of StarCraft II in July and World of Warcraft Cataclysm this quarter," he concluded.
1 Comments
October 4, 2010
Is "price cut" Pachter's answer for everything?