Xbox One vs PS4: The console kings' battle for Christmas
Thursday 12 December 2013
Microsoft has sold 2 million of its new games console Xbox One since its launch, the computer giant announced yesterday, catching up to rival Sony's Playstation 4.
The Xbox One, launched in the UK on 22 November, took 18 days to hit the sales landmark, while Sony, which launched its console a week earlier, sold 2.1 million of its Playstation 4 in just 15 days.
Yusuf Mehdi, Xbox's vice president of strategy and marketing, said the company has been "humbled and overwhelmed" by sales of its console, adding: "Demand is exceeding supply in our 13 launch markets and Xbox One is sold out at most retailers."
Sony and Microsoft are both hoping their consoles will be crowned king of the UK's estimated £3.7bn gaming market this Christmas and so far, despite Playstation's headstart, they're neck and neck.
"It's a better result than probably was expected for Xbox One, especially in Europe where the price difference is a lot greater," says Ian Maude, an analyst at of Enders Analysis who looks at the space.
The Xbox One sells for £429.99 in the UK, while the PS4 retails for £349.99. Microsoft is marketing its machine as a more high-end 'home entertainment system', with built-in features like Skype, YouTube and Netflix.
Microsoft's console also includes a motion-sensor, Kinect, whereas Playstation 4 gamers must shell out extra to get the equivalent feature. Other than that, there's little to difference, says Maude.
"Essentially they offer a very similar experience. It's as much about market positioning as it is about the reality."
Retailers are fighting tooth and nail for consumers' cash this Christmas but perhaps no sales rivalry is as fierce as Xbox versus Playstation. While Christmas is not the be all and end all, it is hugely significant for the overall success of both consoles.
"It's absolutely crucial that they get their pricing strategy, marketing and advertising right because the stakes are so much higher at Christmas," says Mr Maude.
"They're in a battle for domination of the console market."
Both firms pulled out all the stops for the launch events of their rival devices. Microsoft took over Leicester Square for the UK launch of the Xbox One, while Tinie Tempah played the Covent Garden launch of Sony's console.
The response from gamers matched the promotional drive, with fans around the world queuing up to be the first to get their hands on the machines. Both firms sold a million in the first 24 hours.
"What you're seeing at the moment is the fanatical, hardcore gamers who would probably sell their house to get hold of one of these consoles," says Maude. "Once we're through the Christmas period you'll start to get a better sense of how these two are doing. There are some big releases coming in spring."
Games like Metal Gear Solid 5, DriveClub and Watchdogs will bring in big bucks for both Sony and Microsoft, as it's the games themselves where both companies make their money.
"It's the Gillette razor and blades strategy," says Mr Maude. "Both Sony and Microsoft are selling these consoles at close to cost and make their money out of the licensing fees from the games."
Ultimately, both consoles will probably share the market – but spare a thought for Nintendo. Once the flagbearer for the industry, the Japanese gaming company's latest console, the Wii U, sold fewer units in nine months than Sony and Microsoft each sold in 24 hours.
Nintendo's move towards family-orientated, social gaming with its Wii console in 2006, coincided calamitously with the rise of smartphones.
"Wii is really now competing with tablets and smartphones rather than Xbox and Playstation," says Mr Maude. "They're not really in it anymore. It's finished."
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