Analysts Predict Consoles Sales Peak Reached

Thanks to Yahoo News for reprinting the press release regarding financial analysts' predictions that the current videogame console cycle has peaked. According to a spokesman for U.S. Bancorp Piper Jaffray, "We believe spring 2003 marked the midpoint of the current video game cycle", suggesting 2003 "will be the peak year for unit sales of current generation hardware." This may mean leaner times before the next generation of console hardware debuts, predicted by Piper Jaffray for "autumn 2006", and meanwhile, the company is forecasting "...that 22.3 million hardware units will be sold in North America in 2003, a modest increase from 21.1 million units in 2002 and will subsequently decline in 2004 to sales of 20.3 million units as the installed base of video game hardware becomes saturated."

Comments

Leaner times?

[Ondo]

This may mean leaner times before the next generation of console hardware debuts

Not really. Even the companies that don't lose money on their console sales aren't making a whole lot. Game sales are what is important, and the larger installed base should help those.

Re:Leaner times?

[simoniker]

But then again, if the amount of console software out there are still rising at a certain rate, but the hardware no longer increases at that rate, it still may be a problem - although I agree, not a cosmically bad situation.

Actually, I think more a problem toward the end of a console's life cycle is the amount of good quality older games available at budget prices, and the quick pricing-down of new titles because there's such a glut on the market. But this is probably separate of install-base.

Is there any particular reason to listen to this?

[Snowmit]

Who are these guys? Do they speak with any authority on this subject? I read the article and as far as I can tell they're a bunch of financial analysts. Do they have a history of predicting this kind of thing accurately? Is there any reason to listen to these predictions?