NPD August 2007

NPD data for August is in.  Hardware unit sales:

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Nothing too surprising here – Wii again sold through all available stock, DS maintained its excellent performance, and PSP dropped sharply amidst widespread sellout in July.  The Xbox 360 saw a healthy sales increase following a 30-50 dollar price cut (depending on SKU) at the start of the reporting period.

PS3 failed to maintain any momentum from its early July price cut, and while late-August-launching games Lair and Warhawk performed solidly (46.5K and 58.6K respectively), there are few software releases between now and Spring ‘08 (when Metal Gear Solid 4 and Final Fantasy XIII could first potentially see release) that will help Sony gain any sort of traction with consumers.  With the likes of Halo 3 and Super Mario Galaxy releasing on 360 and Wii before Christmas, the PS3 has very little hope of maintaining enough mindshare to remain competitive throughout the winter into the spring – even with the aforementioned AAA releases waiting in the wings.

To maintain any hope of redemption next year, Sony has to drop the price again before the holiday season (or introduce a new, lower priced SKU, as has been recently rumored).  If August has shown anything, it’s that price really is the key to mass market hardware sales.

Get this:  In July, PS3 saw a 61.4% increase over June after its 100 dollar price cut – pretty good, all things considered (slow summer months, unappealing software library, etc).  But in August, Xbox 360 sales increased 62.7% over July – and with only a 30-50 dollar cut!  While some of this can of course be attributed to the undeniably strong software library of the 360, there is no doubt that a mass market price is crucial for long term success.

Bottom line:  A PS3 SKU at $399 by November could potentially allow Sony to keep its head above water long enough for Metal Gear Solid 4, Final Fantasy XIII and Grand Tourismo 4 to bring the system back to relevancy.  Unfortunately, even this drastic move (a $200 price cut over 6 months would be unprecedented) might prove ineffective in light of Wii’s continuing momentum and 360’s upcoming Halo 3 onslaught.

Thanks to NPD and sonycowboy at NeoGAF for the numbers.

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