Sep 22nd, 2015

pachter

According to Wedbush analyst Michael Pachter, game consoles as dedicated devices are going the way of the Dodo. Pachter spoke at DICE Europe last week and during that presentation, he commented that the install base for dedicated gaming hardware isn’t likely to grow beyond the 270 million units that defined the last generation.

The console installed base is as big as it’s ever going to get. [This] generation is not going to be bigger than the last generation. We’re going to be about the same.

The Wii U is going to sell 20 million units compared to 100 million for the Wii. The PlayStation 4 is going to sell 120 million or 130 million – that’s great. The Xbox One will sell 100 million to 110 million – that’s great. Add it all together and it’s 260 million units, maybe, and the last cycle was 270 million.

This is the last real console cycle. I don’t mean that Microsoft, Sony and Nintendo will go bankrupt and shut down – they will not. Each of them will make another console, some people will buy them, and the next console cycle will be to this console cycle what the 3DS is to the DS. The 3DS is selling about 15 million units a year, the DS had five consecutive years where it sold more than 26 million. So about half as big.

So when I say that this console cycle is the last console cycle, the reason is that console games shouldn’t require a console. And I’m not talking about the cloud.

According to Pachter, as hardware from companies like Amazon become strong enough to play console-quality games, we’ll see less dependence on the big three to put out hardware. The hardware market is becoming diverse and despite Pachter’s predictions, home TV set-top boxes and micro-consoles like the Ouya have failed to gain any traction as gaming devices.

What do you think? Pachter isn’t denying that the big three will stop making hardware anymore, just that a dedicated gaming console isn’t as important as it used to be, especially with Microsoft and Sony now using x86 technology in both of their current-gen hardware.

local_offer    michael pachter  Nintendo  wii u