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EA Has Provided A New Combined Install Base Estimate for PS4 & XB1 (READ OP)

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VallenValiant

Banned
Member
Oct 27, 2017
1,244
Lol a low standard that one is. So you're saying that they rather people sell them than keep them? You know that is not true and that is the point I was trying to make
Actually, MS most likely would be VERY happy to have the 2nd hand console getting a new owner. Because the selling of a new console is low margin anyway, so it is more important that someone end up becoming part of the ecosystem via lower price of entry. Fundamentally the actual profit from selling a new console to someone is minuscule compared to the potential software sales and subscriptions.

This is why I argued previously that Sony would discontinue the PS4 Pro once PS5 is released. There would be enough PS4 Pro in the 2nd hand market that Sony doesn't need to make any more, and can focus on the PS5 production.
 
Oct 26, 2017
3,068
Actually, MS most likely would be VERY happy to have the 2nd hand console getting a new owner. Because the selling of a new console is low margin anyway, so it is more important that someone end up becoming part of the ecosystem via lower price of entry. Fundamentally the actual profit from selling a new console to someone is minuscule compared to the potential software sales and subscriptions.

This is why I argued previously that Sony would discontinue the PS4 Pro once PS5 is released. There would be enough PS4 Pro in the 2nd hand market that Sony doesn't need to make any more, and can focus on the PS5 production.
They would rather much prefer than the new owners buy the console they want from them new, though. Also, someone that can't afford a new console, which MS sells at a very discounted price normally, is not what you'd say a "prime" costumer, and probably just wants it to play Fortnite for free.( Although they can't because you have to pay to play Fortnite on the Xbox XD)

Edit: Mb that is the reason Fortnite is free on the PS5 but you have to pay to play it on the Xbox, a desperate attempt from MS to make at least some money of those used Xbox one sales :P
 

VallenValiant

Banned
Member
Oct 27, 2017
1,244
They would rather much prefer than the new owners buy the console they want from them new, though. Also, someone that can't afford a new console, which MS sells at a very discounted price normally, is not what you'd say a "prime" costumer, and probably just wants it to play Fortnite for free :P
This is where the "engagement" argument comes in.
You see, you argue that a customer who doesn't want to spend a lot of money in gaming is less valuable as a customer. But the reverse argument is that such a customer has the potential of changing his or her spending habits and thus diverting expendable income into Xbox in the future. A customer who is already spending all the money he has to spare in Xbox, is not going be able to offer more than what he has. But a new customer, low engagement he might be, has potential for adding to the money pool.

Trying to be selective and picky about who MS should get money from, is not a way to run a business. If you want MS to have less customers, then fine. But I don't think MS agrees with you.
 
Oct 28, 2017
676
Tokyo
They would rather much prefer than the new owners buy the console they want from them new, though. Also, someone that can't afford a new console, which MS sells at a very discounted price normally, is not what you'd say a "prime" costumer, and probably just wants it to play Fortnite for free.( Although they can't because you have to pay to play Fortnite on the Xbox XD)
Of course they would prefer someone buying new but between someone only willing to buy second hand or nothing... Second hand is the best option.
I mean people buying second hand consoles are not that uncommon...
 

boi

Member
Nov 1, 2017
730
Ok, but what do they represent?
ZhugeX said:
I'm not sure what the reason is for the discrepancy with EA's estimates.

It could be it excludes Pro/One X numbers.
It could be that EA excludes a territory like Japan (they used to do this last generation)
It could be that EA estimates PS4 at a lower number. (Which would be weird given Sony release the official numbers)
It could be that installed base =/= sell through in EA's eyes. So replacement consoles sold wouldn't count and only people actively using consoles would count?

EA's estimates aren't wrong. I'm just fairly certain one of the above things is true.

Ultimately what we do know is PS4 sell through was 73.6m at the end of 2017. Xbox One is less than half of that total which shows the big gap between the two in terms of sales. But that's something that has been known for a long time.
 
Oct 27, 2017
6,947
UK
In any case it's not MS is happy that some people are selling their old SKU, far from it., because they don't see a dime. They rather people keep it and new owners buy a new one from them, not a used one from somebody else
You couldn't be more wrong and this makes it clear that you don't understand this business.

The X was sold at a loss at launch, and on both PS4 and XBO console hardware, the profit margins are microscopic. The platform holders make their profits on 1) physical game licensing fees, 2) accessories, 3) digital store sales, and 4) subscription services.

So they'd absolutely love someone to sell their old console to someone else. The console hardware is nothing but a trojan horse.
 
Oct 28, 2017
892
Vail, CO
There is a reason that MS won't talk numbers, and Sony and Nintendo will. The interesting part here is that it looks not only possible, but likely that MS is in a solid third place by the end of 2019. The Switch will pass it sometime next year, especially after Pokemon is announced. We know that if Pokemon doesn't make it this year, it definitely will in 2019. A new Halo will come out sometime soon, and bump MS numbers in the US, but worldwide the numbers are pretty terrible for a system that is almost five years old now.

MS will hopefully provide a better value proposition in the next few years, and get back to being competitive with Sony
 
Nov 12, 2017
946
No I think you missed my point. I'm not arguing about what information Microsoft should or shouldn't be releasing. What I'm saying is that console sales (whilst important) don't tell the whole story. We know that, and it's why engagement is a useful measure. Engagement is the end-game, console sales are a major part of getting there. Microsoft's publicly announced numbers are irrelevant as they'll share far more detail on them with their partners under NDA.
How can consumers engage if there are no point of access sold (consoles/units)? Unit sales are extremely important.

Every company attempts to create an ecosystem (XBL, PS , iOS, Android, etc) for market penetration and profitability. Xbox cannot achieve this unless Xbox consoles are sold.

Is Xbox broke? Hell naw. However, its competition is just destroying them. Which is why Spencer & Co. choose not to disclose the unit sales.
 
Oct 27, 2017
6,947
UK
How can consumers engage if there are no point of access sold (consoles/units)? Unit sales are extremely important.

Every company attempts to create an ecosystem (XBL, PS , iOS, Android, etc) for market penetration and profitability. Xbox cannot achieve this unless Xbox consoles are sold.

Is Xbox broke? Hell naw. However, its competition is just destroying them. Which is why Spencer & Co. choose not to disclose the unit sales.
Did you actually read my post that you just quoted?

"Engagement is the end-game, console sales are a major part of getting there."

The platform holders have two jobs. 1) Selling as many consoles as possible and 2) Getting those console users engaged in the ecosystem. They go hand in hand. Obviously it's possible that one platform holder could do slightly worse on point 1 and slightly better on point 2. Or vice versa. A good example would be Nintendo compared to Sony - even if they both sell the same number of consoles I'd be willing to bet Sony would be making a hell of a lot more revenue through their online ecosystem.
 
Oct 26, 2017
3,068
Of course they would prefer someone buying new but between someone only willing to buy second hand or nothing... Second hand is the best option.
I mean people buying second hand consoles are not that uncommon...
Certainly not! I did not say that though.

You couldn't be more wrong and this makes it clear that you don't understand this business.

The X was sold at a loss at launch, and on both PS4 and XBO console hardware, the profit margins are microscopic. The platform holders make their profits on 1) physical game licensing fees, 2) accessories, 3) digital store sales, and 4) subscription services.

So they'd absolutely love someone to sell their old console to someone else. The console hardware is nothing but a trojan horse.
Personal attacks now I see? I know the PS4 was sold at a loss, which people has estimated to be around 60$.

But that was in 2013, my friend. We are in 2018. 5 years later the price of materials has gone down, so they're are not selling them at a loss now. See the difference?

I definitelly see who doesn't understand the bussines from the 2 of us, if that is any help...

This is where the "engagement" argument comes in.
You see, you argue that a customer who doesn't want to spend a lot of money in gaming is less valuable as a customer. But the reverse argument is that such a customer has the potential of changing his or her spending habits and thus diverting expendable income into Xbox in the future. A customer who is already spending all the money he has to spare in Xbox, is not going be able to offer more than what he has. But a new customer, low engagement he might be, has potential for adding to the money pool.

Trying to be selective and picky about who MS should get money from, is not a way to run a business. If you want MS to have less customers, then fine. But I don't think MS agrees with you.
And I don't either because that is not what I said You are using a straw-man argument, dude. Worse, you'r putting words in my mouth

You are comparing a "low-budget" costumer vs a non-costumer. Of course it's better to have a new one than not to have a new one. I was comparing a "low-budget" one vs a new one. Someone that buys the console used vs someone that buys the console new.

Of course MS rather have as the new user someone that buys the console new, than someone that buys it second hand. And if possible the X and not the S. That was my argument.

Obviously if the options are second hand or nothing, second hand is better than nothing, like Funkallero was saying up above. (But that is what is called a "false duality)
 
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Oct 27, 2017
6,947
UK
Personal attacks now I see? I know the PS4 was sold at a loss, which people has estimated to be around 60$.

But that was in 2013, my friend. We are in 2018. 5 years later the price of materials has gone down, so they're are not selling them at a loss now. See the difference?

I definitelly see who doesn't understand the bussines from the 2 of us, if that is any help...
Firstly, I think you're being a little over-sensitive. But I'm pleased to see in your last sentence that you acknowledge your failings, something that I don't see often on here. You should be proud :)

With regards to your other comments, I didn't say the PS4 is being sold at a loss, I said the margins are microscopic, which they are. You do realise there have been several price cuts since launch too? They make far more money from physical game licensing fees, accessories, digital store sales and subscriptions. How are they going to make money from those four key elements, if your console is sat doing nothing in a cupboard? They'd much rather you sold it on to someone who might not be willing to pay the full price for a new console, but will be happy to pick one up second-hand, and then still contribute to the eco-system.

I mean, it's well known that the console market has always used the razor-blade/printer cartridge model.
 

Aquamarine

Resident Novelist
Member
Oct 25, 2017
1,704
How do you know? You also analyst like Zhuge? What makes you better than Zhuge ? Why we should trust you over Zhuge?

No offence just curious.
Think about it logically. EA is a multi-national corporation. They get physical and digital NPD sales from the USA, Canada, Latin America, Australia, and New Zealand. They also get physical and digital GfK sales from all European and some Middle Eastern and African and South American territories.

Combine those together and you get a very accurate installbase estimate...because their source is direct POS data.

So why would EA's estimate ever be "wrong"? They have every possible data point available to them. If there's anyone in the world who could produce an accurate estimate, it would be EA.

I think it's very likely the case that because EA doesn't care about sell-through in Asiatic territories, this installbase figure excludes those sales...because it's just not pertinent to their business. So the calculations for a "29 million Xbox One installbase" are wrong.
 
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Oct 26, 2017
3,068
Firstly, I think you're being a little over-sensitive. But I'm pleased to see in your last sentence that you acknowledge your failings, something that I don't see often on here. You should be proud :)

With regards to your other comments, I didn't say the PS4 is being sold at a loss, I said the margins are microscopic, which they are. You do realise there have been several price cuts since launch too? They make far more money from physical game licensing fees, accessories, digital store sales and subscriptions. How are they going to make money from those four key elements, if your console is sat doing nothing in a cupboard? They'd much rather you sold it on to someone who might not be willing to pay the full price for a new console, but will be happy to pick one up second-hand, and then still contribute to the eco-system.

I mean, it's well known that the console market has always used the razor-blade/printer cartridge model.
Still, even if the margins are microscopic, they are not selling the sku's at a loss now, so they rather have people buying new ones from them, than used one from someone else.

I mean, wtf is going on peoples minds that we have to argue this?? Do people really believe that MS prefers that someone buys the console used from someone else's than new from them?

Do you realize how you sound?
 
Oct 27, 2017
6,947
UK
Still, even if the margins are microscopic, they are not selling the sku's at a loss now, so they rather have people buying new ones from them, than used one from someone else.

I mean, wtf is going on peoples minds that we have to argue this?? Do people really believe that MS prefers that someone buys the console used from someone else's than new from them?

Do you realize how you sound?
Yes, they would rather have two people using two consoles, rather than one person using one console and another console in a cupboard. Which is what you were proposing.
 
Oct 28, 2017
676
Tokyo
I think it's very likely the case that because EA doesn't care about sell-through in Asiatic territories, this installbase figure excludes those sales...because it's just not pertinent to their business. So the calculations for a "29 million Xbox One installbase" are wrong.
Not including Japan in install base calculation is more big of a deal for Playstation than Xbox... I’m not even sure it cracked 100,000k unit sold over there.
 
Oct 26, 2017
3,068
It was a PSN subscription and a game.
A few months later hardware already made them money.
Yeah but PSN yearly subscription or monthly one? how much money from a 60$ game goes direclty to Sony? It's hard to tell. Some people were saying around 60$, others around 80$,

The discussion was interesting because it goes to another argument. Can Sony release a PS5 with the specs needed by 2019 and for $399?

Most people was saying no, but if you add to those $399 another $80 that seems more posible. Or even $100, because one may argue that now companies make more profit form the "engament" than in 2013, so they should be able to take more of a loss than before.

Long story short, the speccs would be there no problem if they took that much of a loss on the PS5 launch.

Some other people argue that the time of releasing consoles at a loss is over, but I diasgree, How could that be the case, unless there's an agreement between the companies? If one of them, let's say Sony, decides not to do it and MS takes a $100 loss, the difference in speccs would be significant.
 

VX1

Member
Oct 28, 2017
2,000
Europe
Firstly, I think you're being a little over-sensitive. But I'm pleased to see in your last sentence that you acknowledge your failings, something that I don't see often on here. You should be proud :)

With regards to your other comments, I didn't say the PS4 is being sold at a loss, I said the margins are microscopic, which they are. You do realise there have been several price cuts since launch too? They make far more money from physical game licensing fees, accessories, digital store sales and subscriptions. How are they going to make money from those four key elements, if your console is sat doing nothing in a cupboard? They'd much rather you sold it on to someone who might not be willing to pay the full price for a new console, but will be happy to pick one up second-hand, and then still contribute to the eco-system.

I mean, it's well known that the console market has always used the razor-blade/printer cartridge model.
There was a very good reason why MS from the start in 2013. wanted "always online,always connected" console.Offline console is more or less useless to them cause they can't make any money from subscriptions and services.
 
Nov 8, 2017
903
That's what happens when you rely on two countries for sales. If things slow down in those two countries, as happened from 360 to One, then you are in trouble. Nintendo has a stronger global presence, and Sony has the strongest presence of the three.
 
Oct 25, 2017
2,867
There was a very good reason why MS from the start in 2013. wanted "always online,always connected" console.Offline console is more or less useless to them cause they can't make any money from subscriptions and services.
You can still do all of that without requiring hourly online check ins
 
Oct 29, 2017
138
That's what happens when you rely on two countries for sales. If things slow down in those two countries, as happened from 360 to One, then you are in trouble. Nintendo has a stronger global presence, and Sony has the strongest presence of the three.
I really don’t think they had a choice as far as countries are concerned
 
Oct 26, 2017
3,068
Yes, they would rather have two people using two consoles, rather than one person using one console and another console in a cupboard. Which is what you were proposing.
Yes, because that is exactly what I said. Lol, amazing how people can't debate without using straw-man arguments, logical fallacies or straight up lies. At least this one is easy to disprove. Let's paste the exact quote of mine that you quoted

"In any case it's not MS is happy that some people are selling their old SKU, far from it., because they don't see a dime. They rather people keep it and new owners buy a new one from them, not a used one from somebody else"

So I'm arguing that MS rather have this new user buy the new SKU from them, than a used one.

I'm talking about 2 persons here, the one using the X, and the one using either a used console, or a new one

Instead, and I'm quoting you, you said that what I was proposing is that only one user plays the X, and stores the old one "Yes, they would rather have two people using two consoles, rather than one person using one console and another console in a cupboard. Which is what you were proposing"

Again, I was not proposing that, I was talking about 2 people

I'm afraid I made it too complicated for you, as it obvious you have problems following me. If you need I can make you saome drawings
 

ZhugeEX

诸葛亮 - 卧龙
Administrator
Oct 24, 2017
2,589
Given this thread is veering into off topic discussion I'm going to lock it at this point.

The major points have been discussed.
 
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