Analyst: PS3 could be third

In the next-gen console race, there are three main competitors: Microsoft, Nintendo, and Sony. While many would love to see someone come out with some sort of "Everybody is a winner, hooray!" scenario, the simple truth is one company is going to be declared the loser. Though the finish line is still far down the road, industry analysts are already predicting who will break the tape and who will bring up the rear.

Sony has clearly been the favorite in recent years thanks to the unparalleled success of its PlayStation and PlayStation 2, but one analyst firm believes that the company may tumble down from the top of the heap. In a memo sent out today, San Diego-based DFC Intelligence explained how Sony could go from first to worst.

Though the memo contains the disclaimer that the prediction is "only one of several possible scenarios," DFC appears to be leaning towards Microsoft and Nintendo coming out on top through the next generation.

The main reason DFC sees a slide for Sony is the $600 price tag on the high-end version of the PlayStation 3. Though Sony has touted the machine as inexpensive relative to the hardware contained within it, DFC doesn't think consumers will see it that way.

"Sony has done very little to justify why the system is worth a premium price for consumers that don't care about raw hardware performance and are not hard-core audio/visual consumers," DFC said. "Unfortunately we believe that represents over 90% of the consumers in the marketplace."

DFC recognizes that software plays a large part in buyers' decisions, and points out that the PS2 was so successful because of its diverse portfolio of games and large third-party support. The broad range of software made the PS2 "a complete entertainment system for the family priced under $300," said DFC.

"With the PlayStation 3 the company is going after the high-end power user. It is almost as if Coca-Cola not only decided to go with a new formula, but also decided to exit the low-brow soft-drink business to go into high-end wines," DFC explains. "Of course, there is a market for high-end products but it is 1) a very different consumer type and 2) not nearly as big as the blue collar mass market. Wal-Mart sells more toys than FAO Schwartz and McDonald's sells more beef than Ruth's Chris Steak House."

There doesn't seem to be much of an easy way to right the ship either. According to DFC, Sony may have drastically underestimated the competition and will have a lot of trouble cutting the price, particularly in time for the critical 2007 holiday season.

"A $600 price point is okay for launch but it will not fly in holiday 2007. If Sony wants to drive unit volume 2007 needs to be not only the year of price cuts, but the year of drastic price cuts. There is going to be a shakeup in the video game industry and even if Sony executes perfectly there could be a new market leader in two years."

Via Gamespot

That was a very good article.

i dont think that the PS3 price will be cut off just like that in a short date, probably 2 years later. but now?
i don't think so

because of prices ps3 will hurt WII will come out on top this Xmas

actually not, the Wii will triumph this battle for its price and entertainment

just the hardcore and ebay sellers will be all over it in nov if it comes out then. people thought the 360 had problems you havent seen nothing yet sonys track record on new systems isnt good at all the psone had to be redone to keep the laser from moving remember people playing the psone upsidedown for it would work the ps2 the first run of those were almost all bad they even had to settle a class action lawsuit over it . the psp try to find one with out a dead pixel its almost impossible i went through 8 to get 2 with out any dead pixels. your nuts if you dont buy the warranty on this thing. the wii is lame no power and a bunch of lame ass motion games i dont care about it at all .360with firmware fix is the way to go. sept is the month the 360 will start to get real good. the ps3 and wii wont be anygood intill 2007 it takes all systems 6months to a year to get rolling

slayer2psp

you are majorly missinformed, if it is anyone that will come out on top it is the Wii.

why is it lame that a video games company has actually introduced something new, for years it has been the same thing done over and over e.g better graphics, same old controllers and higher powered systems but with nintendo, there has always been a new way to play from the virtual boy to the motion wrist to the Dual screen and now finally the Wii and esentially what nintendo are trying to do is to get the player alot more interacted with the game.

Also nintendo take into account things like price, features, whats new etc.

Sony and microsoft have no attention to this and only wish to sell off their amazing processor and fancy graphics chipped product for more than its worth.

Wii will have the advantage as it has -

- cheap price
- originality
- a new way to play
- backwards compatability with all before nintendo games
- made by a trusted company that always sell good product that is rarely seen to have faults.

I think that the Wii will come out on top because of the software, the price, and the amazing backwards compatability. The Ps3 most likely will be in third for the first year and a half, but I'm willing to bet that it'll pick up during the latter part of the race and come to a semi-close second. My reasoning for thinking that Microsoft will end up third is that the 360 doesn't show much promise in the long run.