It might feel like the Playstation 4 and the Xbox One were released a very short time ago, but this November marks the first year anniversary of their respective initial releases. The running up to these hotly anticipated releases could be considered every bit as eventful at the actual launches themselves. Sony and Microsoft were spending a lot of effort, time, and money trying to convince gamers that their system was the superior choice. While Sony focused on the core gamers and selling the PS4 as a gaming platform, Microsoft wanted the Xbox One to be the one and only box you needed in your living room for any gaming, TV or movie needs. Some of the promises and new inventions that were planned for the systems were celebrated while others turned into huge controversies that only served to alienate the very audience the publishers had sought to attract. In the end, several polls and predictions suggested that the PS4 was the preferred console of the vast majority of the gaming community, and early sales numbers supported this hypothesis. However, it is now one year later and a lot has happened in twelve months. Has the prophecy about the doom of the Xbox come true, or has Microsoft managed to convince enough people to embrace their new system to let them stand side by side with Sony in terms of sold units? We take a look at the first year of the PS4 vs. Xbox One generation to get an idea of what their future might hold.
The November Releases
The Playstation 4 was initially launched in three territories: North America on Nov 15, and Europe and Australia on Nov 29. Before launch, Sony had announced that over a million consoles were already pre-ordered and that they were working as hard as they could with producing a large enough number of machines to meet the overwhelming demand. On the North American launch date, one million PS4 units were sold to consumers. Additionally, the console became the best-selling console at launch, selling 250 000 consoles in a 48-hour period.
While Sony were quick to share sales figures after the launch days, Microsoft has been more reluctant to share that specific information with the media. They originally planned to launch the Xbox One in 21 different countries, but that number was later amended down to 13. The official explanation for the delay in the other 8 markets was attributed to time and difficulties localizing the Kinect to different regions. On November 22, Xbox One was released in North America, Australia and New Zealand, and selected European countries. Microsoft announced that they had sold one million Xbox One consoles within the first 24 hours. While the number itself matches Sony’s numbers from the first day after launch, it is worth noting that while the PS4 was only released in North America at the time, the Xbox One was available in the first 13 markets. This means that the Xbox One sold significantly less than the PS4 in North America. However, Microsoft saw a boost in sales in North America during the following Black Friday and was reported to be the highest-selling console during that sales period in the US. One of the reasons for this could be that the PS4 was in such high demand in November that close to no stores had them in stock. I personally worked in a game store in November in 2013, and experienced how we tended to have several Xbox One consoles in stock at all times, while we could not keep up with the demand for the PS4 and eventually had to stop taking more pre-orders for it.
Interestingly, while it seems like the PS4 won the first round in most countries, Australia might have been won by Xbox One. The Xbox One had the most successful launch of any game console (the previous being Nintendo Wii in 2006) in the region and sold 65 917 units in three days. Sony did not release any sales numbers from that region during launch, possible because they could not match Microsoft.
The PS4 was the big winner during the release month. But would it last?
December to May
After an intense release month it had become clear that with the arrival of the PS4 and Xbox One, the eighth generation of consoles was the most successful of all time in terms of sales. Both consoles had already outsold the launch numbers of their previous consoles by far, and the demand was still high. Sony continued their struggle with shipping out consoles fast enough to keep their promise that most pre-orders would be fulfilled in time for Christmas. To add to this challenge, the PS4 for was released in Asia, South America and more European countries for the end of 2013. On January 7, Sony announced that 4.2 million PS4 units had been sold by the end of 2013. With them, over 9.7 million games had also been sold. But the impressive numbers didn’t end there. Just a month later Sony announced that 5.3 million units has been sold, and the console hadn’t even been released in Japan, one of the major markets for Sony. The PS4 was released in Japan on February 22 and sold 322 083 consoles within the first two days of release.
During this time period Microsoft were also quick to release new sales figures. Only 18 days after the initial release of Xbox One, they announced that 2 million units had been sold. One month later, Microsoft boasted that the console was the fastest selling in the United States based on NPD Group figures. However, if you look a bit closer at those figures you can read that the truth is not quite the same as what Microsoft would have you believe. Sure, the Xbox One was leading in front of the PS4 on a week to week basis, but it’s very important to note that at that time the PS4 was sold out in most of the country. If Sony had managed to keep up with demand, the PS4 could very well have been the fastest selling instead. At the end of January, Microsoft announced that 3.9 million Xbox One units had been shipped worldwide. ‘Shipped’ is not the same as ‘sold’ as it only refers to the number of consoles sent to retail stores and not the number actually sold to the consumers. Finally, on April 17, they revealed that 5 million units had been shipped to retailers worldwide.
In March, news broke that clearly signalled coming changes to Xbox as a whole. The former Xbox corporate VP was stepping down and Phil Spencer, former head of Microsoft Game Studios, was taking over as Head of Xbox. This new role made him the head of not only Xbox, but Xbox Live and all creative teams associated with them. Putting a man who had worked with games for 25 years as the new leader of the franchise could only mean one thing: Microsoft had understood that in order to sell their gaming console they needed to focus on the gamer, not on sports, TV, and movie functionalities. And Spencer himself was clear on this by stating: “Games and gamers have always been at the core of Xbox and the core of my work – and gaming will be our core as we take Xbox forward.” The change would not happen over night as Spencer would have to carefully plan how to reconstruct the divisions behind Xbox, but it seemed like the console had a brighter future going forward.
Will Phil Spencer be Xbox One’s saving grace?
June to November
As of July, Sony had released Playstation 4 in 58 countries. Sony was more than happy to share new milestones and sales numbers over the following months. In August they announced that they had hit a significant milestone: 10 million consoles had been sold worldwide. On October, it was announced that he Playstation 4 was the top-selling console in the US for the ninth consecutive month. At the end of the same month, Sony updated their sales numbers to 13.5 million units sold. Very impressive numbers for a console that is less than a year old! In fact, during the 2014 fiscal year, the overwhelming demand for the PS4 helped Sony top global console sales.
In September Microsoft finally released Xbox One in 26 new markets, including the Middle East, Japan and the remaining countries in Europe. The system sold a total figure of 23,562 during its launch week in Japan, well below what Playstation 4 did in just two days. It is not very surprising, as the Xbox 360 was not very popular in that region either.
Although Microsoft was not sharing a lot of sales figures over this 6 month period, they made some changes that symbolised a restructuring of their company. Initially, all Xbox One units were shipped with a Kinect sensor included, resulting in a higher price tag. On June 9, Microsoft announced that they would start selling cheaper Xbox One bundles without the Kinect. They explained that the decision to remove the Kinect was to allow people to buy an Xbox One and then get the Kinect when they could afford to. Removing the Kinect also freed up processing power that was previously reserved for running the device. The Kinect used a whopping 10% of the GPU processing power, and that power was now free to boost up graphics in games.
Microsoft continued to drop more surprising news in July. As previously mentioned, the Xbox One focused on TV and movies as well as games. Two years earlier they had established a new studio tasked with creating new and original material that would be available exclusively in the console, potentially letting them compete with Netflix in the near future. However, in July it was announced that the new studio was shutting down all together. It was explained that this decision was made to let them focus more on games.
Later in the year, Microsoft announced an additional price drop on the Xbox One in time for the holidays. Starting November 2, Xbox One bundles were available for as low as $349, and the offer will last the rest of the year. It is a good strategy for boosting sales over Christmas and during Black Friday at the end of the month.
To me, it seems like Microsoft has understood that to sell a gaming system like Xbox One, they need to cater more to the gamers instead of alienating them with promises of new features that are not related to gaming at all. Now they are plotting a new course, making their system more affordable and more approachable for the gamers.
Will the Xbox One have a strong comeback next year?
Where do they go from here?
Looking back on the first year of the Playstation 4, we can see that Sony has not done much in terms of changing strategies. And why should they? During these last twelve months the system has been outselling any expectations and Sony have barely been able to keep up with demand. Some might say that Sony can simply sit back and relax because it seems like they have already won this generation. However, Sony is not taking this success for granted. In an interview with Eurogamer in August, Shuhei Yoshida (President of Sony’s Worldwide Studios) admitted that the surprising numbers in sales did put pressure on Sony. Their biggest concerns were that they did not understand themselves why the PS4 is such an astounding success. How did the console attract both existing gamers and new ones? And if they don’t know why, how will they be able to keep the ball rolling? Furthermore, with 10 million consoles sold, will there be any more people to sell the system to? Or will the sales numbers per month fall as fast as they rose at release? These are all questions that will be hard to find a definite answer to, but Sony will have to try their best in order to put together a strategy for the future.
On the other side of the ring, Microsoft has been making changes throughout the year to increase sales. Some have worked well, but they are still falling behind Sony after the first year. However, it is important to note that for the first 10 months the Xbox One was only available in 13 countries while the Playstation 4 was available in 58 as of June. There is a big possibility that we will see the sales numbers become more equal this following year as a result of Microsoft finally launching their systems in more territories. In addition, Xbox One has some highly anticipated exclusive games on the horizon that will surely help boost sales of the system, one of them being Halo 5. Adding all this together with a new gamer focused strategy, I think Microsoft will have a very promising upcoming year.
In the end it seems very evident that the first year of generation eight belongs to Sony. They have released their system in the most territories and have sold more systems in a year than any other game system have accomplished before. They came out on top during release and have stayed there since. However, this does not mean that the battle is anywhere near lost for Microsoft. We have seen them focusing more on games, listening more to what the consumers want and taken a more humble approach to their marketing than they had before launch. Being an Xbox One owner will only get better as Microsoft will continuously work towards making their system the better one. It will not happen over night, but I am certain that Microsoft will come back strong and become a force to be reckoned with. There is no telling how many years this generation of consoles will last, but after only one year we can already see that things are starting to change. I, for one, am very excited to see where the next year will take us and the consoles we enjoy so much.
