After the 2013 holiday season, it appeared that Sony took an early and huge lead over its competitors with the release of the Playstation 4 (PS4). Microsoft and Nintendo were losing money and falling behind in the battle of the consoles, as their offerings, Xbox One and Wii U were not selling as well as either company hoped.
After the 2014 holiday season, it appears that Microsoft and Nintendo have bounced back from their 2013 holiday season slump. Microsoft began to sell the Xbox One without the Kinect accessory in June 2014 for $399 and even cut the price by $50 to $349 for the 2014 holiday season; $50 cheaper than the PS4. Nintendo responded by releasing a number of hit games for its Wii U system; like Super Smash Bros and Mario Kart 8. Both companies were able to rebound from the mistakes they made in the 2013 holiday season.
The original price of $499 for the Xbox One was one of many mistakes Microsoft made when they introduced the Xbox One to consumers. The high price and Digital Rights Management (DRM) issues with used games drove many hardcore gamers away from the Xbox One and towards the PS4. Microsoft learned from its past mistakes, and the Xbox One sales surpassed PS4 in November 2014 when Microsoft cut the Xbox One price to $349 on November 2, 2014. The Xbox One price cut promotion ended January 3, 2015.
There are no reports yet on how sales were for the Xbox One or PS4 for December 2014, but it is likely Sony has a very small lead in overall sales. The US and Great Britain remain the largest markets of Microsoft’s business, but sales outside those areas are weaker, whereas Sony and Nintendo remain favorites in Japan, where Xbox One sales are the weakest.
Microsoft is also trying to edge into the smartphone gaming market. Microsoft bought Minecraft for 2.5 billion in September 2014. Minecraft is a very popular game for smartphones, computers, and on the Xbox 360 and Xbox One. An analyst at Wedbush Securities, Michael Pachter, shared his view on why Microsoft was so successful with the $50 price cut of the Xbox One this holiday season:
In my view, Sony will be content with second place if they sell 50 percent more consoles than last cycle. While Microsoft won’t be content with second place no matter how many consoles they sell.
It remains to be seen what Microsoft’s Xbox One can do to outsell Sony’s PS4 in 2015. Looks like we will just have to wait and see. Let us know what you think in the comments section below!