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January 17, 2008 9:50 PM

Nintendo's Wiimote Holds Back Xbox Invaders



Joe Wilcox
Joe Wilcox

Yawn, Wii once again beat Xbox 360 in US retail game console sales. So much for Microsoft's big bet on HD.

Xbox is unquestionably a successful franchise for Microsoft. Even the Red Ring of Death couldn't keep Xbox 360 sales down, and Xbox Live subscriptions are way up.

But Xbox 360 just can't seem to get past Wii, for which demand is so great shortages are still commonplace. The question: How much stronger would Wii unit sales have been if Nintendo could have met demand, particularly for the holidays?

Microsoft bet on fast action games and HD with Xbox 360. Feature for feature, Wii just doesn't compare. Xbox 360 has more of almost everything, such as better storage and optical drive. But the Wiimote (Wii Remote) sets Nintendo's console apart from Xbox 360 and PlayStation 3.

12-07 US Retail Game Console Sales

There's a lesson here about less being more. Xbox 360 is really a Trojan Horse for living room entertainment—more than just a game console. From movie downloads to recorded content streaming, Xbox 360 is more than just about gaming. Microsoft emphasized HD—and bet wrongly on HD DVD—as the blow away experience. Wii is just about having fun.

Wii has hugely broad appeal, partly because of the games but also for what the controller does for anyone. Successful products typically build on the familiar and then help people to do something more they wished—or would have if they had thought of it—to do. Wiimote lets people interact with video games in ways familiar with real life activities. It's one of the main reasons Wii appeals to young and old. By contrast, Xbox 360 titles and interactive gaming favor younger males.

Wii pretty well embodies my seven tenants of good product design. Success products should:

  • Build on the familiar
  • Emphasize simplicity
  • Hide complexity
  • Let people do something new they wished they could do
  • Do what it's supposed to do really well
  • When displacing something else, offer a significantly better experience
  • Help people feel better about themselves

Many of those attributes also apply to Xbox 360. And what Xbox 360 misses in console sales, it makes up for elsewhere. Microsoft makes truckloads of money from all those Xbox Live subscriptions and Xbox Live Marketplace sales, including movies and TV shows. I'd like to see those revenue sources more clearly broken out on Microsoft's balance sheet.

Also, NPD month-over-month sales show Xbox 360 gaining on Wii. But PlayStation 3 isn't down or out. The game console is finally selling better. The new year started off with a sudden studio shift to Blu-ray over HD DVD. Blu-ray comes with PlayStation 3, which makes the game console one of the cheapest ways to get the optical drive.

For example, Amazon sells the PlayStation 3 40GB Spiderman 3 Edition for $399.99. Standalone Blu-ray players range from about $330 to $537, at Amazon. Why not treat PlayStation 3 as a Blu-Ray player with free game console?

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