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Analyst: No New Console Cycle Before 2013
Wedbush Morgan analyst Michael Pachter doesn’t expect a new hardware cycle to begin before 2013.
“We do not expect a “new” console in 2010 (other than the long-rumoured high definition Wii, which is likely to upgrade the Wii to current console technology),” he wrote in an industry newsletter.
“We do not expect the ‘next’ generation to begin before 2013, if at all,” he added.
“We remain convinced that the publishers will resist the introduction of any video game hardware technology that requires a refresh of software, as the publishers have as yet to capitalise on the immense investments made in being competitive in the current cycle.
“We therefore think it is likely that the ‘next’ generation will begin after 2013, meaning that software sales are likely to grow by a compounded annual rate of 6–10 percent for another five years.
“Because R&D costs are likely to flatten out with the benefits of a learning curve, we expect earnings leverage as the publishers are able to exploit R&D investments. In brief, we think that investors have it wrong so far this cycle, and think that investment in video game publishers will bear fruit for many years.”
Earlier this week Ubisoft CEO Yves Guillemot said the publisher was already preparing for the next generation of consoles, which he expects to launch in the next few years.
"We need to get ready for the future generation of consoles," he said. "In the next few years, there will be new home and handheld consoles, and if you don't invest... you will not be able to cope with both [the existing and new generation consoles].”
I think people need to start ignoring this moron and his 'predictions.'
It's very difficult to say where future generations will go...There is so much new emerging technology that is becoming more economically viable to include into today's systems that will be affordable to the average consumer.
I believe that at E3 this year we may see new handhelds.....Nintendo's DS came onto the market in 2004. That's nearly 5 years ago and going on the success and sale rate we may see a new portable or at the very least an acknowledgement of the existence of one.
I wouldnt worry to much....I think we should enjoy the software for a while. Lets not rush this generation.
The "if at all" comment made is just moonshine. I am a consumer, I want to play games. I refuse to hand over £600-800 for a gaming rig, and quite frankly don't want the eyesore of staring at one in my contemporary living room. Digital download is in danger of never happening. There is a tech race to develop gaming platforms that is far more intense than the snail like tech race to deliver ultra fast download speeds. In effect, the demands of gaming will at the current rate, be forever beyond the capabilities of broadband to match. I predict, factoring in the appalling hardware failure rate of the 360, coupled with the customer alienating price tag and difficult dev kit of the PS3, to see new hardware at 2012 at the very latest.
I wonder what analysts are basing their claims on? It can't be previous generations - 5 year standard cycle, or recouping losses - companies have been making this up in licensing for years. So there's no clear pattern to suggest that this will happen, & this is coupled with developers EXPECTING new consoles to happen. it almost seems that a bunch of old guys see graphics as being so freaking awesome; that they don't see any way to improve things.
There will be more console generations. Games have never been bigger so why shake things up. Once the next big crash happens (if ever) then something might change.
As well, I expect Microsoft to announce their next-generation console at this year's or next year's E3. Possibly this year, definitely by next year.
Online will certainly be a huge feature of next-gen consoles, but I don't believe it will replace physical copies. You have to consider that, even now, not everyone has a high-speed internet connection. Further, the amount of bandwidth required to download these next gen games – and bearing in mind that Blu Ray discs can hold up to 50 gigs of data – will be immense; will ISPs be happy supplying that amount to the consumer? And what about game retailers and publishers? Will they stand by and watch their business go down the tube as more devs go straight to Xbox LIVE, PSN or Steam (or whatever the next-gen equivalents will be), thereby cutting out the middle-man?
It's very difficult to accurately predict trends five years from now, especially given the fast-pace that technology grows and develops. But I still don't see console manufacturers going online only, and I think a significant portion of consumers will still want something they can touch and hold.
WiiHD...? I bet it's some clip on thing like the motion+ or like the ram upgrade thing on the N64 ;-)
The big issue everyone is missing is that there may not be another generation like the past. With the proliferation of games being downloaded, I expect that discs will not be included in the next generation and it will all be downloaded games. Xbox and PS3 are already well on their way. They are developing the on-line marketplaces and new games for web distribution. It reduces cost of goods and eliminates trade-ins, rentals and used games. All things the publishers and console manufacturers hate. It also means that no publisher needs to worry about excess inventory if a game doesn't sell well. This will change the entire economics of the gaming industry for retail, consoles and publishers. And for us gamers.
Patcher is steers the ship that believes there will not be another console generation, WiiHD is an extension of this gen. Iconcur with Mr. Pachter and have thought the same thing for some time. I think that the big three will tease the next gen of hardware in 2012 and release late in 2013. However, if the financial well-being of MS and Sony's Gaming divisions don't turn around soon, I could see the next gen being pushed back to 2014.