No Quit in Xbox Rivals
Demonstrations of the machine's capabilities drew rave reviews at E3, in May, and some analysts think the PlayStation 3 will blow away the Xbox 360 when it debuts next spring.
"The PS3 ... is going to be phenomenal," says one fund manager who focuses on the video game sector. "I don't think Microsoft's going to win this console war as soon as the PS3 comes out." (The fund manager has no position in Microsoft or Sony.)
And Sony will be building on a strong foundation. The company has sold nearly 200 million consoles over the last two generations, far outpacing its rivals; Microsoft has sold about 22 million Xboxes.
"There's a lot of people there that have that huge brand loyalty to PlayStation," says Goodman. "If Microsoft can get it close, that's a huge accomplishment for them."But getting close could prove difficult. Many analysts expect Sony to continue to dominate in Japan, where it has sold 22 million PlayStation 2s and where Microsoft has sold roughly 1 million Xboxes, says Goodman. That's a lot of ground to make up, he and other analysts say. "For all the talk about Xbox, if you look at the Japanese sales charts, you would laugh at Microsoft," says Joe Spiegel, a hedge fund manager at Dalek Capital, who is long Nintendo. "It would be impossible for them to do a worse job." Still, Sony has its own problems. With other areas of Sony struggling, the PlayStation division may feel the need to milk sales of its profitable PlayStation 2 and PlayStation Portable machines, to the detriment of the upcoming console. Some analysts see the battle between Microsoft and Sony shaping up to be almost equal outside of Japan. "It's going to be hard to say till the PS3 gets here, but my gut right now is telling me that it will be neck and neck in North America and Europe," says Van Baker, who covers the video game business for research firm Gartner.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV