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E3 Volume I Blog - Sony vs. Nintendo

June 02, 2009 – Comments (0) | RELATED TICKERS: SNE , MSFT , NTDOY.PK

So Sony is rumored to have a new redesigned PSP coming out soon, so I figured I'd go back and explain a bit of the Sony vs. Nintendo rivalry.

Basically for Nintendo you have the Nintendo Entertainment system, the Super Nintendo, the Nintendo 64, the Nintendo Gamecube, and the Nintendo Wii (plus the Gameboy handhelds, but that's another post).

For Sony you have the Playstation 1, 2, & 3.

First, let's go back and look at where Sony really got traction in the video game market, the Playstation system. Originally, Sony was working with Nintendo on making a CD add-on or upgrade for the Super Nintendo system until negotiations fell through and they made the original Playstation system from the experience. The Playstation had CD based games, making them much cheaper to produce and they held a significant amount of data compared to a cartridge.

Nintendo in the meantime introduced the Nintendo 64 system, which was successful, but wasn't quite the success it could have been because it used cartridge based games still.

The next generation, you get the Nintendo Gamecube and the Sony Playstation 2 (and Xbox later on). Sony did very well with the Playstation 2. While the Gamecube did better with mini-CD based games (a small CD like disc), it wasn't the DVD that Sony had on the Playstation 2.

Now, the current generation you have the Nintendo Wii and the Sony Playstation 3 (and Xbox 360). The Nintendo Wii appealed to non-gamers and gamers alike (although hardcore gamers are apt to own all three current generation systems) while the Playstation 3 was very much made for a target audience. The Nintendo Wii still doesn't play DVD movies, but somehow it sold in droves compared to the Playstation 3. Sony's mistake with the Playstation 3 was putting the burgeoning Blu-ray technology in the system, driving up the cost vs. their competitors.

If you go back and look at the market, Microsoft seems to have replaced Sega's position in the console market, but again, that's another post.

So Nintendo seems to have finally gotten things right with the Wii in terms of appealing the the sort of mass audience, almost like with the launch of their original Nintendo entertainment system. 

As a side note, I sell on eBay and have sold several systems on their launch dates. Basically the Playstation 2 sold for about double it's cost on eBay when it was originally released. The Nintendo Gamecube only sold for a very small markup over it's retail cost (indicating less demand). Playstation 3s sold for about double as well when they first launched and it seemed the Nintendo Wii was going to sell like the Gamecube did on Ebay. Oddly enough, Playstation 3s quickly dropped to only a slight premium above retail, while the Nintendo Wii started to sell for about 75% over retail.

Up until about three months ago, you could sell a Nintendo Wii for retail price or higher on eBay, which is quite remarkable from an eBay sellers perspective. Currently a used Wii sells for about 80 - 85% of retail. An Xbox 360 seems to sell for about 60% of retail and a Playstation 3 seems to range from 60% - 80% depending on the type of system.