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Playstation 4 vs. One The Battle for Market Superiority

Introduction skip to analysis

The $27 billion console gaming category has undergone significant disruption and evolution in the last decade, particularly resulting from new entrants and an increased focus on online gaming. With the U’s abysmal sales, and persist as the two primary competitors for the market leader position in the next generation of console gaming.

Recognizing a traditional product life-cycle of five to seven years and little chance of increasing adoption rates after year one, the company that is able to establish dominance within the first six to twelve months will likely retain the position until the next generation of console hardware is released. As a result, Sony and Microsoft have boldly developed two different marketing strategies that stand in stark contrast to one another.

The ‘One’ moniker attached to the Xbox is the embodiment of Microsoft’s vision of the future of the industry as not simply focused on gaming but as providing all-encompassing entertainment solutions. The is being marketed as the one device to rule all facets of living room entertainment.

Sony, on the other hand, stands in firm belief that gaming consoles should primarily focus on delivering a great gaming experiences above all else. This doesn’t mean that video playback and media applications are not available on the PS4, they are. However, Sony’s messaging is intended to define the PS4 as the quintessential gaming console rather than a holistic entertainment solution.

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Background skip to analysis

The battle for market dominance in the console gaming category has always existed, but over time the key players have continually shifted. In the early 1990s, the market was comprised mainly of offerings from Nintendo and . When Sony entered the market in 1994 with the original Playstation, the company quickly supplanted Sega to become the new competitor for Nintendo’s massive market share. By the start of the new millennium, Sony Playstation sales had eclipsed Nintendo console sales. Sony’s lead in the market was even further increased after the introduction of the Playstation 2 (PS2), an impressive new system that included massive upgrades in performance. Nintendo’s answer, the GameCube, failed to win over , and as a result, Nintendo fell even further behind in market share.

Nearly two years after the launch of the incredibly successful Sony PS2, Microsoft entered the category with its first offering, the Xbox. By this point in time, Sony had shipped a daunting 19.57 million units.[1] To establish its new console as a competitor against Sony’s PS2, Microsoft used the two year deficit to incorporate more powerful hardware and develop exclusive titles designed to be played on its proprietary online gaming network. The release of the highly anticipated first person shooter, Halo, quickly escalated Xbox sales, but nowhere near the pace needed to appreciably chip away at sales of the PS2.

In an effort to get a head start on the next generation of [2][3][4] gaming, Microsoft released the in November 2005, nearly a year before the Playstation 3 and Nintendo’s next offering, the Wii, were set to launch. The Xbox 360 set new expectations with the device’s cutting edge graphics, more ergonomic controllers with wireless connectivity, continuation of the successful Halo franchise, and robust broadband gaming network, Xbox Live. These points of extreme superiority over previous generations of consoles enabled Microsoft to establish an early lead.

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Background Continued skip to analysis

Resolved not to experience the same defeats, Nintendo redefined its market space by focusing on what they believed to be a broader market, family-friendly gaming experiences. Their new console, the Wii, shifted away from competing over performance, online gaming, and titles that appealed to gaming enthusiasts. Instead, Nintendo introduced innovative motion controlled functionality, games designed to make gaming a more active experience, less violent titles, and a lower price point than offerings from Sony and Microsoft.

Previously the champion of technical prowess, Sony focused on exceeding the Xbox 360’s specifications, matching the console’s most popular features, and introducing a major differentiator. Like the Xbox 360, the Playstation 3 intensely focused on increasing online gaming through its Playstation Network, introduced wireless controllers and highlighted gaming titles exclusive to the platform.

On paper, the marginally more performant specifications of the PS3 likely excited only the most intense gaming enthusiasts. The real differentiator was the Blu-ray media drive. High-definition Blu-ray movies had just begun to increase in adoption and individual Blu- ray devices were street priced starting above $500. Sony’s move to include a Blu-ray disc drive had two major implications. The first being that gaming media could contain more content due to the higher capacity of Blu-ray discs. More importantly, it meant that at the price point of $499, consumers would be getting Blu-ray playback and the highest performance gaming console for less than the price of a Blu-ray player.

By November2013, Sony and Microsoft had each sold around 80 million units.[5][6] Impressively, Nintendo’s repositioning strategy ended up trumping technical prowess, elevating the manufacturer back to the position as the market leader with nearly 101 million units sold.[7]

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Shifts in Strategy skip to analysis

Previously, Sony, Microsoft, and Nintendo had each employed different and very succinct strategies. Microsoft focused on being a first mover. Sony focused on addressing multiple consumer needs with one device. Nintendo developed its own market space. With the current generation of gaming consoles something interesting has happened and each company has shifted its core strategy.

For this eighth generation of gaming consoles, it was Nintendo that established itself as the first mover by releasing their newest console, the , nearly a year before its competitors. The company remained true to the family-friendly gaming experience, but replaced the small and simple motion controllers with a bulky controller that includes a built in screen. Nintendo also significantly increased the price point from $249 to $349. These changes have not been well received and have led to sluggish sales. One analyst has projected that lifetime sales will reach a paltry 25 million units.[8] More optimistic estimates put total lifetime sales closer to 50 million units, which is still half of what its previous generation console achieved. As a result, the Wii U has currently been all but written off as a key contender in the current battle for market dominance.

Although Sony fully embraced the strategy of positioning the PS3 as a multi-purpose entertainment system, the company has distinctly moved away from this strategy for the PS4. Instead the PS4 is being positioned as the ultimate gaming machine designed for hardcore gamers. Conversely, Microsoft has adopted the all-in-one entertainment platform strategy previously employed by Sony. The Xbox One name is in itself a full embrace of this mentality with its often used tagline, “games and entertainment are no longer separated”. However, what worked for the Playstation 3 has led to very vocal dissent for the Xbox One, which Sony has been quick to capitalize on. What has resulted is a very interesting sequence of posturing and varying public opinions over time. It is these opinions surrounding the two new consoles that will be further explored in this report.

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Post Volume from Announcement Sentiment Distribution

7,834,000 23%

Gender Distribution 77%

Positive Negative

Setting the Stage skip to announcement analysis

The Playstation 4 was announced at an event on February 20, 2013, nearly three months before Microsoft would unveil its next generation console. The announcement was a techno-driven visual masterpiece of laser lights and stunning game demos played across a panoramic screen that wrapped around the top of the auditorium.

The message revolved around the PS4 as a gaming machine with little mention of media or entertainment. , President and Group CEO, Sony Computer Entertainment Inc, confidently expounded their vision as being, “consumer-centric, developer-inspired, and characterized by an unwavering commitment to phenomenal play experiences.”

Following-up on the message of being developer-inspired, Sony announced the PS4 would utilize the x86 processing architecture, a move that would make it easier to develop games for the platform. This revelation was a big deal and was received with ample applause inside the auditorium. Online, however, the main focus for consumers and pundits were the games.

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The three most commonly discussed themes directly proceeding the announcement were the games, the controller, and the new system architecture.

Games, by far, accounted for the majority of the conversation and were discussed with 78% positivity overall. , , and were the most widely discussed titles. Although receiving lower volume, conversations about the titles Deep Down and were discussed with the highest positivity and levels of anticipation.

Going strictly by the numbers it would appear that one of the traditionally most popular gaming franchises, FIFA by EA Sports, was neither highly anticipated nor viewed favorably. However, the conversations revolving around FIFA were related to the lack of a demo or any mention of the game. Here, negativity was not related to the game itself, but its omission from the event. The same observation was made regarding (COD).

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The move to the x86 architecture was referenced in 1 out of 4 conversations regarding the technical specifications of the PS4 and was discussed with an overwhelmingly high 88% of positivity.

In the week leading up to the announcement, positive sentiment for the Playstation brand held steady at 72%. During and just after the announcement, the Playstation brand received a 5% increase in positive mentions, bringing the overall positivity to 77%. Out of the conversations that contained emotionally charged content, expressions related to anticipation were stated in 56% of conversations, followed by joy/excitement in 12%. Fortunately for Sony, expressions of anger were only found in 3% of conversations and disgust in 1%.

Finally, negative opinions were largely related to disappointment around Sony not announcing the price, not showing off the console design, and not releasing more information. However, it should be noted that specifics regarding price and product specifications are rarely made at the announcement event.

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Post Volume from Announcement Sentiment Distribution 7,328,567 37% Gender Distribution 63%

Positive Negative

Setting the Stage skip to announcement analysis

On May 21st, 2013, Microsoft’s Xbox division took to the stage to announce the company’s new console, the Xbox One. The event was significantly different in tone and style from Sony’s PS4 event. The atmosphere felt serious rather than fun, the speakers were all very corporate sounding, and the content was highly focused on television and entertainment rather than gaming. Also, unlike the PS4 event, this event began with the reveal of the console design, which was one of the aspects consumers very vocally expressed they would like to have seen from Sony at its event.

When games were discussed, the main focus was on the next title in the Call of Duty franchise, Ghosts, a multi- console release. Sports related titles were next in line;however, the brief amount of footage shown looked incomplete with much of it in wireframe form.

At the press conference following the announcement event, Xbox Live VP, Marc Whitten, stated the Xbox One would not be able to play games created for the previous generations of the Xbox.[9] Immediately after this admission hit tech blogs, the social web exploded with responses, 52% of those responses being negative.

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The Xbox One thematic focus mirrored the PS4 with the three most commonly discussed themes being games, the controller, and technical specifications. Games, by far, accounted for the majority of the conversation and were discussed with 69% positivity overall, nearly ten points lower than the 78% for the PS4. The technical specifications were discussed most positively, particularly the 8 gigabytes of memory and 8-core x86 processor.

While consumer conversations penalized Sony for failing to mention FIFA and Call of Duty (COD), Microsoft scored points by including both games in their presentation. In fact, COD made up the majority of conversations around gaming and received a high positive passion index, a mark that no other title from Microsoft or Sony received. This indicated strong consumer demand and anticipation of the title. FIFA, a high-selling and important title for the international market, was discussed 20% more positively for the Xbox than for the PS4.

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On the whole, while consumers responded negatively to Microsoft’s presentation that included less gaming titles and less polished demos, the consumer reaction to the individual titles themselves was mostly positive. , an Xbox-only car racing title, was both the third most discussed title for the Xbox and the title with the most positive conversation sentiment (89%) of any titles announcement by Microsoft or Sony.

In the week leading up to the announcement, positive sentiment for the Xbox brand held steady at 77%, 5 points higher than Playstation. During and just after the announcement, the Xbox brand received a 14% decrease in positive mentions, bringing the overall positivity to 63%. Both pundits and consumers expressed a great deal of disappointment with the event being unnecessarily long, the primary focus on entertainment, revelation regarding the lack of backwards compatibility, and speculation of ‘Always ON’ internet connection requirement.

Out of the conversations that contained emotionally charged content, expressions related to anticipation were stated in 38% of conversations, 18% lower than for the PS4, followed by surprise in 22%, 12% higher than the PS4 and attributed to the fact that Microsoft spent more time talking about entertainment than gaming. Joy/excitement was 4 points higher than for the PS4 at 16% for the Xbox, and expressions of anger were reported in 5% more conversations for the Xbox than the PS4.

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WINNER Sony Playstation 4

The Playstation 4 generated more conversation volume, higher levels of positivity, higher levels of positive emotions, 6x more conversations citing intent to purchase, more excitement for the most important conversation topic, games, and drove an increase in brand sentiment by 5 points.

Microsoft suffered a devastating decrease of 14 points in positive sentiment for the Xbox brand and managed to get itself into hot water with consumers over backwards compatibility, DRM, the requirement of being constantly connected to the internet, and lack of emphasis on the Xbox for gaming.

PS4 Xbox Winner Margin

Volume 7,834,000 7,328,567 PS4 7%

Positive Sentiment 77% 63% PS4 22%

Positive Passion Index High High Draw -

Negative Passion Index Low Medium PS4 -

Games Volume 891,000 964,721 Xbox 8%

Games Sentiment 78% 69% PS4 13%

Anticipation (Higher is Better) 56% 38% PS4 47%

Anger (Lower is Better) 3% 8% PS4 166%

Purchase Intent 24,168 4,343 PS4 456%

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In the video gaming world, the announcement event for a new console is really just a stepping stone to the Electronic Entertainment Expo (E3), the world’s premier trade show for related products. E3 is the most highly anticipated video gaming event every year and is where companies pull out all the stops to impress pundits and consumers.

At E3 Microsoft announced the Xbox One would be priced at $499, $100 more than the Xbox 360 originally released for, and would include the . In an attempt to overcome the negative feedback that resulted from the announcement event, Microsoft backed off of discussing the Xbox One as a TV/entertainment machine and instead rolled out an extraordinary number of game demos. The game that struck the strongest chord with the audience was the fifth version of Halo, which Microsoft announced using a very short video trailer.

Sony revealed the design of the Playstation 4 console and announced that it would retail for $399, $100 less than the original price of the Playstation 3 and also $100 less than the Xbox One. The Playstation Network, a subscription based online gaming and entertainment network comparable to Xbox Live, was revealed with a price tag of $49.99 per year. In stark contrast to the Xbox One, it was announced that the PS4 would support used games, players would be allowed to trade games, and there would be no connection requirement to play games. In line with its game- centric messaging, the PS4 event also featured a tremendous number of game demos and the announcement that 140 titles were in development.

During and after E3, many analysts were quick to proclaim that the PS4 gave the Xbox One a knockout punch. But what did consumers say?

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The most discussed themes following E3 were games, followed by the design and technical specifications. 15 was announced at Sony’s press conference and became the most discussed game during E3, generating 387,000 conversations. *It should be noted the game will be released on PS4 and Xbox One.

While not generating the highest volume of conversations, Driveclub again generated the most positive comments of any game for the PS4. Specific game titles generated 1.3 million conversations with an overall positivity of 79%.

The newly revealed design was well received and scored 3 percentage points higher than the Xbox One.

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The overall brand sentiment for the PS4 decreased 4 points during E3 primarily due to Sony’s announcement of the PSN gaming network which would require gamers to pay for a PS+ account to play online multiplayer games.[10]

Slightly elevated levels of anger were also noted in relation to Sony’s move to a paid gaming network. In response, several petitions appeared online urging Sony to abandon the requirement for all multiplayer games. The petitions were unsuccessful.

Expressions of anticipation of the console plummeted by 21 points from 56% to 35%, though expressions of joy/excitement rose a significant 10 points from 12% to 22%. Overall, there were far more positive emotional responses to the PS4’s showing at E3 than negative responses, a good sign for the PS4 going into the last few months before the November launch.

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The most discussed themes following E3 were games followed by the controller and price. For the Xbox One, the fifth version of Halo, a title exclusive to the Xbox One console, was announced with a video trailer. Halo drove the highest volume of game conversation and at the same time the least amount of positivity. The negativity surrounding discussions about the game drove down the overall sentiment for the console during and immediately after E3.

Although highly anticipated, the announcement of the fifth installment in the Halo franchise was met with significant backlash. The common theme was significant disdain for Microsoft and the Xbox but consumers had resigned themselves to shelling out the $499 for the new console just so they could play Halo. EA Sports barely teased FIFA ’14 but it had a major impact in conversations for both the Xbox One and PS4. For the Xbox One, FIFA ’14 was the most passionately discussed game. Call of Duty (COD) continued to see high volumes of conversation for both consoles; however, COD appeared in more conversations related to the Xbox One and with higher levels of purchase intent, signaling a console preference of the Xbox for COD enthusiasts.

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The overall brand sentiment for the Xbox One decreased 6 points during E3. This was primarily due to ongoing consumer contention with Microsoft’s DRM policies, which were directly referenced around 200k times at 58% positivity and were highlighted and repeated over and over again by Sony executives in their presentation of the PS4. The second issue which seemed to drive negative conversations was consumers who love the Halo franchise but dislike the thought of having to buy a new console to play the fifth installment of the title.

Emotions related to anger rose 4 points to being referenced in 12% of conversations containing emotional responses. An even stronger emotional reaction of disgust rose 5 points to being discussed in 7% of emotionally charged posts. Just as with the PS4, expressions of anticipation decreased, and while the Xbox One witnessed a decrease of 11%, this was not as dramatic as the 21% decline received by the PS4. The good news for Microsoft was that on the whole, positive emotional response still greatly outweighed negative responses. Furthermore, while the majority of indicators depicted the PS4 as having a superior advantage, during and immediately after E3, stated purchase intent for the Xbox One was within 5% of the PS4. This was a promising sign that the race would be far closer than other data would project.

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WINNER Sony Playstation 4

Once again, the Playstation 4 generated more conversation volume, higher levels of positivity, higher levels positive emotions, and more excitement for the most important conversation topic, games.

However, although the Xbox One lost in every one of our categories, the console made up significant ground in terms of consumers broadcasting their intent to purchase the console. Incredibly, for all the negativity surrounding the Xbox One, the PS4 came out ahead in purchase intent by only a 5% margin.

PS4 Xbox Winner Margin

Volume 15,104,365 9,672,184 PS4 56%

Positive Sentiment 73% 57% PS4 28%

Positive Passion Index High High Draw -

Negative Passion Index Low Medium PS4 -

Games Volume 2,636,639 2,053,836 PS4 28%

Games Sentiment 74% 69% PS4 13%

Anticipation (Higher is Better) 35% 27% PS4 29%

Anger (Lower is Better) 9% 12% PS4 33%

Purchase Intent 571,853 543,055 PS4 5%

www.infegy.com +1 816-494-1650 [email protected] 4151 N Mulberry Dr., Suite 240, Kansas City, Missouri 64116 Prelaunch Perceptions

In the months following E3, consumer conversations for both the PS4 and Xbox increased in positivity. While the PS4 had a much more stable level of conversation sentiment, the Xbox One consistently improved its standing with consumers, overtaking the PS4 just before the November launches of the two consoles.

While the Xbox One team was busy making up ground, the PS4 continued to generate more posts than the Xbox One, at 26 million to 20 million respectively.

Xbox increases in positivity began as a direct result of Microsoft reversing its DRM policy in July and announcing that the Xbox One would support used games and would not require 24/7 connectivity to play games. [11] In August the Xbox One again scored points with an announcement that Xbox Live subscribers would have access to unlimited amounts of cloud storage. [12] Finally, in September Microsoft announced a 10 year product life cycle plan for the console and released details about Xbox Fitness, a title designed to reach a broader market than just hardcore gamers. [13]

Just prior to launch, news stories began appearing that PS4s were being built in part through coerced labor of Chinese students. [14] Stories and comments related to this revelation were the primary cause of decreased sentiment. Reports that headsets for the PS3 would not be compatible with the PS4, meaning that PS4 users to would have to purchase additional hardware, also drove negative conversations.

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Microsoft took a bold approach when focusing on the Xbox One as an all-encompassing entertainment console. Unfortunately, using the Xbox One or PS4 for TV and media was at the bottom of the list of commonly discussed topics. Out of 20 million posts about the Xbox One only .8% of them mentioned anything about TV, television, or media. Receiving just slightly more volume than the entertainment aspect of the consoles was price. This meant that price was not a huge issue or concern for the market. The most discussed topic? As you might have already guessed, games.

Call of Duty: Ghosts continued to be the most discussed game for both consoles, followed by FIFA ’14, and , all of which were similarly matched in positive sentiment for each console. Only two exclusive titles specific to each console made the top five. This signaled that neither console had a clear advantage from a game title standpoint going into the launch.

For all of the negativity, lower conversation volume, and well publicized mistakes, leading into November, the Xbox One came in only 11% behind the PS4 in purchase intent.

Prelaunch Purchase Intent

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WINNER Sony Playstation 4

In the three months leading up to November, the Xbox One made substantial progress in making up lost ground to the PS4, narrowing the margins in every category. Unfortunately for Microsoft, the PS4 continued to dominate the majority of categories including the most important, intent to purchase.

Based on our analysis, we anticipate that the PS4 will narrowly outsell the Xbox One from the outset.

PS4 Xbox Winner Margin

Volume 26,938,047 20,662,954 PS4 30%

Positive Sentiment 78% 69% PS4 13%

Positive Passion Index High Very High Xbox -

Negative Passion Index Very Low Medium PS4 -

Games Volume 4,487,657 3,709,087 PS4 21%

Games Sentiment 77% 77% Draw 13%

Anticipation (Higher is Better) 56% 46% PS4 21%

Anger (Lower is Better) 6% 7% PS4 16%

Purchase Intent (Cumulative) 1,206,740 1,086,900 PS4 11%

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The PS4 launched on November 15th, 2013, and reports immediately began to surface of hardware failures, server outages, and poor gameplay experiences. The most notable hardware issue was referred to as the “Blue Ring of Death” and was labeled as such because of the blinking blue power button present on systems that would not boot.

Buyers took to social media right away to communicate their frustration, look for possible alternatives to returning the console, and to share advice on possible solutions. Sony acted quickly and released a troubleshooting guide to their forums less than 24 hours after launch.[15] Fortunately, the hardware issues were not all that widespread and only appeared in .76% of the total conversations during and just after launch.

The Xbox One was released on November 22nd, 2013, just one week after the launch of the PS4. Just like the PS4, reports of hardware failure began appearing online almost immediately. The most common Xbox One failure was a clicking, terribly noisy disc drive, referred to on social media as the “Disc Drive of .” Although not as catastrophic as a system that will not boot, the malfunctioning disc drive was reported in much higher volume and with much higher levels of negative sentiment.

Across both systems there were reports of severe disappointment with graphics and gameplay of Madden, Call of Duty: Ghosts, still the most discussed game, was commonly slammed for being a downgrade from the previous title, and there were rampant complaints about server issues for Battlefield 4 and Call of Duty: Ghosts.

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WINNER Sony Playstation 4

All signs during launch pointed to a clear victory for the PS4. Conversations about purchasing the PS4 outnumbered purchasing the Xbox One by three-to-one. Conversations about future intent to purchase the PS4 outnumbered the Xbox One by more than two-to-one. Another big defeat suffered by the Xbox One came from lapses in Microsoft’s quality control. Although the Xbox One generated less conversations, a far higher percent, 6% to just .76% for the PS4, referenced hardware malfunctions. Heading into the holiday season it appeared that PS4 was set to continue to outpace the Xbox One at an increasing rate.

PS4 Xbox Winner Margin

Volume 4,930,061 3,603,245 PS4 36%

Positive Sentiment 69% 67% PS4 3%

Positive Passion Index High High Draw -

Negative Passion Index Low Low Draw -

Games Volume 406,692 259,102 PS4 57%

Games Sentiment 72% 74% Xbox 3%

Conversations About Device Failure 37,524 218,550 PS4 482%

Sentiment About Device Failure 54% 29% PS4 86%

Joy (Higher is Better) 17% 19% Xbox 12%

Acquisition (24 Hours Within Launch) 986,012 323,314 PS4 204%

Purchase Intent (24 Hours Within Launch) 345,104 134,725 PS4 156%

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On December 11, 2013, one week after an announcement by Sony, Microsoft released their official sales numbers for the Xbox One.[16] As predicted by prelaunch figures, Xbox One sales trailed just slightly behind the PS4, with 2 million Xbox One consoles being sold compared to 2.1 million PS4 consoles, a margin of 5%.

Over the course of the holidays, the reports of hardware failure and service outages for both consoles significantly decreased. The PS4 continued to generate more conversations and higher levels of purchase intent. Posts related to ‘acquisition’ were 26% higher for the PS4, while posts referencing future intent to purchase were only 5% higher than for the Xbox One.

There was a noticeable spike in conversation volume on Christmas day, and once again the PS4 was talked about more than the Xbox One, 823k to 570k respectively. Interestingly, a commonly appearing word for both consoles was “instead”, which appeared in 4% of conversations for each console and was often related to kids taking to social media to vent about their parents buying them the wrong console. The wrong console in this case was usually the Xbox One, not the PS4.

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WINNER Sony Playstation 4

During the holiday season both acquisition and purchase intent returned to a much slimmer margin for the PS4. However, when excitement around the two devices peaked on December 25th, the PS4 generated more conversations and much higher sentiment at 68% to 51%. Furthermore, a high number of posts discussing how gift recipients wished they had gotten one console instead of the other, frequently cited the PS4 as the preferred gift.

PS4 Xbox Winner Margin

Volume 16,941,529 10,732,361 PS4 57%

Positive Sentiment 73% 67% PS4 9%

Positive Passion Index High High Draw -

Negative Passion Index Low Medium PS4 -

Games Volume 2,943,101 2,098,117 PS4 40%

Games Sentiment 79% 78% PS4 3%

Anger (Lower is Better) 7% 9% PS4 -

Joy (Higher is Better) 13% 12% PS4 8%

Purchase Intent 1,016,491 965,912 PS4 5%

Acquisition 2,032,983 1,609,854 PS4 26%

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Most Discussed Non-Exclusive Title

Call of Duty: Ghosts Volume Sentiment 701,069 73

Most Negatively Received Non-Exclusive Title

Battlefield 4 Volume Sentiment 456,501 59

*Battlefield 4 was most negatively received due to ongoing bugs and server issues. Problems were so serious and widespread that Microsoft began offering refunds.

Most Discussed PS4 Exclusive Title

Killzone: Shadow Fall Volume Sentiment 269,318 75

Most Discussed Xbox One Exclusive Title

Forza Motorsport 5 Volume Sentiment 158,616 80

www.infegy.com +1 816-494-1650 [email protected] 4151 N Mulberry Dr., Suite 240, Kansas City, Missouri 64116 Conclusion

Having amassed enough data about consumers purchasing habits and future purchase intent, we predict the PS4 will continue to outsell the Xbox One, becoming the new leader by market share of the console gaming category. Furthermore, based on the data we have collected and analyzed so far, we predict a sales volume advantage of 39% for PS4. Our calculations factor in cumulative recorded acquisition, from launch through the holidays, and the recorded future purchase intent collected during the holiday season.

...based on the data we have collected and analyzed so far, we predict a sales volume advantage of 39% for PS4.

With many highly anticipated game titles set to release in 2014, this prediction can only be rationalized short-term, 6-12 months. It is also possible that along with these yet to be released games, other gameplay innovations could turn the tides in the future. For example, the Xbox 360’s motion controller, the Kinect, debuted in 2010 and helped lead to a year-to- year increase in sales of 68% from November 2009 to November 2010.[17]

In terms of games, the biggest disappointments for consumers were all multi-platform titles, including Madden 14, Call of Duty: Ghosts, and Battlefield 4. Although selling well, these titles all suffered from bugs, server issues, and according to consumer feedback, lack of significant gameplay improvements over previous versions. One notable exclusive title failure was Knack, a PS4 game that was originally met with moderate volumes of conversation and sentiment, around 50k and 82% respectively, but ended up being a complete dud for reviewers and consumers alike.

Report Follow-Up On January 7th, 2014, Sony released its up-to-date sales figures, reporting a total sales volume of 4.2 million units worldwide since launch.[18] In the week prior, Microsoft reported 3 million sales. By these official numbers, the margin is 40%, one point higher than our projection.

www.infegy.com +1 816-494-1650 [email protected] 4151 N Mulberry Dr., Suite 240, Kansas City, Missouri 64116 References & Methods

References

1. So how many PS1s and PS2s has Sony shipped? The Register. 2001-10-25 2. "Sony stops shipping PlayStation 2 units in ". Rappler. December 29, 2012. 3. "Gamers Catch Their Breath as Xbox 360 and Xbox Live Reinvent Next-Generation Gaming". Microsoft. May 10, 2006. Archived from the original on June 21, 2008. 4. "Consolidated Sales Transition by Region" (PDF). Nintendo. June 2011. Archived from the original on 2011-07-28. 5. "PlayStation 3 Sales Reach 80 Million Units Worldwide".Sony Computer Entertainment. 6. "Microsoft Investor Relations - Earnings Release FY14 Q1". Microsoft. 7. "Consolidated Sales Transition by Region" (PDF). Nintendo. 2013-10-29. 8. “Wii U to Sell 25 Percent as Well as Wii”. IGN. 2013-12-11 9. “Xbox One will not be backwards compatible with Xbox 360 games”. The Verge. 2013-05-21 10. “What Happened at the PS4's E3 Event? Here's Everything You Should Know”. . 2013-06-11. 11. “Your Feedback Matters – Update on Xbox One”. Xbox Wire. 2013-06-19. 12. “Xbox One will come with unlimited cloud storage”. Techspot. 2013-07-29. 13. “Microsoft officially reveals Xbox One personal fitness app”. The Verge. 2013-09-26. 14. “Report: using student labor to build Sony’s PS4”. Tech in Asia. 2013-10-10. 15. “[INFO] Blinking Blue Light PS4 Issues”. Playstation Community Forums. 2013-11-16. 16. “Xbox One sales top 2 million”. CNNMoney. 2013-12-11. 17. “NPD: Kinect Helps Boost Microsoft Xbox 360 November Sales”. PC Magazine. 2010-10-10. 18. “CES: PlayStation 4 Sales Pass 4.2 Million”. IGN. 2014-01-07.

Research Methods

This report was created using Infegy Atlas. Infegy Atlas is a social media analytics and research platform that utilizes proprietary automated natural language processing technology and Infegy’s in-house repository of online dialog dating back to 2007.

Infegy Atlas operates on a simple but powerful query language similar to what you would use for a Google search but with more operators, filters and options. In all, around 70 queries were used for this report. These queries are available upon request.

www.infegy.com +1 816-494-1650 [email protected] 4151 N Mulberry Dr., Suite 240, Kansas City, Missouri 64116