Kagan Forecasts Xbox 360 Sales Win In 2006

According to new forecasts from analyst firm Kagan Research, its forecasts are claiming that Microsoft will break Sony’s North American market share dominance in 2006, leading with 54% of hardware unit sales. But Sony’s PlayStation 3 will eventually lead in sales that will peak in 2008, according to the company. Kagan's research presumes that Sony’s PlayStation 3 will hit the U.S. marketplace in the second half of 2006. Under these circumstances, the firm forecasts that the PS3 is likely to surpass Microsoft’s Xbox 360 in cumulative sales by 2008. Kagan forecasts 17.9 mil. consoles sold in the U.S. in 2008, with PS3 accounting for 54% of next-generation game hardware units purchased that year, the Xbox 360 for 24%, and Nintendo's Revolution for 22%. Microsoft's Xbox 360 is expected to roll up sales of 1.6 mil. units in the U.S. by the end of 2005, forecasts Kagan’s Future of Video Games 2005 databook. By the end of 2007, Xbox 360 cumulative sales are projected to reach 11.1 mil. units. As for Nintendo's Revolution, Kagan predicts it will hit North America in late 2006, capturing 19% of the market by year-end. “Console sales have declined for two years in a row, but in 2005, with the highly anticipated Xbox 360 slated to hit the market November 22, we expect to see unit sales start an upward climb with a 3% increase over 2004,” said Irina Mulvey, CFA, analyst at Kagan Research. Other interesting estimates revealed by the report overview include suggestions that total video game console sales over all generations are expected to climb to $6.4 bil. in 2007, though projected to slip to $5.9 bil. in 2008. In addition, total video game industry revenue – hardware, software and accessories for all platforms – is forecast to peak at $16 bil. in 2007. Kagan also expects Nintendo to retain a dominant presence in the handheld market with the DS, although the company did not publically release estimates on the margin of this success.