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July 18, 2006

Xbox 360 news: good, bad, and in-between

Posted by David Hunter at 8:59 AM ET.

The good news is that Xbox Live is very popular:

The headline figure for Jeff Sullivan, one of Microsoft’s developer relations managers for the Games Technology Group, was the attach rate for Xbox Live amongst Xbox 360 users – a massive 60 percent, which is a huge increase over the 10 percent gained by the original Xbox.

“Every time I do this presentation I have to check what the new figures are,” Sullivan said, before rattling off up-to-date stats such as Xbox Live has hosted over two billion hours of gaming, including over 500 million games of Halo 2. It also handles over 900,000 voice and text messages per day. But there’s plenty more where that came from, with Microsoft on-track to hit its target of six million Xbox Live accounts in 2007.

Two key drivers of this growth will continue to be Xbox Live Marketplace and Arcade.

Used by 75 percent of connected users, Marketplace has handled over 30 million downloads; a figure that’s jumped significantly over the past couple months as features such as the ability to queue downloads, or have them operating in the background, have been added.

Meanwhile, over on Arcade (which is used by 65 percent of connected users), over five million games have been downloaded. Conversion rates between free content and paid for downloads currently averages around 21 percent…compared to the industry-standard of 1-2 percent in the case of casual PC games available on the Internet…

More by following the link. The bad news is that the Xbox 360 story in Japan is still grim:

In the last week of June, Xbox 360 sales totalled 1,897 units versus the PlayStation 2′s 23,133 units, according to market tracker Media Create Co. Ltd. That placed it in the number two position among consoles ahead of Nintendo Co. Ltd.’s GameCube, which sold 1,002 units in the same period.

“Globally we are doing very well but Japan has always been tough,” said Darren Huston, president and chief executive officer of Microsoft’s Japan unit, Microsoft Co. Ltd., at a company event on Thursday. “We launched early and with not enough Japan-specific content,” he said.

A poll conducted in May by Cross Marketing Inc. among 366 self-identified gamers found 256 of them said they want a PlayStation 3. Of the respondents, who were allowed to select multiple next-generation consoles, 127 said they want Nintendo’s upcoming Wii console, and 93 said they want an Xbox 360.

The in-between news is that in the USA both videogame hardware and software sales are booming:

Video-game-related sales in June saw a 25% increase year over year, to $844.5 million, according to NPD Group. Game software sales were up 15%, to $444.4 million, while hardware sales came in at $297.8 million, a 48% increase from 2005.

That sounds like good news, but the rising tide lifted all boats, not just Microsoft’s:

On the hardware front, sales were bolstered in June by the successful launch of the Nintendo DS Lite, the company’s sleek new version of their dual-screened portable, as well as strong sales from Sony (SNE) and Microsoft (MSFT) home consoles. The DS led the pack, with over 593,400 units moved during June.

Sony’s PlayStation 2 came in at No. 2, with a strong 311,900 units, beating out Microsoft’s Xbox 360, which shipped 277,000 units.

Software-wise, Frazier says the industry was able to reach out to a multitude of audiences in June. The sales spike was led by portable software, which garnered $135.5 million for a year-over-year increase of 30%.

Filed under Microsoft, Xbox

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