Wedbush analysts Michael Pachter and Edward Woo, who no longer think that the video game industry is "recession proof" (remember that?) are now saying that the new hardware introduced during E3 last week in Los Angeles has the potential to reinvigorate the sector. The major hurdle, they say, is pricing. The Wedbush duo were apparently most impressed with the Nintendo 3DS, which provides gamers (not under the age of 7, says Nintendo, because 3D is the devil to your eyes at that tender age) with 3D gaming and entertainment without the need for goofy 3D glasses. The 3DS is rumored to have a price point of $250 or more, but the pair do not believe it will matter, saying that Nintendo will sell millions of units.
Microsoft's Kinect, on the other hand, will have to be priced reasonably to sell, they believe:
"We think that if Microsoft prices Kinect close to cost (which we estimate to be around $70), it will see a very high attach rate, with the potential to drive $200 – 400 in lifetime value from each Kinect household," the pair states. "On the other hand, it is equally logical to charge a very high price for the device, especially if it is expected to be supply-constrained. We are not yet convinced that the hard core Xbox 360 user, who typically 'controls' decisions about his/her console, will find the game lineup for Kinect sufficiently compelling to purchase the device at a price point over $100, and think that pricing at the higher point would severely limit sales."
You don't have to be an "analyst" to figure that out. On the PlayStation Move, the pair offers a similar opinion:
"If purchased as part of a bundle, the all-in cost to play with Move will approach $180, which we think is beyond the reach of the typical household. We think that Sony's Move is truly impressive, but remain concerned that initial sales could disappoint."
Sony announced that the Move controller would cost around $50 each. But Pachter points out that consumer confusion may ensue over what or how many peripherals you might need to play a game; some Move enabled titles use the camera and one controller, while others require two for one person and there is also a separate entertainment "navigation device (a remote) that can be purchased for around $30. That confusion could fluster some consumers to no end, though most hardcore gamers that want move are quite capable of reading the back of a game box to figure it out..
On the software front, Pachter and Woo believe that this year's E3 lineup "was perhaps the most impressive in years" (?) naming MTV's Dance Central as the Kinect's "killer app," and predicting that Activision's Call of Duty: Black Ops will be this year's best selling game. A pretty safe prediction on the latter..