Analyst: Sony Wins at E3

Robert W. Baird & Co. Incorporated analyst Colin Sebastian offered his E3 Expo wrap-up report to investors, saying the Sony's PlayStation 4 was the clear winner at the trade show which ends in a few hours.

Sebastian said that after meeting with multiple publishers and evaluating all of this year's E3 press conferences, his firm remains cautiously optimistic on the sector. He said that platform holders still need to offer a compelling reason to upgrade, and a clear value proposition for mainstream audiences.

Of the three platform holders Sony emerged from E3 on a stronger footing, contrasting the PS4 against the more pricey Xbox One. Sebastian also said that the PS4 is currently outselling the Xbox One on and GameStop.

Sebastian said that Microsoft had a tough time at this year's event, with sentiment remaining, "in part due to backlash from a vocal group of core gamers." Sebastian said that several Xbox One titles looked promising including Ryse, Quantum Break and Titanfall.

The most interesting thing Sebastian said concerned platform holders. He thinks that they have to make the case to consumers that these new consoles warrant an upgrade that can costs as much as $500.

"We remain somewhat concerned whether mainstream consumers will feel compelled to buy a next-gen console; however, EA management outlined reasons to upgrade, including 6-8x more powerful hardware, new entertainment functionality, digital services, strong game pipeline, and older core gamers with higher incomes."

Sebastian predicts that Activision will remain focused on a small number of high value franchises and a limited number of new IP. He also said that Activision's / Bungie's Destiny was generally well received.

Finally, Sebastian says that EA is "positioned for growth from the next-gen cycle and favorable mobile/digital trends." EA told the firm that Need for Speed, Madden and Titanfall are previewing well at the show.


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