Following up on EA's own hardware sales projections for '08, Janco Partners analyst Mike Hickey has taken a look at the video game console landscape and issued projections for North America that differ slightly from EA's. Overall, Hickey feels that EA's numbers were a bit conservative, especially with regards to the Wii, PS2, and PSP.

Janco  /  EA estimates (in millions)
PS3:  5.0         4.5-5.5
360:  5.0         4.5-5.5
Wii:  8.0         5.5-6.5
PS2:  4.0         2.2-2.7
DS:  8.0         7.5-8.5
PSP:  5.0         3.5-4.5

Regarding the PS3 in particular, although Hickey noted that sales of the console so far have been tracking at roughly 50 percent of the PS2 installed base, he believes an acceleration could take place. "We expect PS3 unit sales will perform exceedingly strong in CY08, due to a recently reduced price point, killer content coming into the channel (GTA), and Blu-ray currently having a decided edge in the high definition format war," he said.

Hickey continued, "We believe the slower relative adoption rate of Sony's PS3 console was a reflection of an unfavorable retail price point ($600), lack of distinguishing content, highly competitive hardware options (Wii), and general value confusion over the console's imbedded Blu-ray player. Considering Sony has sold in excess of 120 million PS2 units globally, we anticipate the PS3 adoption rate could accelerate meaningfully in the coming years as the aforementioned issues are addressed and legacy PS2 players' accelerate their transition to current gen."

If the PS3 does take off this year, Hickey believes EA would benefit greatly from Sony's success. "We believe the Company has the most to gain (versus domestic competitors) from an accelerating PS3 installed base as their portfolio remains highly levered to the PS3 and their universally recognized franchises (Madden, NFS, FIFA, etc.) should top PS3 sales charts," he noted.

The PSP's prospects also continue to remain bright, and even the aging PS2 should fare well yet again in 2008. "We are aware of at least one major domestic retailer who sold out of PSPs during the recent holiday, suggesting CY08 PSP sales could be strong. In addition, Sony recently raised their fiscal year (March ending) global unit ship forecast 30% from 10 million unit to 13 million units. Sony also raised their PS2 forecast from 12 million to 13 million units, suggesting continued strong demand for a console nearing its 8th year in the market. We believe Sony will cut the price of the PS2 in CY08 to $99, which could be a catalyst for units sales similar to the prior year and measurable ahead of EA's projections," Hickey said.

Of the new consoles, however, it's the Wii that will remain on top, according to Hickey. While the PS3 is tracking at 50 percent of the PS2 installed base, the Wii appears to be tracking PS2's growth from the last cycle. "If Wii console sales continue to track PS2 sales from the prior cycle, Wii sales could total over 8 million in CYO8 versus an estimated 6.3 million in CY07. Increased Wii unit sales versus the Company's expectations should come from increased supply and 3rd party content offerings, both of which have been confirmed through channel checks," explained Hickey.

If Janco's estimates prove true, then the respective installed bases in North America through 2008 will look like this: DS (24.4 mil), PS2 (18.2 mil), Wii (15.4 mil), PSP (15.4 mil), Xbox 360 (14.1 mil), PS3 (8.3 mil).