Sony released its quarterly earnings report this morning, following similar reports from Nintendo and Microsoft earlier in the month. As usual, the numbers show Sony continuing to outsell the competition by a good margin, selling 3 million PlayStation 4 units over the three months ending in June. Microsoft sold just 1.4 million Xbox consoles (including both the Xbox 360 and Xbox One), while Nintendo sold just 470,000 units of the Wii U during that time period.
(The usual disclaimer about sales vs. shipments here: while the two numbers aren't precisely equivalent, hardware units shipped to stores are usually sold through to consumers within four to six weeks, according to industry analysts. So most units shipped by the end of June have likely been cleared off of store shelves by this point, having little impact on the relative console race. The terms are used interchangeably throughout this piece.)
Separating out Xbox One sales from the Xbox 360 in the reported "Xbox" numbers is still an inexact science, but we gave Microsoft's older system an estimated range of 350,000 to 560,000 sales for the three-month period. That's down from the 500,000 to 800,000 range we estimated for the 360 last year at this time, and it parallels a roughly 30 percent drop in second-quarter PS3 sales from 2013 to 2014. This estimate may overstate the staying power of the Xbox 360 slightly—Sony doesn't even list the PS3 as a "key electronic product" in its own earnings, after all—but we think it's good enough for an estimate.
The gap between shipments for the PS4 and Xbox One continues to rise on a relative percentage basis as well. Sony's system now represents just over half of the total three-console market (if we use the midpoint of our Xbox One range as an average estimate). That's only a slight change from nine months ago, when Sony represented roughly 48 percent of the three-console market, but pushing past the majority mark is still an important milestone for Sony.
The only bright side for Microsoft, if there is one, is that regional sales reports suggest the Xbox One's problems aren't evenly split around the world. The Xbox One continues to be a non-factor in Japan, where the console sold only 100 units in a recent week. And Microsoft Head of Xbox Phil Spencer recently told Edge that the PS4 has at least 70 percent of the market in every country in mainland Europe, and "frequently greater than 90%." That's very bad news for Microsoft in those regions, but it suggests that the race in North America—the biggest single region for game sales—is a little bit closer than the international shipment numbers would indicate.
What does this mean for publishers?
While it's fun to look at who's winning the latest round of the console war, the battle really only matters to gamers to the extent that it affects which games will be coming to their system of choice. We've already seen third-party developers largely abandon the under-performing Wii U. The important question, as always, is whether we'll ever reach a point where at least some publishers similarly decide to ignore the Xbox One and its smaller user base.
Ubisoft has been providing some interesting data that might help answer that question. The French company behind franchises like Assassin's Creed and Just Dance is one of the few major publishers to break down its software earnings by console every quarter. Since Ubisoft publishes versions of all of its current-generation games on both Xbox One and PS4 (as it generally did for the PS3 and Xbox 360 as well), these results provide a rare apples-to-apples glimpse at whether the gap in Sony and Microsoft hardware sales also leads to a difference in software sales for major third-party supporters.
Crunching the numbers, you can see a major turnaround for Ubisoft in this generation of consoles. While the PS3 and Xbox 360 represent roughly the same amount of business for Ubisoft over the last 21 months, PS4 software is bringing the company roughly two-thirds more money than Xbox One software in the same period. Since the consoles launched, there hasn't been a single quarter where Xbox One software brought in more revenue than PS4 software for the company.
Of course, it's possible to read too much into this kind of data. Ubisoft is just one publisher among many, and others might see different breakdowns for their multi-console titles. Perhaps the types of games Ubisoft publishers are just relatively more appealing to PS4 owners. Perhaps Ubisoft's European headquarters leads to more PS4-based revenues in the Sony-dominated continent.
In any case, it's clear that there has been a major shift in Ubisoft's console business in the last 21 months. That doesn't mean the Xbox One isn't important to Ubisoft, of course. Microsoft's latest system still represents nearly €400 million in business for the company since its launch. That's not exactly chump change that Ubisoft would be willing to just throw away by catering exclusively to PS4 owners.
Then again, Sony's relative lead in the market continues to slowly grow, quarter after quarter. Right now, the Xbox One is responsible for about 38 percent of Ubisoft's current-generation console sales, all told. What happens if that number continues to fall as more and more gamers continue to choose the PS4 over the Xbox One? At what point in relative sales do Ubisoft and other publishers no longer consider it worthwhile to put as much focus on the Xbox One versions of their games? 30 percent of the two-console market? 20 percent?
Maybe there is no such point; as long as those Xbox One ports continue to bring in enough raw revenue at relatively low cost, they'll continue to be made. Still, we shouldn't forget the early 2000s, when many big publishers didn't bother to port PS2 games to the relatively small markets for the Xbox and Gamecube (to be fair, architecture differences between consoles made such porting a more daunting task back then). The Xbox One isn't really in danger of being ignored by major publishers right now, but if Sony continues to outsell the competition at increasing rates, it's not entirely out of the question in the future.
Update Some graphs in this story were originally posted with incorrect axes, making the relative differences in console sales look incorrect. Ars regrets the error.
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