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Sony PlayStation 4 Wins Another Battle, but the War Is Just Beginning


Sony's video-game console outsold the Microsoft Xbox One in March.

Sony (NYSE:SNE) is still looking good in the next-generation video-game console war.

It scored an important victory in March, with market research firm NPD reporting that Sony's PlayStation 4 console outsold Microsoft's (NASDAQ:MSFT) Xbox One in the US for the third straight month.

Electronic Arts's (NASDAQ:EA) Titanfall, a very high-profile Xbox One exclusive, failed to put Microsoft in the lead against Sony. Titanfall was the best-selling game of the month, beating out Sony exclusive Infamous Second Son, but the fact that it failed to move the hardware needle in terms of market share is notable.

In terms of the big-picture perspective, late last week Sony said that PlayStation 4 sales hit 7 million units worldwide, while Microsoft announced it crossed the 5-million-unit threshold.

However, while Sony is currently in the driver's seat, the lead won't necessarily last. Microsoft could instantly make up a lot of ground by instituting a price cut (an issue flagged last June) and by improving its global distribution base, which is still much smaller than Sony's

Last generation, the PlayStation 3 was initially trounced by the Xbox 360 (and one reason was price), but both ultimately ended up with sales in the neighborhood of 80 million units. Of course, both were beaten by the Nintendo (OTCMKTS:NTDOY) Wii in terms of hardware unit sales. That would imply natural early customer bases (mostly serious gamers) of roughly equivalent size.

It's fair to say that Sony has executed a bit better out of the block and was very smart in terms of pricing, but ignore the sensationalist headlines floating around -- it will take some time to figure out the winner in this war.

Of course, the bigger question is: How well will industry sales perform once the early adopters are locked in?

The last cycle got a huge boost from the Wii and the music game boom. It remains to be seen whether there will be applications with similar mainstream crossover appeal this time around.

Twitter: @MichaelComeau

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