For a second year in a row the analysts at Broadpoint AmTech took a look at the past 11 years worth of winners to see if Best Of awards are a predictor of sales. Their conclusion:

"While there have been a few exceptions, overall we found that "Best of" award winners in categories such as "Best Console Game" and "Best in Show" have been retail hits in the U.S. (e.g. have sold in excess of 1mm units lifetime since release according to NPD)."

Certain categories, such as Best Original Game and Best Racing Game, were more hit or miss than others in predicting sales success, the analysts say. That's because, they said, these sort of games have "qualities that appeal more to industry insiders/game critics on the panel (forexample, innovative gameplay and art direction) vs. the average consumer."

While interesting, I wonder if the awards predict a sales success or help to create one. Lots of publishers have in the past used the award in their marketing of the games.

Edge Online reports that Nintendo has already sold 20 million units — 50 million worldwide — and plans to sell another 26 million this fiscal year.

Noting that a price cut is not an "almighty weapon," Nintendo president Satoru Iwata said recently that the company plans to address a slowdown of Wii sales by introducing strong new software rather than reducing the cost of its hardware.

But Pachter says a price drop is highly likely. In a research note, the analyst said, "Wii supply has finally exceeded demand, so we expect hardware sales to show year-over-year decreases for the first half of 2009. In order to hit its full-year Wii shipment forecast, we expect Nintendo to cut the price of the Wii before [the] holiday, likely to $199.99."

Despite his hard line on the PSPgo and subsequent apology, Pachter is still regarded as the guy who knows from games and marketing strategies. Besides the Wii prediction, he's also calling price cuts for the PlayStation 3 and Xbox 360 over the next year:

"In the second half of the year, we expect Sony to cut price for the PS3, and if the cut is deep enough, we expect Microsoft to respond (either with bundles or with a price cut of its own, even as Microsoft just introduced a Xbox 360 Elite bundle with free games Halo 3 and Fable II)."

Analyst Expects Wii Price Cut This Year [Edge Online]

That analyst is Wedbush Morgan's Michael Pachter, who commented on the most recent episode of GameTrailers' Bonus Round that "$249 is too much. Period." Pachter agreed with host Geoff Keighley that Sony is "ripping off the consumer" at that price point, claiming that the PSPgo costs less to make than the already profitable PSP-3000. Sony, on the other hand, thinks it's priced appropriately.

We talked to Pachter today to get more of his thoughts on the device and its asking price.

Michael Pachter says that Sony execs "made it clear that the PSP Go pricing strategy was intended to compete with the iPod Touch."

"I don't disagree with them that the comparison is favorable from a technology perspective, so I can't fault their logic," Pachter said."However, the iPod Touch has a ridiculously loyal fan base, tremendous brand awareness, gigantic advertising support, a touch screen, an app store, and a LOT of music."

But the PSP is not an iPod Touch, despite sharing some capabilities. Its strengths lie in its gaming functions, Pachter admits.

"The PSP Go has a better gaming architecture and better games, but lacks many of the features that the iPod Touch has," he said via e-mail. "In my view, its price should be compared to the PSP 3000, which does pretty much all the same things and is $80 cheaper."

Pachter said during his Bonus Round screen time that pricing the new PSP at a price above the Xbox 360 Arcade and at the Wii's price point was reflective of the handheld costing too much.

"I just am not going to pull punches and say that the price of the PSP Go is justified, since I don't think it will work at that level," the analyst said. "If it cost them $80 more, I would not have answered Keighley the same way. However, I think it costs the same or less to produce, so the increase in price means an increase in profit at the expense of the consumer. I think that Apple rips off consumers as well (look at THEIR profits), but wasn't asked that question."

Sony's John Koller has said over the past week that the device will carry a higher profit margin for retailers, a tactic I inferred as reflective of the higher suggested retail price. But Pachter disagreed.

"I don't think it has anything to do with retail, and truly think that Sony is right to charge what the market will bear," Pachter said. "The fact is that Sony has been subsidizing the cost of the PS3 since launch, so to say that they are 'ripping off' consumers now is not really fair, and if I could retract the statement, I would do so."

But the Wedbush Morgan analyst believes the product will sell, even at that price.

"I think that they genuinely believe that the market will support this price point, I just happen to disagree. It's hard to believe that Sony is giving much away to GameStop, perhaps they are allowing a 15% margin instead of the more typical 6 – 10%, but most of the "profit" on the device will go into Sony's coffers."

That's because two analysts who follow the video game market, Wedbush Morgan's Michael Pachter and EEDAR's Jesse Divnich, have wildly different estimates of the DS game's performance in March. While Pachter pegs sales at about 450,000 for Chinatown Wars, Divnich estimates they'll come in at less than half of that, with just 200,000 copies sold in the United States.

Yes, I know. Analysts.

But Divnich, based on his low ball prediction, says that his findings indicate "elevated risk" for publishers who are thinking about bringing more mature, more violent fare to the generally family friendly Nintendo platform.

We haven't seen Pachter's comments on Chinatown Wars' sales, but would expect they're more positive than the warning that his peer at EEDAR released to investors. We'll know for sure this Thursday who's right, when the NPD Group releases its findings. Then the victor will be forced to eat the heart of his analyzing enemy.

EEDAR: Chinatown Wars Performance Proves Mature DS Games 'Risky' [Gamasutra]
Analysts Disagree Widely About ‘GTA: Chinatown Wars' Sales [MTV Multiplayer]

Cowen & Company's Doug Creutz says the Wii may represent "fool's gold for someone looking to invest in video game development" in a new Gamasutra editorial and that investing in cross-platform Xbox 360 and PlayStation 3 development may offer "more control over your fate."

Creutz follows that argument with an opinion that calls the Wii "a bit of a crapshoot for what works and what doesn't."

One foundation of the analyst's reasoning is something we've heard before—that only Nintendo games sell on the Wii. Nintendo has countered that argument, noting that third party publishers have had some success on the platform, with multiple one million-sellers "making it" on the Wii.

But Creutz says that the majority of third party success comes from Guitar Hero and Rock Band, which he writes accounts for one-sixth of Wii sales.

"You're rolling the dice on succeeding in a market which has proved very resistant to generating meaningful hits away from Nintendo titles and the music genre," he writes.

Analyst: Wii Is 'Fool's Gold' For Game Investors [Gamasutra]

While direct comparisons between trade-in values at Amazon, who recently entered the used game trade-in business, and retailer GameStop might make it look like a close race, EEDAR's Jesse Divnich claims that Amazon doesn't offer the significant value needed to change the overall market. In fact, when GameStop's various trade-in specials are taken into consideration, the world's largest specialty video game retailer provides a great deal more value.

"In scenarios where a consumer either owns the GameStop Edge card and/or trade-ins more than 2 titles that takes advantage of the current GameStop trade-in promotion (trade in 2 games get 10% extra; 4 get 20% extra; 6 get 40% extra), GameStop provides a considerably higher value than Amazon."

During last Friday's midnight launch of Resident Evil 5 at my local GameStop, I actually chatted with several customers about whether or not they would consider trading in their games through the online retailer, and the result was an almost unanimous no, complete with a chuckle and an eye roll from the store manager.

People want instant gratification. On the rare occasions that I've traded in a game, it's generally because I don't have the money right at that moment to pick up something I really want. In those situations, I am not going to be inclined to ship my games away and wait for them to be processed, even if the value were substantially higher. Which apparently it isn't.

Analysis: Amazon No Threat To GameStop [Gamasutra]

Wait. What? Drop the thing that makes the entirety of the PlayStation 3's physical game library playable? That's what he said. See? "We are also hearing continued speculation that Sony is working on a non-Blu-ray PS3 console, which could enable them to make the aforementioned hardware price reduction," Hickey wrote in a note to investors last month.

Sony says there's no way that's going to happen.

"That would pretty much destroy the PS3's backbone, our games were built on Blu-ray," Sony marketing manager Kim Nguyen tells Business Insider. "Quote that: Blu-ray will always be part of PS3."

Glad we got that sorted out. Also, duh!

Sony: The PS3 Will Always Have Blu-ray (SNE) [Business Insider via VG247]

We're sure it's more of an informed estimate than a guess, really, considering the source is Wedbush Morgan analyst Michael Pachter. Mr. Pachter pegs The Lost and Damned sales at a cool 1 million, according to GameSpot, expecting to see that download figure double to more than 2 million by the end of October.

That would mean approximately $40 million in revenue, should Rockstar Games hold the price steady.

If the second Xbox 360 exclusive episode does similar business, it could make that $50 million investment in securing the two GTA IV episodes a financial success for those involved. Possible forthcoming bundles and greatest hits version could eventually make that big payout a drop in the bucket.

The second episode, which is rumored to feature Liberty City resident Luis Fernandez Lopez, is planned for a release later this year.

According to Pachter's note, he also has a "reasonable expectation" that the next fully-fledged Grand Theft Auto game would hit between November 1, 2009 and October 31, 2010. With Rockstar creative bigwigs Sam Houser, Dan Houser and Leslie Benzies only locked in to a contractual agreement until January 2012, we'd bet Take-Two want the developer to get the next one (and its expected downloadable episodes) as soon as is humanly possible.

Analyst: 2 million Lost and Damned, next GTA by Nov. '10 [GameSpot]

Lazard Capital Markets' Colin Sebastian has speculated that the next outing for Link could hit next year, according to a report from GameSpot, making it three years since the previous The Legend of Zelda installment landed on consoles. Since the GameCube/Wii dual release, Nintendo has released two spin-offs, Wind Waker sequel The Legend of Zelda: Phantom Hourglass for the Nintendo DS and Link's Crossbow Training for the Wii.

Sebastian also said we could expect "a new Princess Peach adventure" from Nintendo, which sounds like it could be a follow up to Super Princess Peach for the DS. Perhaps Nintendo and/or Tose will explore just how expertly Peach is at getting herself perpetually kidnapped.

Zelda makes analyst's list of 2009 releases [GameSpot]

Lazard Capital Markets analyst Colin Sebastian points to the tepid performance of those two titles and Need For Speed Undercover for his estimated drop in quarterly earnings of some $70 million, according to a report from Gamasutra. Stronger sales of titles like Left 4 Dead and Dead Space will help, but expects EA to add to the cuts it made in October.

That could also mean some franchises, new and established, going by the wayside. Finally, an excuse to get rid of that pesky Madden!

Analyst: More Cuts Likely For EA As Mirror's Edge, Need For Speed Underperform [Gamasutra]

Sony announced its quarterly results earlier today, showing improved PlayStation hardware sales, but ultimately posting a hefty loss.

We're unsure if Meloni was drinking the corporate Kool-Aid, factoring in the 10-year lifecycle Sony has planned for the hardware. Meloni also believes that Sony's slice of the console market share, at 67% during the PlayStation 2 era, will shrink to 50% or below.

GOF 2008: DFC Claims PS3 Unlikely to Break Even, PC Not Dying [Gamasutra]

"Do awards translate into higher sales? The answer is yes, but not always. Additionally certain categories have a higher correlation between awards and sales. Since these awards began in 1998, the Best Console title has sold an average of 2.42 million units life-time in the U.S., according to NPD," Schachter explained.

Poor Jet Grind Radio. Had my beloved Dreamcast not taken a fall you would have been right up there as well. Schacter goes on to mention that while this works for Best Console title, it doesn't work across all categories, notable Best In Show, with past winners including the PSP and Gamecube, both of which performed poorly in the face of competition.

If you ask me, it isn't so much the receiving of an award that causes the jump in sales. The E3 Critics awards are an indicator of what games the press and reviewers were most interested in. The games the press get the most interested in are the games the press write about. The more positive coverage a game gets in magazines and online, the more likely people are to buy it. It isn't so much people buying the games because they won the awards...people buy the games because the press love them.

Isn't that a rather self-important view, you ask? If you look back at some of my favorite games over the past couple of years you'll see that there are obvious exceptions to the rule. Going to exclude myself from this based on Iron Man alone.

Do E3 Awards Translate into Big Sales? [GameDaily]

In fact, it's those cooling hardware sales on the DS that may force Nintendo to react, making an end-of-year announcement more likely, Pachter writes. The DS has been regularly outsold by the PSP for the past few months in Japan, with marquee software releases doing little to boost matching hardware sales.

Sure, the company is still selling DS hardware at a massive rate in the U.S. and Europe, and it just announced a very, very profitable quarter, but the dates match up.

The Nintendo DS Lite launched just fifteen months after the original, fugly DS, making the timing seem right for a hardware refresh.

We'd heard just prior to E3 that Nintendo was planning on releasing a smaller, cheaper DS, one with a a built-in accelerometer. Obviously, that didn't happen, but that talk was based on an IGN rumor, citing "trusted insiders."

Besides, Europe's shirtless models have become bored with the current DS. They need something desperately to reignite their passion for handheld video games. Won't someone at Nintendo think of the models?!

Nintendo DS Successor Ready? [Edge]

With price cuts possibly on the horizon that could bring console prices closer to the Wii's territory, should Nintendo worry? "The Wii audience is not choosing between 360 and Wii," said Wedbush Morgan analyst Michael Pachter. "Either they will buy a Wii only, or they will buy both a Wii and either a 360 or PS3. So Microsoft is right to consider the PS3 as the competition and to ignore the Wii."

Sony is the one, says Pachter, with more to be concerned about regarding possible pricing and feature set changes for the Xbox 360:

"Consumers see two boxes with very similar game experiences, and have to decide if a 360 with a 20Gb HDD, no Internet adapter, a very well-thought out Live experience and an extraordinary game library is a better deal at $349 (or $299) than a PS3 with built-in Internet adapter, a 40Gb HDD, a Blu-ray disc drive, a weak online experience and a relatively thin library of games for $399," said Pachter.

Both Sony and Microsoft unsurprisingly declined to comment on rumors or on their future price strategy.

Said Pachter, "So far, Americans consider the value proposition a toss-up, while Europeans value the PS3 more. Lower pricing and/or enhanced features for the 360 could change that."

"I don't really think that Microsoft and Sony are doing badly - just doing badly in comparison to Nintendo," Pachter said. "It makes sense that PS3 and 360 are doing about the same... instead of saying 'what's wrong with Sony and Microsoft,' we should be looking at Nintendo and saying, 'how the hell do they keep doing this?'"

It's easy to peg the answers on the price discrepancies, but Pachter said that's not all there is to it, pointing to Nintendo's success in a mainstream market most gamers are less aware of. "There really are people who play games that don't read Kotaku - I know it's hard to believe," he said. "There are people out there who don't even know how to spell Kotaku, and don't even know that there are websites dedicated to games."

Calling the typical console-fanboy attitude "extremely myopic," Pachter added, "There are actually people out there who have sex. The people on Kotaku, other than their parents, they've never met anyone who's had sex."

Mainstream gamers are mad about Wii Fit, Pachter said, agreeing with fellow analyst Billy Pidgeon who predicted that the Wii would not balance its supply with demand until 2009. So no price drop for Wii anytime soon - but what about the others?

"You'll get a price cut," said Pachter. "I think if I were Sony, I would wait for the Fall, or for the Christmas lineup. There's no reason for them to cut it today [with MGS 4 out]."

Pachter thinks it's likely to see a $50 reduction in the PS3's price. "They'll go $100 if they can afford to," he said, possibly close to the release of LittleBigPlanet, taking a "family bundle" angle.

As for Microsoft, Pachter said they won't stand for having the 360 and PS3 on level pricing ground, and will probably implement their own price drop commensurately. "Madden was an event for Microsoft last year, so perhaps you'll get a 360 cut with Madden. But I think if I were Microsoft, I'd maybe cut it in front of Gears 2."

Pachter also anticipates possible future supply constraints for Wii, based on Nintendo's history of consistently underestimating demand - he also thinks their attach rate estimates for Wii Fit are a bit lower than they'll turn out to be.

The online outlet cites Gartner research analyst Bryan Lewis who, at the Design Automation Conference, said that MS "wanted to avoid an ASIC vendor," opting to use a general purpose chip designed in-house. ASIC means application-specific integrated circuit, according to my sources that are Wikipedia. The EETimes writes that the decision saved money up front, but ultimately cost the company over $1 billion in warranty related costs.

According to the EETimes, the chip at the source of the problem has since been redesigned by ATI.

See? Boring. A more interesting theory is that Bill Gates lost a bet with Satan and that the Devil's hellish minions use the Xbox 360's ring of light as a passage into our world, burning them out in the process. We've opted not to contact Microsoft for comment on this matter.

The truth about last year's Xbox 360 recall [EETimes - thanks, Kirk!]

Today, Ernst upped his estimate to 15 million on word from Take-Two that the publisher had already sold through 8.5 million copies of GTA IV, with 11 million shipped to retailers. Ernst noted that "We expect GTA IV sales to re-accelerate in the latter part of year in conjunction with the seasonal holiday period."

As for Final Fantasy XIII shipping 7 million in 2008?

Ernst said that "Initially we had hoped it would make it in for the end of the year" but that FFXIII "definitely appears off the table" according to Square Enix guidance. Frankly, we'll be thrilled (and maybe even a bit flabbergasted) if it hits North America before 2010.

The Hudson Square Research analyst updated us on a handful of other key figures, noting that Gran Turismo 5 is also expected to be a "no show" this year and that next week's release of Metal Gear Solid 4 "won't be enough to materially accelerate the PS3 this year."

"For the PS3, that's definitely a set back," Ernst told us about titles that the firm expects to hit next year, "And I think is why their 10M unit guidance for the [fiscal year] was lower than most had expected."

Worldwide console sales can pass the $180 million benchmark by 2011 even in an economic slowdown, said the analyst group, since high gas prices encourage people to entertain themselves at home. While the report sees Wii as the likely overall install base leader, it is critical of Microsoft, stating that "for the 80 percent-plus of game consumers that do not play FPS games, the Xbox 360 is not the system of choice."

The sales performance of the PlayStation 3 has been less than stellar, but Sony has survived. The Xbox 360 was unable to take advantage of Sony’s struggles to build the type of large lead needed to maintain a long-term advantage. The PS3 survived the onslaught of AAA Xbox 360 titles that hit the market from late 2006 through 2007.

Halo 3 had great sales, but it did very little to enhance the Xbox 360’s overall position in the marketplace.

Full report and more stats than you can shake a Wii remote at:

Led by the PlayStation 2 (PS2), the “128-bit” generation of video game systems has reached a record global installed base that is expected to exceed 180 million units. Of course, the PS2 was the best-selling game system ever.

With high hardware prices and a slow start for most of the current generation of game systems (Microsoft Xbox 360, Nintendo Wii, PlayStation 3), DFC Intelligence had originally forecasted that it would not be until 2012 that the installed base for the current generation started to match that of the 128-bit systems.

However, 2007 was a record year on all fronts, as sales of PC and video games reached an all-time high and overall worldwide industry sales soared over the $50 billion mark. DFC Intelligence forecasts that sales for the current generation of systems will pass the $180 million mark in 2011.

Ironically, a slowing economy can actually help the game industry. Video games provide a high rate of entertainment return and high gas prices actually encourage people to stay home and play games. The latest DFC Intelligence forecasts predict that all three systems (360, Wii, PS3) will have a solid installed base. Nevertheless, it looks like the Nintendo Wii will be the overall installed base leader. The Wii has enormous momentum and appeals to the broadest audience.

In doing retail checks over Memorial Day weekend, the item that everyone was asking about was the just launched Wii Fit. However, none of the retailers we visited had any in stock. It is because of this type of demand that DFC believes in 2008, the Wii could set a record for most console systems sold in a single year.

Of course, many of the biggest games are not even coming out for the Wii. Halo 3 and Gears of War were exclusive to the Xbox 360. The upcoming Metal Gear Solid 4 is only going to be on the PlayStation 3. The biggest title of 2008, Grand Theft Auto IV, is only available for the PS3 and Xbox 360. In other words, for many third-party publishers the more important race is between the Xbox 360 and PlayStation 3.

Two years ago about this time, DFC Intelligence asked the question, “Could Sony Go From First to Worst?” At the time, our less than definitive answer was: maybe. We argued that much would depend on the execution of Sony and its competitors over the next few years. Two years later, DFC can say with more confidence that we do not think the PlayStation 3 will be the third place system. DFC forecasts that the PS3 will overtake the Xbox 360 in 2009 and finish in a strong second place behind the Wii.

The price of the PlayStation 3 has come down to a reasonable level and the software lineup is finally starting to look fairly strong. Most importantly, Sony was able to keep the PlayStation 2 installed base active. For its recently ended fiscal year, Sony Corp. reported that hardware unit sales of the PS2 were down by 7%. From our perspective we would say they were ONLY down by 7%. This is amazing for a system that launched in 2000. The PS2 managed to outsell both the PS3 and Xbox 360 in 2007.

The sales performance of the PlayStation 3 has been less than stellar, but Sony has survived. The Xbox 360 was unable to take advantage of Sony’s struggles to build the type of large lead needed to maintain a long-term advantage. The PS3 survived the onslaught of AAA Xbox 360 titles that hit the market from late 2006 through 2007.

Halo 3 had great sales, but it did very little to enhance the Xbox 360’s overall position in the marketplace. The Xbox 360 is the system of choice for fans of high-action first-person shooter (FPS) games. However, for the 80%-plus of game consumers that DO NOT play FPS games, the Xbox 360 is not the system of choice.

In our upcoming Genre Forecasting report, we look at expected sales by platform based on genre. While the Wii may have the highest installed base, there are not expected to be any mega-hit FPS titles on the platform. The average FPS title is expected to have 60% higher sales on the Xbox 360 over the PS3 and over three times the sales of the average Wii FPS game.

The biggest uncertainty in forecasting the market five years from now is estimating the impact future, unannounced systems will have. In building our forecasts, DFC Intelligence has assumed that some new systems will launch in the 2011 to 2013 time frame.

However, these forecasts are very hypothetical and are made under the assumption that a new generation of console systems will look very much like the past generation of game systems. This may not be the case, and right now we do not even know who the major players will be.

How soon will Nintendo want to launch a new system with the Wii being so successful? Will Microsoft still want to stay in the game business given their losses? Is Sony really serious about pushing the PS3 to a ten year plus life cycle? Will new game systems just be an extension of the current game systems with some enhanced features and services? These are questions we are currently unable to answer.

One thing that is worth noting is that DFC has built in different models for how fast the current systems will be retired and how heavy consumer purchasing of software will be for each system. We call these factors respectively the active installed base and software tie ratio.

The Xbox 360 has a high software tie ratio, but given technical problems among many early units it also has a fairly high retirement factor. The Wii has both a lower software tie-ratio and a higher than average retirement factor. On the other hand, one advantage with the PS3 is its durability and what is expected to be a fairly strong software tie-ratio in the long-term.

For this reason, the DFC Intelligence forecasting model indicates that software sales for the PlayStation 3 will surpass software sales for the Wii in 2012. Of course, by this time, software sales for all systems are expected to be on the decline.

The biggest story over the next few years may be the declining overall importance of the console systems. Last year Sony’s biggest selling game system was the portable PSP. Meanwhile, the Nintendo DS blew out all records for game system hardware unit sales (portable or console) in a single year.

From a pure revenue perspective, the biggest system for software sales in 2007 was the PC, if you include revenue generated from online services. Like we said, 2007 blew away sales records on all fronts. Right now it looks like 2008 will be even better.

Record Game Sales in 2007 Are Just the Start for the Soaring Video Game Business [DFC Intelligence]

May, however, could bring much bigger numbers with the release of Wii Fit—and maybe some of that Grand Theft Auto IV run-off—projected to increase 160% on the software side says Kaufman Bros. analyst Todd Mitchell. If we're looking at May 2007 numbers, that means we may see software sales alone top $712 million. Still chump change, but at least we're making progress.

Hardware dollars are expected to double, which makes us wonder just how amazingly fit this country will be by bikini season.

Bears hunt video game stocks [Reuters]

Pachter puts the PS3 slightly ahead of the Xbox 360, but the Wii is envisioned to outsell both combined. That may be largely due to Mario Kart Wii sales, but we suspect that a good portion of those Wii sold are simply due to rabid demand.

And, for the record, neither the PS3 or the 360 come close to Nintendo DS sales. In our fantasy world, Nintendo's statement about April's U.S. sales is simply the image above, in obscenely high resolution.

Pachter: Wii Outsold PS3 and Xbox 360 Combined in April [GameDaily]