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October NPD Shows Stronger Wii Supply, Chance Of Dominant Holidays

In analyzing October's NPD U.S. sales report, Wedbush Morgan's Michael Pachter and theSimExchange's Jesse Divnich have noted that stronger Wii sales show more retail supply, and have predicted that the console could dominate this holiday season with as mu
In analyzing October's NPD U.S. sales report, Wedbush Morgan's Michael Pachter and theSimExchange's Jesse Divnich have noted that stronger Wii sales show more retail supply, and have predicted that the console could dominate this holiday season with as much as a million unit lead. "It is clear that supply of Wii units to the U.S. has begun to increase," said Pachter, "with 518,000 units sold in only four weeks (an average of 129,500 units per week). From January through June, Wii supply averaged 78,000 units per week, and from July through September, the supply increased to 102,000 units per week." "It appears that Nintendo has managed both its production capacity and the allocation of units to the U.S. market so as to allow for a regular increase," he continued, "and we expect further increases over the next two months." Wii To Make More Massive Gains? In his own notes, Divnich showed that confidence in the Wii's continued performance was clearly evident in theSimExchange's fantasy market, showing continued gains compared to the competing consoles as the year draws to a close. As it currently stands, theSimExchange market is predicting 912,000 units sold for November, a strong lead over the Xbox 360's 636,000 and the PS3's 438,000. For the month of December, though, the market is calling for more than double that -- 2.37 million units sold compared to 1.56 million for the Xbox 360 and 695,000 for the PS3. Don't Forget The Bundles Elsewhere in their respective reports, Pachter notes that a significant number of software units weren't otherwise tallied in NPD's report, bundled as they were with various hardware packages -- the new PSP model packaged with Daxter, and new Xbox 360s bundled with Forza Motorsport 2 and Marvel Ultimate Alliance. "In the aggregate," said Pachter, "these bundles represented over 600,000 units of games that were purchased by consumers and which were not counted in the NPD software numbers for the month because the software was included 'inside the box' as part of the bundle." "The bundled software would have generated over $23 million in retail sales had it been priced separately. Because consumers received this software with the purchase of new hardware, the tie ratios for the Xbox 360 and the PSP were lower than we had expected, explaining the bulk of the shortfall in sales relative to our estimate," he continued. Quake Wars In A Losing Battle Finally, while Activision had an extremely strong month with Guitar Hero III, and is expected to have another in November with Call of Duty 4, Divnich notes that the latter comes at the expense of another Activision title. "The strong success of Call of Duty 4 has had a toll on another Activision title, Enemy Territory: Quake Wars, which only sold a disheartening 18,600 units on the PC in October," he said. He concludes, "It is without a doubt that Activision is not disappointed that Call of Duty 4 reigned supreme; however, it still is worth noting and bothersome that a publisher would set one of its own properties up for failure. This might be one title that might have actually been more successful if delayed until after the holidays."

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