Comparing Playstation Network and Xbox Live, revenue is what matters
As Sony announced yesterday, Playstation Network has 20 million users. Xbox Live, by comparison, has 17 million But PSN is for the Playstation 3 and PSP (around 70 million devices), while XBL is only for the Xbox 360 (about 28 million). PSN has been around for 27 months. XBL? 67.
What does it all mean? Who knows? There are dozens of variables that make comparisons difficult. But more importantly, "registered user" statistics are virtually meaningless. How many websites have you ever registered for? "Second Life" has over 15 million registered users, but it's struggling to survive and find a reason for being.
If you're interested in the business of video games, there's only one statistic of any significance: Sony has generated $180 million in gross revenue from PSN two-plus years of life. As of the last E3, after about five and a half years, Xbox Live had generated over $1 billion.
On that basis, the advantage goes to Microsoft. PSN has been around about 40% as long as Xbox Live, but made less than 20% as much money. Given how much more content there is available to download on consoles today (more games, video content, etc.) than the first few years of XBL, the advantage is even more dramatic.
EXCEPT... A little more than half of XBL members pay for the service. Without knowing how long they have paid for, and under what plans, it's tough to estimate with any precision how much revenue that has generated for Microsoft. But it's safe to guess it's well into the hundreds of millions.
So on download revenue, the two might be roughly equal. But Microsoft still has an advantage. Revenue, after all, is revenue. And running Xbox Live certainly costs, ballpark, about as much as it costs to run Playstation Network. So Microsoft is making more revenue on around the same costs.
Sony's reason for making PSN free is, of course, to make the Playstation 3 and PSP more attractive. But given the weak sales of the PS3 and so-so sales of the PSP (whose main competitor, the DS, also offers free online play), it's not particularly working.
I think it's really tough to argue that, at this point, Sony wouldn't be better off by cutting the price of the PS3 as much as possible and making up at least some of the difference by charging for online play via PSN.
Chris Morris reports on the business and culture of video games and offers analysis of recent events and industry trends.
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They really shoudl have a flag feature to the comments system. False claims a pure flame are all over this site.
Posted by: nathan | October 14, 2009 at 06:47 PM
the xbox accounts wasnt counting xbl silver accounts microsoft confirms that those are subscribing gold users. plus, there is a waaayyyy better selection of games for the 360 and some of the best games you cant get for ps3. Oh well, that sucks for you homos!
Posted by: garrett | August 16, 2009 at 10:12 PM
i think you all should stick to your consoles but its a question of do you want the best service online but have to pay or do you want the 2nd best service online but not pay? but if you think about it paying for xbl isint bad because the price cuts of the xbox 360 make up for paying online and so thats why psn has put the network freee because of the console pre but that seems not to be working and they are not making as much money as xbl so thats why they shoud defintitely drop there price but also when the next consoles come out go for the playstation it will be better! but microsoft should cut theire prices online
Posted by: luay | July 26, 2009 at 03:31 AM
You guys who hate on people who sign up for PSN accounts for free are retarded.
You do realize that XBOX is also counting there XBOX Live Silver accounts also. I have like 4 of those! As soon as you plug in your XBOX to the internet, it know you have how many ever free Silver accounts on your system.
I only have one PSN ID. And with my 360's out there, you know there are more people with multiple silver accounts on there systems.
Just face it, with the EXTREME success of PS3 in Europe, Australia, and Eastern Asia PS3 and the PSN are continuing to grow worldwide.
Posted by: Lemar | April 09, 2009 at 07:40 PM
NETNER SUCKS! AND HIS(or is it IT?) X-BOX of crap
Posted by: Duke_0f_MD | March 12, 2009 at 11:50 AM
I noticed that this Rebel A-hole here is a total looser who spends too much time on a crappy american technology they called x-box.In case you have'nt noticed Sony and PS has been around for a while and will be there for a while unlike your pre-historic Sega genesis and soon to be obsolete x-box,charging for online gaming.What is microsoft going to do next?...charge everybody for using or entering each website?..PS will continue to be around and stay on top because they understand online gaming should be for everybody eighter your white(that means you Rebel)black,purple,red,pink,yellow or heck green, you can play online for free.The way its supposed to be.
Posted by: Duke_0f_MD | March 12, 2009 at 11:47 AM
How is it possible to use a Ps3 or XBox 360 without any account?
When there are "only" 17 mio XBox 360 accounts, then its impossible that more than 17 mio XBox 360 Users have played with there console.
I think that 90% PS3 Users only use one account. Because its the same for PS3. Its not possible to use the console without any account.
Posted by: Martin | March 02, 2009 at 02:34 AM
XBL is doing better than PSN for one reason. It is a better product. Yes you have to pay for XBL but If $4.10 a month is out of your budget I don't think you should be buying $60 games anyway. I pay more for my cell phone in one month than I pay for XBL all year. There really is no online community with PSN. The accessibility is just not there with PSN. I have all 3 consoles and when I buy a multiplayer game I always go with the 360 just because the online experience is so much better. Finding friends, chatting, party's, and messaging are just way better on XBL. I hope PS3 gets their act together. PS2 in my eyes was the greatest system of all time so I had high hopes for the PS3. Sony has really dropped the ball.
Posted by: killerchris2k8 | February 27, 2009 at 10:28 AM
WITWOLFY... Are you sad that you can afford one?
Posted by: Angel | February 26, 2009 at 03:58 PM
A lot of people created multiple accounts/sub accounts in the PSN just to hoard online nicknames. The only requirement was that you had a valid email. There are thousands of dormant accounts being counted and Sony knows it.
Posted by: MightyAtom | February 26, 2009 at 02:52 PM
Before the defense forces get into a tizzy, realize that Ben Fritz is not a fanboy of any sort, nor is he in anyone's pocket. He's just a bad journalist. I don't think it's reasonable to expect more. Video game journalists have the business, analysis savvy of... well, a videogamer. And he's writing for a blog, for Variety, of all places. He just needs to sucker us to click and read his stories. Well done, Mr. Fritz.
Posted by: obonicus | February 26, 2009 at 08:35 AM
well well well. Who would of guessed that Sony gamers would mkae like 100 accounts just to give xbox a run for they're money. when half of the accounts arent even being used. They should do a summary to see how many of those online accounts are actaully active and compare those numbers to the online xbox accounts
Posted by: WitWolfyZA | February 25, 2009 at 11:40 PM
ps3 sucks
Posted by: NetNer | February 25, 2009 at 07:03 PM
Pliskin,
Accounts are different from Gold accounts. You can create multiple silver accounts for 20 people in your family, who cares. So the situations are the same for both Xbox and PS3.
Posted by: Bill00 | February 25, 2009 at 04:15 PM
Rebel are you reading the same article the rest of us are? The whole point is that the number of accounts is pointless. The reason you pointed out is just one of many reasons the author stated.
btw - from my experience (major publisher employee) the revenue we get from psn sales isnt close to what we get from xbm sales. It's not apples to apples (install base -> software sales -> dlc revenue) but all of that adds up. If you made every publisher only make dlc for one, Xbox would win 100% of the time (unless you're Japanese).
Posted by: Discokil | February 25, 2009 at 03:18 PM
Interesting article. I personally have 2 PSN accounts one for me and one for the guest player so they don't mess up my stats when they want to play an online game. Yes people have more than one PSN account, but since were speaking on what if's... What if the PS3 cost as much as a 360? How many people would own one then because no matter how you cut it the PS3's biggest gripe is the price. Now that price the PS3 at $250... How many PSN accounts do you think there would be ?
Posted by: Edge | February 25, 2009 at 03:08 PM
Number of PSN and XBL members doesn't even count. WHo cares if 12 people do have a sum of 100 accounts? Who cares how many people are, collective, on one system. You can only play with so many players in one game at a time. Say there is like 20 million PSN users, well I only get to play with 11 of them per lobby on CoD. Numbers don't count. They importantly don't count when PSN users save an incredulous amount of money or the life span of their 10 year system. And I'm totally a Sony fanboy, just as you are a xbot. =]
Posted by: Incredible | February 25, 2009 at 02:58 PM
You know, this is one area where I would say that Sony's otherwise-hysterical argument about the PS3 being a great value does hold water. That xbox has a lot of hidden costs. Like, if you want to play online games over a wireless network with your Xbox, say for a year, you're talking 150 dollars. The peripherals-and-xbox-live-subscription business is a racket, to be sure, but I don't see how is Sony going to leverage this fact.
The larger question I have after reading this is: how important is online networking for this generation, anyway? It seems like Nintendo has done just fine with its cumbersome friend code system and anemic lineup of Wiiware titles. It seems to me that Sony thought that ambitious nework features-- like Home-- were going to drive consumers to the PS3 and it seems like that wasn't the case.
Posted by: Iroquois Pliskin | February 25, 2009 at 02:33 PM
That is a complete joke, the PSN numbers. At $49/year, it is very unlikely that people will be creating more than one account. One the PSN, I have personally know people who have dozens of accounts (for a variety of stupid reasons and to include the fact that they can and it doesn't cost them anymore). So the PSN numbers are SEVERELY misleading. I guarantee that one PSN starts charging, you'll see those account dry up real fast.
Amazing that the author of this article, clearly a Sony Fanboy, carefully and intentionally left out this incredibly important piece of information.
I was in a lobby in COD4 listening to a bunch of people bragging about how many accounts they have on PSN and why. I was shocked. Easily accounted for over 100 accounts when there were only 12 in the lobby.
Posted by: Rebel | February 25, 2009 at 02:22 PM