Sony Leads Global Console Market with 57% Share in 2016

Market Dominance and Revenue Breakdown

In 2016, Sony solidified its position as the undisputed leader in the gaming console market, capturing a staggering 57% share of global hardware, software, and service spending—totaling $19.7 billion—according to IHS Markit. This dominance is expected to continue into 2017, with projected revenues exceeding $20 billion, driven by the growing popularity of digital console games.

Key Market Insights:

• Total console market revenue (2016): $35 billion
• PS4 installed base: 53 million units (vs. Xbox One’s 27.6 million)
• Sony’s hardware market share: 51% ($17.8 billion)
• Microsoft’s Xbox One share: 26% ($9.1 billion)
• Nintendo’s 3DS/2DS share: 8% ($2.6 billion)

Image Credit: IHS

Market Trends and Competitive Landscape

Despite Sony’s dominance, the overall console market declined by 2.5% in 2016, dropping to $34.7 billion. This dip was attributed to:

• Lower hardware sales volume
• Price reductions for PS4 and Xbox One consoles
• Hardware spending drop: \(10.5 billion (from \)12.8 billion in 2015)

However, the market is poised for a 4.1% rebound in 2017, reaching $36.2 billion, fueled by:

• Nintendo Switch’s March 2017 launch
• Growth in digital sales across platforms
• Microsoft’s Project Scorpio release (late 2017)

Digital Growth and Subscription Services

While hardware sales slowed, digital content spending surged:

• Combined physical/digital game sales: $21.6 billion (+5.6% YoY)
• Console platform subscriptions: $2.8 billion (+14% YoY), driven by Sony’s expanding PS4 user base.

Digital Content Breakdown:

• Sony’s digital games revenue (excluding subscriptions): \(4.4 billion (projected to surpass \)5B in 2017)
• Nintendo’s digital share: 5% ($397 million), down from 7% in 2015 due to fewer game releases.

Image Credit: IHS

Future Outlook

Both Sony and Microsoft are doubling down on digital monetization strategies:

• Microsoft’s Xbox Games Pass: Subscription-based game library.
• Sony’s PlayStation Now: Expanding to include PS4 titles in 2017.

Nintendo’s market share is expected to recover with the Switch’s success, though significant growth may take until 2018.

Image Credit: IHS

The Bottom Line

Sony’s PS4 remains the market leader, but 2017’s evolving landscape—with Nintendo’s resurgence and Microsoft’s Scorpio—promises fiercer competition and renewed growth for the industry.

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