Xbox 360 Software Attach Rate Is 'Alarming'

November 21st, 2006, 23:24 Posted By: wraggster

The latest issue of Jason Kraft and Chris Kwak's 'Video Game Journal' for the Susquehanna Financial Group examines the software attach rate for the Xbox 360, and explores why such an "alarmingly high" rate may not bode well for Microsoft's next-generation console.

Specifically, the report cites the recently announced Xbox 360 attach rate of around five games per console sold as confirmed by Microsoft in October, a number that was up from the roughly four games per console attach rate announced by the company at the console's launch in 2005.

It concludes: "We believe the unusually high attach rate on the 360 is a sign of an increasingly unhealthy console growth rate, and should be worrisome to publishers and investors."
The analysts further explain their hypothesis by offering that a significant portion of the Xbox 360 consoles currently in circulation were purchased by hard-core gamers, who, by definition, purchase a lot of games.

In conclusion, the authors state, "If the Xbox 360 sports an attach rate of ten by holiday 2007, it will probably be because it has failed to gather critical momentum. What does it benefit publishers and investors if ten games are being purchased by a total audience of 10 million 360 owners? It doesn't take effort to see that a console with an attach rate of 8 and an installed base of 50 million is superior to a console with an attach rate of 12 with an installed base of 20 mln."

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