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 1m 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 (for example, 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.

Investors looking to score some easy green on Nintendo’s little white console may be left blue, particularly if they fall for the “red herring” that is the console’s massive install base, says one analyst.

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]

Analyst Michael Pachter has already gone on record saying that Nintendo’s next Zelda game will hit in 2009, but a second has also pegged a Wii follow up to Twilight Princess for next year.

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]

“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 favourite 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.

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 adaptor, a very well-thought out Live experience and an extraordinary game library is a better deal at $US 349 (or $US 299) than a PS3 with built-in Internet adaptor, a 40Gb HDD, a Blu-ray disc drive, a weak online experience and a relatively thin library of games for $US 399″, said Pachter.

Both Sony and Microsoft unsurprisingly declined to comment on rumours 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 $AU 53.22 reduction in the PS3’s price. “They’ll go $AU 106.43 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 $AU 1.06 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 $US 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 $US 50 billion mark. DFC Intelligence forecasts that sales for the current generation of systems will pass the $US 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]