Well, it had a good, long life. At the beginning of 2013, Sony (SNE) halted production of its iconic game console, the PlayStation 2, after more than a dozen years on the market.

Its successor, the PlayStation 3, probably won't even be around as long: The company introduced the PlayStation 4 at the end of 2013. Sony has pledged to support the PS3 (released in 2006) for "as long as there is a good business there for us." It's a rather tepid promise.

Most likely, by the time of its demise, PS3 won't be the blockbuster its older brother proved to be. The latter's total global sales were in the neighborhood of 160 million units. Now, toward the apparent tail end of its life, the PS3 has sold just something a bit north of 80 million consoles.

Dedicated consoles like the PS2 were nearly synonymous with video gaming earlier this decade, but competing platforms have eaten away at their dominance. And that chomping looks set to continue.

Losing the Game

The big two combatants in the console market are Sony and Microsoft (MSFT), which in line with its rival unveiled its own new-generation machine, the Xbox One, prior to last year's holiday season. On the surface, both companies have so far enjoyed smashing business with their latest models, moving millions of units.

However, zooming in a bit on those sales reveals some cause for concern. According to popular IT news website Tech Crunch, parsing data from researcher NPD, around 271,000 PS4s were sold this past January.

For January 2007 -- the month just after the previous generation of consoles (PS3, Xbox 360, etc.) were introduced -- the figure isn't much higher than the PS3's tally of 244,000, and it's beaten by the PS2's nearly 300,000. Remember, at that point PS2 was yesterday's model for Sony.

The numbers for Microsoft are more stark. January saw the company sell roughly 141,000 Xbox Ones -- less than half of the 294,000 in sales of the then-fresh Xbox 360 the same month seven years ago.

Worse still is the tally for the once-mighty Nintendo (NTDOY). Back in early 2007, the company's then-new, innovative Wii ruled the January sales charts with around 436,000 units sold. Fast-forward nearly seven years. Nintendo's current-generation machine, the Wii U, sold only around 49,000 units in January 2014.

Xboxed In

Those declines are symptomatic of a market squeeze. Segments that house cheaper, less involved gaming options such as mobile apps have surged. According to the Entertainment Software Association, these days 44 percent of gamers use smartphones as a platform for at least some playing.

No wonder certain operators in this segment are raking in the bucks. King Digital Entertainment (KING), creator of the addictive Candy Crush Saga, nearly tripled its gross bookings on a year-over-year basis in its first quarter of 2014, from $219 million to $641 million.

Candy Crush Saga follows the modern trajectory for video game success, which often cuts consoles out of the scene entirely.

Candy Crush Saga follows the modern trajectory for video game success, which often cuts consoles out of the scene entirely. In 2012 it debuted as a playable add-on in Facebook (FB). Several months later, King Digital released app versions of the title. These days, Candy Crush Saga is available for all major mobile operating systems on the "freemium" model (it's free to download, but selected in-app options must be paid for).

Meanwhile, at the higher end of the spectrum, many dedicated gamers eschew consoles for tricked-out PCs. These machines, rigged with state-of-the-art CPUs and video cards, can produce a richer and more immersive experience than an Xbox or PlayStation.

These serious players spend serious money on their gear. A report from Jon Peddie Research reveals that they shelled out around $20.7 billion for this hardware in 2013.

The top and bottom ends of the market aren't small. According to industry observer Charles Sizemore of Sizemore Capital Management, at the moment high-end PC gaming comprises roughly 20 percent of the market, with mobile gaming apps taking around 17 percent.

Playing a Brand, Not a Box

This squeeze has led to some dark mutterings that this current generation of video game consoles -- the eighth, for those counting -- could be the final one. Even the top manufacturers hint at such a future, with Sony saying last year that PlayStation will likely evolve into more of a service brand than a piece of hardware.

So the consoles are still hanging in there, but their glory days do seem to be over. They did well while they lasted. Anyone up for getting out the old Xbox for a nostalgic Halo death-match while we still have the gear?

Motley Fool contributor Eric Volkman owns shares of Facebook. The Motley Fool recommends Facebook, and owns shares of Facebook and Microsoft. Try any Motley Fool newsletter service free for 30 days.

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I don't think consoles are doing terrible yet but they are doing worst than any other generation in terms of game title offerings and actual sales of games. Hardware sales are a little harder as you will always see a spike in sales when new hardware comes out and the hardware for this generation is still relatively new. the real problems will arise later in the lifespan of these devices when the overall hardware sale is revealed to be way lower than previous generations and games sales are consistently low due to the consoles hitting a graphical and performance wall way too early due to under powered hardware.
I for one hope consoles fail and mainstream gaming moves to another platform like a tiered pre-built gaming PC option, wither SteamOS or Windows. Gamers could choose between intermediate, advance and extreme hardware components at a good price that way developers can target those tiers when making there games instead of 8 year old crappy console hardware. This would destroy the stoppage in innovation and cutting edge technology that crappy console hardware has caused for many years.

Free the Gamers!!!!!!!!!!!!!!!!!!!!!!!!!!

June 03 2015 at 1:54 PM Report abuse rate up rate down Reply

Be serious, people... The consoles are going down, and for good reason... since the tendency of console games nowadays is always to get BETTER, PRETTIER, and BIGGER... just GO, GO, GO. Never stop to think if the game is good or not.
Any of the older castlevanias you don't take much more than 10 hours to it with the new lords of shadows, and you're lucky if you make 10% after 10 hours of gameplay. It is frustrating.

The game industries are trying to shove a new type of game down the gamer's throats a lot like the FMVs games from the age of Sega CD, and as a result they're alienating older gamers that end up going directly to handhelds where there's much bigger variety... But, they're NOT CASUAL GAMERS.
For instance, "candy crush" is it? Maybe i should look for it after i CASUALLY play the crap out of my castlevanias... dawn of sorrow, portrait of ruin and order of ecclesia. Good 20 to 40 hours that i can squeeze out of each one of these if i want.

March 07 2015 at 7:41 PM Report abuse rate up rate down Reply
Win or Wince

Good to see that others out there are tuning into the shift in the gaming paradigm. For months now, I've been reporting on the ever looming takeover of the gaming industry by smart devices, specifically mobile. With streaming technology taking hold (PlayStation Now for example) it's only a matter of years before game publishers realize that they can make more money selling their product to consumers through smart devices opposed to the deteriorating model of consoles.

All new episodes from Season Two of Win or Wince (on YouTube).
-Video Game Publishers Superseding Console Manufacturers

-Mobile Gaming Taking Over the Video Game Industry

-Bait and Switch Video Game Trailers

On Twitter:

Be adventurous, be creative and stay entertained.

January 07 2015 at 12:31 PM Report abuse rate up rate down Reply
Mike Grunewald

What did i just read ?

what a total bunch of nonsense what in the world are you talking about do you have any understanding on the millions and millions of dollars sony and microsoft and nintendo are making right now ? you think a stupid game like candy crush is the future of gaming ?

do you understand ( Destiny ) cost over $500 million just to make.

sales are better this generation then any in earths history.

this is the most absurd topic i fell for your Click bait shame on me

August 14 2014 at 11:56 PM Report abuse +1 rate up rate down Reply