The story this holiday has been the success of the Wii. In the month of November it sold over 2 million units. Quite impressive. All the headlines liked to tell this story by noting that the Wii more than doubled the sales of the Xbox 360. But they missed the more interesting story. The 360 outsold the Playstation 3 by more then 2 to 1 as well. The numbers don’t lie when they say that the Wii sold more than five times as many PS3. So, how did Sony go from dominating that market with the PS2 to the bottom of the barrel with the PS3? Follow me after the jump to find out.

The first mistake Sony made was relying on it’s name recognition. Having dominated the market with the Playstation and Playstation 2, Sony thought that people would naturally flock to their new system. It had worked for Nintendo for so many systems, so why wouldn’t work here? Sony actually fell into the same trap Nintendo did. After dominating the landscape with the NES, SNES and N64, Nintendo rested on it’s laurels and released the Gamecube. Underpowered, it quickly fell behind the PS2 and the newcomer Xbox. Without a large install base, developers that normally supported Nintendo picked the Xbox and PS2 instead of the Gamecube. That’s effectively what happened here with the PS3. While the most powerful, it was also very expensive compared to the Wii and even the 360.

Blu-ray is a big part of why that price point is so high, and another reason why the PS3 is failing to attract buyers. When Sony had Microsoft to compete with in the High-Def movie arena, sales were going well for both of them. Sony eventually won the war with Blu-ray and HD-DVD fell away. Since that victory has occurred, PS3 and all other Blu-ray sales took a bit of a dip. Sony has failed to excite the consumer with Blu-ray and hasn’t really told us why it’s better. Yeah, I’m a geek and I know a lot of the specs of Blu-ray and why it’s supposed to be better, but my DVD player makes my regular DVDs look high-def. Why should I go out and buy a Blu-ray player and then start playing 30-40 dollars for movies when I’m spending 15-20 now? Microsoft did the smart thing I feel by making the HD-DVD player be an add-on, not built into the system. That way if you wanted to spend the money for this new format, you had a choice.

Probably the biggest mistake Sony made really had nothing to do with the system at all, but with their ability to gauge the market place. I already touched on how expensive this system is, but this is more than that. In the last couple months you’ve seen better 360 sales because they dropped the price, and Nintendo already had a pretty low price for the Wii, helping it fly off the shelves. But the PS3 has stayed up at 400 dollars for it’s lowest model, even while the 360 is below 200 for it’s lowest and the Wii at 250. This holiday season saw Microsoft bundle two games with the 360 to help move it, Sony decided to increase hard-drive space on both models and bundle a game with the 500 dollar model.With the economy getting tight, do you think buyers want more hard-drive space or would they like two games right out of the box? But it doesn’t end with the price. Sony has had a huge debacle with their accessories. While Microsoft and Nintendo evolved their controllers, Sony has stuck with the same controller for the last three systems. Yes, this time it has the SIXAXIS stuff inside giving it some basic motion controls, but the ‘trigger’ buttons, if you can call them that, aren’t trigger shaped like the 360, or even like on the Wii-remote. It also lacked rumble at first, because Sony said it would interfere with the motion controls. Unfortunately they forgot to tell Nintendo that because they had no issue including both. Rumble has since come back and the SIXAXIS seems to have slipped from the minds of developers.

It really seems as though Sony is really going out of it’s own way to make this system fail. Is it internal sabotage as some people think? No, probably not. But is it another example of someone getting too full of themselves and falling on their face? Yeah, it is. I know we’re only 2-3 years into this console generation, but they’re already 8 million units behind the 360 and 18 million behind the Wii worldwide, it doesn’t look like they have much of a chance for a comeback. It’s kind of sad actually, they’re getting so desperate that by the registers at Best Buy where they keep little things they want you to buy at the end like cheap games and batteries, they also have Playsation 3’s lined up. Do you think Sony has mucked this up for themselves, or are they just misunderstood?