Network Effects and Cascades in Purchasing Gaming Consoles
Network effects are greatly involved in the decision of purchasing a new gaming console, as sales updates continuously show the choices of the majority. There is also direct-benefit effects due to the choices of your friends, as the games become more fun with more people to play with. At this point, the PS4 is leading sales over the Xbox One; a good portion of this sales lead is due to these effects and direct-benefit cascades occurring.
The situation of dominance in the console market can easily be modeled with a network effects with x* being the portion of the market using one of the consoles. After a few months, the market most likely reached an equilibrium state with PS4 clearly leading. Xbox one was given a $50 price reduction, increasing demand, and effectively increasing its share by shifting the console market’s equilibrium values to more favorable portion of the market.
source: http://www.techdigest.tv/2014/08/state-of-the-race-ps4-on-10-million-xbox-one-on-5-million.html