A leading US games industry analyst has claimed that the Nintendo Wii bubble is "deflating" and that Sony's PS3 is set to dominate game hardware sales this Christmas.

Cowen Group analyst Doug Creutz told Gamasutra that he predicts Christmas 2009 is all about PlayStation.

"While we believe the Wii is likely to be a drag on overall software sales through the holiday, the impact should be limited to those publishers which have invested significantly in Wii development, with the biggest negative impact likely to be felt by Electronic Arts, which (unwisely in our view) heavily invested in Wii development for [calendar 2009]," he said

Creutz, added that 21 percent of respondents in a recent survey he conducted plan to purchase a PS3, while only 12 percent plan to purchase an Xbox 360. Wii still topped out the survey results at 26 percent, but the analyst noted that this was considerably less than results over the last two years.

Downward spiral in quality

Meanwhile, developers over at Blue Fang have told Gamesindustry.biz that they think Wii software quality is in a "downward spiral" which contributes to the consumer shift away from Nintendo's system.

Blue Fang chief operating officer Scott Triola said: "There's a circular argument going around in the industry. There's a low tie ratio on the Wii platform therefore it's not worth investment, therefore we'll just put out a bunch of low quality titles.

"From a consumer's standpoint, a lot of families have bought those low quality titles and once you spend 40 hard-earned dollars on a game that just isn't very good, you're less likely to buy another product. Or, you're more likely to buy from a proven brand like Nintendo that takes quality seriously.

The Zoo Tycoon dev has just released the new game World of Zoo, published by THQ, which Triola hopes will "cut through the noise" and appeal strongly to parents buying Christmas stocking fillers for younger children.

"There are a lot of games out there that frankly upset parents," said Chouls. "They look at the state of our industry and a lot of it is a lot of death mongering and violence and destruction. We really focused on creative, fun, constructive play that the parents can feel really good about buying and kids enjoy playing."

DSi LL rocks Japan

Finally, its not all 'doom and gloom' news for Nintendo this week, as the newly released DSi XL (or LL as it's know in Japan has sold over 100,000 units in its first week on sale in Japan. ]

Which is just a shade less than the DSi sold in its first week around the same time last year (170,779 if you're interested, according to Enterbrain's estimates) and a chunk less than the original DS and DS Lite in previous years.

The PSPgo sold a mere 28,275 units in its first week of its Japanese launch.

Via GamesIndustry.biz and Gamasutra and Siliconera.