Nintendo has had a stranglehold on the portable games market since, well forever. Unlike the home console space where no company has held onto the #1 position for more than two generations in a row, Nintendo has never been dethroned as the king of all things on the go. With the launch of the 3DS, things for the big N seem to be going just as planned, but is everything really all rainbows and gumdrops in Nintendoland? After a very strong launch weekend, President and Chief Operating Officer of Nintendo of America, Reggie Fils-Amie told USA Today, “3DS was never meant to sell out” when the 3DS didn’t sell through it’s initial shipment. In addition, Nintendo CEO Satoru Iwata told investors that the 3DS has performed below expectations. Can Nintendo be losing some of its luster? The answer isn’t a simple yes or no.
If you’re worried about Nintendo’s financial stability you should stop right there. As a rule, Nintendo always operates at a profit. That’s just how they roll. Unlike Microsoft or Sony, who will sell their consoles initially at a loss to create larger market share, Nintendo will always be in the black for every unit sold out of the gate. When you look at the numbers, Nintendo isn’t moving units as quickly as the DS just yet but they’re actually generation more revenue. The original DS launched in the US and Europe for $/€149.99 and in Australia for $199.99 compared to the hefty price tag of $/€249.99 in US and Europe and an obscene $348.00 in Australia.
Personally, I want a 3DS. Of course I want a 3DS, I’m a hardcore gamer who writes for a video game website. However, I’m not willing to shell out that kind of money for something without a killer app. As much as I love Street Fighter, it’s just not enough. If Nintendo fails to pull in someone like me, what does that say for all the Soccer Mom’s out there that Nintendo relies on to hit that mainstream number? In a world where the average consumer is walking around with their iPhone, which is perfectly suited for that 5 minutes of fun, are they really going to buy another device to accomplish the same thing? Maybe. One of Nintendo’s big hurdles is getting past the current perceived value of games. Am I really going to pay full retail boxed price for Bust-A-Move (USD $29.99 – AUD$68.99) when I can pay $4.99 on the iOS App store for basically the same game? Don’t be silly, of course not. Nintendo is certainly on the right by track focusing more on digital downloads to curb this but there certainly is a perception amongst developers that a full boxed copy is the main ticket event and digital is somehow less than. But Money talks so the tides may be changing.
One thing is for sure, the casual market is ginormous and to lose that is almost like loosing everything. Sure the big N has it’s loyalists who are perfectly happy buying the Nintendo stable of titles again, but without the numbers there isn’t much to compel developers to take risks and create all those unique titles that made the DS such a special device. Especially when everyone and their monkey already has an iPhone. The 3DS is a cool handheld, and I’m sure it’ll do well. But does Nintendo have another monster in their hand or is it’s bark worse than it’s bite?
