Nintendo’s earnings report today showed the first drop in profits the company has seen in four years. For the six month period ending September 30, the Kyoto giant’s operating income fell 58.6% from the same period last year to 104.3 billion yen. The Wii platform took a major hit, its sales falling 43% from last year to 5.75 million units. Nintendo ended up lowering its Wii sales forecasts for the full year from 26 million units to 20 million units.
Mainichi Shimbun reports that Iwata, speaking at a press conference in Osaka today, said “We failed with the Wii. We were unable to continually release strong software, and let the nice mood cool.”
Sankei Shimbun, covering the same press conference, reported Iwata as having said “We were unable to show a new game to become ‘the next thing.’ In the game market, once you’ve lost the momentum, it takes time to recover.”
It does seem that Iwata has a positive outlook for the Wii, though, thanks to the September price drop. According to a Reuters report from the press conference, Iwata said of the decision to lower Wii’s sales targets, “With the price drop, sales returned to a certain level, but they just did not reach the level of last year around this time. We decided that it would be difficult to sell enough to recover from the poor performance of the first half of the year.” On the new 20 million target, he said, “In order to reach it, we’ll have to move quite a large quantity, but it’s a figure we released after having felt the momentum returning [based off the price drop].”
The Slim Effect™ has taken hold worldwide and now even Nintendo is admitting defeat. Very interesting turn of events… expect SDF to dive deeper into this in the coming weeks.
Even Netflix couldn’t ignore The Slim Effect™ and has no choice but to add their streaming services to Playstation 3 or face losing out on a huge chunk of revenue.
With this major bomb dropping, one has to wonder what the point is of paying for Xbox Lag anymore.
In order to better serve fair and balanced video game coverage around the globe, SDF has now opened a branch in Germany. The team there is hungry to provide an unbiased view of the latest gaming industry news and trends and we look forward to working with them.
Hardware:
PlayStation 3 491.8K
Wii 462.8K
Xbox 360 352.6K
Software:
1. Halo 3:ODST (360)
2. Wii Sports Resort (Wii)
3. Madden NFL 10 (360)
4. Random Mario Game (DS) 5. Madden NFL 10 (PS3)
6. The Beatles (360)
7. Marvel: Ultimate Alliance (360) 8. Batman: Arkham Asylum (PS3)
The PS3 beat Xbox 360 and Wii last month in U.S. console sales. This means the U.S. is now inline with the rest of the world where The Slim Effect™ has taken hold and the PS3 is outselling both 360 and Wii on a weekly basis. Also worth noting is even 3rd party releases like Batman: Arkham Asylum are selling better on PS3 than Xbox 360.
According to Michael Pachter MS is expected to raise the price of XBL to $100 in the near future. I’m not sure how MS thinks they can get away with this since PSN matches, and in some cases bests, XBL feature for feature and is still free on charge. It will be interesting to see how this all shakes out. Full quote and source below.
“Wedbush analyst Michael Pachter expects Microsoft to raise the price of Xbox Live Gold membership from the current $50 to $100 per year in the next few years. “You can’t hook a guy into Xbox Live Gold if he’s playing on a PC,” Pachter said in a GTTV discussion talking about how Microsoft has seemingly given up on the PC gamer market. “that’s the other problem ‘ you really want to hook every gamer who has a 360, you want them to buy all their games on 360, play everything multiplayer, pay you 50 bucks a year so that, in a couple years, it’s a 100 bucks a year.”And that’s going up, we all know that ‘ it’s a profit deal,” he concluded.”
