It seems like not long ago when Nintendo was dominating the console markets; both home home and handheld. Only a few years ago the Wii had sold more total consoles than both the Sony Playstation 3 and the Microsoft Xbox 360, and the Nintendo DS had a huge market share in the handheld market. Nintendo had come back in a big way, and the uniqueness of the Wii with the motion controls were different, and helped drive sales; particularly for the casual gaming market.
Today Nintendo announced much lower than expected sales figures for both the Wii U and the 3DS consoles. Since December 31st, 2012, Nintendo has sold only 2.4 million Wii U systems compared to Sony selling 4.2 million systems since it’s debut in November 15th, 2013. These low sales figures have caused Nintendo to buy back 7.8% of its stock ($1.2 billion) to appease shareholders.
Nintendo has dropped the price for both consoles recently, including a drop in price for the 3DS from $250 to $170, and a $50 price drop for the Wii U. To put things in perspective for Nintendo, since 2007 Nintendo has lost 80% of it’s value according to Bloomberg. So what has caused this decline for Nintendo, and what is the future for Nintendo hardware?
There are several factors as to way the Wii U hasn’t met Nintendo’s expectations, and here are my five:
1) Games: Probably the biggest one is the lack of games. To be honest since the Wii U’s debut, Nintendo hasn’t released many games worth picking up. Sure they released a New Super Mario Bros, and the recent New Super Mario 3D World is worth playing, but there haven’t been many games that stand out. I like Zelda games, but a remake HD Zelda game for me isn’t motivation enough for me personally to get excited about the console.
2) 3rd Party Support: Nintendo makes top notch 1st party games; there’s no doubt, but where’s the 3rd party love? Where are the system exclusives? Lego City is a good game and an exception, but there needs to be more exclusive titles outside of just what Nintendo puts out to convince gamers that the Wii U can stand on its own and compete with the likes of the PS4 and Xbox One.
3) Game Pad Controller: The Wii U game pad controller is gimmicky; that’s the honest truth. The battery life doesn’t last very long (only six hours max), and you can’t take the Wii U game pad outside of the system to play games on. The games streams through the game pad, and there is no internal hardware to turn the game pad into a portable tablet device. The games that are out for the Wii U haven’t taken very good advantage of the game pad controller either. The game pad for me personally doesn’t add any true gaming experience.
4) The Name: “Wii U” has got to be one of the worst name choices that Nintendo has ever made for a console. Why would Nintendo name a console that sounds so similar to their previous system the Wii? Sure the Wii U is HD, but graphically the system isn’t much of an improvement compared to Wii, and sertainly compared to the current gen PS4 and Xbox One, the Wii U is severely under-performing when it comes to specs and performance.
5) The Market: When the Wii came out, Nintendo was smart and marketed towards the “casual gamer”. They created a lot of games that most hardcore gamers would consider “shove-ware”. Nintendo got a little too confident and assumed that a lot of those people who purchased the Wii would go on to buy the Wii U. Unfortunately for Nintendo, those casual gamers don’t see reason enough as to why they should go out and buy a new console.
Nintendo’s 3DS sales have also been less than expected, and a major reason as to why this is, is because of smartphone and tablet gaming. The Android and iOS market has thousands of games where most are extremely cheap that are fun, have surprising decent graphics and that are more convenient for gamers to play on the go than buying a separate device to play them on.
Fortunately for Nintendo financially they still don’t have any debt, and they are far from calling it quits yet. They have some big titles that they have yet to release for the Wii U including a new Mario Kart and an all new Zelda title that will be sure to help sell some units.
Nintendo also recently announced that they will be producing and releasing Nintendo game titles for the smart phones and tablet market. These games would promote Wii U and 3DS games through in game advertising. This is a smart move by Nintendo, and perhaps Nintendo realizes that they need to expand their current business model in order to stay relevant in the gaming industry.
What do you feel about where Nintendo is today?