For the past 6 months in the U.S., Nintendo's Wii has slowed down from its mind-bending sales performances seen since its launch. The system that was infamously out of stock for years on end eventually became easier to find in the stores and soon sold in more down-to-earth terms. In Japan where handhelds are king, this effect happened much sooner and before the release of Monster Hunter 3 (tri-) this past August, Wii was even being contested by Sony's PlayStation 3 (PS3 has presence in Japan). Now with the recent dual price drops of the PS3 (in Slim form) and Microsoft's XBox 360, the pressure on console market leader Wii is greater than ever before.
In the face of the worldwide sales surge seen by the PS3 (and most likely to be for the 360), is it time for Wii to cut the price?
Read on to decipher the clues...
Kotaku uncovered some potential ads-to-be from Toys 'R' Us and Wal-Mart both signifying a price drop for the Wii. The Wal-Mart ad didn't specify a price but said that it would come in the 1st week of October (right before the holiday retail rush). The Toys 'R' Us ad showed a specific $199.99 price tag set for the last week of September which begins on the 27th. No confirmation of the validity of these ads but it has been almost 3 years since the Wii debuted.
Since March, Wii while still leading the pack in home consoles has come down from its Icarus cloud. The seeds were planted last holiday season when Nintendo bet the farm on Wii Music and Animal Crossing: City Folk holding the fort while they get their developments in order. They sold well (even if not critically acclaimed) but weren't the blockbuster evergreen sellers like Wii Play, Wii Fit, and Mario Kart Wii. Big hit mega-sellers that also sell well in the long term and entice new Wii console sales. Nintendo resurrected its Gamecube collection with the New Play Control! series and hoped Punch-Out!! and few 3rd party titles (Madworld, The Conduit) could help out but they couldn't keep up Wii's half-million a month sales in the U.S.
Wii Sports Resort gave Nintendo the evergreen blockbuster it needed but even that mega-hit couldn't substantially push up Wii's console numbers as monthly NPD reports see it hovering around the high 200,000/low 300,000 range. Their E3 2009 showing didn't impress everybody even if it showed surefire holiday hit New Super Mario Bros. Wii, the interesting Team Ninja collaboration on Metroid: Other M, and that quizzical Wii Vitality Sensor. Sequels of Super Mario Galaxy and Wii Fit made some wonder if Nintendo had succumbed into "doing the easy" in President Satoru Iwata's words. Maybe Shigeru Miyamoto upturned the tea table again setting back release schedules and Nintendo didn't have everything to show for 2009.
Sony and Microsoft are putting on the pressure with their more affordable price drops but Iwata denied following suit at an early August company investor's meeting. When addressed point blank about cutting Wii's price, Iwata replied:
"It's not the case of the quality of hardware moved, the feeling of missing strong competitive power, lacking its luster or poor sales. Consistently, big time titles will be released in the marketplace for this hardware. When that stops, to reinvigorate the console, or to put it another way, I think the current decline in hardware sales is due to the fact that there aren't many big titles (at the moment). Right now, there aren't a lot of discussions going on about what exactly to do about hardware pricing."
And listen to what he said in an interview from last November:
"This is my personal thinking, but when the model's price-tag drops over time, manufacturers are telling consumers it's better to wait, and I've always thought that was a mistake."
Of course it's poor business strategy to telegraph your price cuts, primarily because of people holding off buying until the cut comes. Then again, Nintendo's DS has been the same $130 price since the 2nd version, DS Lite, debuted here in June of 2006. And the 3rd version, DSi, has actually gone higherbeing priced at $170. Of course, the DS has been a consistent powerhouse seller since DS Lite appeared and the original DS at $150 got that price drop to get an edge on that competitive PSP (PlayStation Portable).
Here's another sign that Nintendo may relent. At the start of this month, they made the Internet Channel free again like it was for the people who got it before the end of June 2007. And those who bought the channel at $5 or 500 Wii Points got credited with any 500 Wii Point Virtual Console NES game of their choice. A refund in game form. Good will to their loyal customers and hopefully incentive for potential buyers to come on board.
You can never tell with Nintendo but if it does come it's certainly overdue. Money is tight for everyone right now and it can only help Nintendo when they reach that magic $200 price range. With new colors looming and big holiday games coming down the pike it can offset XBox 360 and the PS3's plans to ease into their motion-sensing transformations in 2010. It's not like Nintendo's losing money or anything, right?
Thank U Kotaku.
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