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Third-Party Publishers React To Deflating Wii Bubble

January 8, 2010 Article Start Page 1 of 3 Next
 

Tumbling Wii hardware sales and analysts' comments about whether the Wii bubble is deflating have some third-party publishers re-examining and re-jiggering their strategies.

Wii console sales in the U.S. slid 27.5 percent from January to November 2008, when they were 8.0 million, to 5.8 million for the same period in 2009, according to the NPD Group. The tracking firm has yet to reveal full 2009 sales figures, but with an estimated 3 million Wiis sold during December, Nintendo sold about 8.8 million units in the U.S. last year, versus 10.2 million in 2008 -- a 14 percent year-on-year drop.

Some of the most troubling concerns about the possibility of waning enthusiasm for the Wii include whether there are too many Wii games on the market, whether gamers have had their fill of so-called Wii casual or party games, and whether publishers have a handle on the moving target that is the Wii audience.

Take the case of third-party publisher Capcom, whose stock rose to a five-year high in September, 2007 due to increased support for the Wii, according to the company.

At the time, its CFO spoke enthusiastically about Capcom's Wii portfolio -- which had doubled from three to six games -- and was poised to publish Zack & Wiki: Quest For Barbaros' Treasure the next month.

But Chris Kramer, Capcom senior director of communications and community, said even though "it was one of the highest-rated Wii games and was beloved by the media, it sold abysmally -- about 120,000 units in 26 months -- for no apparent reason.

Similarly, Japanese publisher Marvelous Entertainment focused heavily on Wii and PSP releases in 2009, but the company found a considerable difference in its success on the two platforms. Four out of its five PSP games in its first fiscal half were profitable while three of its four Wii games during the same period lost money.

According to Kramer, "If you're not Nintendo, it does seem harder to make money on the Wii today compared to the PS3 and the Xbox 360. It's a very tough market to crack and is ever-shifting."

He recalls that when the Wii first launched in North America in November, 2006, simple casual or party games did so well that they soon saturated the market. "Now, I don't even know what the market is," he says. "

One thing's for sure -- the focus has changed. Stores like Target and Best Buy have reportedly told game publishers not to even bother approaching them with collections of mini games, which they will no longer pick up.

"Third-party publishers are having a hard time determining who the Wii audience is," Kramer adds. "You can no longer say it is solely casual gamers or that only E-rated games own the space. For any sort of solid statement you want to make about the platform or the audience, there are enough opposite proofs to show that it is extremely scattered and chaotic."


Article Start Page 1 of 3 Next

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