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Sizing up Wii U's price tag against history Exclusive
Sizing up Wii U's price tag against history
September 13, 2012 | By Matt Matthews

September 13, 2012 | By Matt Matthews
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    48 comments
More: Console/PC, Business/Marketing, Exclusive



Today Nintendo took the first real step into the next generation of video game consoles and announced the launch details for the Wii U in the U.S. The two features I took most note of during the announcement were the two models being released and the prices. Launching at $300 for the entry-level model puts Nintendo at the high end of historically successful console launch prices.

Nintendo's plan to launch with two Wii U models in the U.S. is a departure from the single-model approach that the company has traditionally taken. For example, the original Wii launched in November 2006 in the U.S. at $250 with Wii Sports and didn't change in any essential way for nearly three years.

Some analysts criticized Nintendo for the $250 price of the original Wii, saying that the company left money on the table when demand outstripped supply month after month. With two Wii U models at two prices, Nintendo is attempting to maximize income from the high-end models while still capturing consumers with tighter budgets on the lower end. In fact, the Wii U now represents the most expensive console ever launched by Nintendo.

If we look back across the history of console launch prices in the U.S., it's clear that most consoles launching above $300 have struggled or outright failed in the marketplace. In particular, the Phillips CD-i and ill-fated 3DO in the 1990s were priced extravagantly and largely ignored by consumers.

The $400 Sega Saturn found a somewhat more receptive audience in the U.S., but still struggled against Sony's original PlayStation, which was priced at $300. Sony's PlayStation 3 is an exception, since it launched with an entry-level model at $500 and higher-end model at $600, well above $300, and yet has sold over 20 million systems in the United States. No other expensive console has started that high and sold so well for so long.

Still, a good entry-level price is not sufficient to guarantee success. Before the wildly popular Wii, Nintendo's GameCube launched at $200 but still sold fewer total units during its lifetime than the higher-priced Microsoft Xbox. And the Sega Dreamcast was out ahead of the PlayStation 2, and very competitively priced, but for various reasons ended its run in the marketplace with disappointingly low sales.

The following diagram gives a history of console launch prices in the U.S., from the Atari 2600 back in 1977 through the Wii U in 2012. (It shows only the entry-level price for systems where multiple models were available.)



The price of the Atari 2600 back in 1977 was $200, and the U.S. Bureau of Labor Statistics has an inflation calculator online that tells us that $200 in 1977 has roughly the same buying power of $750 today. Of course, that's measuring inflation across a variety of goods needed by a household including food, clothing, and entertainment, and need not relate directly to consumer electronics. Regardless, it is an interesting metric for the sake of comparing system prices several years ago and today.



The war over pricing is sure to heat up next year, when I expect Sony and Microsoft to both release new iterations on their consoles.

If Microsoft inverts the traditional business model, promoting its games, Xbox Live network, and media portals (Netflix, Hulu, etc.) as a slate of services that just happens to require their console, you can expect their entry-level price to come in quite low but with a required monthly fee. Launching a new console at under $200 under those circumstances would be incredibly disruptive to the current business, and carries great risk for Microsoft, but also a chance for immediate and long-lasting success.

Sony is still struggling to make a profit on its current PlayStation 3 console and while I do anticipate a new Sony console next year, what form it will take is still unclear. It seems likely at this point that Sony may iterate its hardware slightly and release an upgraded box that puts it ahead of Nintendo's Wii U technologically.


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Comments


GameViewPoint Developer
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No wonder I could never afford a NeoGeo.

Matt Robb
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I'm willing to bet part of the reason for the PS3 exception is Sony exploiting the fact that it was also a Blu-ray back when they were pricey and scarce. People who wanted a Blu-ray player looked at a dedicated player, then looked at a PS3, and figured a little extra cash was worth having the game system.

Stanley de Bruyn
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True. We bought a PS3 for GT5P 50/50 split €385,-
But I bought a PS3 for the living room TV. Wich got more use as BR-player.
It got even a login "BR-Player" :)
Got my third PS3 to hang on my PC monitor the one I mainly play on PSN.

Toby Deshane
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(Not to mention that the Bluray connection sustained the PS3 until they finally brought the price down to something a bit more realistic.)

John Gordon
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I don't think I would call the PS3 successful unless your bar for success is really low. Does a console have to flop as badly as the Neo Geo to be considered a failure?

Also one thing these price comparisons don't take into account is the value of what the consumer gets in the entry model. For example the original NES bundle came with 2 games, 2 controllers, a gun and a robot. The original Atari 2600 bundle likewise came with a game and multiple controllers. More recently the Wii launched with a controller and Wii Sports for $250. That is a great value. The entry level Wii U model costs more than this, and doesn't come with a game.

warren blyth
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agree. but i think it's a tricky thing to lay out.

I remember for at least a year Sony cried out that Xbox systems reallly cost more when you bought all the comparable components. Sony gave you all this great stuff in one slick package. But i think history proves that Sony's approach was wrong (outside of Japan).
It is better to have the illusion of a cheaper system, even if consumers need to buy extra hard drives and controllers and wifi adapters and such to achieve parity. It gives the consumer the illusion of more freedom (to buy the extra bits when they're ready). I think this particular flavor of freedom/choice is more popular in America than Japan.

Stanley de Bruyn
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I rate succes like this. If you got unit sales over several multi milions. Like 60mil. You got profitable target market to sell multimilion games. If direct competition beats you with 20% more. Nice for them but me as a gamer plenty of online gamers on PSN. Image and prestege doesn't serve me at all. Even Wii with double the sales or so. Doesn't matter. The platform stand very strong for crossplatform development.

Even so if it harder to dev for PS3 60+ mil. target platform makes up for that 10 fold.

And yes PS3 is very complete compared to xbox360.
But the Wii.

Wii base system + 3 motes +3 nunchucks + plastic stuf
€250 + 3 x €40 + 3 x €20 + n x €20 wenn I walked out the store it was €500,-
I didn't bought it because it was cheap. Even PC gaming isn't expensive, but it can be extremly expensive, but that everybody freechoice.

Sean Kiley
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Imagine what we would be paying if we didn't keep dumping money into the economy. Here comes QE3!

Tom Franklin
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Let's leave our misunderstandings of basic economics at the door, shall we?

Duong Nguyen
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Given that the last time we had such deep depression and they didn't have QE then, you know what happened, no need to "Imagine". A run on banks as they collapsed one after another in domino fashion, as lending and credit broke down, business shutdown in a systematic collapse resulting in massive unemployment hitting 25% of the working population. Then the dust bowl rolled in (kinda like what were having now with the droughts), massive migration of people, etc.. It took a world war to lift the US out of the Great Depression, so no need to imagine, you can read about it.

Sean Kiley
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Well there was the lowering of interest rates, confiscation of gold and the new deal in 1933, I would consider that to be the QE of its day and nothing really got better.

Ian Welsh
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Sean: in fact the New Deal massively reduced unemployment. This is not in question, and for you to say otherwise indicates you don't know what you're talking about. It did not end the Depression, but it did make things better. It was not comparable to QE3, the policies are very different.

Sean Kiley
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Ian: It's very true that the new deal reduced unemployment, but it did so by paying people with the money that was taken from them (confiscating gold at below market value). That's how it had to work because the dollar was still tied to gold, you couldn't print money out of thin air like they do now (QE). Printing money out of thin air causes inflation is the point I'm trying to make, relating to the article.

Price of gold in 1793=$19.39
Price of gold in 1971 when the fed could start printing money=$44.60
Price of gold today= $1768.80

warren blyth
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when you lay out the competition (xbox$200,ps3$250,appleTV$99), i think wiiU looks pretty good. because it is NEW. so it can cost $50 more than the closest competitor.

I'm more curious about what the launch prices were relative to the existing systems, than the prices alone. Did any launch at just $50 more or $100 more than the existing kings?

... I also think consumers have woken up to the fact that Xbox Gold is a hidden cost. So they're less likely to accept the system as just $200 (everyone I know now complains that it's roughly $50 a year to actually do anything with an xbox. so they've spent hundreds more on it since launch).
The idea that Microsoft will capitalize on this with their next system is interesting. but. I think it'd be pretty short sighted strategy.

warren blyth
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'course I haven't heard any thing about playing DVDs or Blurays. eh. if it can't do either... then $300 seems crazy.

edit: yikes. Iwata came out and said no to both : http://www.engadget.com/2011/06/15/wii-u-will-not-play-dvds-or-bl
u-ray-iwata-says/

wow. for some reason this makes me think it really is an expensive launch price. hmmf. (although, probably just need to calm down and accept that Nintendo is embracing streaming video over discs, with it's TVii focus).

Would be smart if Nintendo really hammered the message that TVii is better than dvd or bluray. somehow.

Kyle Jansen
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As for the lack of DVD/BD, that doesn't really hurt Nintendo too badly. Optical media is dying out (the Wii couldn't play either, and look how well *it* did), and they've latched firmly onto "the future" with WiiTVii (the future, as it seems, has horrible spelling).

Matt Robb
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While that's a little annoying, I don't believe there's a shortage of DVD players out there as it is.

Luke Meeken
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@Jefferson: The Wii hardware is certainly capable of playing DVDs - there are homebrew software programs for the system which allow you to play DVDs on it. The reason DVD functionality was not included on the system is that it would require a licensing fee from Nintendo, and one of their highest priorities for the Wii was keeping extraneous costs down.

That stuff about spinning the disc the other way reminds me of accounts (that I can't seem to substantiate via Google, and which may have been rumors) that the Dreamcast optical drive read discs from the center outward, essentially "backwards" as an anti-piracy measure. Maybe you're thinking of that?

Kenneth Wesley
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Looking at the chart and looking at the launch lineup for the Wii U, it's not so bad overall. There were a lot of games I've pegged as day one buys, so overall: I'm still spending less than I did for the PS3 launch.

Kenneth Wesley
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However, I'm not buying hardware alone, I'm actually getting games for the Wii U, games I'm actually excited to play, regardless of power. I can't get The Wonderful 101, Zombi U, Lego City Undercover, and Scribblenauts Unlimited anywhere else. If it was just raw power it was banking on, the Wii U is a bit overpriced. But that Gamepad has gotten my body ready.

Chris Hendricks
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Actually, Scribblenauts Unlimited is coming to Steam as well. Just FYI.

Kenneth Wesley
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@Chris-I don't play on the PC, so while I have a Steam account, I don't make any purchases on it.

Lincoln Thurber
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If hard to compare prices when even base level consoles can include more or less in the box then their competitors. There is the price, the value, and the perceive value unaccounted forby a chart. Sure, a base level PS3 cost $100 more then a base level 360; but a base level PS3 came with Wi-Fi, Blu-Tooth, BluRay playback, and a 20GB harddrive....none of which XB360 had.

warren blyth
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Some would say this is why the PS3 didn't sell very well. Xbox offers the choice for a cheaper unit, and it leads to everyone saying/thinking xbox is a cheaper system (even though you need to spend a lot bring it up to parity).

Merc Hoffner
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First, Lincoln, you are incorrect and are comparing a premium launch 360 ($400 - disingenuously omitted from the chart above) to a 'base level' launch PS3 at $500. The 360 'Core', or 'Tard Pack' to use industry vernacular, was priced at the 'magic' $300. Make no mistake, the price differential was $200 at each levels. Of course both companies introduced these systems to say to the market 'hey, it ain't that expensive' but both were purposely understocked as both lost their parents huge sums of money. The difference is that the 20GB PS3 was fully functional and compelling while the Core 360 was an intended disaster.

Not that anyone cares to remember, but the 'Core' pack was a ridiculously false economy, lacking any form of memory card, rendering the system essentially unplayable out of the box and online sojourns off limits. Microsoft's minimum memory solution was a 64MB proprietary memory card priced at $40 raising the minimum price for entry without a game to $340. On top of that it lacked MS's proprietary HD cables, had a wired only controller, lacked the headset, remote (there was a very limited addition free pack in), and, if memory serves, lacked an ethernet cable. Oh yeah, and the Harddrive.

If we were talking minimum launch bundles for actually having the machine and being able to play a game then 360 should be further along this chart and the Wii-U looks pretty darn good. If we're talking having the fully capable versions of the machines then 360 should be quite a lot further along.

Matt Matthews
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@Merc Hoffner: The Xbox 360 at $400 is indeed shown on the chart, and it has been that way since this article was published. It is not on the inflation adjusted, because that was messier to do, and I declined to do it. But your implication that it was somehow "disingenuously" left out is, quite simply, wrong.

Merc Hoffner
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You're right. I was wrong. Sorry.

Michael Hartman
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Consoles should cost $199 at launch and $99 at their first price cut.

Otherwise, you might as well stick to the PC. They make billions off the games. They should almost give the stupid console away for free anyway.

Jeremy Reaban
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Except that's not really the case. Sony lost almost everything it ever made in the console business selling the PS3 at a huge loss even at $500/600. (And yet, for not that much horsepower, going with the Cell was a massive money sink)

And MS didn't do so well with the original Xbox.

Eric Adams
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Wondering if an opportunity was missed by not pricing the games at $50 and saving the $60 price for AAA titles (Zelda, Mario, CoD, etc.).

Bob Johnson
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REal price is $350. You gotta be dumb to buy the $300 model.

Higher than I thought. I was thinking prices would be $50 lower.

I liked what I saw today. Cod demo - 2 screen co-op and how the game played on the controller alone. Gave me confidence that if CoD plays on the game controller that well then anything will. I believe this is a big selling point that is underestimated right now by most.

And Nintendo TVii was something I think the average family can make use of.

Of note though is that the selling point of continuing a game on the controller seems to cancel out the TVii feature. Those things can't be used simultaneously by 2 people.

Bob Johnson
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WEll if you are buying at launch they why wouldn't you buy the game that is undoubtedly going to show off what the Wii U can do better than any other game?

And so that's why you buy the deluxe package.

If you can afford the $300 package you can afford the $350 package and the $350 package is the better value.

So I can't imagine one family that would be better served by the base model.

Jonathan Murphy
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What I would have done. Up the system specs for $80 more. Add in 6gb ram($35), 320gb HDD($45). Replace the tablet for a cheap $20 Wii classic USB controller at launch. Price console at $200 and $50 games. In 2013 release the tablet controller with Zelda for $120. Can't wait to see parents in 1-2 years bring back tablets their kids broke and realize it's half the cost of the console to replace. But what do I know?

Leon T
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Nintendo should have a game or at least a demo bundled with the $300 package. Other than that I think the Wii U can sell at these prices. Nintendoland really needs to be a hit for them or the only killer apps they will have is NSMB U and Wiifit U. IMHO a new ip as a killer app is better than the sequel for a killer app. If they market right it will be a hit, but not a sold out for a year like the Wii type of hit.

I'll be getting the $350 bundle along with a few games near launch.

Kevin Fisk
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Yeah I think they should throw in like $25 dollars worth of credit in the eShop with the base model. It educates people on how to get into the online store and purchase something and gives them something to play.

wes bogdan
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Well imho the base unit is an absolute waste of time when adding up what u get for $50 it's around $100-150 worth of extra accessorys,memory and demoland it's silly to waste peoples time with 8gb vs 32gb no demoland and no charging cradle or stand.

That's just nintendo trying to get fence sitters who don't realize they'll pay more by paying $50 less.

How well would wii sd have done without wii sports as the hook..not as well.

So while i plan to buy the deluxe set when dual analog games like metroid or zelda arrive without full customization even though i've had these series since the nes it will be the first unplayable games for both series which needs to be avoided as i really want those games to be accessable and playable.

If not then i simply won't buy them which would be a black day as the reason we spend money on nintendo hardware is for their software .

Cordero W
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Well, it doesn't matter what people are saying about the Wii U failing. Preorders are selling out all over the place for it.

Bob Johnson
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@Cameron

Yeah the Xmas means little unless sales are to either extreme.

@Cordero W

And selling out never means much either. You could have 50 consoles available for pre-order and sell out.

@Cameron
For the fields in China in which you work, $300 is a couple of organs. IN the US it ain't much.

wes bogdan
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Well systems are sold based on the games that are must haves and while ms has shed almost all their exclusives retaining only a handful for the nextbox both nintendo and sony have built their hardware around massive franchises and while it takes around 12 months to see fruition outside the handful of games @ launch it does happen.

My question is will the nintendo faithful be impressed by ports of aaa games from the current gen boxes or has it always been about metroid mario and zelda which can't come out fast enough for fans.

I expect wii sd will be a tough act to follow as people who liked the simplicity of wii would likely be scared off by this big tabletpad so will it be gcn 2 or a real new wii success story.

When ps4 and xbox next arrive in 12-24 months will wii u be showing it's age and nintendo would roll out it's successor to compete against the new boxes?!!

wes bogdan
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Not 2013 but 2 years AFTER xboxnest and ps4. I believe they're entering orbit of sega's hardware death sprial because sega was first out and first out of date then rinse n repeat.
saturn-dreamcast-done coming off the highly successful genesis.

So nintendo had wii IS going to be first out and likely first out of date then 2015/16 when wii u is still under 5 years old they'll rush the next next gen to compete with the then current gen.

Personally i have no problem with handhelds from nintendo but it would make more sense to leverage their ip on ps4/720 and also be consulted for controller innovations as we really don't NEED a system just to get our metroid mario and zelda fix and whatever the price of nintendo gear would be funneled back into games either digital or physical.

kevin williams
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Fundamentally there is one major omission from this report - and that is the hidden pricing of the online support and DLC - PS3, XB360 and now Wii-U will depend on the subscription ans revenue stream achieved by forcing a constant connected environment - already we see players starting to chafe at this bit!

I know its hard for the media to report this element (especially if you are a online service yourself), but we need the costings of how much a average XB360 owner has spent on online services in a life-cycle of the system. I also am very worried that the Wii-U has been rushed to market to establish a online presence for Nintendo forced by angry investor seeing previous management intransigence to embrace the environment.

Merc Hoffner
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If Nintendo pandied to analyst/investor sentiments then they'd be dead like Sega a decade ago.

wes bogdan
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I'll buy wii u exclusives and nn games but without full customization there may be a great many games that are unplayable like pikmin 3,metroid and zelda to name a few.

I hope all games get demo's and i can try them to make sure i can play them before plunking down only to find out it's unplayable.

Any multi plat game i'll get for ps3 as i know i can play it with my custom pad and hope it works on ps 4.

Bob Charone
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you mean the one with the d-pad on the right?

wes bogdan
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What i use on ps3 is a wired thrustmaster pad which is in the default configuration HOWEVER it can be re mapped so that triangle,circle,square and x are where they would be on a giant d-pad which sends the d-pad directions to the face buttons and i can put the sticks into inverted legacy or southpaw-i use inverted southpaw though you must also swap clicks or they'll be wrong.

Also of note this gamepad can be used on ps2,3 or pc and will remember the same scheme for each or 3 different schemes for each because when done all i need do is press preset and i can play almost anything.

It lacks motion so i had to get creative with kz 2 and 3 with 2 i switched to ds 3 did motion and switched back but with kz 3 you have to use the wand then switch back.

So even though stardust,tank battle,pixeljunk shooters 1,2 and blast factor are all smash tv twin stick shooters only stardust has southpaw and blast factor requires motion so even though i own bf i can't play it.

Another great feature other than the giant d-pad is 360 style gun triggers so in most ps3 shooters i just map r1 and l1 to the dummy triggers and the real r1,l1 still work buy why would anyone use them when real gun triggers are avaible on playstation.

Sadly the gilmount thrustmaster dual trigger 3-1 can't be found stateside except for used pads but europe has them.

Meijer a local store has a much smaller wireless version without the giant d-pad or 360 gun triggers but $29 and you to can have real full southpaw or even legacy as these pads override the in game controls like a master control profile should on wii u,ps4 or 720.

All i want to do is play great games so if i could simply save an override scheme for ALL DUAL ANALOG games (god of war's combat roll isn't true dual analog like modern ratchet games sporting the deadlocked scheme) and it would kick in when needed but not onnew smb u

wes bogdan
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I did back on ps 2 / xbox 1 days design full southpaw on gamester's phoenix revolution 4 holes with 4 pods system and shockingly after realizing what a difference d-pad on the right and face buttons on the left made when looking on the left and moving on the right last last gen the industry hasn't implimented my scheme in any game as simply southpaw they stop @ sticks.

Now we're at the end of another cycle and having another custom pad and re wireing my 360 pads i'm still no closer to user created schemes which are filed and forgetten as what's important is the games and being able to play them.

Rodolfo Camarena
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I can't believe that GameStop has sold through all their reserve allocation for the Wii U Deluxe already! They received the sku Thurs afternoon, and were sold out/sku shut off Fri evening! You can only reserve the vanilla version now. Their big marketing... only having to put down $25 instead of $50 (through Sunday only)

So I was only able to reserve the regular version (through GameStop anyway) for $25, then headed to Best Buy. They don't require that much and I was able to secure my Deluxe for just $5.

Looks like we're going to see scalpers making money this holiday season. Expect to see these go for $400 - $800 or more on craigslist and ebay, lol.

wes bogdan
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That's true around gcn,ps2 and xbox 1 days ebay scalpers moved in and secured between 2-10 systems and those who really wanted the system for gaming were left out or jacked for the system.

I'd call the scalpers griefers who ruin others fun even if it's a side effect of chasing money they know kids who really want it will have mom or dad's with deep pockets while those who refuse to pay 3x what it costs get coal.

There should be some way to block scalpers from having multi log in's and multi adresses so they can claim 4+ systems. We all know the black system is the only worthwhile system and the basic set is garbage when for $50 more you could have a 32gb + another 32gb sd and even an external hdd vs 8gb +32gb and a hdd.


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