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Opinion: Nintendo Slashes 3DS Price, But Did It Do Enough?
Opinion: Nintendo Slashes 3DS Price, But Did It Do Enough?
July 28, 2011 | By Chris Morris

July 28, 2011 | By Chris Morris
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Welcome to the post-iPhone world, Nintendo. We were wondering when you'd take those blinders off.

Thursday's announcement that the game giant would be slicing the price of the 3DS by nearly one-third after just four months was significant on a number of levels. But as the mobile gaming world continues to evolve at a breathtaking pace, it may not be enough to secure the system's long-term future.

Let's not mince words: The decision to launch the 3DS at $250 was one motivated by ego and greed. Rather than looking at its audience base as a whole, the company made the decision based on the enthusiastic feedback the device received at E3.

The problem is: E3 is the amen chorus of the video game industry. And show-goers habitually line up to see any sort of playable new hardware, since everyone wants to be able to say "I played it first".

The decision ignored the budget-conscious consumer that had become the company's lifeblood – the gamer who rewarded Nintendo for charging $250 for the Wii, rather than $350 or $400.

That said, making such a drastic pivot after such a short time is an embarrassing thing for a company to do, so Satoru Iwata earns a tip of the cap for making the decision, despite the inevitable second-guessing and backlash it will attract from investors (though, let's be honest, given the dismal first quarter earnings and significantly reduced earnings forecast the company reported Thursday, that backlash was going to come no matter what).

At the same time, the company smartly devised a way to keep the system's early adopters from revolting with its offer of 20 free downloadable games from the Nintendo eShop – including 10 GBA ports that anyone who picks up the reduce-priced 3DS won't be able to buy.

Along with this, it issued a sincere apology to those early buyers, basically saying "We know you feel screwed – and we don't blame you. And we're really, really sorry about that." (The tone of the note made it quite apparent that Nintendo had learned from Sony's PR disaster after the April hacking incident.)

Lowering the price of the hardware is a good first step, but it may not be enough to salvage the 3DS. The weak software lineup is being patched and by Christmas there will be a number of "must have" games for the system – but they'll still cost a hell of a lot more than any app.

That's a problem that won't go away soon. While things like Super Mario 3D Land and Mario Kart 7 might be able to command $40, that's simply not the case with most 3DS titles – something Nintendo has yet to acknowledge. Without a more concrete plan to sell non-premium 3DS games at a lower price (the $15-$20 range would be ideal), the problems won't be over soon for the 3DS.

Sure, it might turn around its minuscule sales numbers on the hardware side, but without software royalties, it won't be a cash cow – and certainly won't fill the gap that's being left by the DS.

That could affect the interest of third-party publishers, who are still upset about the rapid decline of DS game sales – and the 3DS could eventually become a system supported chiefly by shovelware and two to three high-quality Nintendo games per year. That would only open the doors wider for mobile competitors to march in and steal more audience.

Meanwhile, you can imagine the high-level meetings taking place at Sony today. The Vita might be a glossy high-tech system, but it's going to run into many of the same challenges the 3DS did.

It's not 3D, of course, but it's a dedicated system that will compete for pocket space with mobile phones. And it's a system that will have game prices well north of what people pay for apps.

Will the games be higher quality – not to mention deeper, richer and better looking than the majority of smartphone games? Absolutely. Will they appeal to core gamers? You bet! But will the mass audience who STILL thinks Angry Birds is novel be willing to pay $30 to $40 for a portable game today – even one as epic as Uncharted? I'm not convinced.

Of course, Sony has at least acknowledged the mobile competition with the PlayStation Suite for Android devices. So far, the company has made sure to distance the Vita from its Android devices, but the lifeline's out there if Sony needs it. The problem is: If it gets to the point where it needs to bring those older games in for low, low prices, it may already be too late.

In talking with friends and other gamers, I'm hearing a lot of the same chatter about the Vita that I did about the 3DS. "I want to try it," say people, "but I'm not planning to buy one."

Game systems that are curiosities sometimes catch on with the mass audience – like the Wii. But too often then remain just that.

Nintendo has made some smart moves to resuscitate the 3DS. I'm just not convinced they've made all the necessary ones yet.


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Comments


Eric Geer
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I would have to say that the 3DS game prices are a bit steep--even a 5 or 10 decrease for some titles would be just right--so you would have price points ranging from 30 to 40 dollars--



I still don't like that its $40 across the board..thats just pretentious.

michael leisz
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I never wanted to believe that mobile gaming would replace the handheld console, but this article makes a good point: if the DS audience hasn't migrated to the 3DS, and if they aren't buying new DS games, they are shoe-ins for the mobile demographic, and thats a lot of shoe-ins.



I, for one, could never play an iOS game for too long, even the quality titles like Sword & Sworcery EP. Part of it has to do with the button-less interface, but a larger part has to do with the insane over-inundation of software. It's difficult to even find a game worth sticking to in such a flooded market, and the catch-22 is that its difficult to stick to a game when there are so many more to check out.

Matt Fleming
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Put out a few Pokemon games for it, and 3DSes will sell like hotcakes.

Prash Nelson-Smythe
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Yep, because those games are true to their fundamental experience with each iteration, unlike most Nintendo franchises.



A 2D mario with no 3D elements would help too.

Harry Fields
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God I hope this "Smartphone is going to replace portable consoles" thing dies. There's no real money in publishing to "app stores". Angry Birds, a game good enough to charge 30$, doesn't sell at 5$. And that's the definite exception.... most apps prove to be a labor of love only. 3DS is capable of providing a much richer experience for the core gamer. Smart phones and tablets are capable of providing some standout games that no one will pay for. It's great for Indies, bad for the industry as a whole.

Rey Samonte
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Hrm...I think smartphones and tablets are great for freemium games. Handhelds and consoles still relies on full, retail games. I think each has different business models but they can all be profitable. Believe it or not, but the freemium model has made a lot of indie studios revenue to fund their next project. It allows developers to get their apps to the mass market and at the same time, allow consumers to invest in the game however they please. With the console market, you have to buy it all or nothing which is why it commands the higher price.



I think it would be foolish to think one will eliminate the other.

Leon T
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It won't die. The debate was going on in the Gameboy Advance days.

Alex Leighton
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I consider myself to be quite "hardcore", yet there just isn't a place for a portable in my day to day life, and there hasn't been for a long time. If I'm out of my house I'm doing something, otherwise I'm in my house where I can play console or pc games on a 32 inch screen. You could give me a 3DS for free and I probably wouldn't use it.



That's just me though, but there would have to be some unheard of orgasmically good game to get me using a portable instead of a console or pc.

Rey Samonte
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I sort of feel the same way. Even though I use public transportation to commute to work and carry my PSP with me, I don't feel like there's enough time to enjoy whatever core game I'm carrying with me. At the same time, when I'm at home and I have time to play a game, I'd rather play on a bigger screen than on a handheld device. In the end, my PSP hardly gets any play which is a shame because I like the device.

Kevin Patterson
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I feel the same way Alex. I went through the first year of owning an Iphone buying a bunch of games and use it to play games to pass the time once in a while, but when im home id much rather be on my console or PC than a small handheld. That could possibly change a bit if the vita ends up being really good, with really good games to go along with it. I cannot stand the touch screen gaming controls for the most part, and i'm looking forward to trying out the vita for the dual sticks mostly.

If they make an open world RPG (not a GTA clone) for the vita that is really good, that would be a possible reason to buy it alone, something not on other machines.

The 3DS is just an enhanced DS really, and i never owned a DS. The jump from a Gameboy advance to a DS was big due to the new screens, the jump from the DS to the 3DS is more akin to Gameboy to gameboy color. People that already own and love a DS probably didn't see a $250 reason to upgrade either, except for the diehards.

T K
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Your hope will come true because portable consoles will be dead soon enough so as nothing left to replace. You're still thinking about this in the packaged goods sense. Actually most of the revenue for smartphone games don't come from the $0.99 or $1.99 download sales, Angry Birds being one of the few exceptions. Rather its from the free games with microtransactions that are driving the market. The mobile games market has moved to free to play. There are plenty of developers making big big money with F2P. Have you ever heard of DENA or GREE? Well both doing about $700M-1B revs from mobile games of which its all free-2-play. Nintendo and the Sony PSP are dinosaurs from the last age. They are still trying to stick with the old model of selling a game for $40 while the world has moved on to free.

Matthew Mouras
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Well when a freemium game with the depth of Tactics Ogre comes to an iPhone, I'll be sold. Until then, I like my burgeoning status as a "dinosaur".

Todd Boyd
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Or a Dodo bird? (Couldn't resist.)

Matthew Mouras
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Ha! Well done.



T K and others in this thread make some good points. $40 is certainly too high a price - the value isn't there in the current line up. But I still have to believe there is a market for portable games that aren't based on a freemium or race-to-the-bottom pricing structure. I can't be the only one that is turned off or bored by many of the cheap offerings on the iPhone. There has to be a market for folks that would like a little more meat on the bones of their handheld gaming.

warren blyth
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I think it's fascinating that Nintendo slashed the price so much, so soon.

I wasn't bothered by the price. I was just waiting for Kid Icarus Uprising to come out. sooo. huh.



I think their goal here is really to fight off PSVita. The best thing PSVita could do in return is to name a lower price standard for it's games ($20 would be amazing, and very hard for Nintendo to fight off. It would also make Nintendo look bad for recent PR comments about the need to keep games priced high. )

(Would also sort of come into line with the "$15 established cost of downloadable games on consoles"... which is arguably expected to be $20 soon?).



Even if Sony just said the standard price of PSVita games will be $35, they'd be positioning themselves well against Nintendo? I'd pay a little extra for the core system if I could then spend less on the games I buy for it, for the next 2 to 5 years.



I think both of these portables systems are tied into their core home console (if only in mindshare), so they are really competing with each other more than with mobile. I think it boils down to "do I want the cheap 3D toy with two low res screens, or the more solid device with one hi res screen and a weird backfacing touch interface?" I think Vita sounds much more interesting (and has several interesting launch titles). shrug.

William Collins
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Nice insights. I'm still wondering why Sony isn't using their (somewhat diminished) brand recognition to attack both fronts with one device. Releasing a portable/phone just seems logical and they could go with the contract model most phone carriers use so the consumer wouldn't pay full price for the hardware. And what's keeping both Sony and Nintendo from releasing older 1st party games on mobile devices? They'd make a killing and could steal back what the mobile market has taken from them. Really wondering about these guys ...

Joe Wreschnig
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"Releasing a portable/phone just seems logical and they could go with the contract model most phone carriers use so the consumer wouldn't pay full price for the hardware."



They did, the SE Xperia Play. The problem is the people who would pick it up already have PSPs, and from most reports, the few people who have it aren't buying games on it anyway. To get it as part of contracts you have to get the carriers on-board, and they don't care about games unless they're getting a cut.

Casey Dockendorf
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I think the price drop and an increase in games is exactly what this system needs to get into full swing. I had little intention of purchasing one before but since this announcement the first thing I thought was "Now i'll buy one!" And most people I know have said the exact same thing. The device is brand new still and there is a whole lot of appeal to the 3DS. If Nintendo would have launched this thing at this price in the first place I bet they would have sold a ton more at the beginning. I wouldn't be surprised at all if by next week Gamasutra posted an article that says:



NINTENDO HAS DOUBLED/TRIPLED IT'S 3DS SALES SINCE PRICE DROP!!!

warren blyth
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what do you plan to play on it?

Casey Dockendorf
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I've heard really good things about RE: Mercenaries, and Super Street Fighter 4 (which I own on Console but it did look interesting). Pilotwings looks decent (I was a big fan of the original game on Snes), and I have played a few of the smaller games that came out at launch and I have enjoyed those as well. I see a lot of good stuff coming to the system down the road that look fun as well like the New Mario and Kid Icarus games (and whatever that weird Armadillo game was called). I also look forward to the Nintendo E shop since I am a huge fan of old school NES/GameBoy games. I haven't met a single person yet who owns one and doesn't like the system.

Russell Carroll
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I'd recommend Zelda, but for those who have played already (which is the minority of gamers today) you should check out Shadow Wars, Pilotwings and SSF4.



Though neither appeal to me I understand Dead or Alive is good/great and that Resident Evil is a great co-op game (despite becoming the single target of mis-directed customer rage - which should have targeted at all the games that did the same thing instead of picking one...and not even the first or second one at that, alas, intelligence and masses don't go together)

George Blott
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My naive take is that this is a bad move. It undermines the perceived value of the device itself, and it alienates the early adopters who are used to price drops after they buy-in, but not this much this soon. Unless the 20 VC games are worth it to them they will likely feel hard done by.

Eric Geer
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Yes--I agree--the 20 games are kinda cool--but I would rather just have two new 3DS games--equal to the $80 price drop.

Jorge Ramos
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It's funny... in my case, I got the 3DS, because I've had to return one too many DS lites for the fragile hinge issues (and unresponsive shoulder buttons), and because the one DSi I once had was unusually crash-prone. So I didn't exactly pay full price to upgrade to the 3ds... but I'm glad I have it. It's a solidly built system... and at least with the Nyko battery, it doesn't suffer the laughably bad battery life that the PSP is infamous for.



That said, I've still yet to find a game that is worth full price for the 3DS. I was looking forward to Splinter Cell 3D, but seeing it in action left me very disappointed. And with both Saint's Row and MegaMan Legends getting cancelled for the 3DS, that means I now have to wait even further for a game worth playing made for 3DS (Sorry, I resent Zelda and refuse to support that franchise - especially since it is OoT that made me resent the series).



That said, I personally wouldn't spend more than $30 on a handheld game... $40 across the board is horrible. Not as bad as $50 as Sony had the gall to charge for some of its launch PSP games though. The overall pricing structure for 3DS games needs a significant overhaul, and it's as simple as that.

Alex Leighton
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Obviously you're entitled to your opinion, and I won't argue with you, but I've gotta know, why don't you like Zelda?

Ryan Sizemore
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I acknowledge more than I did in the past the consumer power smartphone and even Facebook games have over the market now. Thing is even the best of games on these platforms are not enough to satisfy those used to traditional console and handheld games, there will always be a market for these traditional handhelds.



That is until all smartphones have a full gaming pad like the XPeria Play and fragmentation becomes less of an issue. Pushing picture to the TV would be great too.

Prash Nelson-Smythe
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The problem isn't the "post-iPhone world". The DS and full priced DS games were very successful alongside the iPhone/iPad.



This is Nintendo's own doing. The 3DS hardware and software has a *completely* different philosophy to the DS. It is 3D obsessed. People don't want 3D. They are put off by it. So many game industry and self-identified gamer types (including most Gama commenters) were so sure that 3DS would absolutely explode in popularity (what these people predict, the opposite will happen... see DS, Wii) but there were very early signs that Nintendo were once again creeping towards making 3D games for their own enjoyment rather than making games according to the customer definition of quality. They're on their N64 trajectory *again* and if they haven't learnt from past mistakes they deserve to fail.



If the 3DS was actually not 3D focused and launched with a proper 2D mario game it would be a completely different story. Therefore, I'd say Nintendo are losing to the competition of their former selves rather than portable computers.

Marc Schaerer
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Hell what would I love to have $40 game prices ... switch to europe and start to whine when you realize that you pay $70-$80 for 3DS titles and over $350 for the console at the time (including taxes)



Might be that Nintendo thinks its a tad expensive in the USA but as long as they don't acknowledge that its totally out of scale in europe and needs to be brought in line with the very bad currency standing of YEN and USD soon its truely hilarious as by now even apple corrected the completely wrong currency (only by 10% of the 30% delta but at least ... nintendo has nearly a 50% delta at the time and didn't show any sign to correct it)

Bob Johnson
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Counterpoint:



1 million bought Zelda 3ds worldwide. 1+ million bought Pokemon on the DS this past quarter. Consumers still want those games. And still will pay $30-$40 for them.



Let's also not forget that those games are worth $15-$20 resale easy either. $30-$40 isn't the true cost of those games. And let's not forget that there's room for all kinds of experiences. Large and small.



Plus there is the 3ds eShop. There are a lot of $2-$5 games on there and some $5-$10 games as well. It's a decent enough shop. And should get better even. And probably will end up with many of popular cheap games.



What happens when the novelty of cheap touchscreen-only games dims and the reality of touchscreen analog sticks shines through? And what happens when the easy low hanging fruit has been picked?



Anyway I'm sure iOS will eat the more casual customers Nintendo had, but were those customers really buying software to begin with? Not sure they will be a massive loss.



Folks will still want the big Nintendo 1st party games. There isn't a substitute for those games on the iOS platform. And I bet the farm that folks still will pay for quality software.



And Nintendo has been written off before. The media thought the Gamecube was its last games console. And that the PSP was going to kill off its handheld business.



Plus I don't think many have considered that iOS may just bring more people to gaming which can be a good thing for everyone including Nintendo.


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