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News

  Nintendo Projects First Ever Annual Loss, Misses Half-Year Forecasts
by Kris Graft [Console/PC, Business/Marketing]
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October 27, 2011
 
Nintendo Projects First Ever Annual Loss, Misses Half-Year Forecasts

Nintendo on Thursday forecast a 20 billion yen ($264 million) loss for the full fiscal year ending in March 2012, which would mark its first ever annual net loss since it started reporting its financials in 1981.

In July, the Kyoto-based Mario house originally expected profits of 20 billion yen. Nintendo said the fiscal year earnings forecast revision is due to "stronger-than-expected yen appreciation," a crippling factor for a company like Nintendo which relies on exports.

The company also pointed to "current sales performance" and the holiday sales outlook for full-year downgrade.

Nintendo now expects full fiscal year sales to be 790 billion yen ($10.4 billion), down 12 percent from the previous forecast of 900 billion yen ($11.9 billion). Last fiscal year saw total actual sales of 1.01 trillion yen ($13.3 billion).

Half-Year Results

"Weaker than expected" hardware sales for Nintendo DS hardware and Nintendo 3DS software, combined with an unexpectedly strong yen, caused Nintendo to miss profits and earnings forecasts for the half-year ended September 30.

During the six months, Nintendo sold 8.13 million Nintendo 3DS software units. Combined sales of Nintendo's previous generation DS (DS Lite, DSi, DSi XL) were 2.58 million, with last-gen DS software sales of 28.99 million.

Nintendo's Wii home game console saw hardware sales of 3.35 million units. Software sales were 36.45 million, "because of fewer hit titles and a small number of new titles."

Half-year losses were 70.2 billion yen ($926.3 million), missing Nintendo July forecast of a net loss of 35 billion yen ($461.9 million) for the half-year. The strong yen amounted to exchange losses of 52.4 billion yen ($691.6 million). Sales were 215 billion yen ($2.8 billion), missing the half-year forecast of 240 billion yen ($3.2 billion).

The game maker also confirmed a Japanese report earlier this week that pegged half-year pre-tax losses at over 100 billion yen ($1.3 billion). Pre-tax losses were originally forecast to be 55 billion yen ($725.6 million).
 
   
 
Comments

Anthony Taylor
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It's a marathon, not a sprint and Nintendo sprinted out to a big lead. The 3DS's launch was a blow to them, but they should turn it around.



ALthough I think the Wii U won't ignite the masses like the Wii.

Benjamin Quintero
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If Nintendo is smart, they'll hold back the Wii U launch, add more horsepower, and have a world-wide launch in 2013. Shipping next year with the current Wii U specs would make it an 8 year old piece of hardware that cost $399 in a failing financial market. That's like 16 internet years, and 10 iOS devices later! Heck, that's two bankruptcy claims and credit reboots.



We'll be seeing better performance on the iPhone 6 than the Wii U and that has to be scary for Nintendo.

Leo Gura
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No way the Wii U will cost $399. That would be outrageous and would spell certain doom for Nintendo. The Wii U will cost $300 max, maybe even $250. Part of Nintendo's poor 3Ds strategy, besides the 3D gimmickry and lack of titles, is the outrageous price at launch.



I think Nintendo is in for very tough times. They rely too much on rehashing old classics and that can't last forever. On top of that, mobile and social games will hurt Nintendo big time. And the Wii U looks like a gimmick as well.

Christian Keichel
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"Shipping next year with the current Wii U specs"



I am not aware of any Wii U specs, except specs stands for speculation.

kevin Koos
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So when does the wii become $99? Next Xmas it could be dead, breath some life back into wii at $99 that has to generate sales, doesnt it???

Jonathan Gilmore
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I think it's too late, why spend $99 on something that even Nintendo is barely supporting at this point, when you can spend $200 or so on a console that is going full speed ahead (PS3 or 360)?

Sylvester O'Connor
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Well it might benefit them to actually drop the price to 99 seeing as how Zelda is on it's way. Then they could have a bundle for 150 just to get the last bit of life left out of the Wii. Despite the system not being supported, and just like the pS2, it has a large backlog of titles and might still be able to draw some crowds just by being at the lower price point. Especially for people that still don't own a PS3/360 yet. And yes, I know a large amount of people that don't own either of those consoles yet as scary as it sounds.

Christian Keichel
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replied in the wrong place - the reply button only at the first answer is making things a little confusing sometimes.

Eric Geer
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Wii could still have a few more hit titles--Kirby looks like a pass/Zelda will drive some sales..but they are also failing to bring 3 highly rated JRPGs that people have requesting here in the US since their first debut--Last Story, Xenoblade, and Pandora's Tower. Last Story would push sales just because of the names involved with it.



As for the 3DS--I blame that fail on 3rd party devs--they've been complaining for, well, EVER. That Nintendo first party titles overwhelm and kill 3rd party sales. Well there hasn't been a great NEW 1st party Nintendo 3DS game out since launch--This would have been a great time to shine for 3rd parties...Oh well. There were a few things Nintendo could have done---they should have started the system at $200 and left it there. They could have also improved some of the functions--messaging/chat/and their online store...but they aren't helping much by pushing out garbage on the virtual console and estore.



And the WiiU-- I agree with Ben--it seems under powered and costly. It has some great functions..but if they put in some more power I think those functions would have the ability to truly flourish. If they push forward with the 2012 release I would expect another "rushed" launch similar to the 3DS and a very rough start. Also alot of the information behind the system seems extremely ambiguous--there's lots of questions about it and lots that remains unsettled--mainly being--can you use more than 1 Touchscreen controller? I think if they fail to implement more than 1 touchscreen controller you could see the system almost dead on arrival. And they need to focus on their online functionality and online store--Wii's store isn't terrible--but online gaming is aweful save for Monster Hunter. It is unfriendly and is full of catch 22's concerning friends and making friends online. I undestand they want there to be a friendly/protected atmosphere...but they need to open it up and trust players judgement.

Anthony Taylor
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Rarely does a 3rd party launch game outshine the first party ones.



Consumers caught on that the 3DS is a more powerful DS with a lame 3D gimmick. The high price and lack of launch games is the fault of Nintendo. I wouldn't blame 3rd parties for it at all.

Eric Geer
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I agree with you that they rarely outshine--but 3rd parties have been begging for the opportunity to have a great game on Nintendo platforms..but no body stepped up. I blame them--because it was their time to shine. They had the time..they had the hardware...they had the opportunity for an open market without being outshined by the 1st party titles.



I guess I don't blame them for Nintendos losses--but I blame them to some extent for not taking advantage of the opportunity.



PS. 3D is sweet. I enjoy it in most all the games I have---Sorry to say Bit.Trip Saga takes a framerate hit when it is turned on.

Anthony Taylor
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The 3D gives me a migraine. No other 3D in my life has done that. I detest it on the 3DS.



A lot of 3rd party devs like to see how successful something is before putting games out on it. It's Nintendo's job to launch the system properly and make devs WANT to release games for it. They failed at that, but they can still turn it around.

Eric Geer
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"A lot of 3rd party devs like to see how successful something is before putting games out on it. It's Nintendo's job to launch the system properly and make devs WANT to release games for it. "



This is a Catch 22---You are basically reiterating with what happend with the Wii...Only Nintendo really thrived on it and thats what 3rd party devs complained about. Now you are saying that it's nintendo's job to show how well it can do...and then they will come....



i doubt it...once Nintendo brings out its big hitters...good luck as a 3rd party dev trying to get in there...



As for the headaches--I think its a person to person thing--it doesn't bother me one bit--I can play it for hours in 3D--But that's why you can turn it off too...

Anthony Taylor
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It is, but that is the way business works, I'm afraid. No getting around it.



The Wii had plenty of 3rd party games. The "casual" ones sold ok. The "hardcore" ones didn't.

warren blyth
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I think you're both right. :)



I think eric is pointing out that : Xbox360 had strong third party titles near launch, and PS3 had strong titles within first year, which pushed people to buy their systems (I'd argue Gears and Oblivion were strong reasons to buy 360, while Uncharted and Demon Souls eventually drove me to pick up PS3.).



I still don't see anything that makes me want a 3DS. Where are the devs who made me want a DS? Why didn't they have launch titles which showed off 3D or streetpass or augmented video? Scribblenauts made me want a DS (and vice versa), so why didn't 5th Cell prep something for 3DS launch (...now I'm struggling to think of other DS games i wanted, then actually ENJOYED after I got them.) I dug Pac Pix I guess. uh. and Namco was very into the 3DS launch. but ultimately I didn't see anything innovative or unique in ridge racer, pacman galaga, or duel pen sports. when DS launched there were a lot of tech demos, and I didn't mind buying them. where are the quick quirky tech demos for 3DS? DS proved these can sell, so why didn't developers even try? (honest question. I'm not convinced they were waiting for proof that nintendo would succeed, after the Wii and DS did so well. I suspect something else went wrong.).



Anthony points out Nintendo failed by not having a launch title to sell the system. I agree. but usually at least SOME developers gamble on launch titles. (GUN comes to mind as perfect example). I think we're seeing something specific to Nintendo here, where the big devs weren't interested, and the little devs just shoved out some unimaginative ports.



(I still feel they made it clear the system would launch with a reboot of Kid Icarus, then panicked when early reviewers said kid icarus was too hard. ultimately shot themselves in the foot by pushing kid icarus back, and thus having NO launch title to show off the system).

Bob Johnson
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@warren



YOu are forgetting though that many buy Nintendo consoles for the Nintendo games.



And not sure why Wii U in 2012 would be rushed when they showed it off in rough form on E3 2011. The public info might be ambiguous but that doesn't mean behind the scenes it is.



I do agree it would be a bummer without the ability to have 2 touchscreen controllers. I thought that was a big part of the point of having a touchscreen controller. To bundle in one package some of the gameplay ideas they have attempted in the past between consoles and handheld devices.



They did show off local multiplayer gaming with wiimotes and the touchscreen. It could eventually turn out but I wasn't that impressed by those demos. The most impressive thing was continuing your game on the controller if someone else wanted the tv. I can see that being a big sell to families. I can kick my kids off the tv or my older kid can kick the younger one off or vice versa.

Anthony Taylor
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Let's face it, none of the consoles in recent years have had GREAT games at launch.

Christian Keichel
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"Let's face it, none of the consoles in recent years have had GREAT games at launch."



Except Wii Sports, one of the most popular and successful games in this generation.

Sylvester O'Connor
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I really agree with Bob. Nintendo has never been known for their 3rd party titles. It has always been Zelda/Mario/Metroid that has made their consoles shine.



I also agree with all of you that I blame Nintendo. How do you justify someone spending $300 on a console with no games for it? I know techie's that bought it just because it's new. But how many people that game buy consoles with no real games that drive it.



Plus, to create an entire console on the basis of a gimmick was also not financially wise. i have several friends that tell me even when playing Street Fighter on it that they play it in their regular mode because the 3D just makes their heads hurt.



Nintendo is really starting to look like Sega did before they folded. All I know is that it would be a real shame if that happened. But then again, if it did happen, and they focused just on software, who knows. Just like WCW wrestlers on WWE, maybe you would see Mario on 360 and Zelda on PS3. Imagine that!

Anthony Taylor
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@Christian,



I know you are an ardent Nintendo fanboy who defends them no matter what, but I respectufully disagree with you.



First, I am talking about launch games, not games packed in with the system. The whole topic is about games not selling and if you buy a Wii, you get Wii Sports, so you don't have to buy it by itself.



Second, it's a fun game and it may be popular, but personally, I can't get into it for more than a few minutes at a time.

Christian Keichel
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@ Antony

"First, I am talking about launch games, not games packed in with the system. The whole topic is about games not selling and if you buy a Wii, you get Wii Sports, so you don't have to buy it by itself."



Whenever somebody tries to give reasonable arguments, you come up with the whole "you are a fanboy" part, I think it's of no use to discuss the topic with somebody with a Master Chief avatar who simply can't face the reality, that Nintendo is the only console manufacturer, that actually made money in this generation. MS and Sony piled up gigantic losses, so I think the strategy of Nintendo was right and the strategy of MS and Sony was wrong, except you try to say making losses should be the goal when running a company.



I have my doubts about Nintendos current strategy and never said otherwise, I have doubts Wii-U will sell and I have doubts the 3DS will become as popular as the DS, this is the reason, why I don't believe in your "3DS-lite will come out next tuesday" rumours. By the way, a few weeks ago you said you are a potential 3DS customer and now you are saying the 3D gives you migraine? Didn't you realised this earlier, strange, as a potential customer, I expected you at least to try the console before saying so or are you trying to say you are a potential 3DS customer, even if the 3D gives you migraine?



But about your "argument": a packed game, that was packed at launch day, is in fact a launch title. If you have good and exclusive launch titles, your console will sell better, because people buy the console for these titles. Neither Sony, nor MS had any launch titles, that made people buy their consoles, Nintendo had one (Wii Sports) and this was one of the reasons, why Nintendo sold 90 million Wiis and made a lot of profit. Launch titles usually don't sell very well, simply because the installed user base isn't big enough to sell in huge numbers.

Additionally Wii Sports wasn't bundled in Japan, but still managed to sell about 4 million copies there, that's one of the small facts like that doesn't count in hardcore gamer land, I know.

And by the way, Wii Play was a launch title too, like it or not, it outsold every other game on the market.



The topic was about software don't selling? Since when do you decide what the topic of a discussion is? As far as I read, even in this threat several topics were raised, but it was mainly the topic of 1st party vs. 3rd party sales, not about "games not selling" which is by the way in the generalization simply wrong.

Christian Keichel
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@Sylvester

"How do you justify someone spending $300 on a console with no games for it?"



Maybe you can't justify it, because the console was never sold for $300, the price was $249.

Anthony Taylor
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Christian, you are so funny. Yeah, I have a Master Chief avatar. And only 3 games for the 360. The Ps3 is my preferred console, so maybe you shouldn't make ASSumptions based on things like that.



And Nintendo is now posting losses and the others are doing better. So what matters more, the start or the end?



If I buy a 3DS (lite) I will turn off the 3D entirely. Makes sense? Thought so.



Your arrogance is astounding. You are always trying to catch people in little ways when you can't win the debate properly (see your reply to Sylvester).



We are talking about games that aren't packed in the system, since Wii Sports is the ONLY packed in game in quite sometime (at launch). So if you want to count it as a different sale than a Wii sale, go ahead. Have fun with that.



And Wii Play sold b/c of the extra Wii mote. I know you hate that, but it's true.

And we can agree to disgree, but where did I say that making losses should be the goal of a company? Find that quote for me, please.



And I personally do not feel Nintendo should stop making consoles, but my life would be easier if that did. Try to keep up with what I am saying.

Christian Keichel
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@ Anthony

"And I personally do not feel Nintendo should stop making consoles, but my life would be easier if that did. Try to keep up with what I am saying. "

Your life would be easier? Come on it's video games, not health insurance, you should definitely try to put things in perspective.



"And Nintendo is now posting losses and the others are doing better. So what matters more, the start or the end?"

What matters is the overall performance during the whole generation and here Nintendo has made profit and Sony and MS don't (and neither will be, unless they manage to stretch this generation to 2025).



"Your arrogance is astounding. You are always trying to catch people in little ways when you can't win the debate properly (see your reply to Sylvester)."

So,reminding you of 4 million sold Wii Sports in Japan is catching you in "little ways"? I would say forgetting 4 million sold copies in Japan alone is failing big time.



"We are talking about games that aren't packed in the system, since Wii Sports is the ONLY packed in game in quite sometime (at launch). So if you want to count it as a different sale than a Wii sale, go ahead. Have fun with that."

And you call me arrogant? Ignoring the importance of one the most successful games in the last 5 years is what I would call arrogant. And again, since when you are deciding, what "we" are talking about? You said earlier:

"Let's face it, none of the consoles in recent years have had GREAT games at launch"

I reminded you of Wii Sports and instead of admitting you were wrong you started this fanboyish flame war.



"And Wii Play sold b/c of the extra Wii mote. I know you hate that, but it's true."

Old debate, boring, people could have bought a Wiimote without WiiPlay for lesser money, 28 million people decided to spend an extra 10 bucks to get WiiPlay, this means 28 million people found the game worth buying, saying those 28 million people only wanted a controller and bought the game, despite the higher price is calling these people idiots.



"If I buy a 3DS (lite) I will turn off the 3D entirely. Makes sense? Thought so."

No doesn't make sense, because your main argument why you are waiting for a 3DS lite was the short battery life of the 3DS and with 3D turned off it is up to eight hours, pretty good for a handheld.

Anthony Taylor
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Health insurance? WTF? Yeah, my life would be easier. I wouldn't have to buy a 200 dollar system to play 5 games and then watch it collect dust as once again Nintendo fails to realize it's potential, creatively speaking, of course. We know it made money (your only defense, it seems as the Wii is easily the worst sytem this generation in terms of quality games.)



You ignore your remark to Sylvester, when you know his point was valid, when his facts were slightly off.



And you didn't catch me in anything. 4 million in Japan. Point?



No flame war, but I know you will ALWAYS stretch logic to defend Nintendo.



You seem to think I hate Nintendo. No, I love it. But I would like them to be better in ways that would give me the games I want to play. I don't see how that makes me a troll or starting a flame war.



No, Christian, you poor child.



My main reason for not wanting a 3DS is:



1. Price

2. No games as of yet (though this will change soon)

3. Low battery life

4. Chance of a redesigned 3DS lite



So...yeah. Makes sense to me.

Christian Keichel
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"We know it made money (your only defense, it seems as the Wii is easily the worst sytem this generation in terms of quality games.)"



This remark clearly shows you are not in touch with the industry, 90 million sold Wiis, 716 million sold Wii games and you say the Wii is "easily the worst system this generation in terms of quality games"? Maybe these games just weren't designed for you? Commercially the customer chose the Wii in favour of the other systems and the customer chose to buy more games for the Wii then for the other systems. To say the games for the Wii were the worst when it comes to quality just shows your ignorant hardcore gamer approach, the same approach broke Sony's and Microsoft's neck in this generation (and EA's too). I am really surprised to read such statement 5 years after 2006.



And yes, they made money, this is the ultimate argument, when it comes to business, the Dreamcast was a fine console, but it didn't made money, so it was a failure. It's as easy as that, if you can make games, that people like to buy, they become hits, if you can manufacture the hardware to run this games on, the hardware becomes a success.

Sony and MS didn't achieved this so they made losses, Nintendo did, so they made profits, no mystery here.



Maybe you hadn't noticed yet, the best selling game in the US in 2011 so far was Just Dance 2, in the just revealed Top 20 were 4 Wii games and 3 of them were by 3rd party publishers, which simply shows the whole argumentation about Wii games not selling any more and 3rd party games not selling on the Wii is wrong.

Bob Johnson
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@Anthony



I don't want to join the fray.



I just find it ironic that you only have 3 games for your 360 yet are so bummed out about having to buy a Wii for 5-6 games.



I think it is natural to wish that all the games you would like to play were available on the system you already own so you wouldn't have to purchase more than one system. But I do not think that is a Nintendo-only issue.



I mean how many 360 owners wish a couple of PS3 exclusives were on the 360 so they wouldn't have to pay $250 before they could even buy those games?



The argument you make applies to all consoles. IN some ways we should have just 1 console platform. A standardized one. One that is updated every 5-7 years perhaps.



The problem though is the grass isn't always greener on the other side of the fence. Who knows what pitfalls that model would bring.



Right now though that is a dream. I don't see any movement towards that.

Wylie Garvin
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I wonder how much of this loss is the aftermath of the earthquake. I haven't seen it mentioned anywhere.

warren blyth
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I had the impression that Nintendo was totally unaffected by the Earthquake. Maybe this is just a strong face. but, coverage like this did come out: http://nintendo3dsblog.com/nintendo-remains-injury-free-after-earthquake- in-japa
n-business-will-continue-as-usual

Bob Johnson
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Most of the loss is on paper due to the strong yen. The strong yen is not good for exporters like Nintendo.



Definitely in transition between generations. It has been messy. They have not managed that too well.



However they still know how to make world class video games. and that has always been their ace in the hole.

A W
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I hope that Nintendo doesn't start to tighten its exports because of the economical situation of the YEN to the DOLLAR. Not releasing the 3 good titles they have on the Wii in Japan to the US is suggesting that they are considering doing just that. They have relied more on the Western market than their own region, probably do to nationality name recognition that they would sell well in their own backyard regardless.



As for holding off the Wii U. Unless there is a official spec sheet out there with full specs on the system, I would hold off judgement on the power argument, especially if power just means graphical fidelity. To remotely suggest they just hold off to 2013 to release their new system is to suggest they insure their death in the videogame market. Nice try trolls.

Eric Geer
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Just because there are different opinions doesn't necessary mean there is a need to target people as trolls.

A W
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I'm sorry If I come of as combative, however I see two stories about Nintendo on Gsutra, one caters to the "Nintendo is a Doomed Gimmick Theory" by posting forecast members, the other does not. Which one has the most "Opinionated Comments" in it?



Most of us have been around game forum talk to know that "gimmick" is a means to condescend the conversation rather than to add to it.



Why not admit all hardware makers have their gimmicks?

Ian Uniacke
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Gimmick is just what the encumbant market calls "new technology". When you could get small hard drives back in the 80s they were called gimmicky...till someone had the bright idea to make a portable computer. The encumbant market wasn't laughing so hard any more.

Kris Steele
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Is there anyone out there that is really, really excited for the Wii U (awful name) or the 3DS? Anyone?



Didn't think so.



Earthquake, yen, etc are secondary to this.

Eric Geer
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I'm really excited about what's to come on the 3DS...not so much what is. As for the WiiU---its too mysterious right now---I think it has great implications and gaming potential--but the information provided about the system seems very ambiguous.

Anthony Taylor
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I honestly forgot it existed for a few months.

Christian Keichel
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"Wii U (awful name)"



Heard the same countless times 5 years ago about the name Wii.

Anthony Taylor
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Yeah, the name doesn't really matter.



But it is a bad name.

Nick Kinsman
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Well, there was added shock to the name "Wii" since prior to that we were all being fed "Revolution", which was, at that time, a stunning name for a console. Now that we've had our time with the Wii, progressing to the Wii U is hardly a shock to anyone ...



I, like Anthony, actually forgot the 3DS existed for a while. Even when I try to pay attention there's just ... not been anything interesting ...

Yes, it could change and I could wind up with one. But it'll take one hell of a reason. It would take an even bigger one for me to get a Wii U. But that doesn't mean I want Nintendo to fail. I just strongly question a lot of their plans for the last few years. We'll just have to see how it all pans out.

Bob Johnson
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Zelda and Super Mario 3d make me excited. Mario Kart too.



I would be more excited about the Wii U if I knew more about it like price or games or power or features or release date. Too far off to get me excited. I do admit the gameplay ideas they showed at E3 did not excite me or look like hits.



But I think the Wii U has an interesting controller and streaming feature especially for families that share a tv.

warren blyth
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Interesting to see other commenters feeling so differently.



I was excited about the 3DS until I tried on at GDC. Then I remembered that I don't care about 3D, even without glasses. If they'd just release a game that offered something new, only possible in 3D, I'd be excited. So far I've just heard that it helps mario with hitting blocks in 3D - which is something i don't view as a problem currently.

(i'm planning to buy a 3DS when kid icarus uprising FINALLY comes out, because i'm extremely curious how the game will showcase 3D. flying around avoiding lasers and bullets sounds like something that might only work in 3D).



However.



I'm very excited by the WiiU. A system focused on asymmetrical multiplayer has a real potential to push new gaming boundaries. touch screen input for HD games, and moving screens around your living room are also neat ideas. Sadly, Nintendo doesn't seem comfortable standing up for unique new messages. they're letting the discussion change into "7 years late to the HD table" and "not as powerful tech specs".



The fact that so many people think they want 4 tablet controllers is a strong sign they don't get the appeal of asymmetry. If nintendo buckles on this, WiiU is going to be dismissed as the Wii2 or WiiHD - neither of which is very exciting to a world that is losing interest in the Wii.



While i think we (game developers) know it's really all about the available games - I think the second most important battle is the "unique experience" message. People need to get excited about unique game play scnario that is only possible on these systems.



(P.S. if they had pitched something like "Gamers love 2D Bullet Hell games. Well, 3DS is the only way to enjoy that level of chaos in a 3D game engine. You need 3D to have any chance of keeping track of where you are, as everything changes around you" - this would have sold me on the 3D gimmick. And this is what I expect Kid Icarus was trying to explore, before they panicked over it being too hard).

Ian Uniacke
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Interesting comments Warren. I'm curious to see Kid Icarus too. I wonder if the reason for it being held back is they want to nail that experience that we might not understand yet (as you say). If they can hit the ball out of the park, ala Wii Sports (pun intended), than they could easily be back in the game. I feel this is the case with Zelda Wii as well.

Bob Johnson
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By the way, if you are not a fan of Nintendo games then it is understandable and goes without saying you will not be excited about their hardware.



They are joined at the hip.

Joshua Dallman
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Apple Airplay + More Developers = Wii U killer



This is already happening:



http://www.geek.com/articles/mobile/this-is-what-gabe-newell-fears-metalstorm-wi
ngman-using-airplay-mirroring-20111014/



http://firemint.com/2011/partyplay/



I love Nintendo (personally and professionally) but they better get their shit together if they don't want to end up like Sega making software only (everyone thought that was unthinkable at the time too).

Bob Johnson
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Sounds like FUD. AirPlay is interesting. But not the same thing.



First AirPlay has some lag to it.



Second your only control is the gyro. You can't hit icons on the touchscreen while looking at the tv. Never mind the fact that they were already limited to the touchscreen in the first place. Now touchscreen controls would have to be no look controls. Obviously this drawback doesn't affect all type of games equally.



Airplay is also from device to tv whereas Wii U is from console to device. Wii U will have much more power available for streaming and games.



Then the games. Nintendo's ace in the hole is their games. You can't get those experiences elsewhere.



Never mind that we do not know much about the Wii U yet.

Anthony Taylor
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@Bob,



Yeah, that's one of the problems. You have to buy a Nintendo console to play the 5 or 6 great Nintendo games. People are starting to get tired of that.

Bob Johnson
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@Anthony



I haven't seen anybody getting tired of buying great games.

Anthony Taylor
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@Bob,



Not what I said. People (in general) are tired of having to buy a Nintendo console just to play the Zelda and Mario games they want to play.



I have no stats, but why do you think everyone is always wishing Nintendo would just stop making consoles and only make software?



I buy every Nintendo console, but from now on, I will only do so at the end of it's life, when super cheap b/c it's just not worth it for a half dozen games over a 6 year period.



Unless they change that with the Wii U.

Bob Johnson
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@Anthony



Well if folks aren't getting tired of buying great games then the only problem is the price point. And that is a fairly easy problem to fix.



And you have a plan to meet your price point in the future. You are going to wait roughly 5 years before you buy a Wii U.



Nintendo wants to sell games and make money. They keep an eye on pricing and value as well. And adjust to the market in order to offer great games at a price point that offers value to consumers.



So if you represent a large percentage of customers then I would expect Nintendo to take this into account and offer more value to the consumer when the Wii U launches.

warren blyth
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@Joshua: I feel like Newell is arguing with himself (or maybe I don't get it?)



He's saying Apple could release an AppleTV that threatens the consoles (i take this to mean: the next version of AppleTV could have tech specs that rival PS3, and user interface that is more friendly than XboxLive, plus access to all existing apps).



Then apps at 99 cents could compete directly with console titles at 60 bucks. Suddenly console game devs are in deep shit. right? Because the biggest threat to AAA game development houses on iTunes is the solo garage business innovator dude. Because customers don't care how many people worked on a game they're impulse buying for 99 cents.



But this seems to contradict the OTHER argument Newell has: that walled garden’s will inhibit innovation.



no?

(maybe he's just saying walled gardens will win out, and then all the product in the garden will suck ass? if so, I don't agree.). confused...

Christian Keichel
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"Yeah, that's one of the problems. You have to buy a Nintendo console to play the 5 or 6 great Nintendo games. People are starting to get tired of that. "



Any facts prooving your theory that people get tired buying Nintendo's first party exclusives? The 3DS can hardly be the argument here, because apart from remakes there weren't the big exclusives so far, maybe we should wait and see how Mario Kart is doing. But if it is selling like hotcakes it only will be the "nobody can sell on a Nintendo system except Nintendo" whining from the 3rd parties that is dominating the discourse.

Jonathan Gilmore
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Agree with Anthony's reasoning. I probably would buy Kirby, Mario Galaxy, etc if I didn't have to buy a Nintendo console to play them. That's an argument Pachter has been making for some time as well, that Nintnedo needs to go software only. Not saying agree with Pachter, but he does make a valid point. Nintendo might be more successful software only than they are selling the console required to play their software, and consequently not selling their software to the millions that own consoles not manufactured by Nintendo.

Bob Johnson
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@Jonathon



So a $135 Wii with the $50 Mario Kart game included is preventing you from playing Nintendo games?

Anthony Taylor
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@Christian,



You need to take your Nintendo blinders off and learn to read more carefully.



I never once said people are tired of buying Nintendo's 1st party exclusives.



I said people are tired of buying Nintendo CONSOLES to play those 1st party exclusives.

Christian Keichel
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@Anthony

"You need to take your Nintendo blinders off and learn to read more carefully.



I never once said people are tired of buying Nintendo's 1st party exclusives.



I said people are tired of buying Nintendo CONSOLES to play those 1st party exclusives. "



You understand the term Nintendo 1st party exclusives? It includes the fact, that these games run on Nintendo consoles, otherwise the weren't 1st party and if people get tired of buying Nintendo consoles it would mean they are getting tired of buying Nintendo 1st party exclusives as well. So again, any proof for your argument? Last time I checked the Nintendo 1st party exclusives sold far better then the Sony and MS 1st party exclusives and even outsold the best selling 3rd party multi platform titles for the 360 and PS3.



I wonder, how somebody can honestly think that Nintendo should abandon the hardware market, after selling 90 million Wiis in 5 years and 150 million DS in 7 years and making a profit, which I would estimate without checking as between $10 and $15 billion.

Anthony Taylor
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Wow, you are so deep in the Kool-Aid that you can't even admit what I said was accurate.





People want to play Mario games and Zelda and all the Nintendo games. But they don't want to buy a console just for those 5 or so games. I have no "stats" but I've heard this said many times before from many people. Why do you think people are always down on Nintendo and want them to only make software, like Sega?



B/c they don't want to buy a system just for a few games. It's annoying and I've heard people say these types of things since the N64 days when everyone was suddenly switching to Sony.



No one thinks Nintendo SHOULD for Nintendo's benefit, but for the sake of their own wallets, many people would rather have Nintendo make games for the PS3 or the 360. Look at Jonathan Gilmore's post in this very thread, agreeing with me that people feel like this.



NIntendo consoles for the last few generations just don't have enough 3rd party games to make it worthwhile for some gamers.



You bring up how Nintendo first party games sell better...yeah, no one said anything different. I don't know who you are arguing with.



I'm simply saying and this CAN'T be the first time you've heard this, that there is a fatigue among some gamers (notably the core gamers) about wanting to play Mario, but not wanting to buy a whole console just for it. I'm the only person on my website's staff that has a Wii, but the rest of them all WANT to play the games.



They just don't want to buy a Wii to do so.

Christian Keichel
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"NIntendo consoles for the last few generations just don't have enough 3rd party games to make it worthwhile for some gamers."



In this generation more people thought the 1st party games made it worth to buy a Wii, then the 3rd party games made it worth to buy a 360 or a PS3. Just by simply ignoring the fact, that Nintendo sold 90 million Wiis while the other two manufacturers are at 50 million each doesn't change the harsh reality. You constantly say things like

"Why do you think people are always down on Nintendo and want them to only make software, like Sega?"

I don't know who you are "always" talking too, but you should tell them, that Sega is practically broke. Almost all profits come from Sammy, without the merger Sega would be as dead as Atari (the real one, not the fake Atari). I don't think it would be a wise move for a company to try to be the next Sega.



Oviously you and your friends aren't the targeted customers of Nintendo products, why you try to persuade everyone that a change of the course of a company that has done fantastic during the last 7 years is necessary and why this company should try to become part of a dying niche market (hardcore gamer market) by abandoning the only thing, that allows them to stay independent from this dying market is beyond my understanding.



As a software company there wouldn't have been a Nintendogs, Wii Sports, Wii Fit, Brain Train, etc. These games were made by the people who designed the hardware to run those games, to say Nintendo should abandon the hardware market is to say, they should abandon their most successful business model.

Anthony Taylor
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I didn't know I was trying to convince anyone of anything regarding what Nintendo should do. I was simply saying what I've heard many people say dozens of times. It wouldn't be a smart idea for Nintendo to do that. No one said that. Stop making things up.



Dying? Ok, so the billions that come in from all those hardcore games is a dying niche? LOL.



As for people who are "always" down on Nintendo, look at this thread. The negative Nintendo news always gets the most comments. It's right in front of your face.

Christian Keichel
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"Dying? Ok, so the billions that come in from all those hardcore games is a dying niche? LOL."



Third year in decline still isn't enough to make you think, even when you take in consideration, that it would be the sixth year in decline in a row, if Nintendo hadn't saved the years 2006-2009? Ignoring the problems of the industry isn't making them go away.



"As for people who are "always" down on Nintendo, look at this thread. The negative Nintendo news always gets the most comments. It's right in front of your face. "

So, you mean the number of comments on "negative Nintendo news" on Gamasutra weighs more then the commercial success of Nintendo amongst it's customers? Funny.

Anthony Taylor
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LOL, you said: "I don't know who you are "always" talking too, but you should tell them, that Sega is practically broke."



And I told you. I never said that the comments here weigh more than commercial success, but you asked where I was hearing these things and I told you.



Honestly, if you are going to make things up and not respond to the things I actually post, I am done with you.

Christian Keichel
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"LOL, you said: "I don't know who you are "always" talking too, but you should tell them, that Sega is practically broke."



And I told you. I never said that the comments here weigh more than commercial success, but you asked where I was hearing these things and I told you.



Honestly, if you are going to make things up and not respond to the things I actually post, I am done with you. "



Out of arguments? Instead of trying to accuse me of making things up you could try to discuss the arguments I am bringing up, like "Sega ... almost broke".

Mike Reddy
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First link on my iPhone sends it into a nose dive… :-(

Anthony Taylor
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Learn to read. I never said Nintendo should do that. I said OTHERS say that.



See? You make things up. Not wasting my time on the likes of you.

Mario Kummer
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When I look at my friends who used to have GBAs, DSs and PSPs and myself (although I bought a 3DS) I think phones, especialy the iPhone, have taken over the gaming handheld market.

What do I want a portable device for? I want to play a few minutes when I sit in train on the way to work or when I have to wait somewhere. Sometimes a bit longer when I am traveling.

Sure a lot of games may be better on DS and PSP, but usually that are also the kind of games that I want to play on my PC/PS3/Xbox360 not on a portable.

On my iPhone I can get good games starting at 0.79€, that does not really motivate me to buy the 40+€ games on DS/PSP.

And besides this, I don't like to carry too much devices with me. Its convenient to just play with my phone, while listening to podcasts.

I consider myself a hardcore game, and totally changed my opinion on this topic. When the first friend told me that he will not buy portables anymore because the iPhone is good enough I argued about how much better "real games" are. But then I started to realize that I play my "portables" only at home and that they are not really worth the money.

If a lot of other people experience something similar, and if the 3DS failure is any indication, than I think the game is over for this kind of devices. I will for sure not buy a PSP Vita, and I am considering to sell my 3DS when I finished Super Mario Land 3D ;)

Cordero W
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"Hey look, Sony and Microsoft aren't doing so well with their systems!"



"It's okay. They'll come back. They're pretty big."



"Hey look, Nintendo is having poor sales!"



"OMG, THEY R DOOMED. THEY SHOULD BECOME SOFTWARE AND SELL ON THE SUPERIOR CONSOLES."



This war has been waged forever. And no matter how much a gamer argues, they never know what they want in the end. So like always, instead of making predictions, I'm just going to sit back and watch how the market rolls in. And if Nintendo keeps following their pattern, like always, they'll come out strong as usual. They put the prices on their hardware for a reason: for cost effectiveness. It doesn't make their hardware as powerful as Sony's and Microsoft's, but they deliver content that people still enjoy playing. That's all that matters. They are saying they can still bring good games without all the bells and whistles that come with the more premium systems, which try to offer an all-in-one entertainment experience. I don't want to be ambushed by ads of television shows and other such things that flash once I log into Xbox or PSN. Gamers buy a console to play games, and that's it. And Nintendo knows this.



Not to mention, Nintendo has major profits from the Wii's success. They're fine. Even if they have quarterly losses, that's just data they have to give to keep their shareholders' informed. Unfortunately, money talks, and they're thinking that Nintendo has to go over to this other market that is apparently making lots of money. And don't realize that it's all just a short term fix. Games on iOS sell for pennies. Even if they brought over their IPs, the profit won't be as big as if they kept with their current business model. I blame the business analysts for this, especially since they don't understand how the video game industry works in terms of ethics. Yes, there's an industry that actually exists where ethics is involved, and Nintendo's brand name is one factor of it.

Michael Walsh
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Nintendo is losing profit because of Smartphones. They also need to get on the boat grabbing 3 party developers and publishers, or I see Nintendo falling like Sega in the next 3-5 years. I lost faith in the company when they put the N64. Yeah, they became kings with Wii, but that fade is slipping away running for the fences. I see Sony holding the title again, and for years to come. I even see them putting generation 8 game systems out the same time as Mircosoft keeping a stronghold. Hey,but thats my opinion.

Bob Johnson
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I do not think smartphones are why. I think the 3ds just has had a slow start. There's no AAA Nintendo games yet. I think customers also think it is another DS version. They released 2 or 3 of them late in the DS lifespan. I do not think the 3d selling point is strong either. The effect is good but the viewing angle is way too narrow. Last the price came in high.



The good news is they fixed the price. And 2 AAA games are coming out in the next month. And you can turn off the 3d.



The games should help make folks forget about the slow start and make them realize the 3ds is a new next-gen device when they find out the DS can't play them.



The strong yen accounted for 75% of Nintendo's loss. They had to write down the value of their foreign currency holdings. I am sure that they also get to profit on paper when the value of the Yen swings the other way.



Last remember Nintendo is in a better financial position than ever. They have $14 billion in the bank. They aren't going away anytime soon.

Ian Uniacke
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Keep in mind that it was just announced that 6.6 million 3ds' have been sold since launch. The original DS only sold 6 million in its first year (that includes a christmas period). 3ds is poised to smash the early sales of the DS. Investor response is more that they were expecting better...not that they are doing poorly. That being said the software issue is definitely a problem but I'll take a wait and see approach to that.



All said and done though 1 billion dollar loss is 1 billion dollar loss and anyone would be concerned.

Anthony Taylor
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@Ian,



The original DS didn't need a giant price drop to get those sales.

Christian Keichel
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"The original DS only sold 6 million in its first year"



Unfortunately not true, according to Nintendo, they shipped over 5 million consoles by May 2005, the 6 million after one year were most likely in Japan only.

Jonathan Jou
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Holy cow, over half of Nintendo's losses are from the strong yen!



But of course that's nothing compared to the, uh, staggering, uh... less than half losses that they forecast earlier on. Or, uh... the press release where major company figures took drastic pay cuts.



It's almost like Nintendo knew they weren't going to do very well after the 3DS didn't meet expectations, but the rest of the world is really only figuring this out now! Or maybe the next time remotely bad-sounding news comes out... or maybe the time after that!



Not only that, everyone has somehow concluded that Nintendo has put itself in Sega's shoes, and that Nintendo would be better off as a software company! I hope Gamasutra takes the time to whip up an in-depth article actually comparing and contrasting the two, because hundreds of snappy comments can't be wrong... can they? Is the iPhone revolution going to turn console gaming into a niche market? Is one bad year going to turn the company that kept the gaming industry "recession-proof" into the company that should never have been? There are certainly many very vocal opinions that support this, and I imagine there would be just as much attention to an article that gives these topics a proper and objective treatment.



In the mean time, the sky is falling! The sky is falling! Everyone run for cover, Nintendo isn't as wildly successful as investors have come to take for granted!!


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