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Print 27 comment(s) - last by siberus.. on Oct 25 at 6:28 PM

Nintendo hopes the Wii U will help with profits

Nintendo cut its fiscal-year profit outlook by over 50 percent in its latest earnings report -- and some of the other financial numbers aren't looking too swift, either.
 
For the six months ended September 30, Nintendo reported a net loss of Y27.99 ($350 million USD), which isn't as bad as the Y70.27 billion ($876 million USD) net loss the video game company reported a year ago. However, revenue took a tumble by 6.8 percent to Y200.9 billion ($2.6 billion USD) during the first half of the fiscal year. 
 
Nintendo doesn't report its earnings on a quarterly basis. 
 
For the 2013 fiscal year, Nintendo has significantly cut its profit outlook from Y20 billion ($250 million USD) to Y6 billion ($75 million USD). 
 
Nintendo cited weak 3DS sales for the slash in profit outlook for the fiscal year 2013. The company expected to sell 17.5 million 3DS units and have only sold 5.06 million in the first half, which makes the 17 million look a bit out of reach.
 
Other Nintendo hardware has declined as well, such as the Wii (1.32 million units sold in the first half of 2012) and the original DS (980,000 unit sales during the same time period). However, software sales seem to be doing well -- it reached 64.45 million sales during the first half. Wii sales may pick up too, since Nintendo just cut the price down to $129.99.
 
Nintendo CEO Satoru Iwata recognized that cheap gaming on mobile devices like smartphones and tablets has put the company in a difficult place. While devices like the Nintendo 3DS are also mobile, it's much more convenient to carry one device that makes calls, sends texts, accesses the Internet and offers games instead of just one gadget that only offers games. Despite this challenge, Iwata said that Nintendo is sticking with its traditional gaming machines and titles instead of shifting to other methods.
 
"Certainly, a new competitive environment has been born," said Iwata. "But we have no plans to use our valuable resources for smart devices." 
 
 
A lot of Nintendo's gaming future depends on the launch of the Wii U right now, which is the successor to the original Wii console. The Wii U, which is only weeks from release, offers a new gaming experience that Nintendo hopes will draw customers in a different way from smart devices.
 
The Wii U features a 6.2-inch GamePad controller, 1080p high-definition graphics and 2GB of memory. Nintendo hopes to 5.5 million Wii Us and 24 million Wii U software titles by the end of March 2013. 
 
The Wii U will be released on November 18 in the U.S., and customers can choose the basic model for $299.99 USD or the premium model for $349.99 USD. 

Source: Nintendo [PDF]



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Demand
By chµck on 10/24/2012 3:16:47 PM , Rating: 2
Does anyone here plan on getting one? I don't see much hype over it. It seems like a late product.




RE: Demand
By russki on 10/24/2012 3:26:47 PM , Rating: 2
The last nintendo console i bought was the n64. I dont understand the need for a wii type console as it took a step backwards in graphics performance. now xbox and ps3 have the same technology so why would anyone buy a nintendo, that's even more expensive than those systems???


RE: Demand
By augiem on 10/24/2012 3:34:37 PM , Rating: 2
Not everyone out there buys on technology (as the Wii's success should tell you). The only reason I might buy one is because its the only way you can play Nintendo's titles. For me, without those, I wouldn't buy one.


RE: Demand
By SenilePlatypus on 10/24/2012 8:14:50 PM , Rating: 2
There's more than one way to get your first party Nintendo fix (with better graphics & controllers [XBox])

http://dolphin-emulator.com/


RE: Demand
By othercents on 10/24/2012 3:34:42 PM , Rating: 2
That was definitely the argument that people had when the Wii was introduced, but it was a much better selling console especially since it introduced gaming to people who wouldn't ever want to pickup a controller.

However with the Kinect and Playstation Move I think that idea is gone. The only thing that has kept Nintendo selling consoles was the price point. Wii U doesn't meet that price point and the "new" features are very similar to the current portable gaming systems. While the Wii originally made Nintendo relevant again I don't see the same for the Wii U.


RE: Demand
By augiem on 10/24/2012 3:30:17 PM , Rating: 2
I will get one eventually because I want to catch up on a few first-party titles from the Wii, but I'm not excited at all about the new screen controllers or any of the titles I've seen announced. Still, I suppose its a good thing that there are a number of "hardcore" games coming out for it (Assassin's Creed 3, Call of Duty: Black Ops 2, Batman Arkham, Mass Effect 3, Ninja Gaiden 3, Darksiders 2.) That's quite a contrast from the Wii.


RE: Demand
By Brandon Hill (blog) on 10/24/2012 3:33:55 PM , Rating: 2
I just put my Wii, Wii Fit, 4 controllers, and games up on eBay. We haven't used the Wii Fit since we got married three years ago, and haven't touched the Wii itself in about 10 months (and even then it was only for Netflix).

I don't see myself buying a Wii U.


RE: Demand
By RufusM on 10/24/2012 3:34:49 PM , Rating: 2
I think Nintendo will be fine. They have always been great at creating new IP even if some of them tank: Mario, Donkey Kong, Zelda, Pokemon, etc. Their strength has always been the software side and the hardware was just there to help sell the software, although the Wii had a ton of accessories they probably cashed in big on.

Nintendo created a dynasty of kids games. All they need is to release some rehashes of old games on the new platforms for the new generations. When something new like Mario or Pokemon comes along again they'll really cash in.


RE: Demand
By Scratches16 on 10/24/2012 5:59:40 PM , Rating: 3
quote:
I think Nintendo will be fine. They have always been great at creating new IP even if some of them tank: Mario, Donkey Kong, Zelda, Pokemon, etc. Their strength has always been the software side and the hardware was just there to help sell the software

Weren't people saying the same thing about Sega before they threw in the towel too?

Don't get me wrong, I want to see Nintendo continue to flourish, but I can't help but draw (feel?) correlations between what happened to Sega and what's happening to Nintendo... :/


RE: Demand
By someguy123 on 10/24/2012 10:05:26 PM , Rating: 2
nintendo already bottomed out with the gamecube. nobody seems to remember that they lost practically all share to sony during those days. their ceo was actually fearing for his job back then because of how marginalized they had become.

I think a lot of people see nintendo as going in a different direction with the wii, but you look back at the nes/snes days and they basically did the same thing trying to cash in with super cool radical accessories and advertisements. Their 1st party games were rare, and the only difference was that they had great 3rd parties bringing in content.

If they can get 3rd parties back on the wagon then they'll be fine. If not they're just going to shrink back to their old size.


RE: Demand
By augiem on 10/25/2012 2:07:15 AM , Rating: 2
Nintendo survived the N64/Gamecube era on GameBoy Advance and Pokemon. Their portable dept is having trouble now with all the smartphone games. I'm not sure if Nintendo has another thing like that up their sleeves. I hope the Wii U does better than I imagine it will...


RE: Demand
By Mitch101 on 10/24/2012 6:01:13 PM , Rating: 2
Nintendo is like Disney of the game consoles.

The Wii packed the idea of fun even if many games didn't live up to the hype but people were excited about the Wii. Firs time I ever heard of parents who were excited to get their kids a game console even the anti games people. This time around I don't know of anyone excited for one.

I dont think Pokemon, Zelda, and Pikmin are going to be enough to save this round. This could turn Nintendo into Sega I hope they banked a lot of that initial Wii money away. I hope im wrong and they surprise me.

Even the DS series seems like its way overdue for a redesign.


RE: Demand
By TakinYourPoints on 10/25/2012 3:52:13 AM , Rating: 2
The WiiU was the only interesting thing I played at E3 this year and the year before. I'm mainly a PC gamer, so the 360 and PS3 libraries hold little interest for me since I can play most of their games on my PC at much higher settings (and also on my TV).

The WiiU has things that no platform I own does, and the games were actually great. Ubisoft's games (Rayman Legends and ZombiU) make excellent use of the WiiU hardware, very much unlike the forced gimmicks of third party Wii games from before. The competitive multiplayer mode of ZombiU was super cool. On the Nintendo side, Pikmin 3 alone makes this an instabuy for me.

Yeah, I already have mine preordered. :)


RE: Demand
By siberus on 10/25/2012 5:42:29 AM , Rating: 2
Im still debating it at the moment. There was a few rpg's that came out on the wii i wanted to try but buying a wii this late in its life cycle ruled them out for me. So at the very least i get to play the last story and xenoblade. I can see the controllers screen being great for sports games. Like madden for instance being able to pick your plays or switch to an audible without the opponent knowing what you have planned. But if game companies utilize it wrong it could end up as a major distraction. However given as Nintendo already had experience working with touch interfaces I'm going to give them the benefit of the doubt. In a way the wii u is kind of like a giant DS so we probably only have to look at the ds to see whats possible.

I have wanted the 3ds for a while now as i loved the original ds it definitely got way more game time then my ps3. (lets face it this generation of consoles has had an extremely low amount of rpg's ) Originally i was just waiting for the XL version to be released now i think I'm just waiting for a price drop.
**rant starting** I'll probably lose my interest in a dedicated portable console when the major portable publishers start releasing more hard core games on smart phones. So far i know I've seen capcom re-release some of their ds games for smart phones(ff iii and i think ghost trick) more or less i want games like trauma under the knife and not cut the rope
;s Kinda makes me wonder why more companies haven't re-released their ds games quite a few didn't even require the use of the dpad as they were 100pct touch driven. Is it a cost thing? I think people would be willing to pay more if the quality was legitimately better. **end rant**


Can the hardware business continue?
By epobirs on 10/24/2012 6:03:02 PM , Rating: 2
I've no doubt that Nintendo can do well as a prosperous smaller company by shifting over to producing software for other company's hardware. The question is who will make that hardware. Things are getting very tough in the dedicated gaming device business and many of the advantages of the pure console are in danger of being lost.

Increasingly, the market is offering fewer platforms with a huge installed base that are all functionally identical and can be fully exploited. Abstraction of the hardware is becoming the rule and it becomes more work to fully support the latest hardware with the most enthusiastic shoppers while not giving up the far more numerous older models that are considered the same platform.

But if it was easy everyone would be doing it.




RE: Can the hardware business continue?
By andrewaggb on 10/24/2012 6:19:03 PM , Rating: 2
They have some good gaming assets, they'd probably make more money selling their games on other platforms than continuing to make their own.


By augiem on 10/25/2012 4:42:20 AM , Rating: 2
Direct software sales cannot possibly make as much money as direct software + licensing fees + royalties on games sold by your licensees. Nintendo's 2009 revenue was $17.7 billion. Activision, the world's biggest game company, only has revenue of $4.7 billion. It's pretty clear where the bigger money is.


By TakinYourPoints on 10/25/2012 3:47:05 AM , Rating: 2
Nintendo not producing hardware would be a huge loss for the entire game industry. Even if you don't play their games you would still be indirectly affected.

Before things like motion they were the first with the d-pad, shoulder buttons, trigger buttons, analog sticks, rumble, touchscreens, etc etc.

Their software and hardware development go hand-in-hand, just look at a game as important as Super Mario 64. Analog control and the conventions of movement established by it (tilt slightly to walk, tilt more to run) were enabled by software development and hardware development to happen under the same roof. Other game companies and developers benefit from that.

Again, Nintendo being limited to making only software would be almost pointless. Their software and hardware go together, and it influences everyone else in the process.


By siberus on 10/25/2012 6:28:58 PM , Rating: 2
quote:
Things are getting very tough in the dedicated gaming device business and many of the advantages of the pure console are in danger of being lost.


I don't think we'll see the demise of console gaming any time soon. We're more likely to see the end of pc gaming to be honest not that that's going to occur any time soon either. Even when tablets/smartphones begin to out power the current generation of consoles they are still not nearly as efficient as the consoles at playing games. All console games are so highly optimized for their platform that it would probably be impossible for similarly specced pc's to run their games.

**side thought** The Wii U might be the undoing of Nintendo for another reason. Lets for the sake of argument assume the Wii U is a shinning success. They champion a new age of gaming focused on reality augmentation. They are the first to market so this gives plenty of time for Microsoft and Sony to engineer a more sophisticated version of Nintendo's ideas.

Instead of building a screen into a controller what if Sony/Microsoft allowed us to pair actual tablets with their devices. This to a certain extent would be easy to do and would give most of the abilities that the Wii U controller has built in and at the same time prevent tablets from wiping out consoles in the living room as it would have a synergistic relation to the consoles.

***side side thought***
To a certain extent the Wii U controllers will be the first tablet like thing many families will encounter.Could this be a gateway product for Nintendo to go beyond gaming? So with the introduction of the Wii U, Nintendo could be shooting for something that the rest of us just cant quite grasp yet.


Why consoles?
By melgross on 10/24/2012 6:47:26 PM , Rating: 2
A lot of people bought consoles over the decades because there was no way to play decent games in the living room otherwise. The computer was usually in the bedroom, or sometimes in the kitchen. They also had small screens.

Handheld games were pretty primitive, and didn't offer much in the way of gameplay.

But that changed a lot. Smartphones offer a lot of pretty good games. Good enough to lure some people away from consoles, particularly since they have their phones wherever they go. Even though the games aren't as sophisticated, they are much closer than they used to be. Handheld game machines? A lost category. Sales are dropping like a stone.

In addition, tablets offer a lot of what consoles offer. Again, not everything, but enough so that people are buying those games in the tens of millions. As we get more controllers for tablets, the games will eventually equal those in consoles, and will become consoles. That's already happening, as games can be played on the tablet but sent to the Tv as a consoles does.

And you can play them anywhere without the Tv or power connection. The screens are big enough at 10".

It might just take a couple more years. I read somewhere in a gaming magazine that the iPad 3 was already as powerful as an average of the PS2 and PS3. The iPad 4, just announced, and twice as powerful, could be as powerful as the PS3 already, with higher resolution.

The handwriting is on the wall for all consoles.




RE: Why consoles?
By augiem on 10/25/2012 3:26:46 AM , Rating: 2
quote:
I read somewhere in a gaming magazine that the iPad 3 was already as powerful as an average of the PS2 and PS3


Not true.


RE: Why consoles?
By TakinYourPoints on 10/25/2012 3:40:32 AM , Rating: 2
The problem with that argument is that it doesn't take setting or physical controls into account. Now, you can use a wireless gamepad to interface with an iPad, and you can push iPad to display video to a TV via an AppleTV, but it doesn't mean that developers won't continue to focus on the main interface which is touch and gyro.

There are excellent games on the iPad, but the best of them aren't the traditional shooter or third person action game that you find on a console. They're different genres like board games, RPGs, tactics, and strategy games, genres that play to the strengths of the touch interface.

Every console game will be designed around a gamepad and a TV. The interface will drive the types of games designed, which is why tablets, as capable as they are becoming, won't replace consoles anytime soon. Horsepower alone won't do it, software (which is purpose built for the input method and the display) also matters.


Seppuku
By TerranMagistrate on 10/24/2012 9:59:30 PM , Rating: 2
Nintendo would rather commit seppuku than to put any of their software onto foreign (i.e. non-Nintendo) platforms. It's their hardware or death for them.




RE: Seppuku
By augiem on 10/25/2012 4:40:16 AM , Rating: 2
Nintendo's revenue for 2010 was $13.7 billion, and for 2009 was $17.7 billion. You simply cannot make that kind of money in game software. Activision, still the largest game company in the world, only has revenue of $4.75 billion.


Short sighted
By augiem on 10/24/2012 3:20:12 PM , Rating: 3
quote:
While devices like the Nintendo 3DS are also mobile, it's much more convenient to carry one device that makes calls, sends texts, accesses the Internet and offers games instead of just one gadget that only offers games.


It was pretty clear even before the smartphone revolution that everything was moving toward an all-in-one device. Nintendo should have jumped on the smartphone bandwagon back then. Nintendo was in a better position than anyone else because they had the experience, the game library, and the portable following. Phone gaming would have been a lot better too if they had made a phone with an actual controller as opposed to just a touch screen. Even as smartphone gaming took off, they continued to refuse to go that route. Such a missed opportunity for Nintendo and for the gaming as a whole.




Imagine if
By spamreader1 on 10/24/2012 3:55:48 PM , Rating: 2
Nintindo put out thier game titles for android/ios. I know I'd bite, at least on my nexus 7 anyway.

The Nintindo brand image is still pretty good, could be something to give them an edge. The hard part would be price points, I know very few who pay more than $5 for games to install on their phones/tablets.




How to judge value
By bobcpg on 10/24/2012 5:47:42 PM , Rating: 2
value = enjoyment/cost

No other way around it.

With that being said, I feel Nintendo has a looser on its hands. Also, I'm not going to add to my Wii graveyard of toys with a $300+ system. Nintendo, you have over engineered the U




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