Next generation will start 2012 with the NES 6 from Nintendo?

Discussion in 'Console Industry' started by Squilliam, Feb 26, 2011.

  1. Squilliam

    Squilliam Beyond3d isn't defined yet
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    I don't believe that the Nintendo Wii's profitability and market share are reparable at this point. The only thing which will revitalise Nintendo's flagging hardware and software ecosystem sales and revenue at this point has to be a new console. I don't really see any reason why they would try to prolong the current generation and eek out more life for the Wii as their current flagship console when they would be missing out on an opportunity to take first bite at a new generation of consoles and hopefully gain a leg up on the competition with their still great mindshare amongst the wider general public.

    So am I being crazy here? It just seems 'right' at this point with the supporting evidence in terms of sales and Nintendo's relative quiet on their vitality sensor that they have saved the latter for a next generation console due to the former that we'll see the next generation Wii announced at E3 in June for release in 2012 with final launch games being announced next year from third parties.
     
  2. AlphaWolf

    AlphaWolf Specious Misanthrope
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    Was the gamecube ever doing as well as the Wii is now? They could certainly use something to get some of the buzz back, but I'm not sure a new console automatically promises that.
     
  3. Rangers

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    Ehh, people dog the Wii's slump, and I'm one of them, BUT

    The Wii is still insanely profitable. Even if it's only 1/3 the market now instead of half. They still sell not just Wii's (which at 199 must cost about $20 to make by now), but insane amounts of insanely high margin peripherals (gazillions of wii motes, balance boards etc), and first party games.

    I dont think Nintendo needs to do anything really. I'm guessing their profit level is still immensely higher than the other two. Even if it's lower than it once was.

    Edit: for example, was just looking at Amazon best sellers list. Many Nintendo/Wii products.

    Sales play into some of this, but:

    Micheal Jackson The Experience #2
    Just Dance 2 #3
    Super Mario All Stars #7
    Black Wii hardware #12
    Wii Fit Plus #14


    Seems now a dance game craze is the the latest thing raking in cash on Wii. Just Dance 2 is selling huge.
     
    #3 Rangers, Feb 26, 2011
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  4. Squilliam

    Squilliam Beyond3d isn't defined yet
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    They have on the one hand the fact that fewer Wiis are being sold, less software is being sold and fewer accessories such as Wii Fit and extra balance boards are being sold. Being quite profitable is one thing, they need to either sustain or better yet increase those numbers given they are a publicly traded company.

    On the other hand if they release a new console they can sell new games and accessories to people who have already bought a Wii as well as entirely new customers. They can sell their console at a higher price and sell new versions of previously released games again such as Wii Sports, Play, Mario Kart, Fit etc to people who already own a previous release.

    So why would they prolong the Wii when the Wii 2 could be more profitable both in the short term and the long term whilst helping to preserve their present market position?
     
  5. Rangers

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    Just because they are publicly traded doesn't mean they always need to be on an upward slope. That's impossible.

    The Wii is still a gravy train, less of a gravy train, but still a gravy train. I think they will let it ride at least a couple more years and I think that would be smart.

    In the meantime they are launching 3DS to butter up the portable side of their business and I'm sure that will keep them plenty busy.

    You speak of a Wii2, but we have no idea what that would look like. If it's a significant technological advancement, then it will also significantly erode or even erase their hardware profits, not something they'll be looking to do lightly. A long time ago Nintendo realized they aren't Sony and Microsoft, capable of bleeding mounds of cash to subsidize hardware. Hell even Sony and Microsoft aren't Sony and Microsoft anymore.

    And I'm really not sure where some of your ideas are coming from, they're confusing and dont make sense. Why would Nintendo be able to sell "new versions of previously released games again" by launching a new system? Why cant they just do that now? Why would new hardware in any way guarantee any new software sales, especially of new versions of old games?

    Again, the only thing a technically advanced (and if it's not more technically advanced, then what is it?) Wii2 would be certain to do is destroy a lot of profits in the short term, and no guarantee of long term success. Wii has a lot of life and profits left and it's certain they'll ride it for at least one more year (because we'll start hearing concrete rumblings of a successor at least a year before it would release, and we havent yet) and possibly significantly longer, my guess is a minimum of two years, depending how it holds up.

    Dont forget just this last December, Wii sold 2.355m consoles in the USA, about 500k more than 360, and was the bestselling console for 2010 still in the USA, even with 360 nipping at it's heals. Wii still cleans up at the holidays.
     
    #5 Rangers, Feb 26, 2011
    Last edited by a moderator: Feb 26, 2011
  6. Squilliam

    Squilliam Beyond3d isn't defined yet
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    Why would anyone presume they would have to lose money on a new system? You can pack quite a bit of hardware into a $299 system and still make a very good margin on it. Nintendo will obviously include functional improvements which they will believe that will improve the overall appeal of a next generation system, the equivalent of the 3D in the 3DS.

    Because they can make significant improvements to the titles which will make them appeal once more to people who already own the software. It is the same as how the Wii allowed them to sell Mario Kart in record numbers, and it would be the same for Wii Sports if they can somehow improve the experience.

    If they Wii continuously declines the whole time, then what? It didn't clean up nearly to the same extent as in 2009 or especially 2008 and 2011 is on track to clean up even less. Are you really saying they should ride the Wii out to 2013 and let the rot continue without doing anything? They may not make significant profit in the mean time especially if they are forced to cut the price of the Wii to $149.
     
  7. AmFreak

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    You make that sound easy. But what will these "functional improvements" be? That's the really hard part - they need WiiMote 2.0 (and i don't mean motion controls wtih this i mean something "new" to differentiate themselfs from the competition).

    What you miss is that they can only loose market share next generation (imho).
    Nobody (nobody as in not the majority of Wii owners) would buy a Wii with more power.

    If they don't make a nice profit at 149$ they do something wrong. I mean a PS3 at 299$ is now profitable, a 360 at 200$ is. With a new hardware they also wouldn't make a huge profit. The money maker would be the software and the software wouldn't sell close to the same amount as the Wii software due to number of console owners. The sooner they launch the more money will be left on the table. Just think about the number of price drops the PS3, 360 or other consoles had. The wii had only one 250$->200$. Don't you think the wii would sell crazy again if they would drop the price to 99$? Imho they will again launch in the same timeframe as the other 2.
     
  8. Squilliam

    Squilliam Beyond3d isn't defined yet
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    Well before they had the 3DS announced noone would have seriously predicted an autostereoscopic screen. Just because we on the outside cannot anticipate their actions just as we couldn't anticipate AMD going 4 Wide VLIW doesn't mean that they won't make any action in this direction. They've obviously been thinking about the Wiimote and interfaces for at least 7 years at this point so the chances are good that they will come up with something in that time. However given the DS's dual screen and stylus, the Wii's Wiimote and the 3DS' 3D it would be foolish to assume their next generation Wii is just a Wii+ at this point considering their past record.

    They're losing market share in this generation regardless. With a new system they could gain market share, they could lose market share but with the Wii they will only almost certainly lose market share. I don't believe that Nintendo would release a Wii with just more power, see above.

    Microsoft's average sale price as at the last NPD was $305 which isn't too far removed from the launch and is relatively comparable with Nintendo's price drops since launch. Sony on the other hand was forced to lower the price by a larger margin to stay in business which is something entirely different from running a profitable company. Sure the Wii would sell crazy at $149 but after the currency turned against them somewhat they'd lose a significant quantity of margins in order to sell to people who will buy less software and accessories at the same time losing money from all the people who would have paid $200 but instead have to pay $149. Nintendo's MO is to add value to their products and not cut the price, however they are fast running into saturation of their target markets and diminishing returns on the system selling potential of new software.

    Nintendo is better served by saving their development resources for a next generation console because their software will be better able to sell new $249-$299 hardware and it will be far more productive for them in terms of overall profit than trying to steady the final few years of the Wii whilst facing increased competition and diminishing returns. With a new Wii they can sell new versions of SSBB, Mario Kart Wii, Wii Fit, Wii Sports etc and all this software will sell systems and the new customers they aquire will buy more software than legacy Wii console owners. Just saying they leave money on the table by releasing the NES 6 is entirely wrong because they also leave money on the table in not releasing NES 6. They released the 3DS before the NDS had done it's final dash so they could still release the NES 6 before the NES 5 is finished on the market and sell both at the same time which will give them the ability to target the widest portion of the market from core to extremely casual.
     
  9. AlphaWolf

    AlphaWolf Specious Misanthrope
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    That number is inflated by kinect bundles. Their asp before kinect was $50 lower.
     
  10. Squilliam

    Squilliam Beyond3d isn't defined yet
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    Yeah however they have managed to add value and increase the sale price of the Xbox 360 whilst increasing the consoles value and longevity. This shouldn't be discounted. On the same token adding Wii Sports enabled Nintendo to increase the ASP of their console by $50 at the start of the generation, at the very least it was the justification for doing so.
     
  11. AmFreak

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    Who considered that? I said the exact oposite:
    "they need WiiMote 2.0 (and i don't mean motion controls wtih this i mean something "new" to differentiate themselfs from the competition)".
    But as i said what will it be? 3D would be nothing new - everyone else already has it or will have it. An improvement in Motion controls would also not cut it, cause like 3D everyone else already have it. I also think 3D for the DS isn't in the same league as the Touch Screen of the DS or the Motion Controls of the wii was (doesn't mean the thing won't sell like hot cakes - in the end it's a DS ;) ). There's also always the danger that if they launch first the competition can copy their "new" tech.

    If it wasn't clear i'm almost certain they won't release a wii with just more power. But i don't really see what they could build in to make the same impact as the motion controls. You say they loose market share, but don't you think this is a unparalled situation in nintendo's history to make tons of money. Do you really think they will have the same success in the next generation? Do you think it's likely that in the next generation they will sell more consoles than there rivals combined? Do you think they will have games that sell over 20 million? I mean i can see them, depending on the market, launching the next console in 2012 - that's after all close to 2 years. But i can't see them announce the new console at E3 this year (that would cut into wii sales). Also i would make sure that before the next console comes out the Wii price is cut to 99$, i think at that price they could shift huge numbers.

    Microsoft's average sale price as at the last NPD was $305 which isn't too far removed from the launch and is relatively comparable with Nintendo's price drops since launch. Sony on the other hand was forced to lower the price by a larger margin to stay in business which is something entirely different from running a profitable company. Sure the Wii would sell crazy at $149 but after the currency turned against them somewhat they'd lose a significant quantity of margins in order to sell to people who will buy less software and accessories at the same time losing money from all the people who would have paid $200 but instead have to pay $149. Nintendo's MO is to add value to their products and not cut the price, however they are fast running into saturation of their target markets and diminishing returns on the system selling potential of new software.

    The Ms Sony prices were only posted to illustrate that Nintendo should make a profit at 150$. And you make it sound as if Nintendo never should make a price cut.

    And do you think a new Mario Kart, Sports, etc... would sell 10+ Million on the new console and at what time span? 10-15 Million is maybe the number of consoles they will sell in the first year. It's seems you assume the next console and the software will sell the same numbers as the wii, as in my opinion it will be a much bigger uphill battle for them. I would take any bet that the next console won't have the same market share that the wii has.
     
  12. I.S.T.

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    You forget that they are so far behind at this point of time that a significant technological advancement, as you put it, could simply be putting Nintendo at the X360/PS3 level.

    I'm sort of hoping next gen, whenever that happens, they go for X360+. Basically, more ram than the X360, better AF/AA speed, stuff like that, but not at the level of whatever MS and Sony are planning.
     
  13. AlphaWolf

    AlphaWolf Specious Misanthrope
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    There's no question they could achieve ps360 performance quite easily, but would that be enough to entice people to buy in right now? Are millions of Wii owners looking to upgrade the performance? Are ps360 owners looking to jump ship for something slightly different.

    The longer they wait the more they can distance themselves from the current generation consoles. Despite somewhat flagging sales (they aren't exactly bad), profits are still good for Nintendo. I don't see a sense of urgency.

    It feels to me like the ball is in Sony's court atm. If kinect wasn't doing so well I'd have expected MS to move first.
     
  14. Xenus

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    I see the Nintendo in between a rock and a hard place in regard to console space atm. Next year they can release a PS360 level machine with more ram and DX11 but similar level overall performance for about 300 with their model. But I don't see that being a big enough jump to convince the PS360 owners to jump and how many of the new Wii owners this gen that got it for the motion control would jump? So it appears they have to wait to be much closer to the launch of the PS4/Xbox next to get an appreciable jump to convince people to make the leap. However the closer they get to the launch of those the easier it is for those on the PS360 platforms to wait for the new platform of their choice to come out. his of coarse is leaving out the possibility of another new idea which is out of the scope of the others that could drive sales.
     
  15. Squilliam

    Squilliam Beyond3d isn't defined yet
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    Well! Sorry I misinterpretted your comment, forgive? :sad:

    Anyway I figured they would go for something that they felt was uncopyable by their competition due to different values, they really do subscribe to disruption theory it seems. The first thought I had was an open application store given the fact that they make considerable margin on their hardware and point to Apple as being their main competition in many ways. As a plus side it would help them avert many of the hacking attempts by allowing home brew for their console. The second would be adjustments to the Wiimote itself, I felt that having a back facing touch pad/screen might be a good way to differentiate since the designs for the Move or whatever Microsoft has would be unlikely to facilitate this given the size/shape of Move and likely Microsofts inevitable design. Another good thing would be an analogue slider, I wonder what kind of gameplay possibilities that would bring.

    If the next installment of Call of Duty can sell over 20M copies just as MW2 and Black Ops probably have then im pretty sure that the next full installment of Wii Fit, Mario Kart etc will sell extremely well so long as they can get a good number of consoles out to the general public. Do I think they will have the same success? I can't say, however they do have an advantage in that they are the top selling current generation console manufacturer and momentum does count for something in this industry, an advantage which is even stronger if they do indeed release first with a viable console replacement, going by past history. It is their market to lose or a market which Sony/Microsoft have to physically wrest from their hands.

    If they do announce a Wii 2 for 2012 they may immediately cut the price at E3 this year or soon after. On the other hand most of their audience isn't privvy to game news so may remain oblivious to the fact that a Wii replacement has already been announced. A price cut to $149 may indeed be the final price of the Wii before it is discontinued, especially if the NES 6 comes in at $299, hence entirely different market segments. Nintendo hasn't significantly cut the price of the DS so maybe they will do likewise with the Wii.

    Yes I believe they will sell 10M+ and the timespan will be similar to the current Wiis or maybe a little faster given they are more established franchises nowadays. Call of Duty and other franchises have managed to increase or maintain their share, why not Wii series on a much longer release schedule?

    The Wii market share is under threat regardless and coming out first gives them an opportunity to establish the kind of commanding lead they never quite established in this generation, the same way the Xbox 360 market share has always been augmented by their 1 year earlier release.
     
  16. corduroygt

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    Sony is doing really well on software sales by the way. They almost caught up with the 360 in Activision's revenue figures, despite Call of Duty being on Microsoft's payroll and they've equalized with the 360 in EA's revenue figures. As long as that doesn't change, Sony's happy with the PS3 and selling both hardware and software at a profit. Maybe what they'll do is throw in the move bundle for $299 as the cost difference between the move PS3 bundle and the standard can't be more than 20-30 bucks, it's very cheap tech in there. By forcing a move bundle with every PS3, they can also claim excellent sales numbers as well.
     
  17. -tkf-

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    I would love a WIITO with real next gen graphics and Blu-Ray playback. Nintendo doesn´t have to innovate like crazy for every console, they didn´t for everything else they produced, they can just improve. Add improved motion controllers with kinect style tech.

    And simple stuff, compared to the 360 and PS3 they should be able to get cheaper and powerfull hardware. What would it require?
    Intel I5 with integrated graphics? or an I3 with discrete graphics chip from AMD? Easily upgradeable harddrive and of course a Blu-Ray drive, doesn´t have to be anything fancy, even a 6x speed would blow the PS3 away.

    It shouldn´t take much to be more powerfull than the PS3 and 360.

    Imho they would be smart to be the first to market with the next console and beat the current consoles in terms of graphics and features. Imagine Nintendo having the console with the best looking 3rd party games :)

    And when the PS4 and 720 launches, the WIITO may be the weakest, but even by then it wouldn´t be so much of the mark as the WII is today.
     
  18. eastmen

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    Come on guys if the wii droped to $150 or $100 it would start selling like gang busters again . If i were nintendo i'd shrink the system a bit and relaunch at $150
     
  19. MfA

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    I think Nintendo should push a Wii with little more innovation than better graphics and a more precise wiimote inside the bundle. At the same time releasing a VR headset.

    Make use of the 3D hype, but provide people a way to experience it with cinema like quality (better than anything they can get with flatscreen TVs, even if they stop ghosting and increase refresh they just won't be able to touch the viewing angles). Also with the benefit of headtracking of course.

    Launched separately to avoid sticker shock (I think the VR glasses can be made cheap, but still going to be over 200$ alone) and to not make people with their own 3D setups feel bad (even though they almost certainly suck).
     
  20. eastmen

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    At that point why not just push the vr on the wii . Drop the wii price down and then put out $200 glasses. Or do you think they need a power house console also ?
     

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