Talking Point: Nintendo Shrinks Prices and Consoles - Nintendo Life

It's all about the money, mini, money

When we first reported the rumour of a Wii Mini, we made the mistake of including a slightly mocking tagline that referred to flying pigs. With the existing Wii models already selling at such low prices, the concept of Nintendo arranging the manufacturing, packaging and advertising for a new model this late in the day seemed unlikely. Yet, it's a reality, albeit one currently only confirmed for release in Canada. The reaction of some members of the Nintendo Life community was, not surprisingly, bafflement, though in the cold light of day there is some logic to Nintendo's "trial" of Wii Mini, if we can call it that.

When considered alongside recent rumours and confirmed moves to reduce the price of 3DS, it's clear that Nintendo is being aggressive and active in reacting to its markets. Gone are the days when Wii couldn't be manufactured quickly enough for demand, DS was quickly becoming the most successful handheld console ever released and Nintendo was enjoying dizzying profit margins. That's not to say that the company's current position is untenable or disastrous, as despite recent losses it has an impressive war chest of assets; yet change and evolution are clearly required.

What Wii Mini and Nintendo's Black Friday results show us, is that diversity may have to be a source of strength for the company. For example, Microsoft sold 750K Xbox 360 consoles in Black Friday week, easily beating Wii's 300K and Wii U's 400K, though consideration must be given to the fact that Wii U stock would have been in limited quantities. Yet Wii showed decent legs, considering the dearth of new content for the system, and when you throw in 3DS and DS family sales Nintendo had a rather meaty overall total of 1.2 million units sold; let's not forget that DS narrowly outsold 3DS due to "significant" retailer deals, to quote NoA boss Reggie Fils-Aime. Nintendo's range of products ? rather than one specific console ? helped it to achieve strong results, with distinctly last-generation systems compensating for their age by being affordable and accessible.

Staying competitive

And so we return to Wii Mini, a rather cute and attractive version of the core system that's lacking GameCube backwards compatibility ? like the first re-released Wii model ? while also being stripped of all online capability. It's basically a disc drive with Wii's ageing tech squeezed in, and will be good for playing games alone, with no online play or access to the extensive library on the Wii Shop. Its price of $99 (just over ?60 in the UK) raised questions of whether it'd make it to territories such as the U.S. and Europe, yet it seems quite unlikely ? aside from a small quantity to tap into collector's desires, perhaps ? while the existing model still sells in reasonable numbers.

The new model's lack of internet connectivity may be confusing to many, but plenty of regions ? including Canada ? don't necessarily have widely-available or reliable broadband services. As highlighted by wired.co.uk, one attraction on Wii, Netflix, would have little impact in Canada; this is due to, in the words of Netflix's chief content officer, "almost third-world access to the internet" in various areas of the country. If a proportion of the population doesn't have a modern broadband connection, then the opportunity to pick up a fun little gaming system at a budget price suddenly makes sense, whereas many customers in countries like the U.S. or UK would likely scoff at a console with no internet capability.

Yet Wii Mini could be a future driving force that allows Nintendo to target countries beyond Canada that are still developing infrastructure such as high speed internet, areas where access to video game systems is more limited or budgets are simply too tight for extravagant purchases. For a low price of entry, and with Nintendo Selects budget games available, new consumers can experience Wii for the first time; it could represent a fresh opportunity to join in with what so many have been enjoying since 2006. Perhaps Canada is, ultimately, a trial ahead of a wider and more ambitious plan to give Wii a PS2-style longevity.

Beyond the Wii Mini, Nintendo's reacting to the economic realities in many major nations and regions, as well as the increasing competition from alternative devices such as tablets and smartphones. Producing new 3DS hardware bundles ahead of a Holiday period is hardly surprising, but the cost of entry to Nintendo's latest handheld is continuing to fall, even though it's less than two years old. Production costs are reduced by bundles with a game pre-installed on the system, rather than packing in a physical copy, while a rumour from this week suggests that the MSRP of the original model is set to fall a further $30 in the U.S., adding to the drastic price cut that was implemented to revive the system in its early days.

A pricier proposition

As it currently stands, Nintendo couldn't be much more active in its efforts to sell systems, games and accessories to turn a profit. As Black Friday and the emergence of Wii Mini has proven, the famous gaming company is leaving no stone unturned with budget cheap-entry last-gen systems, an increasingly affordable current handheld and, at the top end of the scale, a brand new home console coming in at a comparatively high price. That diversity of products, and the surprising reality that its older products can still sell despite the presence of shinier, newer alternatives, gives Nintendo a fighting chance to achieve success against increasingly challenging odds. Microsoft could say that its home console outsold Nintendo's equivalents during Black Friday, but Nintendo combined four systems to triumph overall.

While Wii and DS family sales will continue to fall back, it's clear that given the right circumstances they can still shift units. It's often asked whether Wii U and 3DS will hit the sales heights of their predecessors, and the realities of a changed world suggest that they have little to no chance of doing so. If Nintendo can continue to maintain a range of systems that sell in reasonable numbers into future generations, however, perhaps that will ensure long term survival and success.

Source: http://www.nintendolife.com/news/2012/11/talking_point_nintendo_shrinks_prices_and_consoles

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