Wii Hardware To Be Profitable At Launch 191
Next Generation reports on comments by Nintendo's Reggie Fils-Aime, stating that the Wii will be profitable out of the gate. It's been well-publicized that the consoles offered by Sony and Microsoft are subsidized by those companies. From the article: "Nintendo, however, has traditionally avoided the 'razor and blades' business model by selling its consoles above what they cost to make. Fils-Aime confirmed to Reuters that the Wii would carry on the tradition. 'We will make a profit on the entire Wii proposition out of the box -- hardware and software,' he said. 'That really is a very different philosophy versus our competitors. We are a company that competes only in the interactive entertainment space so we have to make a profit on every thing we do.'" The comment is undoubtedly meant to assuage analysts nervous about the relatively late release date and somewhat higher than expected price for the Wii.
nintendo is a game company (Score:3, Informative)
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Re:nintendo is a game company (Score:5, Informative)
At one point, yes they did own a taxi service and "love hotels"(which are not brothels, they are basically hotels rented by the hour with the express purpose of having consenting adults do things in them which one would rent a hotel by the hour for)
Re:nintendo is a game company (Score:5, Funny)
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Re:nintendo is a game company (Score:5, Funny)
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Based on plenty of anime and manga, you can remove "adults", and perhaps "consenting" from that statement.
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Re:nintendo is a game company (Score:5, Insightful)
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I seem to remember some profits analysis that I read months ago breaking down what each of the big 3 earned leading up to the release of the Xbox 360... according to that report Nintendo was far and wide the most profitable of the three despite the fact that their install base was dwarfed by MS and Sony. Basically they didn't take losses on anything they sold... and a majority of the games they sold were 1st party, which funneled more m
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I could never get into Halo myself. I did play it with a friend after he kept telling me how good it was. It seemed generic and boring to me, just like any other FPS. But I loved Metroid Prime, it's more about exploration and puzzles, but still of course a shooter. Honestly, the video from E3 wasn't very impressive at all if you ask me. If you get a wii I would recommend picking up the first Metroid Prime (I've
A Minor Correction (Score:2, Informative)
Just a minor correction on your assumptions so far:
You really ought to read rather than skim over the information released yesterday, or at the very least look it up on Wik
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Comment removed (Score:5, Informative)
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Actually, I think in this case they don't care. There's much much more at stake to drive the other (Sony or Microsoft) out of the business. For Sony, the PS3 doesn't just mean game revenue, but in their eyes, Blu-Ray revenue. Winning the HD format feud is much more lucrative in the long run than game consoles.
As far as Microsoft, they're desperatly trying to establish a foothold in the home theater environment. They want (perhaps ne
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That part is key, it means it is suspected to be true, but there is no actual proof. I have never heard from an authoritative source that Sony actually lost money on the PS2 hardware, and they certainly did not on the PS1 hardware. The only consoles to ever have confirmed to sell under cost were: Dreamcast, Xbox, Xbox 360 and, we assume, PS3. The PSP might also, but, again, no authoritative source available.
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You can STILL sell the console at a loss. Look at it this way.
By lowering the price from 250 to 150, they go from making 50 per console to losing 50 per console. But they sell 2 million rather than 1.5 million consoles. If there is an attachment rate of 3, and a per game profit of $25 (half - since most N games are first party anyway), they make 12,500,000 more.
So the 'mus
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Except that, just like the Xbox 360(1), and unfortunately (let's be realistic here) the PS3, the Wii will most probably sell out this holiday season. They won't sell more by lowering the price, because there won't be any more to sell. By selling it $250 instead of the expected $200, if they manage to ship and sell all the 4 millions of the units they
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Yeah... I guess my keyboard was running out of zero's... ;-)
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Sir, agree completely with you in that the Wii will make some publishers loose, at their stomach of course.
Other than that, I cant find a relation between those two concepts. More publishers will be attracted to the Wii ifnot for anything else for the mere dev kit price, and as everybody says, those "cross platform" publishers have certainly used the GameCube already, so (as Wii bashers love
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It is because of people like you that science does not develop =oP.
The difference is that this "pointer & gyros" will come togheter will dozens of games *specially* designed to exploit its capabilities.
I am sure there are already input devices with gyroscopes and other more interesting technologies available for computers, but the difference (and that is what can make a console *better* than a computer for gaming) is that b
Re:nintendo is a game company (Score:4, Insightful)
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In the realm of Video games, Nintendo INVENTED (Score:4, Interesting)
Fast forward 2 years and Nintendo comes along with their new machine but a different outlook: Nintendo will approve or dissaprove each game released for their system. To enforce it, Nintendo patented a special type of chip that had to be put in each video game before it would play on the NES, and was able to collect royalties on every game sold.
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"Razor and Blades" is the concept that you sell the base unit (i.e. console or razor) at a loss becuase you sell the consumable (games or blades) as enough or a markup to make the money back and then some. Because once they buy a razor from you they have to come back and buy blades every week. In the long run that can be more profitable by giving the razor away.
"Intellectual property contro
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No surprise here (Score:3, Interesting)
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If for say their actual cost is $230 or something and they would lose money on a $200 console $250 sounds like a nice price point. If in fact that are making these (including all other cost) for $190 and selling it at $250 one could argue it might be worth it for them to sell at $200 for a tiny profit, leading to more game sales.
Either way its their buisness and they can run it how they want to. (shocking idea on slashdot hu?)
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The one time Big N had a losing quarter was during a period of currency fluxuations between the yen and the US dollar.
In Japan, the price is Y25,000 ($213) so they'd have to match at least $213, (it's more important that the foreign markets are priced higher, see above), so probably $225, but that's just a bizarre round number, so toss in Wii Sports and ratchet it to $250. Simple.
Added bonus is Wii Sports is a good showoff of the remote, it's a
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How does that explain selling them for $330 in Britain? I know I won't be buying one because of that. Thanks for trying to rip us off Nintendo.
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I really doubt the $50 price increase will hurt sales that bad. They expect to ship 4 million units by the end of the year, and unless there's a horrible hardware failure worldwid
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It may reduce demand at launch -- I know I for one would have been a first adopter at $200 but am having second thoughts at $250 -- but in the long run I don't think Nintendo will be hurt by it. The first few production runs will sell out to the diehards at $250 easily. Maybe next year, once demand has begun to wane, Nintendo will be able to make a price cut or improve the bundle to make the system more attractive to non-acolytes.
My biggest co
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au contraire (Score:3, Interesting)
On the contrary. By buying off the used racks, you're making it possible for those who purchase new to continue doing so. Joe Gamer is more likely to purchase Madden 200X at $50 new if he can trade in the last two new games he purchased for credit; credit which comes from you buying u
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Strange concept (Score:3, Funny)
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econ 101 (Score:2)
If anything, if the PS3 sells as
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Note that this way they don't need to be #1 to be profitable, and that it's actually difficult to lose their shirts.
So while Nintendo might have been willing to
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And not only Mario & Luigi get lower salaries than their GTA counterparts, as they also help sell merchandise items, which would be hard to do legally in the case of GTA and similar franchises.
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Even being only a little cheaper, the Wii comes with a game. It doesn't matter what the game is, a parent who knows nothing about gaming will choose a system with a game over a system without a game 9/10, even if the system with a game is more expensive. So basically, unless the person they're buying it for requested a specific system, or a specific game, to a parent the Wii is still more attracti
Late? High?? (Score:4, Insightful)
People have predicted for months that it would be $250. Only recently did the media put their fingers in and try to 'predict' it would be $225 or even $200. The only reason they even considered those crazy prices was:
1) Every Nintendo console so far has been $200 at launch. Obviously, they couldn't keep that up forever, especially since this system is quite a bit more complex than the previous ones.
2) Exchange rates. Any fool knows that exchange rates only set the price range of a product, not the exact price. The fact that it was $225US when converted on that date didn't mean anything except that it wasn't likely to be $200 here. Nobody in their right mind uses an odd number like $225 when pricing here, at least at launch.
As for the late date... Are we still predicting the PS3 will actually be out before that? I'm still predicting shortages and mayhem for the ps3 launch... It's still a tossup on the Wii launch. I'm hoping they have enough that I get one, but who knows? If there aren't enough ps3's, Mommy and Daddy are gonna buy Wii's for Johnny instead, so he'll have a Christmas present to open.
And maybe that's Nintendo's logic... Capitalize on the failure of Sony. If they launch before Sony, they aren't quite as 'new'. If they launch soon after, amid Sony's sellout chaos, they can pick up extra launch sales and make the figures look better.
I could just see the media spin: Nintendo fails to sell out, slow start for Wii.
But if they wait until after: Sony sells out, loses sales to Nintendo's Wii Launch.
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80s: The NES is $200 at launch. It comes with 2 controllers, 2 games, a light gun, and a crazy robot accessory.
Early 90s: The SNES is $200 at launch. It comes with 2 controllers and a game.
Late 90s: The N64 is $200 at launch. It comes with 1 controller.
2001: The GameCube is $200 at launch. It comes with 1 controller.
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ROB was only in the NES deluxe set, which I believe cost more than $200 and was discontinued shortly thereafter.
Also, an often forgotten piece of trivia: Nintendo 64 was launched in Sept. 1996 at $200, but the price was announced to be $250 at the prior E3 (or spring TGS, I forget exactly) and was dropped only about a month prior to the console's release due to price changes from Sony and Sega.
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1. Deluxe Set ($250) which included Duck Hunt, Gyromite, and ROB
2. The Action Set ($200) which included Duck Hunt and Super Mario Bros. (The original version had two cartridges, later they replaced it with a single cartridge that had both games on it...)
Re:even better yet... (Score:2)
1. The Deluxe Set which contained R.O.B., a Zapper, and two games: Gyromite and Duck Hunt
2. The Control Deck which came with Super Mario Bros.
Wikipedia has more info here. [wikipedia.org]
The Action Set was not a launch configuration as it came out three years later in 1988. This does not necessarily mean that there were not bundles containing both SMB and Duck Hunt before this date. Sadly, Nintendo altered the bundled
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The action set came out soon afterwards...
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No, the combination of all the technological parts related to processing power in the Wii is a rip-off. With any console, you get more than the machinery, you get the fun value, which is basically everything else that the console can provide to you *through* its parts. The fun-value is only created through the purchase of games, though. The Wii is the only console of this (and the last, and arguably others) generation to really differentiate itself by what it off
Re:Late? High?? (Score:5, Insightful)
Bullshit. It has never been done right. There is a lot of R and D in that. Also, those controllers have to be nigh unbreakable. Nintendo spends money on system and controller durability. This time around, along with increasing the graphical power, RAM, and internal memory, they reduced the power consumption of the system and kept all GameCube ports. Add to that the fact you are getting built in wireless and a composite video cable in the box and you can see that there is some value to this machine.
They made it small because they wanted it to fit in tiny spaces with your TV (they stressed that EXTREMELY in the interview)... yet they removed DVD functionality so that you have to put a DVD player beside it to take up more space?
So you were going to throw out your DVD player when you bought a Wii?
Also, have you seen Virtual Console game prices? $5, $8, and $10 for NES, SNES, and N64, respectively. Why so much? All it costs them to sell them to you is the price of their auction software and the bandwidth and servers to get it to you. Way too high for what it is, even if it isn't THAT expensive.
The NES classic games for the GBA have been selling like hotcakes for $20. People who own Oblivion have been buying HORSE ARMOR for $2.50 on XBOX live. Why the hell would they give their shit away if they can make money off it? You also forget that their online gaming system will be free. People who want Tecmo Bowl get Tecmo Bowl for $5 and you get to play Super Smash Brothers online for free. Damn you, Nintendo!
Is it worth $250 for the technology you get? Probably not. I'd suspect the highest bang for the buck is the PS3 even if it is expensive. Xbox 360 isn't a bad deal either. The Wii, for what you get, is a rip off. Overclocked Gamecube with a new controller and (finally) online support.
Same argument was made for the DS vs. the PSP. Problem with the argument is that the PS3 and the Wii are two very different machines. The PS3 is a souped up PS2. The Wii is a kind of video game machine that has never been seen before. So you can pay $600 for $1000 of hardware and get a graphical upgrade, or you could pay $250 for $250 of hardware that you can't find anywhere else. It depends on your priorities. The PS3 may cost $1000 to make, but it's worth about $200 to me. The Wii may cose less than $250 to make, but $250 is less than I would have paid for what they are offering.
However, acting like Nintendo is better than Sony or Microsoft is stupid. If anything, they're just as bad, if not worse.
Every Nintendo console is nearly indestructable. They treat their customers well and fix and problems that do arrive without much hassle. Both Sony and Microsoft settled class action suits in the past generation for faulty componants that they would not replace.
Botched launch date for old technology, the Leizpeg event where they kicked Nintendo loyalists in the balls, dropping DVD to save money, $60 controllers for a system that is supposed to be heavy multiplayer, expensive VC games, overpricing, etc.
The wireless X360 controller is $50. The PS3 controller will likely be that much or more. Again, Nintendo's controller offers things that other controllers do not, and unlike Microsoft and Sony, you can be sure that it will be built like a rock. DVD playback is trivial and therefore unnecessary. I currently have 2 machines that play DVDs that are not DVD players. How many more do I need?
Serously, go buy a PS3 or a X360 if you want, just stop sucking Sony's and Microsoft's respective cocks.
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In an earlier Wii thread, Karma Sucks pointed out the following [slashdot.org]:
Let's play "spot the pattern."
SNES launch price: 25000 Yen / 200 USD.
N64 launch price: 25000 Yen / 200 USD.
Gamecube launch price: 25000 yen / 200 USD.
Wii launch price: 25000 yen / ??? USD.
Hrm.
You can blame the higher U.S. price on a bad exchange ra
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Yeah but you try buying an item in the USA using cash. Most american goods have very odd prices once you take into account tax. Is there any other country in the world where an item is marked as $9.95 on the shelf but you can't buy it with a ten dollar note, since they add some random amount to it? Would it hurt americans to tell the truth about such a small thing as the price of a chocolate bar in a grocery store? </pet_rant>
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And yeah, there's another country. Canada. They actually have 3 different sales taxes in many places in Canada. Some of our states (I live in 1) only have 1 tax.
I'm sure
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"1) Every Nintendo console so far has been $200 at launch. Obviously, they couldn't keep that up forever, especially since this system is quite a bit more complex than the previous ones."
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This is the part that refers to inflation. The 'especially' part after it means there are additional factors as well, which I listed.
Not really surprised (Score:1)
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I got burned in the past. I ain't ever buying MadCatz hardware again. They break easily, and they can't even make a turbo controller that beats my own finger in button-mashing games. What's the point of "turbo" if it's slower than what I can do? I remember my NES-Advantage joystick, now THAT was turbo.
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Wii + second remote + Zelda = $360 for unit and two games
PS3 = $600 with one controller and 0 games.
Math still works out for me.
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Nah. The videos of Wii Sports Boxing show that you can play it with one wiimote and a nunchuk. You can also play it two players simultaneously and beat up your buds virtually.
--R.J.
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What happened to "Play together"? (Score:2, Interesting)
I mean come on, it is the Wii ("We") right? Play together? Wii Sports and one controller makes no sense.
I can see parents buying this for their kids. The kid opens the box, sets everything up and then wants to play baseball, or tennis, with dad. Oops, we can't experience this fun new system together because the system only came with one controller. You can sit still on the couch and watch daddy play though.
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Higher than expected price!? (Score:2)
Maybe if you are a delusional idiot would you think they might sell it for $150, and to be fair, I had a small delusional idiot hope that it might be $200 like the Gamecube, but that didn't for one second knock away the reality that it would more than likely launch at $250.
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But think of what you got with the GC - a console, and a power brick and a controller and a video cable. Not much at the end of the day. What do you get in the Wii box? A console, power brick, controller, nunchuck adapter, sensor bar, bundled game (I think we all expected a demo disc at least to test the controller out on some little games) plus all the extra features inside the console itself - wireless ethernet would be the primary one
If a console owner buys 10 full price games (Score:2)
Online services do add another revenue source however, which can help.
So the Wii will make a small profit for Nintendo, every game will make them a profit, online services may make them a profit. The games can be sold with far less licensing fees as well, hence why Wii games are chea
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That's hilarious. I was just thinking about this and have come to the conclusion that MS will be out of the console business within 5 years unless something extraordinary occurs this generation. They lost over 5 billion dollars on the Xbox. That is >$5,000,000,000! This all while they had Halo and Halo 2. You may recall Halo 2 sold over 2.4 million copies on its first day and over 7 million in its lifetime.
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Microsoft does not release numbers for individual products, so no the number is not for just the hardware. Here's links to MS's Earnings Statements for Q4 2004 [microsoft.com] ($1.21B lost, shows 2003 as $1.19B lost)), Q4 2005 [microsoft.com] ($.39B lost) and Q4 2006 [microsoft.com] ($1.26B lost). What you're looking for is results for the division called 'Home and Entertainment'. As far as I'm aware the only quarter that division made money
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MS achieved last place in profits and they did so with entirely borrowed funds. They are a business so in the end, profits is all that determines success. Which was my point. They made a splash, but even with such hits as Halo and Halo 2 they couldn't gain a profit overall.
For a citation, h
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2. The 5 billion dollars are mentioned in Microsoft's SEC filings (more exactly, added up from the filings over the lifetime of the XBox) and include the entire games division. Unless you believe MS is cooking the books that should include everything.
It is a lot like razor blades. (Score:2)
PS3 pretty much same deal really
Other Agendas (Score:2)
Microsoft's stock price as been stuck in a narrow trading range for several years
Re:nice to know (Score:4, Insightful)
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Yep - and this should mean that the full-price games will be a lot cheaper, too, since Nintendo doesn't need to claw back money lost on the hardware.
... Right?
If cross-platform games end up being the same price on the Wii as on PS3 and Xbox360, albeit with cruder graphics, then it's time to get suspicious.
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- and this should mean that the full-price games will be a lot cheaper, too, since Nintendo doesn't need to claw back money lost on the hardware.
Since Sony/MS are trying to claw that money back, it means that perfectly legal things that hurt their software license revenue will probably be targeted by them with lawyers who should know better. Imagine that because of the expensive PS3 titles, some kids in a dorm or the same c
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Nintendo can create a Linux boot disc that lets you do web browsing, play music / videos, write documents in ooffice using wiimote as a 'giant pen' to write in 'air cursive', etc. Or if somebody else does that they won't care one bit, because even if people buy their system and never p
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Yeah because Nintendo is widely known for releasing consoles you have to turn upside down just to get them to work.
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Most people in the USA won't be paying 250$USD for their Wii. They'll be paying 250$USD + 8-9% in taxes, depending on which state they live in.
As another example, here in Quebec I'll be paying (279$CAD + 6.0% GST) + 7.5% PST (Yes, that's a tax on top of another. Not just added, multiplied). That means my "279$CAD Wii" ends up costing me 317.92$CAD. That's 38.92$CAD in taxes.
So my qu
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I think they are doing the smart thing and sticking with standard resolution for just 1 more generation, unlike Xbox and Sony. By the time the next generation comes rolling around, Nintendo can offer this upgraded resolution very cheaply, due in no small part to Sony/MS massproducing it to a large extent.
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