Game Marketing Tips, Analysis, and News

Friday, June 10, 2011

Wii U: The Future

The Wii U controller is bigger than a 3DS opened up.
Nintendo has to be a little disappointed and perhaps puzzled by the reaction to the Wii U introduction. Sure, the industry generally had nice things to say about it. Third-party developers actually got invited to be on stage for Nintendo's presentation of its new console, which is a first. They returned the love by saying nice things about the console, no doubt hoping that Nintendo will be more helpful with third-party development then they have been in the past.

The puzzler, for Nintendo, was what happened to Nintendo's stock price after the announcement. Wouldn't you expect that the stock, which had been trading near a historic low, would see a bounce when Nintendo actually unveiled their new hardware? Nope. Nintendo's stock dropped 5.7% the day after the announcement, and the day after that it dropped another 5.2%. Analysts, it would seem, are not impressed.

Of course, Nintendo pointed out that their stock dropped when the Wii was announced, too. And it dropped 10% when the 3DS was announced, though given how that's been selling a drop in the stock price seems like a reasonable response.

Certainly we don't really have all the information yet to really judge the Wii U. We don't know the graphics performance or the price point or the ship date, or what the launch titles might be or how they look. Yet there is cause for skepticism about the Wii U's chances. I doubt it will do as well as the Wii did. The Wii had two big advantages going for it: It was substantially cheaper than the PS3 or the Xbox 360 ($249 versus $499 or $599), and it had motion control. The latter was new and had some possibilities for game play, but many people were skeptical that it would really be useful. To some extent, they were right; the Wii controller was great for some new types of game play, but never really worked for things like shooters. Many developers never really put a lot of effort into the Wii, and it showed. The Wii sold very well, but ultimately the software library is quite disappointing.

The Wii U will be at least as expensive as its competition, and quite possibly $50 or $100 more (or even higher, if Microsoft or Sony drops their price in the next year). I doubt the graphics performance will be substantially different, at least to the naked eye; in fact Nintendo was showing Xbox 360 and PS3 graphics as part of their Wii U demo, passing it off as Wii U graphics, until they were caught at it. Which leaves the Wii U's controller as the only differentiator, and that's going to be up to software developers. Will they really put in the necessary extra time and effort to develop for the Wii U's special controller, or will they just port over titles and do something that's quick and easy in terms of supporting the controller? Given budgets for game development these days, I think we know the answer.

It will be up to Nintendo to demonstrate with their software how the Wii U is special, and if they do then maybe some third-party developers will spend the extra time and money to do the custom development work.

My guess is that the Wii U will allow Nintendo to compete more evenly with the Xbox 360 and the PS3, but it's not going to be a huge success. They really missed their chance here by focusing all their effort on the hardware. You'll notice there was no mention of online gaming, digital distribution, social gaming, DLC, or any of the other things that have turned the industry on its ear in the last few years. Nintendo doesn't really understand that stuff, and obviously hopes that it will all just go away and people will go back to buying new consoles because they are, well, new. I just don't think that's enough these days, and I think so far the 3DS is a pretty good argument in support of my position.

Nintendo's got a lot of software mojo, and if they produce some killer games with their iconic properties people will buy them, no doubt. But I don't think Nintendo will be leading the industry into new growth with this sort of hardware. They're still fighting the last war, and the battle has moved to new areas. Sony and Microsoft seem to have some understanding of this, emphasizing their networks, music, video, and other capabilities. Nintendo looks very 20th Century, I'm afraid. Great if you're a nostalgia buff, but not so great if you're hoping their stock price will soar.

1 comment:

  1. I honestly believe this could be Nintendo's last console. They were financially successful with the Wii, but I think it was short term gain at the expense of their image in the longer term. They've announced this new Wii U but there doesn't seem to be any uniqueness here. It seems they're confusing the consumer with an apparent new portable device but it's really not. It's almost as if they were scraping the bottom of the barrel this time. And I was shocked there was still an optical disc drive on it. Nintendo just don't get the modern gaming world we're living in today.

    Give it another five years and I find it likely Nintendo will become the last 1st party developer and will announce a ream of iPad and Xbox games. Which is good because I still quite like Mario.