Nintendo will lose billions!

[Momma Bear]

Nintendo will miss out on an estimated $1.3 billion (£639 million) in sales this Christmas by failing to meet soaring global demand for its Wii video games console.


James Lin, an analyst at MDB Capital, which monitors retail activity, said Nintendo could sell twice the 1.8 million Wii consoles that it is manufacturing each month.


“There are as many people who want a Wii but end up walking away empty-handed as there are who get one,” he said.


Production has been hit by shortages of components, Nintendo says, and it insists it is doing all it can to meet demand.


Some analysts believe, however, that the company privately welcomes tight supplies because it wants to delay market saturation to prolong interest in the console.


Consumers also have their suspicions. A proliferation of online conspiracy theories recently forced Reggie Fils-Aime, president of Nintendo’s American operation, to reject accusations of a “secret plan to store Wiis in a warehouse to spur demand”.


Mr Lin said: “It’s a difficult balance, but at this stage, shortages are not the worst thing”. The Wii is 12 months into its expected lifespan of between four and six years.


Nintendo has raised production targets several times in recent months and now plans to ship 17.5 million units globally this year, up from 14 million. It said that demand “has been higher than we could ever have anticipated”.


This month the company said that it was withdrawing planned television advertising for the Wii because of severe shortages of the games console in the run-up to Christmas.


Piers Harding-Rolls, an analyst for Screen Digest, the market research firm, said: “There has probably been a certain amount of supply chain mismanagement. But Nintendo could not have predicted the level of demand.”


He added that the shortages were also “a function of Nintendo’s ‘just-in-time’ supply chain, which keeps inventories down to a minimum and is proving hugely profitable”.


Built to appeal to “non-core gamers” — women and older people hitherto ignored by the games industry — the Wii has outsold both Sony’s PlayStation 3 and Microsoft’s Xbox 360 by more than two to one this year.


Stock market investors appear to believe that Nintendo can maintain its success. Over the past two years the group’s shares have risen fivefold to make the company Japan’s third most valuable quoted business.
However, last month Sony’s PlayStation 3 beat the monthly sales of the Wii in Japan for the first time, signalling that the battle between the two next-generation consoles may yet have further to run.


Sony sold 183,217 PS3s in Japan in the four weeks to November 25, against sales of 159,193 for the Wii, according to the closely watched survey from Enterbrain, the games magazine publisher.


Analysts have argued that the Wii – a product largely constructed from off-the-shelf components – runs the risk of suffering a much shorter lifespan that the PS3, which is largely powered by expensively developed proprietary technology.

WTF? You know what I am glad I have a Wii but they aren't making me proud. They were supposed to rock the console world. Now they are just making people pissed off and making themselves look bad.

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[Roll16]

I feel the same way but I'm glad I got my Wii last christmas so that I didn't have to rush for it this year.

[DeMoNiC]

I don't care much for the Wii. My 360 is all I need.