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Nintendo’s Rebuttal

When the 3DS was unveiled I recall the ooooos and aahhhs from the crowd. Being the first 3D device that didn’t require special glasses was pivotal in Nintendo’s ploy to keep a stranglehold on the handheld market. Unfortunately for Nintendo, things haven’t exactly gone as planned, and the once immortal company has been looking a bit vulnerable as of late.  

When it comes to the 3DS, the system itself isn’t the issue; it has way more to do with the severe drought of quality software that’s causing so many 3DS’s to collect dust. The 3DS is actually the greatest handheld released thus far in my opinion, from a hardware standpoint, but we all know the only reason you buy anything gaming related is usually to play games. Nintendo looks to smooth this over this holiday season with a really strong line-up of titles including Super Mario 3D Land, Mario Kart 7(the title will more than likely change), Starfox 64 3D, and possibly Kid Icarus: Uprising.

It appears they were hoping for Street Fighter IV 3D, and The Legend of Zelda: Ocarina of Time 3D to hold people over until then, but Nintendo has been getting called out lately for their lack of 3DS sales, and dissatisfaction from 3DS owners for the absence of games.

So, to combat their poor sales and consumer pressure, the 3DS will be receiving a super-early price drop from $249.99 to $169.99 on August 12th. That’s $80 off of the original retail price and the system has barely been available for five months. This is very out of character for Nintendo since they are usually the ones to release their hardware at a reasonable price from the get-go without the need for an early price drop.

Nintendo has also been heralded for always being able to turn a profit on all of their hardware, this way no matter what their sales are they are still making money. Well, this is going to change with the price drop. Nintendo will now be losing money with each 3DS they sell. All of this is in effort to spike sales in 3DS’s for the holiday season, but does Nintendo look weak? I believe investors see it that way.

Nintendo’s stock fell 21% in response to Nintendo’s first quarterly loss ever, due to plummeting Wii sales and the lackluster espousal of the 3DS. I can’t imagine Nintendo feeling too optimistic about this no matter which way you look at it. Subsequently, the 3DS gets a price drop and Nintendo formulates a plan to get out of this hole, but is it possible that we are witnessing the fall of Nintendo?

A company that looked so strong a little as less than one year ago is now struggling to find its place within the handheld market. Due to the increased popularity in mobile games, people are expecting more and more to pay less for handheld titles. The issue here is that most apps cost $0.99 and some of them are pretty damn good and cost way less to produce than most console/handheld games. Along with this, Nintendo also must face its inevitable fate as the Playstation Vita draws nearer to release. The Playstation Vita, which was also set to launch at a $249.99 price tag, looks to outdo the 3DS in terms of technical proficiency, but we’ve learned that graphics and raw system power have never been Nintendo’s strong points. It will be interesting to see how Sony reacts to the newly announced price drop of the 3DS, and it’s possible that we might see a price drop of the Vita itself before launch to really put the pressure on Nintendo.

The plot thickens as these next few months could serve as a glimpse into the future for Nintendo. What do you guys think? Is Nintendo going to sink or swim?