Last week’s news that Nintendo will slash the price of the 3DS globally less than six months after its release has caused somewhat of a stir (personally, I prefer “shock wave”). Some owners can’t wait to get their hands on exclusive “ambassador-only” GameBoy Advance games (which surely will be made available to all 3DS owners in the long-run, right Nintendo?), others feel completely ripped off, the prospect of ported Virtual Console games not enough to make up for the extra $100 or so spent on their latest handheld system.
Regardless of the consumer reactions, recent industry reports aren’t suggesting the highest of hopes for the handheld’s future. For starters, Nintendo President, Satoru Iwata, had to meet with shareholders in order to convince them that the 3DS and the Nintendo company are still worth investing in. Iwata himself took personal responsibility for the sluggish 3DS sales, and as such slashed 50 percent from his own salary. He drew on Nintendo’s past experiences with the GameCube, admitting that an opportunity to cut the console’s price early in its life cycle was missed, resulting in a much poorer performance than initially hoped. He reiterated that the 3DS price cut is not a drastic move in a moment of panic, rather a clear-calculated business strategy. The fact that parallels are being drawn between the 3DS (the latest in Nintendo’s most successful product line) and the GameCube (arguably Nintendo’s worst hardware performance to date) is somewhat concerning, however, and it seems the shareholders agree.
On July 29, Nintendo’s shares plunged 12 percent by close on the Osaka Securities Exchange, that’s the company’s greatest drop since January 2009. Former President,
Hiroshi Yamauchi, who remains Nintendo’s largest shareholder owning 10 percent, may have lost up to US $312 million from his estimated US $4.6 billion dollar wallet. Certainly these figures are nothing to scoff at, but is this knee-jerk reaction just another in a long line of perceived Nintendo mistakes?
Many of Nintendo’s annoucements over the past decade have resulted in significant concern for the company’s future. The original DS, the Wii, and now the Wii U, all resulted in somewhat diminished shares, and perhaps we’re simply seeing history repeat itself with the 3DS. Way back in 2002, Microsoft undertook a similar strategy with the original Xbox console, slashing the retail price by $250 in Australia. Sluggish hardware sales during the launch period were the primary cause, and while the console never reached the success of the PlayStation 2, the price cut certainly helped raise Microsoft’s box off the ground.
My theory? DS gamers are not just waiting for an improved software library, but a likely 3DS Lite, whose existence was only downplayed for the first year or so.