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[NEWS] How Wii Is Creaming the Competition

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Mr.Guvernment

Member
Joined
Feb 26, 2003
It may not have the best graphics or the poweer house titles- yet, but....



+--------------------------------------------------------------------+
| How Wii Is Creaming the Competition |
| from the my-favorite-flavour-of-competition dept. |
| posted by Zonk on Wednesday April 25, @13:11 (Wii (Games)) |
| http://games.slashdot.org/article.pl?sid=07/04/25/176226 |
+--------------------------------------------------------------------+

CNN has a report on [0]the Wii's success in the games marketplace right now, referring to their sales dominance as 'creaming the competition'.
The article tries to break down exactly why Nintendo's console has sold so successfully, discussing the system's marketing, engineering, and philosophy. "Next, engineers settled on a new approach for the Wii's looks. Just as the DS shunned the Game Boy name to appeal to a broader audience, the Wii would adopt a sleek white exterior instead of the toylike loud colors used on the GameCube. Even CEO Iwata got involved in the design process; at one point he handed engineers a stack of DVD jewel cases and told them the console should not be much bigger. Why so small?
To work with the motion-sensitive wireless controller Nintendo planned, Iwata reasoned, the console would have to sit directly beside the TV.
Make it any larger and customers would hesitate to leave it there. "
Their sales strategy is working in spades. CVG reports that at least one analyst thinks that [1]Wii demand won't be met until 2009. This past weekend Chris Kohler had an interesting comment on the 'ambassador programs' Nintendo ran in advance of the Wii's launch, and [2]how that might tie in to the system's financial success.

Discuss this story at:
http://games.slashdot.org/comments.pl?sid=07/04/25/176226

Links:
0. http://money.cnn.com/magazines/busi...5/01/8405654/index.htm?postversion=2007042407
1. http://www.computerandvideogames.com/article.php?id=162666
2. http://blog.wired.com/games/2007/04/wii_and_the_tip.html


How the Wii is creaming the competition
Business 2.0 Magazine tells the inside story of how Nintendo outfoxed Sony and Microsoft and got itself back in the game.
By John Gaudiosi, Business 2.0 Magazine
April 25 2007: 9:58 AM EDT


(Business 2.0 Magazine) -- A year ago it looked like game over for Nintendo's storied console business. The Kyoto-based gamemaker--whose Nintendo Entertainment System ushered in the modern age of videogames--was bleeding market share to newer, more powerful systems from Sony and Microsoft.

Even as the videogame business grew into a $30 billion global industry, Nintendo saw its U.S. hardware sales shrink to almost half of what they had been nearly 20 years earlier.


The Wii is reversing 20 years of declining Nintendo console sales.

The DS broadened Nintendo's market. The Wii goes even further; grade-schoolers and grandmas are getting into the swing.

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CNN's Nicole Lapin talks with Scott Steinberg of Embassy Multimedia about the latest in gaming systems.
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Today, as anybody within shouting distance of a teenager knows, Nintendo is the comeback kid of the gaming world. Instead of joining Sony (Charts) and Microsoft (Charts, Fortune 500) in the arms race to pack their consoles with ever-higher-performance graphics chips (to better attract sophisticated gamers), Nintendo built the Wii--a cuddly, low-priced, motion-controlled machine that broke the market wide open by appealing to everyone from grade-schoolers to grandmas.

Unorthodox? Maybe. Effective? You bet.

The Wii is a pop culture smash of such dimensions that Nintendo still can't make consoles fast enough. Even so, it's outselling Sony's PlayStation 3 and Microsoft's Xbox 360--at least since January. (The Xbox had blowout pre-Christmas sales.) And while its competitors lose money on every console they build, expecting to make it back selling high-margin games, the Wii was designed to sell for a profit from the get-go.

Nintendo blows by forecasts
Nintendo's turnaround began five years ago, when the company's top strategists, including CEO Satoru Iwata and legendary game designer Shigeru Miyamoto, zeroed in on two troubling trends: As young consumers started careers and families, they gradually cut back on game time. And as consoles became more powerful, making games for them got more expensive.

Studios thus became more conservative, putting out more editions of Madden NFL and fewer new, inventive games that might actually grow the market.

Iwata and Miyamoto eventually concluded that to gain ground, Nintendo would have to do something about the game controllers, whose basic design had hardly changed since the first NES paddles. Changing how the controllers interacted with the consoles would mean changing how engineers designed a system's electronics and casing and eventually the games themselves.

The first product to test the new strategy was not the Wii but the DS handheld game system, released in 2004. To appeal to a broader audience, Nintendo abandoned the kid-friendly Game Boy name it had given its other popular handhelds, while building in Wi-Fi networking, voice recognition, and two screens (See correction below).

The idea was not to load the DS with technology but to help draw in new gamers by offering options other than the old button-based controls. Some DS games would work through the tap of a pen and simple voice commands.

The trouble with gee-whiz gadgets
The $150 gadget got off to a tepid start. Until gamers tried it, they tended to be wary. "People thought it was weird," says Perrin Kaplan, vice president for marketing at Nintendo of America. "It took about two years for people to warm up to it."

But warm up they did, largely thanks to Miyamoto. The creator of Nintendo's blockbuster franchises--Donkey Kong, Super Mario Bros., Legend of Zelda-- offered up Nintendogs, a Tamagotchi-like simulation in which players use every feature of the DS to nurture virtual puppies. The game struck a chord with female gamers in particular, says John Taylor, an analyst at Arcadia Research.

During the first holiday season after Nintendogs hit the market, Nintendo sold 5.6 million DS units--a standout performance that was nearly twice its total for the rest of the year.

Soon after Nintendogs, the company released Brain Age, a game designed for more mature players in which they solve a series of puzzles by filling in answers or speaking phrases aloud. "That further bolstered the market by attracting older boomers and even senior citizens," Taylor says. The DS surge encouraged Nintendo executives, who saw their strategy to grow the market taking shape.

They wouldn't have to wait long to put it to a bigger test. Work had already begun on the console, code-named Revolution, that would become the Wii.

Club Penguin, Webkinz corner the tween market
Nintendo's top strategists knew early on that they wanted to build a machine with a wireless, motion-sensitive controller. But equally important was the chip that would be the brains of the Wii console itself. The more powerful processors that Sony and Microsoft were using would make the screen action look better but would also guzzle more electricity.

What if Nintendo used a cheaper, lower-power chip instead? After all, the DS, with its efficient mobile processor, had already proven that you could create new gaming experiences without the fastest chips. A low-power chip also meant that the machine could be left on overnight to download new content.

It was settled: The design team made the risky decision to build the Wii around a chip similar to the one that powered the GameCube, an earlier Nintendo entry that posted disappointing sales. If the Wii succeeded, it wouldn't be on the strength of breathtaking graphics.

Next, engineers settled on a new approach for the Wii's looks. Just as the DS shunned the Game Boy name to appeal to a broader audience, the Wii would adopt a sleek white exterior instead of the toylike loud colors used on the GameCube. Even CEO Iwata got involved in the design process; at one point he handed engineers a stack of DVD jewel cases and told them the console should not be much bigger.

Why so small? To work with the motion-sensitive wireless controller Nintendo planned, Iwata reasoned, the console would have to sit directly beside the TV. Make it any larger and customers would hesitate to leave it there.

Videogames get real
While the console team worked on the shell, Miyamoto and another team perfected the controller. He was determined that its design be as simple as possible--he insisted on several revisions that enlarged the "A" button to make its importance obvious.

When design work was done, players could arc the Wii remote to throw a football in Madden NFL 07, tilt it to steer off-road vehicles in Excite Truck, and swing it to play sports like Wii tennis and baseball. Market tests suggested that the product was everything its designers hoped: engaging enough that nongamers might give it a go, and simple enough that newbies could quickly get up to speed.

Finally it came time for Nintendo to market the Wii to the world. In addition to its standard TV campaigns targeting schoolkids, the company pumped 70 percent of its U.S. TV budget into programs aimed at 25-to 49-year-olds, says George Harrison, senior vice president for marketing at Nintendo of America.

He even put Wii ads into gray-haired publications like AARP and Reader's Digest. For Nintendo's core users, he took a novel, Web-based approach: "To reach the under-25 audience," he says, "we pushed our message through online and social-networking channels" including MySpace.

But Nintendo's most effective marketing trick was to give away its killer app, Wii Sports, with every $250 console. It was a calculated attempt to speed up the process that brought success to the DS. And because Nintendo makes about $50 in profit on every Wii sold, it can afford to give away a game.

To be sure, not everything has gone according to plan. Although Nintendo shipped more than 3 million Wiis in 2006, supply-and-demand problems have plagued the machine since its launch. Demand continues to outpace supply and may continue to do so until summer.

It's a problem many businesses wouldn't mind having, but it means that Nintendo might be leaving money on the table--something no company can afford to do for long, not even the newly revived Nintendo.

John Gaudiosi is a freelance journalist in Raleigh, N.C.

Correction: An earlier version of this story incorrectly stated that the DS handheld game system has two touchscreens.
 

OC Noob

Member
Joined
Jun 28, 2002
Location
Phoenix, AZ USA
I agree that the DS is creaming the PSP, because Sony has FUBAR'ed it by keeping the price so high and almost ignoring it completely when it comes to first party titles.

The Wii would also be creaming the competition, but Nintendo hasn't put the numbers out to accomplish that and that is of course my opinion and its based off the last months NPD numbers, both of which could easily be flawed. Anyway, my point is that even though people are going nuts over them if you only sell 250k in a month that your competitor sold 200k then thats not really creaming the competition. Of course, that is just 1 region, although its the biggest region for sales and those numbers are subject to flaws.

I really expected the numbers to be much further apart considering people are claiming 5 or 6 million units sold, which would put them on an average of about 1 million units a month. Of course, those numbers are subject to flaws and more units will sell in the holiday months, but weren't there other numbers that claimed 3 million sold during the holiday season? hat would still have to put sales around 500-750 per month and you would think they could put more units out last month then they could the month before and the month before that, etc...

But who knows since we don't get any real numbers.
 

[email protected]

Inactive Moderator
Joined
Sep 27, 2003
I skimmed, but this makes me want to buy one myself.

I currently own two Xbox 360s... anyone care to comment on if I'd actually want one of these?

Man, I have to get to someone's house who has one to try it myself. I still haven't tried a Wii...

I'm glad Nintendo is doing well. The NES was a ground-breaker... glad they still manage.
 

rainless

Old Member
Joined
Jul 20, 2006
Well the Wii hasn't quite creamed the PS2 yet...

And somehow all those hardware sales don't really mean anything when you put their abysmal software sales right next to it.
 

John G

Member
Joined
May 31, 2004
They're not creaming anybody until they're selling games. I think the 360 is still way out ahead of everyone else as far as selling content goes.

(Not to say the good hardware sales isn't interesting, though.)
 

OC Noob

Member
Joined
Jun 28, 2002
Location
Phoenix, AZ USA
RedDragonXXX said:
I tried Wii and it doesn't appeal to me. It's fun to pick up and play but it lacks depth more then anything.

I would agree with the exception of a few titles like Zelda, the initial focus seems to be on light content like mini-games, but that should change as devs get used to the system.
 

knight_of_knee

Member
Joined
Mar 20, 2005
Location
Springfield, Missouri
Yeah, I agree the titles for the Wii have been a little lack luster and I've gotten bored with it and started to play counter-strike again. Hopefully by Chirstmas though they'll have enough titles that are going to spark my interest again. Although whenever my friends has Wii parties it's still fun to go and play Wii sports with a whole lot of people.
 

FudgeNuggets

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Joined
Mar 2, 2006
Location
Gone Racing
After a couple of months, the novelty of the Wii wore off. Bowling is still fun but Tiger Woods sucked, Rayman was nothing more than a bunch of minigames and I hear it's great but have yet tried SuperSwing Golf. I'm waiting for some quality titles to be released now. Zelda is not mu cup of tea, ExciteTruck gets old after about 20 minutes and GT racing looks awful, the graphics look 16-32 bit.
 

rainless

Old Member
Joined
Jul 20, 2006
OC Noob said:
I would agree with the exception of a few titles like Zelda, the initial focus seems to be on light content like mini-games, but that should change as devs get used to the system.

But WILL devs ever get used to the system? That's what I've been asking since before the system was released...

And now they're releasing more and more games simultaneously on the PSP and the Wii... (not the 360 and the Wii... or the PS3 and the Wii... or even the DS and the Wii...) Prince of Persia is the latest. (Remember I made that little thread pondering whether this was going to become a trend? That was back when I heard about Alien Syndrome. Six months ago everybody said that was ridiculous... doesn't sound so ridiculous now.)

But oh the FIRST PARTY SOFTWARE right? Well... I also predicted you'd get one Nintendo game about every six months and that that wouldn't do at all. That without third party support the console would never make it. And regardless of if they've sold 4 or 5 milliion consoles by now... that still isn't as many as the 360... let alone the PS2. And the software sa;es/// are about on par with those of the PSP. (With the exception of Zelda of course.)
 

tenchi86

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Oct 19, 2004
Location
Smoky Mountains, NC
The Wii is doing incredibly well, the question is can it keep this up. History has shown that when it comes to fads (Furbys, Pet Rocks) they sell extremely fast initially and everyone wants one but eventually the sales start to decrease and the more stable brands will win out in the end (Beanie Babies, Real Pets). Of course the question being posed by most right now is asking if the Wii is in fact just a fad or something more. Anyway I will give the Wii credit for doing so well as it stands right now, though I am having trouble believing it will continue to dominate the console race like it is now.
 

John G

Member
Joined
May 31, 2004
If we just had Wii Contra, Wii Megaman, Wii RC Pro-am, Wii Dragon Warrior, Wii Street Fighter, and...um... Wii Paperboy, Wii would be okay.
 

Oc1Kenube

Member
Joined
Mar 5, 2007
tenchi86 said:
The Wii is doing incredibly well, the question is can it keep this up. History has shown that when it comes to fads (Furbys, Pet Rocks) they sell extremely fast initially and everyone wants one but eventually the sales start to decrease and the more stable brands will win out in the end (Beanie Babies, Real Pets). Of course the question being posed by most right now is asking if the Wii is in fact just a fad or something more. Anyway I will give the Wii credit for doing so well as it stands right now, though I am having trouble believing it will continue to dominate the console race like it is now.

Furbys were not made by nintendo though, were they.

As far as i am concerned you can keep your ps3 and 360's, my pc will have them battered graphically in 6 months time and if i were to buy a console it would be the Wii as it looks fun and like the Ds im sure, it actually is fun.
Once first party tiles like supermario galaxy hit stores i think the wii will truly shine.

The ps3 is overpriced and likely to stay that way coz of the stupid bluray drive. M$ 360 will end up as overall market leader but it wont be because the wii loses momentum, although some slowdown after initial launch will occur. It will be because it had a full years head start in the next gen wars.

I am admittedly a Nintendo/mario fanboy, i believe no devs have come close to matching any of the best in house Ninty games, super mario world for example or mario 64" name me a better platformer on any console upto date?"
 

tenchi86

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Oct 19, 2004
Location
Smoky Mountains, NC
They were not made by Nintendo but they were examples. The Blu-Ray drive is already drastically decreasing in price and the new diodes are expected to under 8$s. As for the Xbox 360, how is it going to keep the lead if Nintendo does not slow down considering the Wii has already sold over 6 Million while the X360 is reportedly around 10 million?
 
OP
Mr.Guvernment

Mr.Guvernment

Member
Joined
Feb 26, 2003
Oc1Kenube said:
Furbys were not made by nintendo though, were they.

As far as i am concerned you can keep your ps3 and 360's, my pc will have them battered graphically in 6 months time and if i were to buy a console it would be the Wii as it looks fun and like the Ds im sure, it actually is fun.
Once first party tiles like supermario galaxy hit stores i think the wii will truly shine.

The ps3 is overpriced and likely to stay that way coz of the stupid bluray drive. M$ 360 will end up as overall market leader but it wont be because the wii loses momentum, although some slowdown after initial launch will occur. It will be because it had a full years head start in the next gen wars.

I am admittedly a Nintendo/mario fanboy, i believe no devs have come close to matching any of the best in house Ninty games, super mario world for example or mario 64" name me a better platformer on any console upto date?"


Come back in 4 years and tell me your same PC you have today with NO upgrades looks the same as top game released for consoles.....

and if you do upgrade, besure to include that in your original price if your pc to play games + upgrades VS the $600 PS3 or the $300 360 or the $250 Wii.
 

rainless

Old Member
Joined
Jul 20, 2006
tenchi86 said:
They were not made by Nintendo but they were examples. The Blu-Ray drive is already drastically decreasing in price and the new diodes are expected to under 8$s. As for the Xbox 360, how is it going to keep the lead if Nintendo does not slow down considering the Wii has already sold over 6 Million while the X360 is reportedly around 10 million?

Simple:

Nintendo has only sold as many games as they have because they created an artificial "shortage." This is an extremely popular thing to do around the holiday season (traditionally) but Nintendo had the novel idea of extending the tradition to six months after the console is released.

The minute they increase production to some "believable" amount, the demand will go down. I hope you don't think the holiday-level of sales is going to last forever... particularly with the systems shortage of anything more than "promise."

Systems almost always sale more at launch than any other time in the console's lifespan. You're talking about a gap of 4 MIIIIIIIIIIIIIIIIIIiiiiiiiiilllllllllliiiiiiioooooooon consoles. And it's not like Microsoft is gonna wait for them to catch up... hahaha :)

I mean when Nintendo hits 7 million Microsoft will probably be at 12 million, and, unless something DRASTICALLY changes in the software department before the Wii is readily available on store shelves, by the time the Wii hits 8 million the 360 will be at 20 million.

The Wii has NEVER caught up to the 360's installed base, and every quantifiable piece of evidence (including the NPD sales I posted earlier this month) indicates that they never will.
 

OC Noob

Member
Joined
Jun 28, 2002
Location
Phoenix, AZ USA
tenchi86 said:
The Wii is doing incredibly well, the question is can it keep this up. History has shown that when it comes to fads (Furbys, Pet Rocks) they sell extremely fast initially and everyone wants one but eventually the sales start to decrease and the more stable brands will win out in the end (Beanie Babies, Real Pets). Of course the question being posed by most right now is asking if the Wii is in fact just a fad or something more. Anyway I will give the Wii credit for doing so well as it stands right now, though I am having trouble believing it will continue to dominate the console race like it is now.

Did you know the Beanie Baby guy made $2 billion? I read it in the Uncle John's crapper book, so it may not be accurate, but if it is, thats just amazing.

Guy quits to manufacturing job, designs cheap toy for kids, limits numbers and availability and makes $2 billion off freaking bean bags.

Way off topic, but I thought it was interesting how much the guy made from them.
 

Oc1Kenube

Member
Joined
Mar 5, 2007
Mr.Guvernment said:
Come back in 4 years and tell me your same PC you have today with NO upgrades looks the same as top game released for consoles.....

and if you do upgrade, besure to include that in your original price if your pc to play games + upgrades VS the $600 PS3 or the $300 360 or the $250 Wii.

I guarantee it wont but i will be upgrading in the next 6 months as i need a dx10 card! Considering my northwood 2.4 and radeon 9600 had the ps2 licked from about it's early second year or so and it would still run games looking better than any ps2 game or probably xbox now.

Hell give devs 4 years to develop games on an 8800gtx and you would probably weep with the eye candy that was made,but the pc market moves on and new hardware is as inevitable as day and night and there would be no xbricks or ps3's without pc tecnology companys developing new hardware, so fact, my pc will urinate all over gran turismo 25, or whatever other sequel you can think of, killzone 6 and the ilk that appears on ps3 or XB360.

P.s have you seen Crysis? Oh, pc exclusive btw. Well at least until a second rate conversion is done and sold to console owners just like far cry on xbox,this will happen right about the time that a sequel will be landing on pc that will blow the original away or some other similar original graphically gorgeous title, like i said previous i would buy the nintendo because it looks fun and as i already have the best box on the planet for realistic games it makes total sense to me.
 

Oc1Kenube

Member
Joined
Mar 5, 2007
rainless said:
Simple:

I mean when Nintendo hits 7 million Microsoft will probably be at 12 million, and, unless something DRASTICALLY changes in the software department before the Wii is readily available on store shelves, by the time the Wii hits 8 million the 360 will be at 20 million.

The Wii has NEVER caught up to the 360's installed base, and every quantifiable piece of evidence (including the NPD sales I posted earlier this month) indicates that they never will.

And like said previous M$ have a full year of sales ahead of the Wii it is possible for Ninty to catch up, i believe it will be tough, but i think an aggressive price point and the family focussed theme is going to lead to a lot of parents going out and buying them for the kids at xmas etc over the overpriced ps3 at least