The Wii U is Costing Nintendo Millions, How Can It Survive?

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Jaysonguy

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#1 Jaysonguy
Member since 2006 • 39454 Posts

Nintendo loses money on the Wii U, millions.

They were already hemorrhaging money at the end of the Wii's lifespan and now the Wii U is killing the company.

Nintendo is on pace to lose over 200 million dollars from the Wii U this year.

They can't cover productions costs, they can't cover advertising, they can't cover game development.

The software isn't anywhere to be found, Mario Kart tentatively in 2014, Smash Bros tentatively in 2014, Zelda in 2015.

No sports games, devs pulling away constantly.

What could Nintendo do at this point to turn the tide?

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haziqonfire

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#2 haziqonfire
Member since 2005 • 36353 Posts

In 2013, Nintendo Co Ltd increased its cash reserves by 15.28%, or 62.21bn. Cash Flow from Investing totalled 89.10bn, indicating this company earned more from the sale of existing assets than it spent on the purchase of new assets. In addition the company used 40.39bn for operations while cash used for financing totalled 12.87bn.

Nintendo has enough money in cash reserves and doesn't have any debt. 

Sure it's costing them now but in the long term it can become a viable platform and a profitable one. 

This kind of thing happens all the time and companies can definitely rebound. Look at PS3 and how that started off and where it is now. Sony's mistakes were much worse than Nintendo's, so that's why I think by the end of it all Nintendo will be able to rebound, though definitely not achieving the amount of userbase that the Wii had. 

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Megavideogamer

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#3 Megavideogamer
Member since 2004 • 6546 Posts

Nintendo Will survive Nintendo should start think about their 7th Console. Begin creating it now So that it is ready in 2016. Until then tough it out with the Wii u. They may score a must have game yet. with the second screen Gampad tablet. Maybe when games that use 2 Gamepad tablets are created.

Nintendo survived the lean Gamecube era. They will survive the Wii U era. The Wii U has sold 3.61 Million consoles. Since launch Nintendo can survive the lean years.

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IMAHAPYHIPPO

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#4 IMAHAPYHIPPO
Member since 2004 • 3428 Posts

Unlike the games divisions of Microsoft and Sony, Nintendo's been making profits for three decades. They have investments and assets (they own the Seattle Mariners, surprisingly enough) that total up to something like 10 billion dollars. In all honesty, they could afford it if the 3DS and the Wii U were total flops this entire generation and still have enough to try it again with new consoles five or so years from now. Now, for those of us who are smart enough to know that Nintendo's going to pull out of it, this downward trend isn't likely to last much longer than the hatrick of releases that are Zelda, Donkey Kong, and Mario at the end of this year..


People say it year in and year out, but the truth is, Nintendo's going to be just fine.. Just like they always are..

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nini200

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#5 nini200
Member since 2005 • 11484 Posts

There's a simple answer to your question Jay. GET RID OF FILS-AIME AND IWATA. :D

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IMAHAPYHIPPO

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#6 IMAHAPYHIPPO
Member since 2004 • 3428 Posts

There's a simple answer to your question Jay. GET RID OF FILS-AIME AND IWATA. :D

nini200

 

I'll admit there's better choices to run the whole company than Iwata, but calling for Nintendo to rid themselves of Fils-Aime is the statement of the misinformed. If you spend some time reading into it, Nintendo of America has next to no control over the company, leaving Reggie an English-speaking puppet who's job is to do nothing other than make the decisions of the Kyoto headquarters look good... And that's what most people don't understand about CEO's; they can't go around painting their companies anything other than perfect. That's what they get paid to do. It's not like the company doesn't know the Wii U is struggling.

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Avatar_Taxidous

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#7 Avatar_Taxidous
Member since 2006 • 4407 Posts
It's no worse than PS3's start, and that turned out to sell well. I think if Nintendo advertises its big software coming out later this year, then also thoroughly advertises games like Mario Kart 8 and X in 2014, Wii U will be doing more than fine.
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nini200

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#8 nini200
Member since 2005 • 11484 Posts

[QUOTE="nini200"]

There's a simple answer to your question Jay. GET RID OF FILS-AIME AND IWATA. :D

IMAHAPYHIPPO

 

I'll admit there's better choices to run the whole company than Iwata, but calling for Nintendo to rid themselves of Fils-Aime is the statement of the misinformed. If you spend some time reading into it, Nintendo of America has next to no control over the company, leaving Reggie an English-speaking puppet who's job is to do nothing other than make the decisions of the Kyoto headquarters look good... And that's what most people don't understand about CEO's; they can't go around painting their companies anything other than perfect. That's what they get paid to do. It's not like the company doesn't know the Wii U is struggling.

Ok then, GET RID OF IWATA!!!!! :D Better now?
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IMAHAPYHIPPO

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#9 IMAHAPYHIPPO
Member since 2004 • 3428 Posts

[QUOTE="IMAHAPYHIPPO"]

[QUOTE="nini200"]

There's a simple answer to your question Jay. GET RID OF FILS-AIME AND IWATA. :D

nini200

 

I'll admit there's better choices to run the whole company than Iwata, but calling for Nintendo to rid themselves of Fils-Aime is the statement of the misinformed. If you spend some time reading into it, Nintendo of America has next to no control over the company, leaving Reggie an English-speaking puppet who's job is to do nothing other than make the decisions of the Kyoto headquarters look good... And that's what most people don't understand about CEO's; they can't go around painting their companies anything other than perfect. That's what they get paid to do. It's not like the company doesn't know the Wii U is struggling.

Ok then, GET RID OF IWATA!!!!! :D Better now?

 

Haha, yes. Even then, that probably wouldn't help. I think Nintendo's doing some damage control right now because for the first time, their brand alone didn't move consoles, and I don't think they were prepared for that; however, sticking Mario on a system has worked so well for 30 years, I don't think anybody at Nintendo would've assumed that trend could have stopped.

People keep pointing to how poor Wii U sales have been, but their lineup suggests it shouldn't be any different. I don't think we can talk about the failure of a system when we're less than a week away from the Wii U getting the games everyone's been calling for. You can blame Iwata, or whoever else, but if you look at the pattern of what's going on, it all starts to make sense. There's no advertising because there's no games to advertise, and I think Nintendo's doing the financially smart thing by saving their advertising money until there's a bigger lineup of games to advertise, which will be coming by the end of the year. Nintendo's going to be just fine.

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IMAHAPYHIPPO

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#10 IMAHAPYHIPPO
Member since 2004 • 3428 Posts

And to answer the original thesis of the post, what they can do to turn the tides is what people have been saying all along: put some more damn games on the system. Mario's going to move a boat load of systems by the end of the year. Zelda and Donkey Kong will help add on to that. Pikmin 3's release already has sales up by over 200% in Japan.

The whole thing's an upward trend. More systems means more games are going to be made, which is also going to bring more innovation. When there's close to 10 million units in people's homes and a decent library, I think the higher ups will give studios free reign to start innovating a little more than they are now, and that's where the big innovating "OMG I HAVE TO HAVE A WII U FOR THIS" games will come becuase studios can afford a little extra delay to make sure the games are good enough for release.

I think all of Nintendo's major studios had the pressure on them to get games out by the end of the year, which is why we're seeing games like Mario 3D World as opposed to some big, new Mario adventure that changes the makeup of 3D platformers.

As always, the answer's simply more games to put more systems in more homes. Just like every struggling system that turned it around.. Games...

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Solaryellow

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#11 Solaryellow
Member since 2013 • 5320 Posts
With the right advertising you can sell a ketchup popsicle to someone in the desert wearing white gloves. Make people think the Wii U is a must have system. Nintendo needs to start the advertising ball rolling. I can't recall if I've ever seen a Wii U commercial on television. Besides the small pamphlets that have recently (within the past few months) hit shelves next to the cash registers, not much else comes to mind.
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nini200

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#12 nini200
Member since 2005 • 11484 Posts
With the right advertising you can sell a ketchup popsicle to someone in the desert wearing white gloves. Make people think the Wii U is a must have system. Nintendo needs to start the advertising ball rolling. I can't recall if I've ever seen a Wii U commercial on television. Besides the small pamphlets that have recently (within the past few months) hit shelves next to the cash registers, not much else comes to mind. Solaryellow
Advertisement is key. Remember how much they advertised the Wii with the "Wii would like to play" videos? That needs to happen with the WiiU
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Raptor_Herc

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#13 Raptor_Herc
Member since 2013 • 330 Posts

Good thing Nintendo has the 3DS to help cover the Wii U in the mean time (especially with Pokemon coming out in October). That being said, I believe a price cut will be necessary for the Wii U in the coming months (if not now) should it wish to stimulate sales as more games are released. 

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fig56

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#14 fig56
Member since 2005 • 2443 Posts
Nintendo will be fine just like it always has. The games will come out eventually, people will buy the crap out of them, and there you go.
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bonesawisready5

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#15 bonesawisready5
Member since 2011 • 4971 Posts
JaysonGuy, your posting is very odd to me. We know you aren't dumb enough to actually believe these doom and gloom ideas or else you wouldn't have founded a gaming site. Its clear you do this just to get a rise out of people. I'll give you credit, your word choice is usually good since you know how to push every posters buttons. Mine included. But you know that they can lose money on the system for dozens of years. $200 million in one year is nothing. Nintendo has sold 2.15 million copies of New Super Mario Bros U at $60. Since they likely get about $45 per game (a retailer fee, shipping/packaging costs and they don't have to pay themselves a 30% cut) they likely have made just under $100 million off a cheap, $10-$20 million project. So one first party game offsets about half of their system losses. That isn't counting the hundreds of millions of dollars they make annually off the 30% cut they get from third parties on 3DS/Wii U/Wii/DS. That isn't even counting the 8 million sales of Mario Kart 7 and Mario 3D Land. They likely make roughly $30 per copy of those 3DS games and with 16 million copies sold between both of them that's $480 million in profit. Nintendo makes over $450 million profit off two handheld first party games and you ask how can the Wii U survive? They've got more than enough money, they simply must apply it in the right direction. They likely won't sell Wii U at a loss much longer anyway. Even if they sell 20 million over 5 years globally, 3-4 years of that will likely be at a profit. Remember that the GameCube was sold at a loss at its beginnings, was dropped to $99 in 2003 after production ceased for six months but Nintendo still made a boat load of money off it. Don't act like they won't/can't do the same thing in this bad scenario. You aren't some random, stupid internet poster even though you try to come across like it here. You actually seem to know quite a bit about the industry and it puzzles me why you say such silly things on GameSpot when you appear to act differently on other social networks. I really don't understand why you go out of your way to push so many buttons on GameSpot forums when it could be tracked back to your other online presences. I understand that it is fun to be eccentric with your words sometimes when it comes to certain matters, and heck its fun to tease online users at times too, but you don't carry yourself in a respectable way. Thankfully for you co-workers on PanicGamer don't seem to mind your posts on GameSpot. You don't come across nearly as silly on your site as you do here, so I have to ask what gives? Because at first glance it looks like you just like manipulating the unsuspecting users of GameSpot. If so, mission accomplished. Don't get me wrong, I don't mean to sound negative about your game media writing, I actually like it. I like what what you're doing. It just strikes me as odd how you behave on GameSpot.
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KBFloYd

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#16 KBFloYd
Member since 2009 • 22036 Posts

OMG OMG!!!

panic-buttons.jpg

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Josh5890

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#17 Josh5890
Member since 2007 • 1025 Posts

They have over $5 billion in assets. They can afford the Wii-U to struggle.

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Avatar_Taxidous

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#18 Avatar_Taxidous
Member since 2006 • 4407 Posts

They can't cover productions costs, they can't cover advertising, they can't cover game development.

Jaysonguy
With the amount of money Nintendo has in the bank, I think they could/can cover all those. Their advertisement of the system itself, though, should definitely be more aggressive.
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Toxic-Seahorse

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#19 Toxic-Seahorse
Member since 2012 • 5074 Posts
Ah jaysonguy, the buzzkill of the Wii U section. The ultimate downer and borderline troll.
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meetroid8

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#20 meetroid8
Member since 2005 • 21152 Posts
Wii U is inevitably going to cost them in the short term. Now it's just about how it can perform in the long term.
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superbuuman

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#21 superbuuman
Member since 2010 • 6400 Posts

Trugs26 posted this in another thread.

http://au.ign.com/articles/2013/07/31/exactly-how-bad-is-the-nintendo-situation

Wii U is not alright (atm) but Nintendo is alright.. :)

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meetroid8

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#22 meetroid8
Member since 2005 • 21152 Posts

Trugs26 posted this in another thread.

http://au.ign.com/articles/2013/07/31/exactly-how-bad-is-the-nintendo-situation

Wii U is not alright (atm) but Nintendo is alright.. :)

superbuuman
I don't think 'alright' is really the right word. They may not be on the verge of bankruptcy, but a huge product failure failure would leave them in a bad position.
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bonesawisready5

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#23 bonesawisready5
Member since 2011 • 4971 Posts
Hey JaysonGuy, Nintendo has $8.8 billion in cash on hand. They have ZERO debt. You were saying?
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Toxic-Seahorse

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#24 Toxic-Seahorse
Member since 2012 • 5074 Posts
Hey JaysonGuy, Nintendo has $8.8 billion in cash on hand. They have ZERO debt. You were saying?bonesawisready5
Don't you not know jaysonguy? He will NEVER answer to a post that is factual or proves him wrong. I've done so many times and he just disappears. Hell, he might not even reply to this thread at all. He's a troll and nothing more.
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schu

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#25 schu
Member since 2003 • 10073 Posts

If nintendo would just release a bunch of their old games on the virtual console they could make up for some of the lost cash and probably rope a few more people in, but they are so goddamn stubborn. I just got Earthbound for the Wii U VC, but it is depressing to me that so many of my old favorite games are completely unavailable to me. I can only hope that them releasing Earthbound was a recognition that they maybe need to listen to teh fans a little if they want to get back in favor.

 

I'd personally pay them a $100 fee to "upgrade" my Wii U to play NES, SNES, N64 VC games w/ ONLINE multiplayer w/ other Wii U owners.  I've wanted this for so many years.  They could make this happen and I know there are a lot of older gamers who would love to be able to play w/ their old friends who they no longer even live near. Throw in a headset w/ voice chat and you've reunited friends in their favorite old past time. But no, Nintendo simply doesn't care. They refuse to offer obviously awesome features just due to being cheap and old fashioned.

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Lyphe2k

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#26 Lyphe2k
Member since 2007 • 3385 Posts
[QUOTE="bonesawisready5"]Hey JaysonGuy, Nintendo has $8.8 billion in cash on hand. They have ZERO debt. You were saying?Toxic-Seahorse
Don't you not know jaysonguy? He will NEVER answer to a post that is factual or proves him wrong. I've done so many times and he just disappears. Hell, he might not even reply to this thread at all. He's a troll and nothing more.

I mean, he's not totally wrong lol. Sure, Nintendo may not go bankrupt due to the Wii U but honestly, Nintendo is still a business and I assume would like to profit as much as they can, right?
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Toxic-Seahorse

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#27 Toxic-Seahorse
Member since 2012 • 5074 Posts
[QUOTE="Toxic-Seahorse"][QUOTE="bonesawisready5"]Hey JaysonGuy, Nintendo has $8.8 billion in cash on hand. They have ZERO debt. You were saying?Lyphe2k
Don't you not know jaysonguy? He will NEVER answer to a post that is factual or proves him wrong. I've done so many times and he just disappears. Hell, he might not even reply to this thread at all. He's a troll and nothing more.

I mean, he's not totally wrong lol. Sure, Nintendo may not go bankrupt due to the Wii U but honestly, Nintendo is still a business and I assume would like to profit as much as they can, right?

It all depends on what he means by"it" in the title. I assume he means Nintendo and Nintendo will survive. It could also mean the Wii U but that seems unlikely as it doesn't really fit the post or the theme of money. Regardless, what I said is absolutely true. He's the most successful troll I've seen on GS.
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Solaryellow

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#28 Solaryellow
Member since 2013 • 5320 Posts
The bottom line is Nintendo will not be going anywhere even if the Wii U turns out to be a failure. Nintendo didn't fold when the Virtual Boy (which was a disaster) failed miserably nor will we see them leaving the market if the same holds true for the Wii U. Each and every system supposedly marks the end of Nintendo yet it never happens.
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rawsavon

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#29 rawsavon
Member since 2004 • 40001 Posts
>This kind of thing happens all the time and companies can definitely rebound. Look at PS3 and how that started off and where it is now. Sony's mistakes were much worse than Nintendo's, so that's why I think by the end of it all Nintendo will be able to rebound, though definitely not achieving the amount of userbase that the Wii had. Haziqonfire
This is not quite an analogous situation though... Both Sony and MS do 'other things'. They are in a position (well aside from Sony being down all around for a while) to take losses in one division in the short term for a long haul gain. Nintendo does not have that option. They do have the cash reserves to sustain themselves, but companies (and especially stockholders) are generally not willing to sustain continued losses from the only business segment the company is involved in.
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rawsavon

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#30 rawsavon
Member since 2004 • 40001 Posts
Hey JaysonGuy, Nintendo has $8.8 billion in cash on hand. They have ZERO debt. You were saying?bonesawisready5
That is a good point so far as 'going concerns' but not one as far as the fate of the WiiU goes. (see above post about stockholders).
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#31 Avatar_Taxidous
Member since 2006 • 4407 Posts
He's the most successful troll I've seen on GS.Toxic-Seahorse
This does seem a little like a trolling topic; the TC hasn't replied to anyone who has brought up valid arguments (such as Nintendo's massive reserves and the fact that the PS3 was in a similar boat in '06)
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bonesawisready5

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#32 bonesawisready5
Member since 2011 • 4971 Posts
[QUOTE="bonesawisready5"]Hey JaysonGuy, Nintendo has $8.8 billion in cash on hand. They have ZERO debt. You were saying?Toxic-Seahorse
Don't you not know jaysonguy? He will NEVER answer to a post that is factual or proves him wrong. I've done so many times and he just disappears. Hell, he might not even reply to this thread at all. He's a troll and nothing more.

I do know him, at least from his online history and that's what i'm saying. He just comes here to troll GSpot users but doesn't act that way on other spots on the web.
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bonesawisready5

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#33 bonesawisready5
Member since 2011 • 4971 Posts
[QUOTE="bonesawisready5"]Hey JaysonGuy, Nintendo has $8.8 billion in cash on hand. They have ZERO debt. You were saying?rawsavon
That is a good point so far as 'going concerns' but not one as far as the fate of the WiiU goes. (see above post about stockholders).

Then its a good thing they recorded a small net profit of $80 million during the first quarter of this fiscal year with the Wii U selling at a loss and doing so badly.
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bbkkristian

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#34 bbkkristian
Member since 2008 • 14971 Posts
They just posted profits despite terrible Wii u sales.
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rawsavon

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#35 rawsavon
Member since 2004 • 40001 Posts
[QUOTE="rawsavon"][QUOTE="bonesawisready5"]Hey JaysonGuy, Nintendo has $8.8 billion in cash on hand. They have ZERO debt. You were saying?bonesawisready5
That is a good point so far as 'going concerns' but not one as far as the fate of the WiiU goes. (see above post about stockholders).

Then its a good thing they recorded a small net profit of $80 million during the first quarter of this fiscal year with the Wii U selling at a loss and doing so badly.

80 million is a meaningless number without knowing what the investment cost is. In other words, it is all about ROI (return on investment)...that is what the company and stockholders care about. If they could have (or could in the future) made 160 million on that same investment, then it was a bad choice. It explains why companies do away with 'profitable' projects and divisions - they could make more money investing that money somewhere else. Limited Investment Resources = not just 'a' profit is important, but how much profit vs another venture
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bonesawisready5

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#36 bonesawisready5
Member since 2011 • 4971 Posts
[QUOTE="rawsavon"][QUOTE="bonesawisready5"][QUOTE="rawsavon"] That is a good point so far as 'going concerns' but not one as far as the fate of the WiiU goes. (see above post about stockholders).

Then its a good thing they recorded a small net profit of $80 million during the first quarter of this fiscal year with the Wii U selling at a loss and doing so badly.

80 million is a meaningless number without knowing what the investment cost is. In other words, it is all about ROI (return on investment)...that is what the company and stockholders care about. If they could have (or could in the future) made 160 million on that same investment, then it was a bad choice. It explains why companies do away with 'profitable' projects and divisions - they could make more money investing that money somewhere else. Limited Investment Resources = not just 'a' profit is important, but how much profit vs another venture

You're ignoring an important point. The Cube was sold at a loss at first, stopped production for 6 months in 2003 and price cut to $99 yet they found a way to make it super profitable for them. Once the Wii U becomes profitable, which will probably happen in 2014, its all good even with bad sales. Look at those poor 160k sales during Q1, which btw we know something is up with that number. Nintendo says 60k in America during Q1 yet NPD data suggested 35k in April/May and 42k in June. But looking at that 160k. Let's say they actually made a $20 profit off the hardware with bad sales. That's about 32 million in profit. As the 3DS gets older its cost will go down too. It just became profitable in mid-2012 which implied that it costs around $150 to make now. So as time passes their profit margins are only going to increase because they typically don't sell stuff at a loss if they don't have to. Just like with the Cube, they'll find a way to cut prices and make money. Heck, I'd be surprised if at this point next year they aren't making at least a small portion off every WIi U (even with a price cut) and $70-$100 off every 3DS unit.
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rawsavon

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#37 rawsavon
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[QUOTE="bonesawisready5"][QUOTE="rawsavon"][QUOTE="bonesawisready5"] Then its a good thing they recorded a small net profit of $80 million during the first quarter of this fiscal year with the Wii U selling at a loss and doing so badly.

80 million is a meaningless number without knowing what the investment cost is. In other words, it is all about ROI (return on investment)...that is what the company and stockholders care about. If they could have (or could in the future) made 160 million on that same investment, then it was a bad choice. It explains why companies do away with 'profitable' projects and divisions - they could make more money investing that money somewhere else. Limited Investment Resources = not just 'a' profit is important, but how much profit vs another venture

You're ignoring an important point. The Cube was sold at a loss at first, stopped production for 6 months in 2003 and price cut to $99 yet they found a way to make it super profitable for them. Once the Wii U becomes profitable, which will probably happen in 2014, its all good even with bad sales. Look at those poor 160k sales during Q1, which btw we know something is up with that number. Nintendo says 60k in America during Q1 yet NPD data suggested 35k in April/May and 42k in June. But looking at that 160k. Let's say they actually made a $20 profit off the hardware with bad sales. That's about 32 million in profit. As the 3DS gets older its cost will go down too. It just became profitable in mid-2012 which implied that it costs around $150 to make now. So as time passes their profit margins are only going to increase because they typically don't sell stuff at a loss if they don't have to. Just like with the Cube, they'll find a way to cut prices and make money. Heck, I'd be surprised if at this point next year they aren't making at least a small portion off every WIi U (even with a price cut) and $70-$100 off every 3DS unit.

It is not about being 'profitable' (on a per unit sold basis), and one cannot look to the past to predict the future (just ask sony): The GC did not predict the Wii which looks to not be predicting the WiiU. It is all about how much profit (% of investment) once can make on Project A versus any other project. So the owners (which are the stockholders that elect a board to represent them) will dictate if Nintendo should stay with the WiiU and for how long. Just turning 'a' profit will not be enough to stay the course. One thing that is in the WiiU's favor are all the sunk costs (money invested already). That money is lost. So they may decide to stay the course and hope for the best. But all projects, at some point, become no longer worth any extra money being poured into them. I am not saying the WiiU is at that point or will reach that point soon. A. I have not looked at their financial statements (nor would I want to). So I don't know what the ROI is with the WiiU B. I do not know what the Boards' mindset is in regards to patience What my point is is that 'a' profit is meaningless. All that matters is how much they can make with Project A (WiiU) versus Project B (another investment). If they see the long term ROI of B > A, then they will dump the WiiU. This is the same as Developers not bringing games to the WiiU. They know there are profits to be had with the WiiU, but they can make more money investing that same dollar figure with another system (they assume). This is also the same as stores no longer carrying the WiiU. They can make money off each system sold, but there is limited shelf space. They assume they can make more money with that 'real estate' shelving another product tl;dr: your point of >"Once the Wii U becomes profitable, which will probably happen in 2014, its all good even with bad sales" is false. it is not about 'a' profit per unit sold but how much profit versus another venture
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bonesawisready5

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#38 bonesawisready5
Member since 2011 • 4971 Posts
[QUOTE="rawsavon"][QUOTE="bonesawisready5"][QUOTE="rawsavon"] 80 million is a meaningless number without knowing what the investment cost is. In other words, it is all about ROI (return on investment)...that is what the company and stockholders care about. If they could have (or could in the future) made 160 million on that same investment, then it was a bad choice. It explains why companies do away with 'profitable' projects and divisions - they could make more money investing that money somewhere else. Limited Investment Resources = not just 'a' profit is important, but how much profit vs another venture

You're ignoring an important point. The Cube was sold at a loss at first, stopped production for 6 months in 2003 and price cut to $99 yet they found a way to make it super profitable for them. Once the Wii U becomes profitable, which will probably happen in 2014, its all good even with bad sales. Look at those poor 160k sales during Q1, which btw we know something is up with that number. Nintendo says 60k in America during Q1 yet NPD data suggested 35k in April/May and 42k in June. But looking at that 160k. Let's say they actually made a $20 profit off the hardware with bad sales. That's about 32 million in profit. As the 3DS gets older its cost will go down too. It just became profitable in mid-2012 which implied that it costs around $150 to make now. So as time passes their profit margins are only going to increase because they typically don't sell stuff at a loss if they don't have to. Just like with the Cube, they'll find a way to cut prices and make money. Heck, I'd be surprised if at this point next year they aren't making at least a small portion off every WIi U (even with a price cut) and $70-$100 off every 3DS unit.

It is not about being 'profitable' (on a per unit sold basis), and one cannot look to the past to predict the future (just ask sony): The GC did not predict the Wii which looks to not be predicting the WiiU. It is all about how much profit (% of investment) once can make on Project A versus any other project. So the owners (which are the stockholders that elect a board to represent them) will dictate if Nintendo should stay with the WiiU and for how long. Just turning 'a' profit will not be enough to stay the course. One thing that is in the WiiU's favor are all the sunk costs (money invested already). That money is lost. So they may decide to stay the course and hope for the best. But all projects, at some point, become no longer worth any extra money being poured into them. I am not saying the WiiU is at that point or will reach that point soon. A. I have not looked at their financial statements (nor would I want to). So I don't know what the ROI is with the WiiU B. I do not know what the Boards' mindset is in regards to patience What my point is is that 'a' profit is meaningless. All that matters is how much they can make with Project A (WiiU) versus Project B (another investment). If they see the long term ROI of B > A, then they will dump the WiiU. This is the same as Developers not bringing games to the WiiU. They know there are profits to be had with the WiiU, but they can make more money investing that same dollar figure with another system (they assume). This is also the same as stores no longer carrying the WiiU. They can make money off each system sold, but there is limited shelf space. They assume they can make more money with that 'real estate' shelving another product tl;dr: your point of >"Once the Wii U becomes profitable, which will probably happen in 2014, its all good even with bad sales" is false. it is not about 'a' profit per unit sold but how much profit versus another venture

You make good points but fall short because you have no interest in looking into their financial statements to cement your ideas. History tells us that under the absolute worst case scenario Nintendo already got a console with bad third party support to make them major profits despite quitting production for 6 months in 2003. That isn't the same as "PS3 will do as good as PS2 coz its Sony!" at all. It shows they know how to make the best of a bad situation. That's a skill that they possess, not an assumption of success.
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rawsavon

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#39 rawsavon
Member since 2004 • 40001 Posts
[QUOTE="bonesawisready5"] You make good points but fall short because you have no interest in looking into their financial statements to cement your ideas.

The same could be said for your reliance on Nintendo's history to predict future success. For me, this has nothing to do with Nintendo. It would make no difference to me if they failed or dominated. I would apply these same principals to any business/venture. Though if you want to use history as your ally, you might want to include some psychology as well...in that the success of the Wii will have big impact on the mindset of investors, stockholders, and the board (as to how they view the 'success' of any future console)
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#40 rawsavon
Member since 2004 • 40001 Posts
Also, I have been clear this whole time in saying that I don't know (or care) what Nintendo will do in regards to the WiiU. To that end, the financials (or me looking over them to make a 'guess') does not matter. I am simply explaining what will go into their decision and also explaining why your assertion was incorrect (about being profitable being enough). I have no interest in asserting either way/how long they will stay with it as it matters not to me
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bonesawisready5

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#41 bonesawisready5
Member since 2011 • 4971 Posts
[QUOTE="rawsavon"][QUOTE="bonesawisready5"] You make good points but fall short because you have no interest in looking into their financial statements to cement your ideas.

The same could be said for your reliance on Nintendo's history to predict future success. For me, this has nothing to do with Nintendo. It would make no difference to me if they failed or dominated. I would apply these same principals to any business/venture. Though if you want to use history as your ally, you might want to include some psychology as well...in that the success of the Wii will have big impact on the mindset of investors, stockholders, and the board (as to how they view the 'success' of any future console)

Same can be said about the mindset of investors being hurt after N64 didn't repeat SNES success, after VB didn't repeat GB's success, after Cube didn't even repeat the N64's success. Clearly Nintendo keeps trucking along because they run their business well even in dark times.
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rawsavon

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#42 rawsavon
Member since 2004 • 40001 Posts
[QUOTE="bonesawisready5"][QUOTE="rawsavon"][QUOTE="bonesawisready5"] You make good points but fall short because you have no interest in looking into their financial statements to cement your ideas.

The same could be said for your reliance on Nintendo's history to predict future success. For me, this has nothing to do with Nintendo. It would make no difference to me if they failed or dominated. I would apply these same principals to any business/venture. Though if you want to use history as your ally, you might want to include some psychology as well...in that the success of the Wii will have big impact on the mindset of investors, stockholders, and the board (as to how they view the 'success' of any future console)

Same can be said about the mindset of investors being hurt after N64 didn't repeat SNES success, after VB didn't repeat GB's success, after Cube didn't even repeat the N64's success. Clearly Nintendo keeps trucking along because they run their business well even in dark times.

I am not making any assertions either way...that they will or will not 'keep on trucking' as a company or for how long they will stay with the WiiU. That seems to be your forte ITT. I am merely explaining/exposing the flaw in your logic that 'profitable' means they will stick with the WiiU in the foreseeable future (it does not, for any company or venture).
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sman3579

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#43 sman3579
Member since 2008 • 21174 Posts
Nintendo will be fine just like it always has. The games will come out eventually, people will buy the crap out of them, and there you go.fig56
Yeah I agree, things are rough now but it will pick up.
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mrfokken

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#44 mrfokken
Member since 2009 • 642 Posts

Nintendo will survive for a while. The question has to be will the Wii U survive.


Nintendo seems to know what gamers in Japan want, but, with virtually no Wii U sales in Europe, they seem completely out of touch with Europe and the US gamers.


Yes, games are on the horizon, but I dont see any of them as system sellers. Not with the new systems coming out soon. How many people are going to rush to purchase a Wii U so that they can play The Wonderful 101? Bayonetta did not sell that well to begin with, so what hopes does its successor have to becoming a system seller?


Worse yet, games like Arkham Origins for Wii U will lack the features found on other systems making it hard to justify a purchase on Wii U over other versions. EA is not going to make its sports games available for the Wii U. In fact, most multiplats wont be showing up on it.


Meanwhile, Nintendo is focusing on rehashing its franchises like Mario Land 3D and Donkey Kong Country. For me, this doesnt work. It hasnt been that long since I played these (basically) and I have little desire to fork out 50-60 dollars to do it again. Remaking Wind Waker or Majoras Mask wont sell systems either. American audiences have played Oblivion and Skyrim. I dont think those games are better than Zelda, but its hard to convince game-buying 17 year olds in the US that they are not.


To me, NIntendo needs to look at that 17 year old male demographic in the US. The ones who want to play games with "realistic" graphics, "adult" themes, and with online social aspects. Nintendo may be right when the say it is more fun to play games with people who are in the same room, but, in the US at least, gamers may not live close enough to their friends for this to occur very often. Thus, it will be a huge mistake to leave out online multiplayer in games like Smash Bros, but NIntendo will.


If the Wii U is to become successful in the US and Europe, Nintendo will have to recognize the difference in their audiences. They will need to make some killer apps that gamers outside of Japan will clammer for. They need to endear themselves to a new generation of Westerners who jeer at Wind Waker and cheer for Watchdogs.


If they dont, it wont matter how powerful their next system is. Theyll be making games for an audience that no longer exists.

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#45 sonic_spark  Online
Member since 2003 • 5710 Posts

Well Nintendo could survive another 3 generations easy of Virtual Boy proportions (although I do like my Virtual Boy).

If the 3DS could turn around and sell well through GAMES, I imagine the Wii U could do the same.

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bonesawisready5

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#46 bonesawisready5
Member since 2011 • 4971 Posts
[QUOTE="rawsavon"][QUOTE="bonesawisready5"][QUOTE="rawsavon"] The same could be said for your reliance on Nintendo's history to predict future success. For me, this has nothing to do with Nintendo. It would make no difference to me if they failed or dominated. I would apply these same principals to any business/venture. Though if you want to use history as your ally, you might want to include some psychology as well...in that the success of the Wii will have big impact on the mindset of investors, stockholders, and the board (as to how they view the 'success' of any future console)

Same can be said about the mindset of investors being hurt after N64 didn't repeat SNES success, after VB didn't repeat GB's success, after Cube didn't even repeat the N64's success. Clearly Nintendo keeps trucking along because they run their business well even in dark times.

I am not making any assertions either way...that they will or will not 'keep on trucking' as a company or for how long they will stay with the WiiU. That seems to be your forte ITT. I am merely explaining/exposing the flaw in your logic that 'profitable' means they will stick with the WiiU in the foreseeable future (it does not, for any company or venture).

"Stick with Wii U"? So are you implying that if they don't look like they'll make enough profit they'll scrap the console? Or move along with next-gen plans sooner? If so, no. Just because the Wii U doesn't become "profitable" for them doesn't mean they'll not "stay with the Wii U" because ultimately the thing that will hurt them the most would be pulling the plug on a console early. No matter how much money they lose on Wii U, their losses on the hardware won't begin to compare to the losses they would suffer if they replaced or dropped the Wii U earlier than November 18th, 2017. Consumer perception of them as a product maker that sticks with a device would be damaged immensly and could never be fixed. Ask Sega about dropping consoles too early.
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rawsavon

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#47 rawsavon
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[QUOTE="bonesawisready5"][QUOTE="rawsavon"][QUOTE="bonesawisready5"] Same can be said about the mindset of investors being hurt after N64 didn't repeat SNES success, after VB didn't repeat GB's success, after Cube didn't even repeat the N64's success. Clearly Nintendo keeps trucking along because they run their business well even in dark times.

I am not making any assertions either way...that they will or will not 'keep on trucking' as a company or for how long they will stay with the WiiU. That seems to be your forte ITT. I am merely explaining/exposing the flaw in your logic that 'profitable' means they will stick with the WiiU in the foreseeable future (it does not, for any company or venture).

"Stick with Wii U"? So are you implying that if they don't look like they'll make enough profit they'll scrap the console? Or move along with next-gen plans sooner? If so, no. Just because the Wii U doesn't become "profitable" for them doesn't mean they'll not "stay with the Wii U" because ultimately the thing that will hurt them the most would be pulling the plug on a console early. No matter how much money they lose on Wii U, their losses on the hardware won't begin to compare to the losses they would suffer if they replaced or dropped the Wii U earlier than November 18th, 2017. Consumer perception of them as a product maker that sticks with a device would be damaged immensly and could never be fixed. Ask Sega about dropping consoles too early.

As I have said countless times ITT, I am not making any predictions (hence me not needing to look over the financials...which I would need to in order to make an informed prediction). You are the only one doing that. I am simply pointing out the flaw in your assertions/lines of reasoning. As to whether of not they could drop the WiiU and overcome that: They certainly could (and go handheld only or go with another console). -you (erroneously) try and use history (sega) as to why they could not do this, but: 1. just b/c something happened before, does not mean that it will happen again...nor is the situation the same 2. they have already done this...if you choose to go with history - see the virtual boy Once again you are making assertions (I am not). I am only pointing out the flaws in such assertions.
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BigBen11111

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#48 BigBen11111
Member since 2003 • 1529 Posts
I'm sure that Nintendo has plenty of money in reserves, & a price cut wouldn't hurt for the Wii U. They need to do what they did for the 3DS. And start making games for older franchises that no one would see coming. Some quick, but yet thought out well games.
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getmeon10

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#50 getmeon10
Member since 2013 • 25 Posts
I love Wii but i think nitendo is better