Thursday, October 28, 2010

Nintendo posts first loss for seven years

   Nintendo announced earnings today and posted a loss of JPY2 billion (US$24,616,899) for the six month period ending September 2010. As a comparison, Nintendo posted a profit of JPY69.5 billion (US$855,437,257) in the same period last year.

   So, is this the end of Nintendo like some writers are probably going to state as absolute fact? Y'know, just like someone declared Microsoft a dying consumer brand yesterday? Nah man. It's just the natural cycle of the video game industry. The Wii peaked last year and the Nintendo DS is getting old. Both gaming machines are mature now and they only have a few more years left in their respective life-cycles before the next generation is introduced.

   One analyst had this to say, which revealed his ignorance about the gaming industry which he covers:
“It’s been harder than people realized for Nintendo to make the transition between the DS and the 3DS,” said Jay Defibaugh, a games analyst at MF Global FXA Securities Ltd. in Tokyo. The 3DS is cannibalizing sales of its predecessor, Defibaugh said.

   You mean the 3DS which hasn't been released yet and won't be released until next year in Japan? That 3DS? The word "cannibalizing" is an active verb which insinuates that the 3DS is an available product that is already eating into sales of the earlier DS models. Where do they get these guys? From the same Businessweek article - Yoshihiro Mori of Nintendo sets the record straight:

“I don’t think the announcement of the 3DS had much effect on second-quarter earnings,” Nintendo’s senior managing director Yoshihiro Mori said in a briefing in Osaka today. “We decided not to release the 3DS this year because we didn’t have enough.”

   What he said and the fact that the games probably aren't ready for public consumption yet are why the 3DS won't be released until February 25, 2011 in Japan and a month later in North America and Europe.

No comments:

Post a Comment