I agree with you. Things weren't looking to good for nintendo, but they've managed to bounce back. One of the things i've always loved about them is how much they care about the consumer and how far they're willing to go for their fans and they proved that with all their promotions, free games, and what not. That, is something Microsoft and Sony would never do. And that is one of the main reasons the 3ds will succeed while the vita fails.
Used to having the handheld gaming market right under their thumb, it is no massive offense to conclude the leading heads at Nintendo got a little bit too arrogant with their launch plans for the Nintendo 3DS. Not only was this supposed to be the follow-up to their most dominant handheld yet, it was also going to carry the widely recognizable name of its predecessor right on its box, and feature an extremely similar design whose differences can only be noticed after further inspection. In a way, Nintendo had the mentality that most teams that win the Super Bowl have in the year following their achievement. It is that nearly unshakable feeling that regardless of what you do, you are predestined to be there again in a few months, after all, you are the best; so why put too much effort in your work at all? Nintendo did not get lazy in designing the 3DS, but their feeling of entitlement made the company overlook some key business points.
As Sony's debacle with the Playstation 3 launch showed, gamers are – by no means – high-risk investors. We don't have sums of money to spare to place it in ventures that might go wrong in the future, we don't buy future potential of gaming machines. Our income is, mostly, very limited and when we buy a system we expect to purchase the rights to have access to a very great library of titles right here and right now. We may have our preferred brand, or game developer, but we don't spend our money until we see an immediate reason to so. Therefore, much like the Playstation 3, the Nintendo 3DS would not move hardware based on the sweet promise of real 3D without the use of glasses and the benefits that feature could bring to both the visual aspect of the gaming experience, and to possible new gameplay mechanics. We needed Mario, Samus, Link, Pikmin, Star Fox, F-Zero, Sonic, Luigi, Donkey Kong and Wario; instead, we got Steel Driver, Nintendogs, Ridge Racer and a couple of cool remakes: no system sellers nowhere to be found.
And that is when things started turning awfully sour. Your expensive new system was not flying off the shelves as you had expected; on the contrary, there were many units just standing around waiting to be purchased. The money spent in research and development to squeeze power into that tiny machine and make 3D magic is not coming back to you in the foreseeable future, your fat profit predictions based on the assumption that the 3DS would sail – right off the gate - as fast as the DS did at its peak start looking like what they actually were to begin with, crazy optimistic shots in the dark, your investors start running preoccupied with the fate of their money and market analysts start doing what they know to do best, broadcast doom and gloom at the first sight of trouble, when the storm is just a few drops of drizzle.
That is not to say Nintendo did not break a sweat. Any wise businessman with a high-paying job starts showing a little bit of preoccupation as a reaction to shaky grounds, but preoccupation is the defense of those who still have salvation, of those who still have a certain degree of control over their fates and a prompt to act; desperation, on the other hand, is the useless defense of those who have already given up, and despair Nintendo did not, because even though there were chances of failure, there was still a lot of wiggle room to try to fix a system that was still on its early months of life. And, once again, like it happened with the Playstation 3, we saw a company maturing from their mistakes and savaging a situation that was the target of mockery for some and the source of worries for others.
With the ship wheel firmly at hand, and carrying the realization that the early release of the 3DS – a possible honest attempt to get an even bigger head start on the competition to increase market dominance – Nintendo was quick to drop the hardware's price nearly in half. The price drop was the only immediate solution at hand, because the other antidote – great software – was still far on the horizon and any attempts to drastically reduce said distance could end up causing quality games to turn into messed up examples of software design, and as we have come to know over the years, the Miyamoto "A bad game is bad forever" philosophy on delayed titles must be one of the highlighted items on the Nintendo's Employees manual. And it is just now, some eight months after the system hit stores, with the arrival of Super Mario 3D Land, that the Nintendo 3DS will start receiving games that are able to directly affect hardware sales. From this point on, players will not be buying risky potential, but immediate good old Nintendo-fashioned fun.
With the August price drop, looking at 3DS sales data is looking at two extremely distinct time periods: the first going from March to July, and the second from August to October. In the United States, a market that gets more excited with new hardware, the 3DS peaked in March when it sold 480,000 units, but then it dropped to 290,000 in April and to a ridiculous average of 125,000 units a month in May, June and July. Ridiculously low numbers for a brand new system that is the successor of a record-breaking handheld. After the reduction in price, the 3DS still hasn't been able to overcome the initial 480,000 mark in one month, but it has constantly and comfortably broken 300,000 units sold in the three months following the drop. It is an indication that those numbers could be a lot better right now, and probably will do so once the two Mario games are out; it is no bold prediction to say that the holiday months will blow the 480,000 mark to pieces. Overall, the increase in sales before and after the drop has been of 42% in America.
On the other end of the globe, the Japanese market, where hardware sales are incredibly influenced by game releases, and not solely by shiny new pieces of plastic, the reaction to the 3DS launch was much colder. With 85,000 units sold, March was the weakest month for the handheld, and things did not get a whole lot better on the following months where virtually no interesting games were released, with the exception of June, when Ocarina of Time 3D launched and the system peaked at 151,000. If Japan's numbers were much lower than the American ones before the price drop, they grew to US levels after August, the month of the reduction. Before August the system averaged 182,000 units a month, but after it the average jumped to 328,000; a whooping increase of 80% in the average sales figures.
Things get a lot less scary for Nintendo when we cross the data between the first eight months of life of both systems. By looking at the chart below, it is possible to see that the Nintendo DS had a amazingly fast start, three to four times better than that of the Nintendo 3DS, but it is worth considering that the Nintendo DS November in North America and December in Japan, and that as soon as the holiday months were done, it started slumping on pretty much the same way the Nintendo 3DS was on the months preceding the price drop. After the price was reduced, the lines representing the 3DS on the two regions rise above the numbers the Nintendo DS was experiencing at that time. In total sales, the Nintendo DS is still ahead in the first eight months total with 4,400,000 against 3,600,000 of the 3DS.
In other words, the scenario is not that bleak at all, now that the price drop has come to ease the deficit. In fact, considering that in that sales comparison the 3DS has yet to go through a holiday season and receive any significant software, while the DS has already been through one, it is only natural to expect that within three months the 3DS will be in a better shape than the DS was with the same amount of time elapsed after its launch. The 3DS is well awake and running, Nintendo has at least eight top-notch games being cooked up for the system, and so do many third-party companies that are much more comfortable with working alongside Nintendo in the portable market than in the home console scene, and whose developers were drawn away by the novelty of 3D effects.
Yes, the company isn't profiting as much from one 3DS unit as they initially expected to – hence why they had to announce considerable losses - and software sales numbers have been weak, with no 3DS games constantly showing among the best-selling software in the market, which can't be good news for motivating third-parties to spend significant resources on game development. But based on how things were looking not too long ago, it is possible to envision how Iwata is currently looking through the gigantic glass window of his office, looking down at the rest of the world and laughing like a mad man who is making a lot of money.
@NiKva: Well, the greatest games are about to come out, and right on the holiday season. So I guess it will pick up drastically from here on. @hotdiddykong: Amen to that! I think they have learned from their mistake and the Wii U is bound to be released with a great starting lineup of games. @Foolz3h: What a sight would that be! @JustPlainLucas: They have got to keep the games coming. I can't wait for Luigi's Mansion 2. @AK_the_Twilight: I was going to wait for such redesign, but I threw my doubts out the window and bought one since Mario Kart 7 and Super Mario 3D Land are so close to us! I completely agree with you on the smarphone vs tablet vs handheld system thing. @pokecharm: I will be interesting to keep a watch on those numbers. And thanks! @almossbb: Thanks! And I completely agree. @Stonetowerghost: She is paying me 5 bucks per sales chart posted in this blog, I thought it would be a good idea to get some extra money. But seriously, this was the result of me thinking about a 3DS blog and wondering how the sales were doing compared to the DS. I started researching for sales infor, and next thing I knew I has a chart done and a blog in mind. The things you do when you are bored at work.... @TAMKFan: I need to go online to check what games they have. I am ashamed to say I have had a 3DS for a week and I haven't done so!
One thing that's bugging me is how long Nintendo is taking to release Virtual Console games. The 3DS is been out in a little under a year, but it's Virtual Console is still very, very little.
Jeez Pierst. Did Cammie Dunaway hijack your blog? 3DS will do fine. DS had an awful first year if I remember correctly.
nintendo really messed up and they are paying for it. but hey they should recover once they finally start releasing some great games. great blog btw
great blog - and it will be interesting to see the numbers as this holiday season fast approaches. I worry with the economy being where it is that we'll all be suffering, regardless...
The original DS had a rough start too. I remember many people calling it a flop with the PSP on the way, but that obviously didn't happen. I really want a 3DS, but I'm still hesitating to purchase one for fear of the impending redesign. That doesn't stop me from getting excited for the first-party titles on the way and even a few third-party titles like Sonic Generations for 3DS. My biggest fear, though, is the apparent lack of interest in new portable hardware. With the 3DS at a slow start and the waning interest in PS Vita (at least in Japan), I'd hate to give this generation to the smartphones and tablets. I'm not rooting for either Nintendo or Sony this time around; I want them both to succeed, proving that games belong on gaming systems and shouldn't be simplistic chunk-based distractions. Long live true portable gaming.
Nintendo's always a slow starter when it comes to games. Let's just hope they can keep the momentum going after Super Mario 3D Land and Mario Kart 7 release.
"looking down at the rest of the world and laughing like a mad man who is making a lot of money." While apologising to them profusely!
True points, it was their mistake. But true to cause they admit their mistake and,hopefully have a better plan for the WIIU's launch. I have a 3DS and I love it, all I can do is wait for the more better games to come and soon the 3DS will carry its predessasor's award for biggest amount of variety and games.
It seems so far that everyone who wanted to buy a 3DS so far has already done so, and now there isn't anybody else buying. Just have to wait until the greatest game ever comes out and makes people want to buy it.