New Yorker: Wii doesn't have to win to be a winner

I don't buy the "third place is better" garbage. I do believe in the concept of a niche, which the Wii fills its own quite nicely.

well of course the Wii has a better standing as a third place console. It is in a different and crappier league than the other consoles. its mostly for casual gamers, kids, and people who like nintendo first party games, but the good thing is that its cheap enough to also be a 2nd console to some people. The real console race in america is between 360 and ps3. Nintendo lacks resources to make a superior console cause they cant afford to lose money therefore they rely on gimmick (abet innovative ones) but gimmicks none the less to sell an overclocked gamecube. Let the fanboys start ;)

ha some revolution

Nintendo plain just knows how to turn a profit.

Yep. Nothing new here. Nintendo is already selling the Wii for a profit and they will only make more money as the system becomes cheaper to manufacture. I just hope they put some of that money into developement. I don't want any more of those long game droughts like on the cube.

Baldwin's character in Glengarry Glen Ross is called "Blake".

Third place for the wiin.

But, seriously though, the wii will quickly become a Nintendo only system once developers realise they cant compete with Mario, Zelda, etc. This has always been the case since N64; its the case today with DS and more recently with GC. And, its not gonna suddenly change with Wii no matter how Reggie et al. like to spin it.

So, third place is good for Nintendo, but, not anyone else. Which is just fine for Nintendo shareholders.

Wherever Wii lands this gen Nintendo is going to make a bundle on it, while Sony and MS will struggle to make a profit

"Wherever Wii lands this gen Nintendo is going to make a bundle on it, while Sony and MS will struggle to make a profit"

Don't read the news much, huh? The 360 is now in the black.

Death Dealer, you couldn't be any more incorrect.

"I do believe in the concept of a niche, which the Wii fills its own quite nicely."

I agree with this - Nintendo is trying to define themselves in the reverse, but they're only doing so because the assumption is that "niche" means "small". That's not the case - a niche is simply a distinct market, and I think it's pretty clear that the Wii audience is distinct from most of the rest of the industry. But it's always possible for a niche to be *bigger* than the rest of the market.

I don't think the Wii will finish in third this time anyway, but I do think Nintendo has (as always) positioned themselves to be profitable even in a worst-case scenario. They are better at the game business than their land-grabbing competitors, who often can't seem to manage profitability even in their best-case scenarios. That's the big problem with both Sony and MS - their goal often seems to simply be to beat each other to death (which is basically futile, and impossible), rather than to deliver any value to their shareholders in the meantime.

#8

actually thats only correct for sony. microsoft was smart with the hardware this time around. i remember reading a few weeks ago that within a few months, the 360 production costs will come down so much that they'll be profiting around $75 for each console sold.

Boo hoo - I don't care if Nintendo make a one dollar
profit and finish last. I am gonna buy their stuff - becuase guess what - its fun to play

Microsoft hasn't made a profit yet, that only shows they reduced production costs. You have to take account for shipping, packaging and retail marings

http://www.gamasutra.com/php-bin/news_index.php?story=11833

I love the backstreet boys, they are the best band ever cause they sell lots of records and are profitable!

thats a good point..while nintendo is making money...3rd parties arent..which seems to always be nintendos problem...

its just hard/impossible for third parties to compete with nintendo games that have the luxury of 2-3 yr dev times...case in point...Twilight princess.

with that said..at the end of the day...its about the dollar figure..and u cant argue nintendos profit...but can nintendo live with another lackluster 3rd party outing like the GC ?...

"The real console race in america is between 360 and ps3. Nintendo lacks resources to make a superior console cause they cant afford to lose money therefore they rely on gimmick (abet innovative ones) but gimmicks none the less to sell an overclocked gamecube. Let the fanboys start ;)"

I don't believe that's true. The real race is between all three, just because one IS inferior as far as processing power, the majority of consumers won't care about graphics, it's whatever is hot or the trend and is (mostly) easy on their wallet.

Where do you get the idea that Nintendo can't afford to lose money - they're the only console maker who has posted a profit year-in and year-out. Their stock is at an all-time high. Yeah, MS is finally making money off their console, but after 5 years of losing A LOT of money.

We'll see if the Wii is a gimmick in a year. And we'll see where the PS3 lands in a year. I highly doubt Sony will be selling 5-7 million units by the end of 2007. They've earned a lot of bad press and it doesn't help that a lot of Sony loyalists have turned away in disgust. I'm sure the system will sell a lot, but I don't see it becoming the staple in every household like the PS2 was.

I think it's way to early to be making predictions. The Wii looks hot right now, but will it be next year? And the PS3 looks like it's taken some bruises, but will the brand name carry it through to overall market share? And of course the 360 is already out and it's like that steady horse in the race, I'm sure it's going to be real close when all the numbers are laid out in a year or two.

"You want to know what it takes to sell consoles? It takes BRASS BALLS to sell consoles." I'm surprised Reggie hasn't quoted Blake yet. I'm sure he does at shareholder meetings:

"That watch costs more than you car. I made $970,000 last year. How much you make? You see pal, that's who I am, and you're nothing. Nice guy? I don't give a shit. Good father? Fuck you! Go home and play with your kids. You wanna work here - close! You think this is abuse? You think this is abuse, you cocksucker? You can't take this, how can you take the abuse you get on a sit? You don't like it, leave."

I don't get this whole concept of "winning the console war." Every company has competition, it is essential to prevent monopolies. But just because you're not the biggest brand doesn't mean you aren't successful.

Is Pepsi losing the beverage war to Coke? No, they both are fairly successful in their own ways. Now if a company is way behind the competition like RC Cola, then you could say they aren't doing that well. But in this case Nintendo, Sony and Microsoft are all making money.

I was once reading Game Informer and they asked "Who will win the console war?" and one guy gave an excellent response. I'm paraphrasing, but he said that no one will, because each company is aiming to do something different.

The Wii is trying to become a system enjoyable for the whole family. Microsoft is the system for online and multiplayer experiences. And PS3 is a media center. Can all of these systems be good for the family, online, and a media center? Sure, but if you want this best family experience you go to Nintendo. Even if its $50 a year Xbox Live is the best online option and worth it. And Sony's console may look expensive, if you're looking at it as a video game system. But if you consider that you can get a Blu-Ray player for $500-$600, it's not that bad of a deal.

It all depends on the way you look at it, and all of the sytems will do well. Remember, Sony loses the most on their systems, and Microsoft has paid big bucks to secure developers. So if the console war ends up being the same as last time, 1. Sony 2. Microsoft 3. Nintendo, they might all end up making the same amount of money.

The concept of a console war is just something propogated by video game companies to have customers loyal to their system. Fanboys then get caught up in the hype, and end up buying their products no matter how crappy they are. All three companies have done this, and I will admit that I have gotten caught up in it. But at the end of the day, console wars are just ways for people to waste their time by declaring their loyalty on message boards.

"Don't read the news much, huh? The 360 is now in the black."

From what I have read, they are not in the black overall - they are now making a profit on each console sold. To truly be in the black, they will have to make enough profit to offset all the losses from previous quarters.

That said, I'm sure that the 360 will eventually be a net profit for MS... at least if they don't count the losses from the original Xbox (which MS never intended to be profitable) against the 360.

Baldwin's character was a construct for the movie, and not part of the original play. Mamet's play begins just after "blake" has visited and the character's entire purpose was to be a focus and source of tension, but since the play is not actually about the drama of selling bogus property, but aging, change and the effects of depression on the human condition, "Blake" is a completely extraneous set piece.
True alec baldwin does an excellent job with with brief screen time, but it is unecessary and only serves to add another name to the billboard so that people will get their butts in the theaters.

(it's very similar the the use of Jabba the Hutt in the the special edition star wars. All of the threat and tension created by jabba -whose sole reason for being in the plot of the original movie is to give Han a reason to leave tatoine- is done much more artfully and successfully by having our only contact being his henchman Greedo and the actual conversation between Han and Greedo. Jabba's scene is repetitive -practically same dialogue- and brings nothing to the story.

anyway, i love glengary glen ross. oh yeah, and video games... sometimes it's so difficult to remember to stay on topic when you are rambling about pet peeves.

I suppose this is new news for the guys at the New Yorker, but yeah, Nintendo has always done what they could to play it safe and keep themselves in the business. When everyone had a Playstation (except me, Sega Saturn fan forever), the N64 suffered heavily, but STILL turned a profit. In fact, the Virtual Boy is their only failure, and you can't even call it that, because they pulled the plug on it quickly...they were overly ambitious about the project, but yeah, canned it ASAP.

I honestly don't think Nintendo has been in it to win it for a while now. They consider a profit a win, so they do things that will intrigue new players. I'm not even disappointed with software scarcity. Even with PS2s abundance of titles, I never found myself wanting more than maybe 3 games at a time. No biggie

Business is about profit. Bottom line. If you don't turn a profit, you lose investment. If you lose investment, say "bye bye". Very mature for a company associated with "kiddie" games eh?

#2, you said "they cant afford to lose money"

Are you serious? I guess you don't know how much money Nintendo really has.

Can someone link to this "360 is in the black" thing? The only place I read that was the typoed article that mistook a $75 loss for a $75 gain. Last I heard, they were still losing $75 on each unit.

From the article: "The point is that business is not a sporting event."

I think this is the most important point that is lost on most fanboys. I think the Wii is going to be one of Nintendo's finest products - in every way except market share. Good article.

"From what I have read, they are not in the black overall - they are now making a profit on each console sold. To truly be in the black, they will have to make enough profit to offset all the losses from previous quarters."

Incorrect.

Profit is calculated quarter by quarter. You need not atone for all previous losses to declare a profit.

You're talking about NPV-positive. To be NPV-positive, you've got to sum up all inflows and all outflows. It'll be a while before MS is NPV positive with the Xbox 360, but profit is much, much closer (if not already here).

I direct my applause at Judd, #18.

Yoshi: that's not a typo. Here's the teardown estimate that results in the $75 figure.

http://www.isuppli.com/news/default.asp?id=6919

"The real console race in america is between 360 and ps3."

Uh-huh, just like Sega's Game Gear owned the Gameboy, right? I'd say the difference in resolution and HD, especially when most people don't even own an HD set yet, is minor when you think back to the Game Gear and Gameboy -- the Gameboy didn't even have COLOR and it won.

As for third-party support, games are much cheaper to develop for the Wii than for the 360 or PS3. Cheaper development equates to more profit.

For me and my wife, the Wii has been extremely fun so far and I'm glad I picked one up. Once I get an HDTV, I'll probably pick up a 360 for that gaming experience, too, but I don't expect the Wii to take a backshelf it. It's a totally different way to play games.

Got a 360 at launch, had it for Xmas last year, and nobody besides my 8-18 year old cousins were interested.

Got a Wii at launch, had it for T-giving this year. From my 4 year old to my 65 year old grandparents, everyone wanted to go bowling/play tennis.

Result: 4 Wii's being sold to families who have either never had a console (my aunt/uncles) or haven't had one since we bought them a NES 15 years ago (grandparents).

The wii is not for everybody, but it is for *anybody*. It was really remarkable to see. The Wii is not going to replace my 360 as my 'serious' system (for my friends/online play), but the Wii will dominate family reunions. And I can't wait to find the drinking games associated with the Wii (Beer pong with the Wii-mote anyone?)

You know, I never quite got the impression that the success of Nintendo's home-grown franchises interferes with the success of non-Ninty franchises on Big N's systems.

I mean, there are quite a few successful franchises in SCEA's stable. I've never heard anyone say that Jak and Daxter, Sly Cooper, or Ratchet & Clank (all published by SCEA) hurt third-party games on the Playstation 2. I don't think anyone says that successes like Halo hurt non-MS Xbox games.

And it also doesn't quite make sense when GC versions of cross-platform games do quite well proportionally. SoulCalibur II sold best on the GameCube, which is interesting when the GC had the smallest install base. Proportional to install base, Resident Evil 4 also did much better on the GC (and most people I know recommend the GC version over the PS2 version).

The logic makes no sense, and the facts don't really back up the claim. The only thing that hurts a franchise, really, is crappy gameplay that doesn't hold up to earlier chapters in the series (for example, witness the various incarnations of Mega Man - pretty much every single one devolves as the individual series drag on).

My bad, I thought there was someone that debunked that article, I didn't realize they broke it down. Thanks for the clarification, Vlad.

I completely disagree that Nintendo is going after the "niche" market.

If anything, Sony and MS are going after the "niche" gaming market, and Nintendo is aiming at everyone BUT. At this point Sony and MS are fighting over each others customers in this limited market.

All you gamers out there complaining that the Wii doesn't have "Next Gen" HD support or Dolby Digital 5.1 surround...Guess what, you're part of a niche market, one that is about as big as it will ever get.

Most people couldn't fathom spending more than a grand on a TV, let alone another $300 or so (I'm low-balling these figures here) for the surround sound setup. Most of America would buy a 27" Apex TV and DVD player from Wal-Mart and be perfectly happy with the speakers on the TV.

I think what most gamers forget is that they are not the majority of people, and that it simply doesn't make good business sense to market exclusively to a "niche."

The New Yorker article is terribly flawed. He claims that Sony and Microsoft's rise to ascendance in the industry has actually helped Nintendo, but doesn't explain how. Ninty would be making a profit whether it was in first place or third place; it's a mindset. While of course they would like to be on top of everyone, to a certain extent, as long as they follow heir design and business principles, it doesn't matter what place they are in as long as the machines sell reasonably well and make the company a profit.

Also: GlenGarry Glen Ross is one badass movie. One of my favorites.

PEOPLE!!! Whoever thinks that the wii is not going to be a big hit because consumers will think its only an "overclocked gamecube" are hugely mistaken.

The wii can play, in an essence, every game ever released for all past Nintendo consoles!!! They are not going to be making huge profits off the console it sells, but the games; and not just the new games but the old ones too. And Nintendo has a lot of games that go way back, that people still love to play.
How many people still have their original NES, SNES, and N64's collecting dust in the closet because someone challenges you to game of Tecmo Bowl or other game?

Nintendo is smart, they are the oldest player in the gaming industry, and surely the wisest. Think about it. They have well over 20 years of games locked up in a vault that people still loved to play. These will slowly but surely be available for purchase and download for the wii console. The wii will be bringing in huge profits for Nintendo.

Some people might think, "So what if I it can play roms, so can my pc for free? Big Deal!" While true, to me at least, there nothing like playing classics with a controller and not on a keyboard.

Nintendo has always been the innovator of this industry. The lightgun, the gameboy, and now the wii's controls.

It's kind of sad to see everyone racing to see who gets the most insane amount of pixels pushed out of their console, at the expense of consumers. I'd rather have a well-made 2D pixel-side scroller than a 3D game that takes forever to load.

I'm glad to see a system in the market thats affordable, and fun. Maybe I'm biased because I don't have an expensive HD Plasma set up, or vast 100.1 channel speakers... yet.

The only thing the wii is missing is DVD features, otherwise it would be a perfect $250 media center.

Just my 2Cents.

The thing to remember is the Wii is targeting the masses- Moms , not hardcore gamers. Overall, I think the hardcore gamers will get a Wii AND another system, but most families will get a Wii.

Like many other adult gamers, the Wii has brought the rest of the family back to gaming. My technophobe wife consistently dominates me at boxing, and we had a great time doing 4 player games over the weekend with friends and family.

If Nintendo can continue to supply consoles heavy into the holidays, they might just hit critical mass like they did with the original NES. The simple fact that the Xbox and PS3 are going head to head leaves them a TON of room to sell consoles to the types of people that we don't consider gamers.

Judd, you made my point.

We get all worked up in this "console war" and never seem to look at other industries...

Since the beginning of time, Coke has sold much better than Pepsi. However, Pepsi still makes money.

Apple and Microsoft aren't going to put one another out of business.

For the time being, most developers will write games for both the PS3 and the Xbox 360. Some will also port those games to the Wii.

Some developers will develop solely for the Wii.
Some will develop only for PS3 or 360.

Sony, Microsoft, and Nintendo have very deep pockets and can afford to take a temporary hit in order to make an eventual profit. And as long as those profits are there, those companies will continue to produce.

"well of course the Wii has a better standing as a third place console. It is in a different and crappier league than the other consoles. its mostly for casual gamers, kids, and people who like nintendo first party games, but the good thing is that its cheap enough to also be a 2nd console to some people."

Just remember that the number of "casual gamers, kids, and people who like nintendo" is MUCH BIGGER than the number of self-proclaimed die-hard gamers who look down their noses at the Wii. Sniff all you like, but remember that hardcore titles like Gears of War and Call of Duty continue to be outsold by casual titles like Bejeweled and Nintendogs.

--R.J.

I never understood Nintendo being in 3rd. If you look at the business side of it they won the last generation because profit is what counts at the end of the day.

Both Xbox and PS2 lost a lot more money then the Gamecube. Profit isn't the entier story however both Sony and Microsoft are in the console race as a defensive business and do not really care about games. The fact that Microsoft isn't letting Sony take over the living room, and the fact that Sony has somewhere else to go beyond dead end appliances matter to them a great deal.

Its not Nintendo franchises that interfere with 3rd Party titles, and it never was

Its the fact that starting with the N64, Nintendo consoles have been a maverick in the console race

5th Generation: Nintendo backed Cartridges
6th Generation: Nintendo shunned Online
7th Generation: Nintendo shuns HD

Now in the 5th and 6th generations, Nintendo's black-sheepiness was bad for 3rd Parties, Cartridges were both More expensive to develop for, AND had less space than CDs, so it was a no-brainer to take your business elsewhere
Online gameplay was a big fad last generation (while now it is still just as fun, but has lost its novelty factor), and the reason GameCube didn't see Online games other than PSO was that they basically said "YOU can put it online, but YOU have to provide servers, YOU have to provide accessories," and 3rd Parties went away to the other guys who pushed Online more, and actually had dedicated servers (although not universally in Sony's case)

This time, Nintendo is a black sheep in all the right ways, Dedicated Motion Sensitive Controls will bring people in faster than shiny HD graphics, and cheaper Development costs will bring in developers (example: DBZ Budokai Tenkaichi 2: Only for PS2 and Wii)

As long as people accept the new control scheme (and they clearly are) then the simple economics of it should solve itself, netting Nintendo a win

I'm sure i will be burned in effigy for saying it, But the wii sucks. I have been a gamer for a long time and played it for several days over the holiday. Before then i intended to buy it. The tennis and bowling that everyone raves about it bullshit. just time your swing and don't worry about moving the character. Thank you nini for pushing the envelope of gaming interface. But if you translate their "core strategy" from bullshit to English means "profit" not "game-play".

I don't understand why everyone is concerned with winning the console war. The game market is more complex and driven by different factors then most other consumer markets - case in point most average americans own at maxium one vechile per driver so GM, Honda, ect really need to corner the market but most gamers own more than one system. Personally we've got every Nintendo system, the xbox, a playstation one, a playstation 2 and before our house got robbed we had two sega systems. Now here's sometime telling about that robbery, all of our systems except the oldest were stolen and we replaced all of them, not just the playstation 2 which was the one we play the most and owned the most games for. Honestly we're not even true avid gamers like my brother but this christmas I'm buying the wii, sometime next year we'll pick up an xbox 360, but the playstation is gonna have to wait cause it's just tooo expensive and that's the key. Take all my desposable money for maybe two weeks or so and I'll buy your box, try to grab it all for a month or two and it's no dice cause I just don't have that kinda patience and I'm still having a good time with my older systems. There's plenty of room around my tv for more systems, just keep them reasonably priced with plenty of good games.

Go PC! woooooo

no matter what 'niche' they're going for, no matter how 'underpowered' the system is, no matter how many 'kiddy games' there are, the Wii is still whipping the FUCK out of the PS3 just because Nintendo can actually get a decent amount to retailers and Sony can't. since launch day for both consoles, my local Gamestops have had well over 200 Wiis total and less than 50 PS3s. all of both systems have sold out... so, by my (completely unscientific) estimates, Nintendo could have more than 4x the next-gen marketshare than Sony already. now, in a year when Sony can actually put out more than 4 PS3s per shipment per store, things might change, but for now Nintendo is 'winning' on the principal that they can actually manufacture their shit and Sony can't.

32_Footsteps:

As good as the first party Sony games you mentioned are, very few games - first party or third party - have the pull that Zelda, Metroid, or Mario games still have after all these years, or arguably as much polish. I would not be surprised at all if third parties are somewhat daunted by the task of their game going up against a top-tier Nintendo title as opposed to having a more level playing field on the other consoles where third party support is (currently) stronger.

As for Soul Calibur 2, it sold the best on Gamecube because of the exclusive character for each system, and Link was in the Gamecube version. And as for Resident Evil 4 selling better on Gamecube, I have a feeling it's because the game was originally developed exclusively for the Gamecube and thus runs and looks better on it, in addition to it being released on the system first.

For the Glengarry fans...

Dave Moss: What's your name?
Blake: Fuck you. That's my name.

I kinda take offense to all these people who say Wii isn't for hardcore gamers. I've been playing videogames all my life and I'm completely excited about getting a Wii shortly.

What's with this unnecessary dichotomy that Wii fans cannot be hardcore gamers? I'm sorry, but there's more types of hardcore gamers out there than those who just like to play 50 different FPSs on the Xbox 360.

This dichotomy is as equally rediculous as the graphics vs. gameplay garbage that nintendo fanboys have been tossing around for months.

Here's the thing, Panadero - the evidence doesn't corroborate that claim. You can say, "oh, they feel daunted by Nintendo's series." But is there any proof of that? Top series still continue to sell well on Nintendo series as long as the quality backs them up. Look at the Castlevania series - it's undoubtedly at its strongest on the Nintendo portables, because the gameplay is there. Meanwhile, the console side is languishing because the PS2 versions have been agonizing.

Besides, you could also turn around and claim that the bigger third parties would be a potential intimidator for other consoles, but there are no backups for that. I mean, the Playstations have had the main Final Fantasy titles, the first iteration of each Grand Theft Auto title, the most popular versions of the Madden games (and for that matter, all of EA's sport titles), and the first crack at the Metal Gear Solid games. Sure, it's nice and comfy for Saure-Enix, EA, Take Two, and Konami. But that's a murderer's row to compete against for the smaller companies. Yet they developed without fear on the Sony platforms.

And that doesn't even get into the fact that GC cross-platform titles sell proportionally as well as their other console counterparts.

Honestly, I think that the theory just doesn't hold any water.

I just think there are way too many holes

OBVIOUSLY more faster, more expensive, bigger, widescreener, douche baggier, limp penisier hardware means that you will be #1. Just look at how the PSP made Sony #1 in the handheld world!!!!!!!!!!!!! I mean GOD!

32 Footsteps: I agree with you on your main point about more third parties meaning more competition for a developer, and I realized that as I was typing my post. I never said it was entirely clear cut. But the way I see it, given the reduced third party support Nintendo consoles have been receiving, their first party titles take center stage more than ever before. Unless you make games the calibur of the titles you mentioned before (and overcome the notoriously fickle Nintendo fans when it comes to third party games), it seems to me it could be rougher to develop primarily for Nintendo consoles.

I'm interested in where I can find information about GC versions of cross-platform titles selling comparably to other versions, because as far back as the beginning of the Gamecube's life cycle, there were third parties pulling games for the system, citing low sales. Not that I don't think this is ludicrous, given that I think third party publishers and developers should look at percentages of sales in relation to userbase and not just raw numbers. Selling a game to 75% of a smaller fanbase should be considered as much of a success as selling a game to 40% of a larger fanbase.