Nintendo expects limited losses from Wii launch

Become a member of the CGSociety

Connect, Share, and Learn with our Large Growing CG Art Community. It's Free!

THREAD CLOSED
 
Thread Tools Search this Thread Display Modes
  06 June 2006
Nintendo expects limited losses from Wii launch

Quote:
"Japanese game software and console maker Nintendo Co. (7974.OS) said on Wednesday it is unlikely to lose much money on the launch of its new "Wii" video game console, in sharp contrast to rival Sony Corp. (6758.T), which expects a hefty loss on the debut of its PlayStation 3.

Game machines manufacturers often lose money on initial console sales, but recoup those losses over the life of the product through software sales. Sony expects to post a 100 billion yen ($884 million) operating loss at its game division in the current fiscal year due to costs related to the PS3 launch.

"We can't promise we won't have even a one-yen loss, but we are not expecting an enormous loss," Nintendo President Satoru Iwata told a news conference. "It is a strange notion that a game console always leads to mounting losses in the beginning.""

>>LINK<<

-R
__________________
LW FREE MODELS:FOR REAL Home Anatomy Thread
FXWARS
:Daily Sketch Forum:HCR Modeling
This message does not reflect the opinions of the US Government

 
  06 June 2006
Originally Posted by RobertoOrtiz: "It is a strange notion that a game console always leads to mounting losses in the beginning."



My thoughts exactly.

Well, I'm looking forward to the Wii, and I hope Nintendo does well with it.
 
  06 June 2006
which leads me to believe this will be a highly over-priced console or a highly under produced........the reason PS3 predicts such a loss is because they can't charge $1000 for a console system.....its not gonna happen! So they make a killer pc rivalling console and put a starting price tag of about $499 (costing more like 7-800 to manufacture), and make their money back in game sales which are highly over priced sometimes starting as high as $69.99...it makes sense and its a system that has been used since the Genesis hit the shelves. (nes was damn enpensive when it came out and it wasnt that high tech!).

This is the exact reason M$ was getting so pissed when people were installing linux on their xbox consoles to make a server or render box......its a $500 desktop computer that you can buy for $200, if you take away its gaming ability you take away their ability to re-coup their lose!

Not sure how nintendo will get away with this unless they are really cheaping out on parts....because currently to build a next gen console it costs a great deal of money.....just look at the fact that it would cost about $2000 to build a PC with the same power as the XBox 360 paying retail for parts.....so even at cost it would be close to $1000.....IMHO the fact that Sony is willing to take that billion dollar hit at startup means they are pretty confident they have a killer product and will more than likely outlast all others (as all other incarnations of PSX have shown in the past!)
 
  06 June 2006
IMHO i think its great, it means that games will be cheaper, and as there will be less licencing costs, more start up dev houses will be able to afford to make more interesting products.

also cheaper games means dev houses will be taking less risks, as more people will be prepared to spend 20 quid on something unusual, therefore more stable industry andmore unique and interesting IPs, something that the industry needs.

all looks rosy to me, when i buy a console i dont think am i going to get loads of calculations per secs for my money, i think how much fun am i going to have.
__________________
my real current projectio
 
  06 June 2006
would be nice if thats how it worked......but there are standard game prices....and do you honestly think nintendo will stray from the industry standards? Nope.....whether they take a loss on the consoles or not, you should still expect your games to cost anywhere from 50 to 70 bucks......as always!! has always been this way will always be.....I remember paying $50 for NES games, then $50 for Genesis and SNES games.......PSX games?? $50. N64=$50.....PS2, Xbox, Game Cube, Xbox 360.....average starting price for a game.......$50 This is industry norm....the only system that broke this code was Neo Geo...and you see how well they faired! They aren't saying....we will take no loss and pass the savings to you....they are saying we will take no loss, and use that initial gain to attempt to keep Nintendo alive through another experimental console attempt!
 
  06 June 2006
To be fair to Nitendo, their consoles/handhelds are built like tanks.

What they do is the they buy, current state of the art parts, and implment them in creative ways.

The problem with the PS3 is that mostoof the teck on it is bleeding edge (cas in point the cell processor to the blue ray drive).


And this is costing them dearly.

-R
__________________
LW FREE MODELS:FOR REAL Home Anatomy Thread
FXWARS
:Daily Sketch Forum:HCR Modeling
This message does not reflect the opinions of the US Government


Last edited by RobertoOrtiz : 06 June 2006 at 04:37 PM.
 
  06 June 2006
Originally Posted by Gentle Fury: ...Not sure how nintendo will get away with this unless they are really cheaping out on parts....because currently to build a next gen console it costs a great deal of money.....just look at the fact that it would cost about $2000 to build a PC with the same power as the XBox 360 paying retail for parts.....so even at cost it would be close to $1000.....IMHO the fact that Sony is willing to take that billion dollar hit at startup means they are pretty confident they have a killer product and will more than likely outlast all others (as all other incarnations of PSX have shown in the past!)


There are a lot more factors to this than simply cost of hardware. I think you area vastly over estimating part costs with $1,000 per unit. You are basing your numbers off your retail pricing of componants. Priced based on percieved public demand, not on actual manufaturing, that have been handled by at least one other source prior to getting to you. The raw componant costs for the various chip manufacturers themselves certainly does not equal $2,000. Also, there are many levels of initial development costs, there are assembly cost, advertising costs, packaging, shipping.....And their estimations for loss are based on a predicted number or initial sales (or more relevant, a specified number of units produced). In my opinion, Sony could easily be shooting themselves in the foot with their stance and opinion of the PS3. Even they have admitted that one of their biggest selling points is the blue ray tech. It better be an outstanding machine and even then, if it doesn't take off (due to its higher price) it could really hurt Sony's standing.

Of all three console venders, it would make sense that the one with the most experience could produce a lower end console for a lower price and not incure the same initial development costs of the others.
__________________
Proverbs 17:28 - Even a fool is counted wise when he holds his peace; When he shuts his lips, he is considered perceptive.
 
  06 June 2006
nintendo DS cartridges are cheaper than PSP games, i could easily see them making their Wii games cheaper and if not the savings will be passed on to dev houses, due to less licensing costs.
__________________
my real current projectio
 
  06 June 2006
Originally Posted by RobertoOrtiz: To be fair to Nitendo, their consoles/handhelds are built like tanks.

That is very true. All my Nintendo systems still work. I am on my 2nd Xbox and it is starting to grenade too. If they are loosing $ on the systems, they better make sure people dont have to buy a 2nd one...
 
  06 June 2006
Originally Posted by Gentle Fury:
This is the exact reason M$ was getting so pissed when people were installing linux on their xbox consoles to make a server or render box......its a $500 desktop computer that you can buy for $200, if you take away its gaming ability you take away their ability to re-coup their lose!



Why is Microsoft pissed about people installing Linux on an Xbox when the person had to buy the Xbox in the first place. Microsoft doesn't build desktop computers. Microsoft charges under $200 for a license of XP. If that person wasn't going to install Linux on an Xbox, and they don't do gaming, they wouldn't buy the Xbox, so Microsoft would be out the $200 sale anyways. So Microsoft could care less about that other than the fact that the EULA for the Xbox prohibits mods, but even Apple has that, and people still run OSX x86 on a PC or install Linux on a Mac.
 
  06 June 2006
Originally Posted by SHEPEIRO: IMHO i think its great, it means that games will be cheaper, and as there will be less licencing costs, more start up dev houses will be able to afford to make more interesting products.


Hold on there SHEP. Don't forget that developers have to get Dev kits, which is a very different pricepoint than the actualy production/consumer product. Dev kits alone can cost 10's of thousands of dollars per unit (depending on which one we are talking about). Companies cannot develop using the production units.

As far as cost of development going down, the trend these days is the inverse. Teams are getting larger, and thanks (or no thanks, depending on how you look at it) to evolving technology (like normal mapping, lighting, etc...) tasks are becoming more and more specific and require greater amounts of people to pull these off.. Now ofcourse, this all depends on the game and what it's design and visual artistic direction takes.. But as an overall trend, many developers are finding it harder and harder to compete with the big boys like Ubisoft (where I am situated) and EA as some examples. This is not to say that smaller guys cannot compete. But as consumers' expectations of next gen graphics grows, companies now have to staff larger teams to get all of this stuff done (as a rule.. there are of course exceptions).

But as far as Wii being as cheap as it is.. I think thats great for us consumers! I'm looking forward to what it will be like to play one of these little bad boys.

Just my 2 cents

Cheers,

NRG
 
  06 June 2006
Originally Posted by Gentle Fury: you should still expect your games to cost anywhere from 50 to 70 bucks......as always!! has always been this way will always be.....I remember paying $50 for NES games, then $50 for Genesis and SNES games.......PSX games?? $50. N64=$50.....PS2, Xbox, Game Cube, Xbox 360.....average starting price for a game.......$50


There were many N64 titles that went for $70-75.

Looking at the upcoming release list at my local EB Games, most 360 and PS3 titles will be priced $60-70.

The highest price I've seen announced for a Wii game is Twilight Princess for $60. Most of the other Wii titles have been marked $50. IF the numbers I've been seeing are accurate, Nintendo will have a serious price advantage over the competition from both the hardware and software sides.

.
 
  06 June 2006
If any of you watched the XPLAY special at G4TV awhile back when they tested the current generation system's ability to withstand abuse the Nintendo GameCube was the only one left standing. After having a bowling ball dropped on the systems, a sledge hammer test and a 2 story drop test...the results were the PS2 was the first to break, the XBOX second and the GameCube remained operational after all the test. So I don't question Nintendo's manufacturing ways.
__________________
Who'da woulda fudge and shakes!
 
  06 June 2006
Originally Posted by Gentle Fury: which leads me to believe this will be a highly over-priced console or a highly under produced........the reason PS3 predicts such a loss is because they can't charge $1000 for a console system



Actually, look at the Wii's stats compared to the PS3's stats. The PS3 is nearly twice as powerful, plus they are putting in their blu-ray readers. That's why Sony is taking such a big hit, as Robert said they are on the bleeding edge of technology, where Nintendo is making a less powerful but different machine. Nintendo's betting on their control scheme where Microsoft and Sony are betting on their technology. That's why Nintendo doesn't expect huge losses and Sony does.
 
  06 June 2006
This is what I think is going on:

Sony is taking such a "big hit" mosty because of creative (although legal) accounting practices. They are allowed this because they are a giant mega corp that produces it's hardware in-house and has different accounting for each division.
 
Thread Closed share thread



Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

vB code is On
Smilies are On
[IMG] code is On
HTML code is Off
CGSociety
Society of Digital Artists
www.cgsociety.org

Powered by vBulletin
Copyright 2000 - 2006,
Jelsoft Enterprises Ltd.
Minimize Ads
Forum Jump
Miscellaneous

All times are GMT. The time now is 08:43 PM.


Powered by vBulletin
Copyright ©2000 - 2017, Jelsoft Enterprises Ltd.