Singularly Datarific said:
Haaaa, what an idiot.
They've sold 5 times as many DS's than there are Canadians.
Doomed my ass.
Keep in mind the basis for the comment. When the Nintendo DS was released, it was in competition with another dedicated handheld device: the PSP. Thanks to a series of
baffling decisions by Sony in addition to enormously widespread piracy on the platform, in most markets the DS was running a very nearly uncontested race. Of course, the DS also dropped in price and featured multiple revisions during it's lifecycle, both of which helped spur sales. People who owned the original DS often bought a DS Lite for the smaller form factor, or the later DSi for the
promise of games they might not be able to play otherwise. An important thing to note here is that a great many of those sales Nintendo made were the result of someone purchasing a new DS even though they already owned one. The fact that it found it's way into the hands of countless young children was largely thanks to the relatively trivial price of the platform (often under 150 USD) and the ever expanding back catalog of games that were also cheap.
But, since 2004, things have changed. Since 2007, the iPhone has sold 73 million units. In only a year the iPad has sold nearly 15 million units. In that same span the iPod touch has sold more than 45 million units. The short version is that in
four years the iOS platform has moved 95% the number of units the DS managed in 7 all while having a price point that is
significantly higher than the DS.
The question is, quite naturally, why? It's easy enough to explain; in fact, the problem facing Nintendo is the same reason the Wii was a success. The iPhone (and, to an extent, various Android devices) is disruptive technology. The advantages the smartphones have makes the race seem grim (from Nintendo's perspective) by any measure: they have catalogs of countless thousands of games, many of which are worth playing, that cost anywhere from
nothing to a few bucks. The devices themselves offer ready access to the store from anywhere someone can make a phone call along with internet and the ability to make a phone call. They are devices that are virtually guaranteed to be carried by their owners almost all the time. For a great many people, even those who own a DS and a PSP, the choice of which device to bring along is easy: you bring your phone. Since your phone can also handily fill those little moments where I need to kill time why bother bringing the handheld out of the house at all?
So, what does this really leave for Nintendo's handheld? A rapidly shrinking market. The new release of the DS will cost more than a smartphone (presuming it is purchased along with a contract) and games are going to cost between 40 and 50 USD. While they might take some solace in having access to a back catalog of old DS titles, it lacks any pretense of killer app at launch and the early launch window is incredibly sparse. What's more, the technology in the device that makes it unique (3D) has, thus far, received a nearly universal "meh" from the world at large.
The 3DS is launching into a market where it no longer dominates the market share as it is clearly running in second place in terms of total units moved when you consider the iOS and the notable for gaming Android devices, and this isn't by a little bit. What's more, this edge was gained even though these devices launched well after the DS was established as a wildly successful product. It will be launching at a higher price point along with games that cost substantially more than the competition all on a device that lacks any sort of functionality that dictates it as a device that a user will constantly carry.
On the Console front, the Wii was certainly a success but what has Nintendo done with it? Countless people purchases the platform and use it as a single game device. With rare exception, the only developer to have success with the platform is Nintendo (and even then most of those successes are just "something that Nintendo did but with a twist (the EA workout title for example)". The platform has become synonymous with shovelware. That enormous install base is rarely leveraged by anyone, even Nintendo has never shipped a title (that was not included in the box) that managed to make it's way into more than 20% of households with the console. Worse still, sales of the console itself have been trending downward for quite awhile now.
There is little reason to believe the Wii will find a second wind on the hardware front and many studios and publishers have outright given up on the platform as a viable place for most of their games, instead simply using it as a platform to move a few hundred thousand units of incredible cheap shovelware every quarter. Worse still, both of Nintendo's competitors now have a horse in the motion gimmick arena.
The Wii is, in short, losing ground. It's still in the lead in many ways but it's rapidly becoming apparent that without some dramatic change the console is going to eventually fall behind. And, what can Nintendo really do? There isn't really a new way to interact with games available to exploit and 3D is already being done by a competitor with a vested interest in the area. What could a new hardware release do but be a more powerful version of what they did before?
The bottom line is that in the handheld space the game is changing because of disruptive technology which is rapidly producing an environment where the 3DS is going to have trouble doing well. In the console space the Wii is losing ground and there is no known way to introduce a new set of disruptive technology into the market to change the game in Nintendo's favor again. This doesn't mean Nintendo is doomed but given their reaction to these trends it seems obvious that Nintendo does not plan to change in response to them. That the market is changing is merely troubling, that they seemingly refuse to change in response is damning.
